How to stop the global inequality machine

Added: 06-26-2018

In this article, Hickel explains how unfair trade deals and cheap labor have led to an “unequal exchange” of money from the Global South to the Global North. The Global South pays 11 times as much money as is provided in foreign aid. Hickel proposes imposing a global minimum wage to combat this.

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Type Reading Time Author Date Source
article 19 minutes JASON HICKEL 05-18-2017
Type Reading Time
article 19 minutes
Author Date
jason hickel 2018-06-26 00:00:00 UTC
Key Takeaways

  • Global South gives 11 times the amount it receives in aid to the Global North via cheap labor and trade. 
  • Modern trade dynamics reflect the colonial era relations between north and south. 
  • Imposing a global minimum wage would cut back on unfairly cheap labor.


Jason Hickel explains the history behind increasing global inequality and the meaning of the United Nations (UN) Sustainable Development Goal Number 10, which aims to “reduce income inequality within and among countries.” 

Beginning with economist Samir Amin’s ideas from the 1970’s, Hickel explains that the ‘Global North’ siphons uncompensated work from the ‘Global South’ due to the price for labor being less in the South. 

This “unequal exchange” was calculated by Amin to be approximately $22 billion during the 1960s, or twice the amount the Global South received in aid. Now this figure is estimated to be 1.46 trillion dollars in transfers, or 11 times the amount that flows to the south in aid. 

Hickel compares this phenomenon, and others like apartheid, to the way colonial governments explicitly abused the labor market. 

Colonial policy was designed to force people into the labor market, by kicking them off their land or imposing crushing taxes, leaving them with no choice but to work in European industries where employers could get away with paying “rock bottom wages.” Because colonial powers could dictate the rules of trade, they were able to depress the prices of exports from their colonies, which in turn put downward pressure on wages. 

Pro-worker movements in the south, such as Chile’s in 1970s, were specifically designed to install structural adjustment programs by the International Monetary Fund (IMF) to collapse wages across the South. He concludes that a possible solution to this problem is a global minimum wage. If economies are to be globalized, then so too should the minimum wage he argues.