Economic inequality is at the heart of all humanity’s major problems, but the wealthiest refuse to confront a system that benefits them
This week, hundreds of government leaders, heads of state, and business executives are gathering at the annual meeting of the World Economic Forum (WEF) in Davos. They will be discussing solutions to the world’s biggest risks and problems. But everything suggests that, once more, what will not be addressed at their meeting is the biggest threat to humanity and the planet: neoliberal capitalism.
All forms of capitalism are characterised by extensive private ownership of companies as well as the primacy of the profit motive. But the specific neoliberal form of capitalism that has risen to dominance from the late 1970s onwards has additional features: the privatisation of companies previously in public ownership; a shift in power from workers to capital owners; and reduced taxes on entrepreneurs and the richest.
The transition from mixed economies under social democracies to neoliberal capitalism has led to a notable increase of wealth concentration at the top, which is now eroding (and in some places even destroying) our democracies. The absence of a sustained discussion of neoliberal capitalism in elite circles is illogical, since it is the main cause of the other problems that will be discussed at Davos.
Last week, the WEF launched its 2026 Global Risks Report, in preparation for the Davos meeting. Experts were asked to pick from a provided list the risks that they consider to be the biggest for the world. Geo-economic confrontation, misinformation and disinformation and social polarisation are regarded as the top three risks for the next two years. Over a period of 10 years, the top three are extreme weather conditions, biodiversity loss and ecosystems collapse and critical changes to Earth systems.
Inequality in income and wealth comes in seventh place. The analysis in the report presents it as the factor that is most central, as it connects most other risks. That is certainly a valid observation. However, the commentary in the report does not provide a good understanding of what the precise problem with inequality is. The WEF reduces inequality to the feelings of citizens who perceive themselves to be excluded and who are unhappy with their limited opportunities for social mobility.
Yet at its core, economic inequality is about much more fundamental issues. It is about who gets what share of what we produce together. Neoliberal ideology, with its focus on individuals and the efficiency gains of competition, makes us inclined to think that we can attribute wealth-holding to individual efforts. But this is a myth.
The economy is a complicated ecosystem of interlinked processes, in which the areas where the largest profits are made are reliant on other fields that provide the conditions for this to be possible. Without people working in the public sector for the common good, such as (often poorly paid) childcare workers, teachers and NHS doctors and nurses, there would be no productive workforce to co-create the profits of the business owners.
In recent decades the divide has widened, making capital owners even richer and workers even poorer. Taxes have also shifted from capital to labour, and the possibilities for the very richest people to pay hardly any taxes have amplified. That is what citizens are also angry about – and rightly so.
As I documented in detail in my book Limitarianism: The Case Against Extreme Wealth, economic inequality is also about the increase in social, ecological and political damage caused by billionaires and centimillionaires (one whose wealth is estimated at $100m or more). But to see that, we need a system-level analysis of the fundamentals of our political economy. And unfortunately, we have no reason to believe that this will happen in Davos. As long as we dodge the question of whether neoliberal capitalism delivers what we want, and fail to take seriously the question of whether there are better systems, the world’s key problems cannot be properly understood, let alone solved….
https://www.theguardian.com/global/2026/jan/19/davos-rich-global-threat-economic-inequality-wealth
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