Global Futures Initiative

Consider that more than a billion people still live on less than US$1.25-a-day. Yet, research by Oxfam suggests the richest 1% may soon see their share of global wealth overtake the other 99% of people in 2016, if the current trend of rising inequality is unaddressed.

And inequality can have the most severe effects in developing countries. With a US$510 billion GDP, for example, Nigeria is Sub-Sahara Africa's largest economy. But the largest sector of the economy has also shifted from labor intensive agriculture to service. Worse, Nigeria's impressive GDP growth masks some ugly realities. The number of Nigerians living on less than a dollar a day increased to 61% in 2010. Investments in drivers of broader economic growth, including education, health, and infrastructure, is anemic. Nigeria generates an average of 3,800 megawatts of electricity for its 177 million citizens. By comparison, the U.S. state of Montana produces 6,000 megawatts of electricity for its 1 million residents.

What's more, the consequences of inequality no longer exist in silos; globalization provides a contagion platform. Poor healthcare infrastructure in West Africa can translate to infectious disease epidemic in Western Countries. Unemployment in Asia and Africa drives illegal immigration in the West. An ideology of radical Islam in Africa, Middle East, and now Europe, advocates violence and reduces vast territories to economic wasteland. Even French Prime Minister, Manuel Valls, acknowledges that “territorial, social, ethnic apartheid” disenfranchise many in France.

Economic mobility and investments in drivers of innovation are good remedies. Tuition-free community college education should improve economic mobility. Increasing research grants to institutions such as Georgetown University will aid innovation. Innovation and knowledge created at Georgetown and similar institutions remain critical drivers of wealth and human development. Also vital is a fairer political economy that biases taxation towards capital and wealth, rather than labor and consumption. 

But change won't be easy. 20% of billionaires, for example, have interests in finance and insurance, a group which saw their cash-wealth increase by 11% in 2014. These sectors also made over US$1 billion in political contributions to Washington and Brussels between 2012-13. Yet this is hardly reason to despair, to paraphrase President Kennedy: We don't do things because they are easy, but because they are hard. Because the challenge is one we're willing to accept, and one which we intend to win.   

O. Felix Obi is an Alumni Board Member at Georgetown’s McCourt School of Public Policy. His professional background is in economic and international trade development in Africa, especially innovation and entrepreneurship.