Time to get serious about inequality and sustainability.

• Author: Alperovitz, Gar
• Position: Thinking Economically - Report

It's time for people who are serious about sustainability to open a direct, clear, and explicit challenge to the extreme inequalities of income and wealth which are among the most important drivers of unsustainable growth. This requires far more than the usual laundry list of (failing) progressive tax and other policies. There are also signs that the beginning points of a tough-minded program may be possible in many parts of the country.

Although we often talk in generalities about inequality, the fact is the numbers are far more dramatic than most people understand. The top 1% now garners for itself more income each year than the bottom 100 million Americans taken together. The top 1% owns just under 50% of all investment capital. An only slightly larger elite group, the top 5%, owns slightly under 70% of financial wealth and more than 80% of unincorporated business assets. The most recent data (1999) showed a mere 0.2% at the very top making more money on the sale of stocks and bonds than all other taxpayers taken together. [1]

And of course this is only within the United States. Internationally, things are far worse. The richest 1% of people in the world have as much income each year as the poorest 57% taken together. The richest 5% have incomes 114 times that of the poorest 5%. [2]

Quite apart from the indecency of these statistics, what needs to be confronted is their relationship to materialism in general and unsustainable consumption and production in particular. Ever more expansive materialism is driven in large measure by the pattern set by those who can afford upper level purchases. After "the rich and superrich began a bout of conspicuous luxury consumption" in the early 1980s, Juliet Schor reports, members of "the upper middle class followed suit with their own imitative luxury spending ..." In turn, the 80% below who lost ground also "engaged in a round of compensatory keeping-up consumption." [3]

Even at times when there is no worsening in the relative distribution of income, there is an expanding absolute gap between those at the top and those at the bottom. Thus: If you have $50,000 this year and I have $1,000--and next year you have $100,000 and I have $2,000--the relative distribution of income has not changed since the ratio between our incomes remains constant at 50 to 1. However, the real world distance between us has gone from $49,000 to $98,000.

Dynamic processes of the kind which systematically expand the gap between those at the top and those at the bottom generates a powerful "envy machine"--a social and cultural dynamic in which even those who climb the ladder, step by step, regularly experience the space between the rungs getting greater and greater and the distance to the top farther and farther away as they climb (if, in fact, they do climb).

"Compensatory consumption" to keep up is also driven by factors which are not directly related to envy or status. Essential to getting into a top college is high quality primary and secondary education. However, for those who can only send their children to public schools this almost always requires purchasing a home in a neighborhood supportive of good schools--i.e. a location where...