According to a study to be released tomorrow by Boston Consulting Group, the world’s wealth grew by 7.5% in 2006, reaching $97.9 trillion. The study also showed that the wealth gap between the haves and the have-nots continued to widen over the past five years, with much of the global wealth gains going to the wealthy.
Pope Benedict XVI offers wisdom on the topic:
Capitalism should not be considered the only valid model of economic organization. . . . The emergencies of famine and the environment demonstrate with growing clarity that the logic of profit, if predominant, increases the disproportion between the rich and the poor and leads to a ruinous exploitation of the planet. . . . When the logic of sharing and solidarity prevails, it is possible to correct our route and point it toward fair and sustainable development.
Of course, people like Gary Becker might view such sentiments as merely the product of “simple jealousy and envy,” and intellectuals’ “remove from the real world.” Views like Becker’s are enormously powerful, but perhaps someday he will recognize that the legitimacy of globalization depends on its fulfilling basic human needs–and not some abstract measure of wealth maximization:
While the supporters of an exclusively private-sector driven globalization may resent the idea of vesting tax-raising authority for the first time in history into a global agency, they cannot fail to notice that the very process they support undercuts, in an ironic twist, their own position. It does so by rendering the gap in wealth more obvious, and the fairness of the existing global distribution, more questionable. They will ultimately realize that their self-interest lies in supporting some form of global action to deal with both poverty…and inequality.
(From Branko Milanovic, Global Income Inequality: What it Is and Why it Matters.)