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The evidence from Thomas Piketty, the United Nations, and other sources is quite conclusive: Current rates of global inequality are simply unprecedented.

In his celebrated book Capital in the 21st Century, Piketty marshals a massive amount of data to show that rising inequality has been the norm since capitalist growth took off in the 18th century. Now, he says, things are likely to become even worse.

The dynamics of contemporary capital accumulation, he warns, can lead to excessive and lasting concentration of capital: no matter how justified inequalities of wealth may be initially, fortunes can grow and perpetuate themselves beyond all reasonable limits and beyond any possible rational justification in terms of social utility.

The only period when there was a reversal of this flow, Piketty writes, occurred in the middle decades of the 20th century, when what he calls exogenous shocks such as wars and the social revolutions they triggered forced capitalist elites to make economic concessions. These social compromises were largely mediated by Keynesian or social democratic political regimes. By the last quarter of the 20th century, however, inequality resumed its onward march under democratic regimes implementing neoliberal policies.

Pikettys remarks are unsettling to believers in democracy, which most of us are.

One of the things he seems to be saying, at least implicitly, is that democratic regimes whose rise in the Global South paralleled the rise of neoliberalism in the North dont really work when it comes to containing economic inequality. They of course enshrine formal political equality and institutionalize majority rule. But they are ineffective at bringing about greater economic equality.

My generation came of age from the 1970s to the 1990s fighting to oust dictatorships and bring about democracy in the Third World. One of our potent arguments against authoritarianism was that it promoted concentration of income in dictatorial cliques allied with transnational capital. We said that democracy would reverse this process of impoverishment and inequality. From Chile to Brazil to South Korea to the Philippines, fighting against dictatorship was a fight for both democratic choice and greater equality.

Yet the evidence now seems clear that we were wrong. What Samuel Huntington called the Third Wave of democracy in the Global South went hand-in-hand with the spread of global economic policies that hobbled the fight for greater economic equality from the outset.

So what does this mean?

Democracy and Land Reform

See the original post:
Does Liberal Democracy Promote Inequality?