Telecoms & Broadband Business Newsletter - January-February 2015

Editorial - Let’s address inequality

The nature of the BuddeComm business is following developments around the world, and as my job includes a great deal of travelling it is interesting to observe, not just telecoms developments, but cultural, social and economic developments as well.

For example, comparing my trips to Africa in the 1970s with those I have made in recent times, or my first visit to China in 1987 and my later trips to that country, or visits to most of the other Asian countries, Russia and Eastern Europe between the 1970s and now, there is no doubt that developments have been mindboggling in these parts of the world (which comprise two-thirds of the globe), and in general they have benefitted most people.

While we can always argue about its real value, the desire to make progress is inherent to the human race; and that includes developments across the board, such as better housing, better jobs, better transport (having cars), the use of consumer whitegoods and consumer electronics, and a whole range of other social and economic improvements, healthcare, education and so on.

Earlier this year I published a range of stats showing that despite the enormous growth in world population we now have less people dying in wars, there are fewer people living below the poverty line, more children going to school, fewer infants die at birth. So plenty of reasons to cheer.

At the same time we all know that many of these developments also have very serious side effects in relation to the environment, social structures, and in particular to (and this is the element I want to address in the Christmas blog) inequality.

As progress is an inherent human need, rather than fight it we should concentrate on how to best guide this in the right direction and how to best address the side effects. This is something we intuitively know but it seems to be difficult to achieve, as the ‘me’ factor has become bigger than the ‘we’ factor in social and economic developments. What in the end the ‘me’ needs to understand is that not addressing the ‘we’ will have a severely negative impact on the ‘me’.

Especially since the 1980s (greed is good) we have seen a massive change in the level of inequality. This applies to many aspects of people’s lifestyle. In general, since that time the rich have become richer and the poor poorer. The middle class in many of the developed countries has not moved much, and that can also be seen as a negative trend.

A lot of the strife that is happening around the world has to do with inequality and the fact that the people feel powerless. They see the increasing wealth around them in the big cities while, a few kilometres away, they remain rather poor, are unemployed and are struggling to make ends meet. Or in developing countries people close to the ‘wealth’ are living below the poverty line.

One of the major stumbling blocks is the fact that those belonging to the 1% of the wealthiest in their countries are ‘becoming too big to fail’ – be it those involved in the political systems, in mining and oil companies, banks, telecoms companies – and they use these powers to protect their incumbency, which only increases the level of inequality. All the time the 1% has kept on saying leave us alone as that is the best way for the money to flow deeper into society, all that time however the gap has grown, not shrunk.

In September I reported on my discussions around how our industry could perhaps assist in fighting the Ebola crisis. I was shocked to find out how much of the aid effort is hampered by corruption within the affected countries. The same incredible level of corruption applies in countries like Nigeria, one of the richest countries in Africa, where it is impossible to share their enormous wealth with two-thirds of the population still living on less than a dollar a day. South Africa is another country were corruption creates higher levels of inequality.

The Arab Spring was another effect of huge inequality. That same inequality is the ideal breeding ground for the groups of extreme fundamentalists in many countries in the Middle East and North Africa. While we most certainly need to use military force to combat these criminals if we don’t address the problem of inequality it is just a matter of time before new groups pop up.

Education is the key to addressing inequality, especially in the developing countries, but we also need to break the plutocracies that are rapidly establishing themselves in countries such as the USA. The latter is a country that, rightly or wrongly, is seen by many developing countries as an example of economic growth, and therefore its systems are copied. This often leads to corruption by the ‘regents’ in charge of the economy and the political systems in those countries. These ‘regents’ are enormously powerful and the longer we wait to address these issues the more difficult it will be to reverse the situation.

History clearly shows what happens when there is inequality. Decline of the Roman Empire was directly linked in increased inequality. The French Revolution and many similar events in Europe from the late 18^th century all the way up to the Russian Revolution show what the consequences are if these issues aren’t addressed before disaster strikes. Look around the world: the Ferguson riots in the USA; the social unrest in countries like Spain and Greece; the shocking developments in the Middle East and increasingly in more countries in Africa. Children fleeing Central America, as inequality has created a lawless society without a functional social system or economy. Also, China should be cautious – over the last two thousand years all the major violent uprisings in China arose from inequality within the country.

Sadly inequality does get addressed in times of crises. Both during WWI and WWII the top tax rates in countries such as the USA and UK were increased to 92% and 77% (the same applied for all other countries involved in these wars); this led after WWII to several decades of a more equal society.

I started this Christmas blog with all of the positives and if we look back over thousands of years of modern human developments we can confidently say that we are able to overcome major adversities. However sometimes this resulted in decades, even centuries, of setbacks. As I wrote recently we can avoid that, and technologies – particularly the ones that our ICT industry is involved in – can play a key role. But for that to be effective we need to have the political will to make the fight against inequality a top priority.

Thank you very much for your ongoing support and for your business, which is greatly appreciated by all of us at BuddeComm. On behalf of the team we wish you all a peaceful Christmas, and let’s work towards more equality on our beautiful blue planet in 2015.

For those of you not celebrating Christmas, please accept the goodwill that radiates from the spirit of this celebration.