By Donella Meadows
–December 3, 1998–
The combined wealth of the world’s three richest people is greater than the total income of the 48 poorest nations.The 84 richest people own assets worth more than the total annual production (GDP) of all 1.2 billion Chinese.
Together the world’s 225 billionaires are worth $1 trillion, equal to the annual incomes of just under half (2.7 billion) of the global population.
Statistics like these, which are taken from the 1998 Human Development Report of the United Nations Development Programme (UNDP), make me mad twice over. My heart gets mad at the gross inequity they convey. My mind gets mad at the glaring error of equating wealth with income. Surely the people who put out these numbers know better.
Take that $1 trillion owned by those 225 billionaires. It has accumulated over one or several lifetimes. If it were all distributed to the 2.7 billion poorest people (which seems to be the implication of rich/poor comparisons), they would get $370 apiece, which would double their average income for one year. Then the party would be over. If the poor invested the windfall in a cow or machine or house, or at least got out of debt, some lasting good would be done by this grand global potlatch, but poverty would persist.
However, let’s assume that the 225 billionaires get a modest five percent return on their combined trillion bucks. That comes to a total of $50 billion a year, an average of $222 million per billionaire. Suppose they limited themselves to a frugal $2 million a year apiece in personal spending and gave the rest ($49.5 billion) to help the poor on an ongoing basis.
Here’s what they could buy, according to that same UNDP report. Basic education for all the world’s children ($6 billion, in addition to what is already being spent). Clean water and sanitation for everyone ($9 billion). Proper nutrition and health care for those who do not now have them ($13 billion). Reproductive health and family planning services for all women ($12 billion). That adds up to $40 billion — there’d be $9.5 billion left to protect the environment or promote peace. Year after year.
To produce those results the billionaires would retain their wealth, but they’d have to drop out of the game of seeing who can pile up most. They would get to play a different game, to see who could do the most to make the world work for everyone. They could give us all the unimaginable experience of living without the constant shadow of poverty and hunger and illiteracy. I presume it was just such a challenge that moved Ted Turner to pledge a billion dollars to the United Nations and Bill Gates to give $100 million to vaccinate poor children.
A wonderful magazine called “More than Money” (2244 Alder St., Eugene OR 97405, 541-343-2420, impactefnorg) is full of stories about people of wealth who play serious giving games. Such as Tom Lowe, chairman of the Lyman Lumber Company, who is organizing fellow Minnesotans to give away a minimum of one percent of their net worth each year. He figures that if Minnesota’s 28,000 richest citizens did that, they would increase charitable giving by five times the budget of the Minneapolis United Way. Claude Rosenberg’s book Wealthy and Wise says that the top 20 percent of the wealthy in the United States could give over $100 billion a year more than they now do and their fortunes would continue to grow.
Here are some incredible but very real quotes from contributors to the Winter 1998 issue of “More than Money”:
“I first gave away all income from my inherited stocks, then about five percent of my net worth a year, and finally up to 10 percent of assets a year. My principal grew, even at this rate of giving! I saw my contributions make deep dreams come true and I was motivated to keep giving more.”
“For a long time I gave away 50 percent of my taxable income because that was what was deductible. A couple of years ago, my taxable income dropped dramatically, and my accountant told me I ‘couldn’t’ give away so much that year. I decided I wouldn’t let the government or my accountant make that decision for me. So now I give what I want, and it’s more than 50 percent.”
“Financial advisors generally assume that wealthy people share the goal of giving as little money as possible to the government. I see things quite differently. I am proud to support vital government services with my tax dollars. I know that philanthropy can never, by itself, create the kind of society I want. We should not withdraw our financial support from the government, but work to make it better.”
The billionaires could easily put up $50 billion a year to end hunger and poverty, the millionaires could supply another $100 billion, but why should the rest of us let them have all the fun? Fifty billion is the amount Europeans spend in a year on cigarettes or Americans spend on soft drinks. It’s the annual cost of business entertainment expenses in Japan plus perfumes in the U.S. and Europe. A five percent tax on advertising would raise $50 billion a year. So would a five percent cut in weapons expenditures.
Collectively we are far richer than we think we are. We could give much more than we think we can. It would take surprisingly little to make a more joyful, less dangerous, fairer, sweeter world. All we would have to do, really, would be to choose to play bigger, more exciting, more challenging, more deeply satisfying games.
Copyright Sustainability Institute 1998