The graph below should be a compulsory study in all political science classes. The more the government spends, the greater the income equality. What is being measured here is government spending in Europe and North America as a percentage of GDP, plotted alongside the wealth share of the top 1%. We don’t have a comparable graph for SA but we can be sure it will approximate what you see below.

How is this even possible? 

Inequality is the sworn enemy of governments everywhere, so they spend other people’s money in an effort to “fix” the problem. Instead, we end up with super-concentration at the top and more inequality at the bottom.

This leads us into asinine debates about socialism v capitalism. 

Alex Krainer of Trends Compass dissects this beautifully: “It’s not that free market capitalism is bad: it’s that we don’t live in free market capitalism and much of what we think we understand about “socialism” is patently wrong. The dismal science of economics has hardly evolved at all over the last century and most learned economists continue to cling to beliefs articulated in 100+ year old textbooks. We would do much better to simply articulate what we, as a community of humans actually want in life and then study systems that are most conducive to those ends. With all the information and knowledge at our disposal today, this should be doable and intellectually much more productive than conjuring insults for the members of the other tribe.”

Krainer, who grew up in communist Croatia, explains how the simple business of taking out the trash was turned over by the government to private operators who quickly made this profitable by reducing the number of points from which garbage could be collected, doing it fewer times a week, and then raising prices.  (depending on the size of your garbage container).

This is what the city’s trash collection looks like now:

That is modern capitalism at work. The incentive is to cut costs in any way imaginable, allowing the private owners to become fabulously rich.

Economist and author Michael Hudson explains it this way: “What Western ideologues call democracy and free markets has turned out to be an aggressive rentier-financial imperialism. And what they call autocracy is a government strong enough to prevent economic polarization between a super-rich rentier class and an impoverished population at large, such as is occurring within the Western oligarchies themselves.”

The West is being run on rentier capitalism, where everything that moves is metered, billed and wrapped in monopolistic privileges. So be careful of those pushing for the privatisation of everything. It sounds like a good solution in the short run. Longer term, we could end up with towns and cities swaddled in trash, with the 1% living far away from the deluge they create.

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