Some eminent thinkers have recently tried to conflate wealth with wellbeing, suggesting we should measure wealth not simply in economic or monetary terms, but in terms of other indicators: happiness is the latest buzzword. But happiness is impossible without a minimum level of economic security. Wellbeing cannot be achieved simply by convincing ourselves we are happy regardless of our economic circumstances. It’s difficult to avoid the conclusion that the happiness debate is a tactic employed by politicians to deflect attention from the ongoing failure of the economic system to provide sufficient economic opportunities, and thus condemn millions to poverty.
What is Wealth?
Happiness is a noble, if rather nebulous, goal; but any definition of wealth must emphasise the primacy of economic security. I would define wealth as ‘the ability to purchase in the market place those goods and services which are essential to wellbeing, along with others which, though not essential, nonetheless enhance quality of life.” Under this definition the economy must, at the very least, be arranged so that all citizens can secure their essential needs. Currently it fails in this respect to the tune of at least a billion people worldwide.
Wealth, then, is the ability, or capacity, to satisfy our needs and desires. Most of us, assuming we are fortunate enough to have a job, or enterprising enough to carve out a niche in the uncertain world of self-employment, earn a living by exchanging our labour effort for a wage. Whatever work we do, it generally involves playing a role in the process through which the factors of production - land, labour and capital - are combined to create goods and services. We are paid in money which gives us purchasing power in the market place where the goods and services we produce are traded. But for a small minority, the greater proportion of their wealth is acquired not through work, but by other means.
Over the coming weeks I shall investigate the sources of unearned wealth; who benefits and why; how the economy came to be configured to allow some people to derive this wholly unjust advantage; and the consequences for those of us who have to work to live, and for the millions of people who are denied this basic human right. I hope to demonstrate how the mechanisms through which a minority derives unearned wealth are also responsible for denying viable economic opportunities to a quarter of the world’s people, and ensuring the rest of us live in a state of perpetual insecurity.
First, we will look at land rent: the wealth derived by landowners not as a result of their labour effort, but from the collective efforts of wider society. Then, wealth derived from speculative investments that have no connection with the real economy. Next, interest; wealth derived by charging for the use of money, and the wider problems caused by the way money is issued. Then, the complex problem of profit: where it comes from, and the uses, legitimate and illegitimate, to which it can be put. Finally, inheritance, and the issue of genetic advantage, and what George Bernard Shaw termed the ‘rent of ability’.
The series will conclude with discussions about the impact of unearned wealth in terms of consolidating elite power and maintaining the status quo; the obstacles to implementing the requisite changes to economic structures and institutions; the need for change to be effected globally through a democratically derived consensus; the idea of creating a fair market in place of the current so-called free market, the (much reduced) role of the state in an equitable society, and finally, an imaginary sketch of a more just, inclusive and stable global society in which unearned wealth has become a thing of the past.