Draft Global Issues Pilot August 2011 1
Area of Inquiry – Poverty, Wealth and Power
Introduction and key concepts
Wealth, power: these are two things most people aspire to. They are also the hallmarks of prosperousnations and successful corporate entities.
Wealth is – simply put – an accumulation of resources.
Awealthy (or rich) individual, community, or nation has more resources than a poor one.
Power is theability to exert control over one’s environment
or other entities, which both constrains and enables.Both are intimately tied to societal structures.In Canada, most people have wealth unimaginable to the rest of the world.Canada's net worth per capita came in at $70,916 US in 2006, the same yearthe United Nations Millennium Development Goals were put in place tosupport basic needs for the poorest individuals in the world. In contrast,Ethiopia had per-capita wealth of $193 and Congo had $180.
1% of adults areestimated to hold 40% of world wealth.
The bulk of the wealthiest adults(almost 90 per cent) are concentrated in North America, Europe and Japan.The richest 10 per cent of adults in the world had $61,000 US in assets. In contrast, globally, 50 per centof adults owned barely one per cent of the household wealth. Having assets worth just above $2,200 USwould be enough to put an adult into the top half of the world's wealth distribution.
There is a widening gap between rich and poor; however this is not a simple question of extreme wealthin developed countries and extreme poverty in developing countries. Using data, European researcherHans Rosling shows how
wealth and poverty have been shifting over time.
Countries defy ourexpectations, e.g. Botswana in Africa is richer than Albania. Also, now the countries with very unequallydistributed incomes are mostly found in Latin America and parts of Sub-Saharan Africa. Incomes areoften more evenly distributed in “the West,” Asia and the Middle East.
Further, the overall trend ispositive. The UN estimates that between 1990 and 2002, the number of people living in extremepoverty fell by 130 million;
the average overall incomes around the world increased by 21 per cent.
And this translates into better quality of life, including healthier populations. For example, childmortality rates fell from 103 deaths per 1,000 live births to 88.This last statistic shares something more about wealth (and its opposite, poverty).
Often defined inpurely economic terms, wealth relates to one’s capacity to engage easily and productively in society.
This means having enough money to fulfill basic needs: food, adequate shelter, basic healthcare andeducation. Economic security is connected to employment. Having access to adequate paying and stablework makes for security. With this security come many privileges that people in developed countriessometimes take for granted, such as access to credit and loans. Without secure work, most banks andcredit companies will not provide services.
This same access to credit and loans can lead to the opposite of wealth: debt.
The debt load at anindividual and country level can be paralyzing and it impacts on decision-making, limiting choices. At anindividual level, there is an interesting paradox around wealth for the North. If – as it often is - wealth is