Just over two months ago, Oxfam released a report on income inequality in South Africa. It revealed that the two richest South Africans had the same wealth as the bottom half of the South African population.
We will get to who those two chops are in a bit.
More importantly, the report said that the consequences for such inequality were eating at the heart of our society. It wasn’t a case of just one person having more than another. Inequality helped explained why the country was lagging, struggling.
“Extreme inequality corrupts politics, hinders economic growth and stifles social mobility. It fuels crime and even violent conflict. It squanders talent, thwarts potential and undermines the foundations of society,” Oxfam said.
Of course, South Africa is not the only country facing extreme inequality. We can think of India, Brazil as obvious comparisons. But the United States, Japan, even Spain and Greece are guilty of playing host some of the most unequal societies on the planet.
In fact, earlier in the year, Oxfam said, the richest 85 people on the planet had more wealth than the poorest 3.5 billion people (on the same planet, but living in a different universe).
So how did this happen? And why?
Some people blame God for not adding capitalism as a vice to The Ten Commandments. Others say it was the economic revolution of the eighties led by British PM Margaret Thatcher and US President Ronald Reagan. They introduced a wave of interventions that cut taxes, reduced public spending and basically made fools out of the rest of us.
Al Jazeera’s Mehdi Hasan, on his superb show Head to Head, spoke to one of the guys behind the logic, a gentleman named Arthur Laffer.
Hasan asked him what on earth was he thinking when he recommended these changes, and, if he understood, in light of the financial crisis and what not that has destroyed peoples’ lives, that he may have been wrong (very wrong).
Watch the fascinating discussion here:
PS. The two richest South Africans are Johan Rupert, chairperson and chief executive of Remgro and chairperson of Richemont, who is worth R82.35bn and Nicky Oppenheimer, chairperson of De Beers who is worth R72.6-billion.