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Global inheritance and social inequalities

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In the late 1990s up to the early 2000s, there was a growing voice on inheritance in Zimbabwe. The message then was very clear to both men and women that they should have their wills in order before they die to ensure their estates benefit their children.

Develop me: Tapiwa Gomo

There was no doubt that the traditional practice of inheritance was no longer in sync with the requirements of modern times
There was no doubt that the traditional practice of inheritance was no longer in sync with the requirements of modern times

There was no doubt that the traditional practice of inheritance was no longer in sync with the requirements of modern times. There was a big push to invest in various insurance policies of different forms and dimensions. That simply meant that labourers took a portion of their salaries to an insurance company for investment. And that it was seen as a better idea than investing in family businesses.

It was believed that investing in insurance companies was safer in terms of protecting the estates for those who remain. Investments in insurance companies were meant to ensure that our children can continue to go to school, access health care, food and shelter and others so that they can grow up to provide professional labour to those who owned the means of production. Children of the deceased needed to continue to live normal lives after their parents passed on.

So insurance was the in-thing and I am sure it still is, but when our country was hit by inflation, most insurance investments were wiped out. I lost mine, but I am sure those who ran insurance companies did not lose as much.

What did this form of inheritance investment mean exactly? Insurance meant that taking part of the earnings from the labourer back to those who own the means of production to use it for their own profits and share interest with the labourer at a later stage.

The situation is much worse at global level and has perpetually cemented global inequalities and centralised economic power.

Every morning people wake up to go to work and are rewarded for their efforts, but differently. Billions of people across the world earn less than $2 a day, while others earn more than a million dollars an hour. The difference is that one is providing labour to those who own the means of production and the labourer sends back the same earnings for both investment and safekeeping in the form of insurance.

Studies have shown that inheritance has a lot to do with these global disparities. If one comes from a wealthy family, which owns the means of production, no matter their intellectual abilities, they are most likely going to inherit an opulent life than those who come from low and middle income families.

And similarly, children of middle income earners tend to follow the professions of their parents’ which is often none other than providing labour to those who own the means of production. It is a vicious cycle.

That is not the only problem with inequalities. The pre-capitalist thinking was that large scale inequalities in power and wealth were justified by religion, particularly the claim that social and economic hierarchy was ordained by God and those with wealth had divine right to it and, therefore, should never be challenged. Inequality is not social, but economic, but it determines the social status.

And the mantra that follows to justify economic inequalities is the assumption that people must be rewarded according to their contribution to the wealth of those who own the means of production. And this principle simply means if you are provider of labour, the reward must be based on your contribution to those who own the means of production. The employer decides the wages.

There is no doubt that inheritance at lower level is a good idea, but there is a problem with inheritance generally when we look at it from the perspective of global inequality. The global economy has become too centralised with most decisions coming from a few wealthy people in the world.

In the United States of America for example, inheritance accounted for 50 to 60% of their wealth in the 1980s.

Globally, inheritance accounts for 60 to 70% of the wealth that is passed on from one generation to another, resulting in huge dynasties, while widening the gap between the rich and the poor. That means there is a bigger chunk of global wealth that cannot be subjected to redistribution.

Economic stability and productivity are key to a stable life, but inherent inequalities tend to hinder human potential as this is replicated at all levels.

It is often argued that those with wealth have the right to do what they want with it including passing it onto their children and influencing global economic policies.

However, this has to be balanced against other rights — most specifically the right of others to be part of a world of equal economic opportunities and access to basic services.

When the rights of the wealthy and those of the poor conflict, the right of the former tends to preside over the latter simply on account of inheritance. In Zimbabwe, corruption has been the core of our economic rot, but that has made some a few people obscenely wealthy.

Their children will always be better than the rest as they are born already owning the means of production.

For whatever becomes of the future Zimbabwe, in the context of inequalities, economic opportunities will mean the difference between health and illness, education and illiteracy and happiness and depression.

Tapiwa Gomo is a development consultant based in Pretoria, South Africa

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