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Rich man, poor man
Published in Al-Ahram Weekly on 08 - 03 - 2012

Globally people are rising against social injustice, demanding that the rich support the poor, writes Ayman El-Amir*
Social injustice has been the core issue of almost every uprising since the French Revolution. The Egyptian revolution of 25 January 2011 was no exception. Social justice was one of three key demands of Egyptian revolutionaries who braved Mubarak's paramilitary security forces, rubber bullets, tear gas and live ammunition, and eventually forced him out. It is also a most challenging revolutionary quest since it involves new policies for the redistribution of wealth, which could be painful and coercive. That is what former Egyptian president Gamal Abdel-Nasser did after he led a military coup in the 1950s to oust the king and to uproot the ruling class that supported and benefited from his royal regime.
Wealth changes hands only grudgingly and under duress. Despite the strong demand for social justice enunciated by Egyptian revolutionaries 13 months ago, the interim military regime in power has no visionary programme to achieve that. The revolutionary demand of a comprehensive programme for social justice soon turned into a series of professional grievances that were infiltrated by pro-Mubarak sympathisers hired by big business leaders who amassed fortunes through illegal practices that the Mubarak family covered up, encouraged or shared in. Clashes among different groups led to hundreds of casualties and shifted the focus of social reform to inter-sectoral bickering. Meanwhile, the three successive governments that have been installed by the ruling military council have only scratched the surface of the system of social injustice. They fiddled with the perennial issue of minimum and maximum wage, of how to manage subsidies, how to improve the embarrassingly chaotic healthcare system, to control the rising cost of living, curb inflation, improve pensions, overhaul the skewed tax system and resuscitate the ailing economy. However, none of them came to grips with combining all these issues into an egalitarian social justice system.
The Mubarak regime, through its minister of finance, Youssef Boutros Ghali, designed and legislated a system of flat taxation of 20 per cent across the board that enriched the wealthy and added more burdens to the poor. This relieved the rich of the nearly global progressive taxation code that obliges them to contribute a fair share of their wealth towards financing social services that the poor and the lower middle class can ill-afford. Forty years after the introduction of the free market economy system under former president Anwar El-Sadat, the so-called "open door policy" -- particularly during the last 15 years of Mubarak's regime -- turned into an increasingly rabid form of capitalism guarded by the interests of a business oligarchy and compared only to the robber barons of the late 1800s and early 1900s in the US. As Nobel Laureate Joseph Stiglitz put it in an article in Vanity Fair magazine a year ago, "Wealth begets power, which begets more wealth."
The steady growth of inequality between the rich and the poor has spurred a global protest movement. The "Occupy Wall Street" demonstrations, which spread from the East Coast to the West, are but one example of this global phenomenon. The European Union's bailout package of 130 billion Euros in loans to Greece will cost every man, woman and child in the 27-nation union 20,000 Euros. Griping Greeks are marching the streets everyday in protest against reduced benefits, cost cutting measures, rising unemployment and spiralling inflation. Ten other members of the EU, including Italy, Spain, Portugal and Ireland are skirting the same precipice. The crisis is spreading and the global protest movement is gathering more momentum, driven by rising awareness that the rich are becoming richer because they do not pay a fair share of their wealth to finance services for the poor, thanks to protective taxation privileges. In developing countries like Egypt, the problem is more acute because the survival of 95 per cent of the people depended on acts of charity by one man who was not answerable to anyone but himself.
One way of addressing the problem in the US started in 2007 when Bill and Melinda Gates, together with the insurance billionaire Warren Buffet, initiated the Giving Pledge. They have so far been joined by more than 57 American billionaires who have pledged to give at least 50 per cent of their fortunes to charity -- an estimated total of $600 billion. It is, perhaps, a reflection of the spirit of sharing by some pioneers who feel that the real burden of financing social programmes falls mainly on the middle class. Trillions of dollars more went to financing of the costly invasions and subsequent wars in Iraq and Afghanistan. It may also reflect a desire to save their inheritance from the US's estate tax that could be as high as 65 per cent levied on the estate of the deceased wealthy. Another tradition is donations to arts and cultural foundations, museums, parks and educational institutions -- donations that enjoy tax deduction privileges.
There is nothing comparable to that in Egypt or the Arab region where the contribution of the rich is reduced to a form of alms to the poor. The Muslim Brotherhood has a long-standing tradition of giving to the poor or offering volunteer services. However, this was not free of political purposes. One bottle of cooking oil, one kilogramme of sugar and an amount of flour to the residents of poorer neighbourhoods and slums went a long way towards ensuring a majority vote for the Brotherhood's candidates in the recent parliamentary elections. This falls within the category of voluntary contribution which is no substitute for the state's network of basic services, including education, medical services, job creation, upgrading infrastructure, transport, housing and selective subsidy of selected goods and services for the underclass. And these can only be financed not by charity but by a system of balanced contributions by the wealthy and the middle class to the underprivileged poor.
In Egypt and several Arab countries a fair system of taxation can go a long way towards the redistribution of wealth, which is an anathema to the wealthy, especially those who amassed wealth by illegal means or under suspicious circumstances.
Europe and the US have gone through five eras that helped them amass wealth and consequently power: the industrial revolution, the era of colonial conquest (respectfully nicknamed the Age of Discovery), the post-World War I era of colonial redistribution, the post-World War II American Century and the 21st century's era of the technological revolution. Wealth changes hands only in times of great upheaval. It has begun in the Middle East and no one knows how far it will go or where it will stop. However, clear signals of discontent have appeared in the Mediterranean and Europe and it is underway in the US, whether through the Giving Pledge, the Occupy Wall Street Movement or President Obama's initiative to reform taxation laws to reduce disparities in the distribution of wealth. In 1937, Sir Winston Churchill said: "We make a living by what we get but we make a life by what we give."
* The writer is former corespondent of Al-Ahram in Washington, DC, and former director of the UN Radio and Television in New York.


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