Bill Gates is worried -- too many people are talking about raising the minimum wage. Appropriately, the world’s richest man spoke on the eve of the World Economic Summit in Davos.
Gates is a great symbol of the Davos summit, an annual away day for global capitalism.There, the world’s 1% mouth concerns about poverty and climate change while working on policies that fuel inequality.
Despite a fair bit of evidence that a reasonable minimum wage doesn’t cost jobs, Gates is picking up on a regular Davos theme. In 2012, Tidjane Thiam, chief executive of Prudential, called the minimum wage a "machine to destroy jobs".
Last year, Gates increased his wealth by US$15.8 billion and has once again become the world’s richest man, worth about $78.5 billion. He’s not alone -- as a whole, the world’s millionaires got 11% richer last year.
For the rest of us, the decades-long trend of stagnating income continues. In some countries -- Greece, Spain and Britain -- median household income fell sharply.
The policies dreamt up by those who meet in Davos are the direct cause of these historically unprecedented rates of inequality. Last week, even the financial press was taken aback at the concentration of corporate wealth.
Just six companies -- including Apple, Microsoft and Google -- are sitting on more than a quarter of the $1.5 trillion reserves held by US non-financial corporations.
Among other reasons, a big factor is tax avoidance. This has been enabled by the financial liberalisation regime put into place over 30 years by the likes of those who attend Davos. According to the Financial Times: "Some 94 per cent of Microsoft’s $81bn is now outside the US."
So Gates does not want a higher minimum wage denting the amount of wealth his company is able to avoid taxes on.
The really incredible thing about the Davos set is the way they are able, without irony, to expound all the good they are doing in the world. We barely question the illegitimacy of the enormous power these corporate leaders hold over the world.
During the summit, Gates is portrayed as a dreamy idealist, explaining to Davos seminars how "there will be almost no poor countries left in 20 years time". Presumably this will happen with a lot of charity, but without minimum wages.
Certainly Gates’ money will have significantly shaped the form which that "development" will take, not least through the Bill and Melinda Gates Foundation. Forget democratic national projects, the world’s richest many will decide what sort of food you will eat and which corporation will supply your medical needs.
In an article in the Observer, the head of the World Economic Forum, Robert Greenhill, said that mental and physical health were a priority of this year’s summit. Good business, he said, depends on good mental and physical health.
Yet some of the participants at Davos are directly responsible for the crisis and austerity measures that have been responsible for mental health problemsgrowing across Europe. In Greece, suicides rose 37% from 2009 to 2011.
The Red Cross published a shocking report on Europe, characterising the continent as one of mass unemployment, suicides, social exclusion, deep poverty, crime, racism and collective despair. We should remember that none of this was an accident.
Charities such as Oxfam that talked about inequality did some essential work to frame the global context in which Davos takes place. But we need to do more than put these issues on their agenda.
The corporate elite represented at Davos cannot be allowed to meet in luxury and pretend they have the answers to the world’s problems. They are the world’s problems. Gates has helped us unmask the true interests of the corporate elite.
[Reprinted from Red Pepper. Nick Dearden is the director of the World Development Movement which campaigns in Britain on global justice issues. He was formerly the director of Jubilee Debt Campaign.]
