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[Data] G7 Summit on Inequality: Let's Take the Heat out of the Debate!

[Data] G7 Summit on Inequality: Let's Take the Heat out of the Debate!
 Julien Damon
Associate Professor at Sciences Po

Based on an original idea by Marc-Antoine Jamet, Mayor of Val-de-Rueil.

Inequalities, on which the G7 summit, to be held in Biarritz from August 24th to August 26th, will focus, are a constant issue of global - and French - concern. In a world irrigated with false information, where emotion often prevails over reason, it is important to take the heat out of the public debate on this subject, especially in France, a country particularly passionate about equality, where perceptions are often far from reality. Julien Damon, sociologist and associate professor at Sciences Po, shares his analysis on poverty, the middle class and inequalities in France and in the world today.

This series of analyses on poverty, the middle class and inequalities has supported a simple and relatively optimistic thesis: comparatively, poverty and inequalities remain limited in France, in a global context of decreasing extreme poverty, reducing international inequalities, and growing national inequalities. The evolutions at work regard, as we have seen, the distribution of living conditions and the evolutions of the middle class, which is expanding in the developing world and in crisis in the developed world

What lessons can we learn from this?

Relative poverty is increasing, while absolute poverty is decreasing worldwide. In particular, extreme poverty is declining and is concentrated in sub-Saharan Africa. Yet, perceptions are misleading, since the majority of the world's inhabitants – the French population in particular - believe that extreme poverty has increased in the world over the past 20 years. France, precisely, remains in a very good position in the community of nations in terms of GDP per capita. While poverty in France is stable, it has nevertheless evolved: it now affects young urban dwellers, single-parent families and foreign workers in particular.
Not all middle classes follow the same trend in different countries. We are witnessing the dawn of emerging countries’ middle classes, while those of Western countries are in decline. By 2030, we will be fully in a world of middle classes, whose proportion will be twice as large as that of the poor. In France, the "U" of the social and tax system means that the middle class is not disadvantaged enough to benefit from social assistance, nor is it favoured enough to benefit from tax reductions. This leads to a polarization where the middle class, "neither-nor", feels forgotten.
Finally, the French population is very passionate about inequalities. Several elements can be analysed, such as Internet access or housing, showing that France stands, on a global scale, as a country with relatively little inequality, with a Gini index of 0.29. This is especially due to one of the highest social expenditures in the world, representing over a third of GDP. Yet, perceptions are quite different, and there is a real French fear of inequalities. Pessimism means that solidarity is valued. In fact, income inequalities declined until the 1990s, before stabilizing. While wealth inequalities have also fallen drastically over time, some signals suggest that they may increase in the near future. Finally, territories are unequal, both between and within themselves.
As the G7 Summit, which will be held in Biarritz from August 24th to August 26th, promises to provide an opportunity for the world's leaders to discuss inequalities, it is important to take the heat out of the debate.

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