Here’s what inequality means to me

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Inequality can be defined in numbers by economists as the ever growing income gap between the rich and the poor.

It can be defined by paparazzi photos of celebrities’ sun bathing on Mediterranean super-yachts.

And it can be defined in words by those politicians who make speeches about the risk it poses to social stability.

But for working people inequality is about power.

When a group of workers are denied the right to bargain with their employer for a fair wage, denied the right to withdraw their labour as an action of last resort, denied social protection, or denied the right to join a union, inequality is at work.

Global polling by the International Trade Union Confederation (ITUC) shows there is not a single country where a majority believes the economic system is fair to most people.

Inequality is deep and it is growing. No corner of the world has been left untouched.

The orthodoxy of the IMF and other international institutions has failed, but despite recognition of inequality as a global risk, and despite the IMF admitting that they underestimated the negative impact of their measures, the austerity prescription continues.

The medicine of low wages, flexible labour markets, insecure work, less social protection and low taxes has only served to increase inequality.

It is inspired by corporate dominance that makes governments cower.

Sixty-four per cent of the world’s people surveyed in the ITUC Global Poll want corporate power tamed.

Recent data from Europe and BRICS countries shows that growth has slowed again, creating the very real prospect of the euro area entering into a “triple-dip” recession.

Working families have had enough. If you want the global economy to grow, you need to pay people more, not less.

The question is whether the international financial institutions are prepared to shift away from the thinking that says the path to growth is cutting wages and maximising short-term business profit.

This is not a pathway to sustainable growth; instead, it is increasing inequality.

Economic modelling shows a mix of wage increase and investment in infrastructure in developed countries can create up to 5.84 per cent more growth and create 33 million jobs.

It could create five per cent growth in developed countries and help emerging economies deliver a concerted attack on inequality and provide social protection and minimum living wages in all nations.

The economics of household demand show that the world economy, in aggregate, is wages-led – that is, the more you pay people, the more they will spend on goods and services, thus stimulating local, national and global economies.

Seems basic.

On the other hand, every one percentage point simultaneous decline in the wage share in the world leads to a decline in the global GDP by 0.36 percentage points.

So when G20 finance ministers set a bold target of two per cent of growth above expectations, the obvious question is: “how do we get there?”

With a global wages’ slump over three decades and a sluggish global economy, the facts are clear. Jobs and wages are the keys to growth.

Just wages, rights and social protection are at the heart of the worldwide trade union movement to rebalance power.

The dominant model of trade is not working for people, so we must fight the exploitation of the supply chains – we demand that they purge their contract chain of forced and informal labour, that they guarantee safe work and a minimum living wage and respect collective bargaining. We demand governments ensure sustainable wage fixing mechanisms and compliance systems.

Sixty-two per cent of people in the ITUC Global Poll know corporate power is now out of balance and they want workers’ rights respected through all global supply chains.

Inequality of wages, of rights, of power is defining a generation.

But so is the global response.

From Cambodian garment workers demanding a living wage, democracy activists on the streets on Hong Kong to climate activists taking to the streets of New York.

Across the world, a line in the sand has been drawn from where working people are saying no more.