Inequality-A Major Obstacle for Sustainabiliity

Sustainability is a property of the whole Earth system. As long as large numbers of people cannot obtain the resources to flourish, we will remain far from sustainability. Economic disparity has long been a concern. The notion of "sustainable development" arose from two sources: 1) knowledge of severe environmental impacts and threats, and 2) huge gaps in wealth between the "North" and the South." These differences still remain although the two populous economies, China and India, are closing the gap.

Often lost in the focus on the "developing" world is the state of the US economy. I recently read an advance copy of a fascinating paper (norton ariely actual vs ideal wealth distribution.pdf ) about this topic that my readers might be interested in reading: "Building a Better America - One Wealth Quintile at a Time," by Michael I. Norton and Dan Ariely. The data about the actual wealth distribution are shocking. The bottom 40% don't even show in the upper bar graph.

Inequality data-US.png

What intrigues me, however, is the differences between the perceptions of inequality, visions of what would be an ideal distribution, and the actual situation. The authors' abstract tells the whole story.

Disagreements about the optimal level of wealth inequality underlie policy debates ranging from taxation to welfare. We attempt to insert the desires of “regular” Americans into these debates, by asking a nationally representative online panel to estimate the current distribution of wealth in the United States and to “build a better America” by constructing distributions with their ideal level of inequality. First, respondents dramatically underestimated the current level of wealth inequality [the middle bar]. Second, respondents constructed ideal wealth distributions [the bottom bar] that were far more equitable than even their erroneously low estimates of the actual distribution. Most important from a policy perspective, we observed a surprising level of consensus: All demographic groups - even those not usually associated with wealth redistribution such as Republicans and the wealthy - desired a more equal distribution of wealth than the status quo.

Greening the economy usually refers to efforts to make production and consumption more eco-efficient. But that is clearly not enough; the capabilities necessary for flourishing must be made accessible to the group missing from the chart. The findings that all ends of the political spectrum would prefer a flatter distribution are at odds with current political behavior, especially as the 2010 elections draw nearer. More evidence that something is seriously wrong.