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Inequality and the rise of extremism

This article elaborates on the rise of inequality and the resulting rise of extremism in Western, but also African and Asian countries.

🕑3 min

By Kevin Issah

1. Introduction

During the previous decades, most global economies have been experiencing an increase in the wealth gap between poor and rich people. It has been historically proven that economic distress has mostly led to the rise of extremism and mass violence. For example, citizens tend to relieve their voting for radical parties from both the right and left political spectrums during a crisis. In some African and Asian countries, inequality causes heavy political turmoil, which lent to the overthrow of the head of their governments. On the other hand, we can observe that in the past election of democratic governments such as the USA and the United Kingdom, the working and middle classes highly voted for the then former President Trump and Brexit. The main highlight events in these countries were the rise of inequality which the states failed to tackle, causing the political polarization on this aspect.

2. Socio-economic inequality

Earlier this year, the ECB Economic Bulletin showed that in most advanced economics, income and wealth inequality has increased since the 80s, although relatively less than in the United States and the United Kingdom. With the Covid crisis, most advanced economies faced the rise of unemployment among those with low wealth and income brackets causing the economic inequality to expand furthermore. Here, the expectation of the public institution was to provide sufficient resources for its inhabitants to reduce the wealth gap. When the state institutions fail to meet its expectation, it leads to a lower public trust which tends to weaker support for democracy. On the other hand, French economists Gabriel Zucman and Emmanuel Saez's study found that the income and wealth inequality in the USA was far more remarkable compared to continental Europe because of the contribution of low taxes of the wealthy people. They also observed that the top class's average annual income growth rate has increased at a higher rate compared to the middle and lower classes. This division contributes to the rise of voters electing populist politicians as anti-elite agents.

Meanwhile, in Africa, inequality is still very high. The wealth inequality captures by looking at the geographical distribution of the citizen, whereby the rich are concentrated in the urban area while the poor are in the rural area. The disparity between the rich and the poor is enormous regarding the political spectrum. The political scientists Christian Houle and Cristina Bodea’s study found that the income and wealth inequality among the different ethnic groups in Sub-Saharan Africa led to the overthrow of the government by a rebel group or military. Finally, several Asian countries have faced a rise in wealth and income inequality that distress the country's political stability. Countries such as Pakistan, Sri Lanka, and Myanmar are currently facing political turmoil given the citizen demonstration due to the economic crisis. Hence, the rise of the extremism movement tends to have a strong linkage with income and wealth inequality since the citizens cannot have sufficient resources for their standard of living. Sources: UN, BBC, VOXEU, ECB, DW.COM, Christian Houle and Cristina Bodea, Emmanuel Saez and Gabriel Zucman

Written by Kevin Issah

June 2022

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