[...] they insist that the poor do not necessarily get poorer, so that one may express a cautious hope that some of the poor might sometimes become somewhat less poor than they used to be. Indeed, the only remaining moral justification of the current system hangs by that thread: as long as it can be argued that the poor do not always and everywhere get poorer, the rich should go ahead and keep getting as abundantly rich as they can, in good times and bad.

Th is small scruple—this impulse to justify the accumulation and concentration of wealth in the name of ameliorating, if not eradicating, widespread poverty—offers a crucial hint about the current legitimations of global capitalism and, indeed, about the weakening need to legitimate it at all. The prevailing discourse may be apologetic about the specifics but remains unapologetic about the overriding vision: even if the free markets do not function perfectly, everyone is supposed to agree that capitalist models of growth remain the only hope for rich and poor alike. The pursuit of wealth can represent the very essence and purpose of human civilization only because poverty has been recast as something left over from someone else’s history. In the face of metastasizing glass-box skylines and the endlessly televised worship of luxury, poverty appears to be the flawed and fallen condition of life without capitalism. The fact of poverty will be acknowledged only in order to make those wretched people somehow more pathetic or pathological, whether glimpsed from a distance or demonized as an immediate threat. Even when poverty is recognized as a persistent human problem, it will be explained in localized terms and addressed on a case-by-case basis, as if countries were poor because of their own particular disadvantages, and individuals because of bad habits they haven’t learned to break. State-of-the-art capitalism—the multilayered tangle of markets enforced by its biggest powers—can solve the problem (the story goes) only if everyone will see it as the cure rather than the cause of poverty. That is why the most optimistic plans for helping the poor scarcely mention the existence of massively concentrated wealth, let alone
suggest that such wealth is part of the sickness, too.

Yet it should be clear that there is no way to “fix” poverty without “fixing” the processes of accumulation. Without dismantling the top-heavy structures of the world’s economic architecture, poverty reduction programs and deficit-driven fiscal policies can do little to reverse the entrenched patterns of inequality. Moreover, entrepreneurial schemes to help the poor all too often follow the priorities set by the developed countries, thereby preserving the prerogatives of capital and launching another round of lopsided accumulation. As the current crisis has demonstrated once more, and with renewed ferocity, the global system has imposed deeper forms of dependency without cultivating stronger forms of reciprocity: the virtuous circle of commerce always turns vicious when left to its own devices, and unequal booms unerringly lead to even more unequal busts.

Instead of treating inequality as inevitable and poverty as some kind of immature condition, we should start by seeing both as the result of an ongoing process—actual impoverishment—that is systemically produced and maintained by the current arrangement of things. The basic mechanisms of impoverishment—expropriation and oppression, rooted in violence—have been at work for centuries, administered by a variety of social forms and political regimes in increasingly multilateral and overdetermined ways. In the course of this long history there has been a fundamental shift in the meaning of poverty: whereas it might once have been rooted in sheer scarcity external to social organization (and therefore would have seemed natural, local, and ineradicable) it is now permanently installed in the global functioning of the system, as the price a certain portion of the population must pay for the enrichment of the rest. Whether this shift from contingent scarcity to structural deprivation and exclusion occurred during the Mesolithic era or during postmodernity does not matter very much (that depends upon one’s conception of capitalism as a world system); what we face today is a thoroughly contemporary system for the production and maintenance of widespread poverty for the sake of stupendous wealth.

it seems long ago that anybody trusted the state to serve as a bulwark against the global system

What might appear to each of us as vicissitudes of fate and fortune are actually organized by more durable relationships and processes that usually remain opaque.

—In the US, the UK, and the EU, the ratio of household debt to GDP has been rising alarmingly since the 1980s. Even so, these broad measures conceal the very differences that the wealth and inequality figures revealed: debt means rather different things for households at different ends of the scale. For wealthier households, more debt is associated with greater ability to borrow for houses, durable goods, education, and so on. For everybody else, increased debt should be seen in the context of the persistent stagnation in wages, where borrowing against a house became the easiest and perhaps the only way to support consumption. In either case, those who took on debt in the form of mortgages and home equity loans are now seeing their equity flowing back to the financial institutions. And people will find themselves even more vulnerable in the downturn. (In 2007, household debt as a percentage of disposable income topped 130 percent in the US; the EU ratio was about 90 percent.)

Through its operations the scission between wealth and poverty turns into a self-reinforcing pincer.