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The Transformation of Inequality Starts with Us

The ‘Economist’ magazine this week featured several very thoughtful articles on the dysfunctions of contemporary macroeconomics: ‘wealth without workers, workers without wealth’, ‘the disappearance of middle class in developed economies’ and ‘arrested development’ in the developing countries. The ‘Economist’ attributes such macroeconomic challenges to the fundamental characteristics of the 3rd wave of industrialization and governments’ failure of responding to it. Unlike the first two waves of industrializations that involved large number of workers in transforming physical assets, the 3rd wave is driven digitally by tech giants such as Google, Facebook or Alibaba that command huge market valuations but employ relatively few workers. The net result is concentration of wealth in talented (and lucky) few.

Classical Marxist economists would suggest government solutions similar to the ‘New Deal’ introduced by President Theodor Roosevelt to overcome the ‘Great Depression’ in the 1920-30s. The ‘Economist’ describes it as ‘politics must craft rules and institutions that harness technology to suit society’s values.’ That may very well turn out to be necessary. However, there is at least another and more organic mechanism other than forced wealth redistribution by government with inevitable side effects (e.g., bureaucracy). This 2nd mechanism would not only minimize undesirable government interventions but also provide an authentic path of transformation for the talented (and lucky) few. No, my definition of the talented and lucky few is not limited to Warren Buffet and Bill Gates of the world. I count myself among them. Having been born in then Communist China and growing up ‘poor’ by Western standard, I consider my current middle class status quite ‘wealthy’. What motivates me is no longer how to accumulate additional wealth but realize higher values that will make the world a better place for our children. The opportunities of acquiring and fulfilling such higher values are remarkably abundant, especially at the workplace. It coincides with remarkable transformations taking place today inside many global companies to upgrade corporate values from job security, winning, personal pride and authority to creativity, transparency, accountability and compassion. To be sure, this transformation is just beginning and no more than a trickle most of time. But the opportunity is real enough for most of us – the talented and lucky few. The only question is if we choose to act or at least try to acquire the skills to do so in small and incremental steps.

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