Global leaders urged to join initiative to fight extreme inequality

More than 1,500 academics and economists from 100-plus countries are urging global leaders to join an initiative against extreme inequality, calling current unfairness “a policy choice that can be reversed”.

Before the UN general assembly in New York next week, the experts have signed an open letter backing the International Panel on Inequality (IPI).

High-profile signatories include th former US Treasury secretary Janet Yellen, the Nobel prize-winner Daron Acemoglu, and a slew of other prominent economists, including Thomas Piketty, Mariana Mazzucato and Jayati Ghosh.

In the letter, they say: “Extreme concentrations of income and wealth translate into undemocratic concentrations of power, unravelling trust in our societies and polarising our politics.”

Set up with the support of Spain, South Africa, Brazil and Norway and championed by the UN secretary general, António Guterres, the IPI aims to mirror the International Panel on Climate Change, which assesses the state of the climate emergency and makes recommendations.

It will be chaired by the Nobel-winning economist Joseph Stiglitz, who said he hoped it could become “the world’s leading authority on the issue”.

“It is news to no one that the gap between the richest and the poorest in most countries is large and growing. The interrelated impacts of the inequality crisis are affecting the lives of many, with significant political, economic, social and environmental consequences playing out across the globe,” Stiglitz said.

The signatories of the letter suggest the IPI could work towards a “shared scientific consensus” on the nature and scale of international inequality, as well as pointing the way to potential policy solutions.

It would bring together leading experts, partner governments and multilateral institutions to produce regular reports and seek to raise the profile of inequality as a global issue.

Experts are concerned both about the gap between wealthy and poor countries, and inequalities within individual economies.

Ghosh, a professor of economics at University of Massachusetts Amherst in the US, said: “India’s experience tells us everything we need to know about why an International Panel on Inequality is needed. One of the world’s fastest-growing economies is also one of its most unequal and its extraordinary wealth sits alongside profound deprivation.”

The World Bank said recently that “barring a miracle” the 2020s would be a “lost decade” for many developing countries, which – aside from India and China – had failed to narrow the gap with the industrialised world.

Former global leaders including Germany’s Olaf Scholz, Ireland’s Leo Varadkar and New Zealand’s Helen Clark also backed the idea of the IPI in a separate statement this week.

In the UK, the government has not yet said whether it is prepared to join the IPI, but the foreign secretary, Ed Miliband, has indicated a willingness to work with other countries on shared international challenges – notwithstanding the reluctance of Donald Trump’s US to participate in such initiatives.

Andy Burnham will attend the UN general assembly next week, marking one of his most significant appearances on the global stage since arriving in Downing Street in July. The prime minister is expected to meet Trump on the sidelines of the New York gathering.