The 1%

The Top 1%

In recent years, the term ‘1%’ has become commonly used to discuss the world’s richest people. Particularly since the Occupy Wall Street protests in 2011 drew attention to the vastly disproportionate wealth of those in the Western world, many of us latched onto that familiar statistic whereby 24% of the total annual income lands in the pocket of just 1% of the population of the United States. Shocking, perhaps, and probably similarly true throughout developed countries. But what we consider ‘poor’ by American or British or Australian standards is incomparable to what is considered poor in, for example, Rwanda or Ethiopia or Myanmar. Yes, the majority of the people reading this article are probably not in the richest 1% of their native country but if you consider global wealth, that image might change.

I’m currently reading a book called Do Good Better by William Macaskill. I’m actually reading it in an attempt to improve the way in which my charity works but the introduction itself caught my attention with talk of the 1%. It’s an often enough used phrase but, it seems, according to Macaskill, misused. Ok, true, in developed countries the majority of the wealth is concentrated amongst a relatively small group of people. But the way in which global wealth is distributed is far more interesting and revealing about our society. Right now, I’m going to assume that you, yes you, reading this article right now, are in the richest 5% of the world. I’m in the top 10% and I work for a charity which only covers my rent … Ok, I write to top up my monthly earnings but I’m not exactly raking it in.

So how does this work? Well, economists have worked out that if we take the sum of the global annual income, people only have to earn US$52,000 (£40,000 or AUS$69,000) per year to land in that elusive 1%. Ok, that’s not an entry-level wage but it’s also not nearly as high as you might expect. To be in the top 5% you merely need to earn US$28,000 (£21,500 or AUS$37,000) per year. Those of you reading this article have access to the Internet, enough free time on your hands to browse the web, an interest in charity work or wellbeing and a comprehensive grasp of English (if you’re not from an English-speaking nation). Therefore, I deduce, that you are probably in the richest 5% of the global population. The most affluent 15% of the world earns US$11,000 (£8,500 or AUS$14,500) and this income is considered to be below the poverty line in the United States. Compared to villages in remote Africa, these people are still mind-bogglingly wealthy.

But money doesn’t work like that, I hear you say. You may, technically be richer, but our society is more expensive. You simply need more money to live in developed countries whereas in the developing world, everything is cheap. True, to an extent. I can indeed get lunch in Cambodia for $1.25 or $1.75 if I’m feeling flush. So when Macaskill quotes that 1.2 billion people, the bottom 20% of the global rich list, live on less than $1.50 per day, you may think that is tough but manageable given their cheaper living costs. Except this $1.50 is an equivalent currency, converted by some clever economist using a formula I don’t understand but it involves this Numbeo website. It doesn’t mean $1.50 of our money in their world. It means $1.50 of our money in our world. How much can you buy in the developing world for $1.50? Not much, is the simple answer.

Considering this new knowledge that we’re comparatively loaded, Macaskill goes on in his book to say that we should all be giving 10% of our wages to charity. Which sounds like a lot and I’m not going to try and convince you to do this right now … The truth of the matter, however, is that our money which we spend on frivolous, overpriced commodities without even thinking about it could go much further elsewhere in the world. If we, you, are in the richest 5% in the world then surely we have some kind of duty to do what we can to provide support to those who are not only living on $1.50 per day but using the vast majority of that money to feed themselves and their families. There’s no room in that budget for cinema trips or meals out or concert tickets or new cars. They are living day to day, hour to hour, keeping themselves alive, subsisting rather than living, while 5% of the global population of 7.5 billion people (that’s 375,000,000 people) hold not only the resources and capacity but also all of the power when it comes to doing something to correct this global imbalance. And for those of you reading this who are in the 1%, and I know there will be some, consider how much you currently donate to charity and ask: is this enough to make up for the 7.425 billion people worse off than me on the planet?

Go, do, experience. More Good Deeds.