It’s not just the ecosystem, our economy is socially unfit too

Posted on by Dr. Trevor Hancock

A recent intergovernmental report found that in 2023, public and private expenditures of US$7.3 trillion had direct negative impacts on nature

Dr. Trevor Hancock

2 March 2026

699 words

Last week I discussed a couple of recent global-level reports that identify serious problems with our current economic system. In particular, the UN Environment Programme, in its 2026 report “Global Environmental Outlook 7”, found that human-created climate change, biodiversity loss, land degradation and desertification, and pollution and waste are undermining human wellbeing and “already costing trillions of dollars each year.”

The report recommended investing in the transformation of our societies and economies, because doing so will avoid or reduce these costs and will have huge economic benefits. Another report, this one in early February from the Intergovernmental Platform on Biodiversity and Ecosystem Services (IPBES) – the biodiversity equivalent of the Intergovernmental Panel on Climate Change – focuses on the relationship between business and biodiversity.

Prepared by a panel of public and private sector experts from 35 countries, the report found that in 2023, public and private expenditures of US$7.3 trillion, 2/3 of them from the private sector, had direct negative impacts on nature. These expenditures included “environmentally harmful public subsidies and private investment in high-impact sectors.”

Troublingly, that means governments are spending around US$2.4 trillion every year on environmentally harmful subsidies. Meanwhile, less than one-tenth of that amount from public and private sectors combined was “directed toward activities that contribute to the conservation and sustainable use of biodiversity.” Looks to me like the definition of insanity.

But it’s not just about the way our current economic and societal systems harms the planet. Suddenly it seems to be dawning on people – at least, some people – that our economy is socially unfit too.

Writing in Time Magazine on January 27th, Professor Olivier de Schutter, UN Special Rapporteur on Extreme Poverty, stated our economic system “is fundamentally unfit for purpose”. It “only ever serve[s] a tiny minority”, he wrote, adding “it will always do so at the expense of the planet and the vast majority of people who live on it.”

The authors of the 2026 World Inequality Report (WIR) write: “Inequality has long been a defining feature of the global economy, but by 2025, it has reached levels that demand urgent attention.” Indeed, frankly, the level of inequality has reached obscene levels. This is highlighted by a finding in the report that “fewer than 60,000 multi-millionaires, control today three times more wealth than half of humanity combined” – that is, more than the poorest 4 billion people!

More broadly the report notes, those 4 billion people – half the world’s population – have only 8 percent of the world’s income and only 2 percent of its wealth. The authors of the WIR make the point that “Reducing inequality is not only about fairness but also essential for the resilience of economies, the stability of democracies, and the viability of our planet.”

So in what conceivable way is this level of inequality fair, just and appropriate? Why aren’t those 60,000 people rushing to share their wealth – and if they won’t, why aren’t we taxing it and redistributing it? How many millions or billions does anyone actually need anyway? As in previous reports the authors make the vital point that “These divides are not inevitable. They are the outcome of political and institutional choices.”

In a forthcoming report to the UN Human Rights Council, Professor de Schutter will be presenting an action agenda to reduce extreme poverty that outlines some of the choices we need to take. His proposals fall under five pillars, with adaptive governance and participatory decision-making underpinning them all.

The first pillar is focused on “how economic systems can be reimagined to prioritise sustainability and wellbeing over consumerism and GDP growth.” It includes ideas about progressive taxation, subsidy realignment, tax enforcement and embedding social purpose in corporate activity. And there is much, much more.

The fact we are making bad political and institutional choices is not only true for inequality and poverty but for the public and private sector policies that lead us to spend vast sums of money on causing environmental harm and piddling amounts on protection and restoration. It’s time we changed the political choices we are making if we want to ensure the wellbeing of people and the planet for this and future generations.

© Trevor Hancock, 2026

thancock@uvic.ca

Dr. Trevor Hancock is a retired professor and senior scholar at the

University of Victoria’s School of Public Health and Social Policy

The problem is income inadequacy, not affordability

Posted on by Dr. Trevor Hancock

The bottom half of the population has seen its share of national income dropping, while the top one per cent’s share has grown dramatically.

Dr. Trevor Hancock

22 September 2025

702 words

Food Banks Canada just released its annual report on poverty in Canada. Key findings are that one in ten Canadians are living in poverty, over 40 percent are paying more than 30 percent of their income on housing (which is the Statistics Canada definition of unaffordable housing), and 40 percent are feeling worse off compared to last year.

Of course the core business of food banks is hunger and food insecurity. The latter is defined by Statistics Canada as being unable to or uncertain of the ability to acquire or consume an adequate diet or sufficient food in socially acceptable ways. A May 2025 report from Statistics Canada stated that in 2023 one in four people in Canada – and almost half of people in one-parent families – reported they were living in food insecure households.

That was a roughly 15 percent increase over 2022, and the third annual increase in a row. Moreover, most of that increase was among those -19 out of 25 percent – who experienced moderate to severe food insecurity. This situation has led a number of cities in Ontario to declare food insecurity emergencies. The CEO of Toronto’s Daily Bread Food Bank noted in a CBC interview that “we need to feed more than one in 10 Torontonians.”

This is happening, we should remind ourselves, in one of the richest countries in the world.

Often, this situation is presented as an issue of affordability; food, housing and other basic needs are just too expensive. But while that is true, there is another way to look at it, as Valerie Tarasuk – a prominent Canadian food researcher at the University of Toronto – notes in that same CBC interview: “I think we have a fundamental problem with income that needs to be addressed.”

That fundamental problem with income is not new. In its 2022 report the World Inequality Lab noted: “Income and wealth inequalities have been on the rise nearly everywhere since the 1980s, following a series of deregulation and liberalization programs which took different forms in different countries.”

What they mean, of course, is the adoption by Margaret Thatcher in the UK and Ronald Reagan in the USA of neoliberal economic policies that were then adopted more widely. That is true of Canada too, as the Lab’s report on Canadamakes clear: “Income inequality in Canada increased significantly from 1982 until the mid-2000s.”

Between the Second World War and the mid-1980s the bottom half of the Canadian population had around 20 – 22 percent of Canada’s pre-tax income, while the top ten percent had a bit under 30 percent and the top one percent had between 6 and 7 percent. By 2005 that was dramatically different: The bottom half of the population received just 17 percent of pre-tax income, the top ten percent had reached 38 percent and the top one percent got 14 percent.

In other words, the bottom half of the population – half, note – saw their share of national income decline nearly one fifth, while the top one percent more than doubled their share. Since then, the report notes, “income inequality has decreased slightly although it remains far above the levels observed in the early 1980s.”

This inequality was worsened because while pretty much everyone paid between 40 and 44 percent of their income in taxes overall in 2022, the Canadian Centre for Policy Alternatives reported last year, the 90-95th percentile paid only 37 percent and the 95-99th percentile paid just 34 percent – less than the lowest ten percent, who paid 35 percent. Shockingly the top one percent paid a mere 24 percent of their income in total taxes.

The 2022 World Inequality Report made a vitally important point about this situation. Noting there are significant differences in the extent of the growth of inequality between different countries they concluded “inequality is not inevitable, it is a political choice.”

So it is up to us. Do we want to perpetuate the poverty, hunger and unaffordable housing situation for low-income Candians? Or do we want to go back to the decades after the Second World War when the rich paid their share and the bottom half took a larger share of the income?

© Trevor Hancock, 2025

thancock@uvic.ca

Dr. Trevor Hancock is a retired professor and senior scholar at the

University of Victoria’s School of Public Health and Social Policy