Inequality and Climate Change

2026-01-15
greens.org.au
Our obscene and widening levels of inequality are a neglected driver of the climate crisis. We should make explicit the many ways in which inequality is driving up emissions and advocate for policies to reduce inequality as central to solving the climate crisis.
By Rob Delves, a member of the Green Issue Editorial Team
Inequality has reached crisis proportions and The Greens have several policies to reduce the gap between rich and poor. We also have wide-ranging policies to solve the climate crisis. As far as I’m aware, we rarely link the two sets of policies, although we do acknowledge that social justice principles must underpin the urgent transition out of fossil fuels to a clean energy economy. However, this is most frequently defined as rich countries assisting poorer countries with the costs of adapting to climate change damage, or assistance for workers who lose their jobs as fossil fuel plants close.
I’d like to make the case that our current obscene levels of inequality are an important but neglected contributing factor to greenhouse gas emissions. Inequality is also holding back efforts to reduce emissions. Therefore the world cannot solve the climate crisis without linking it with the inequality crisis.
The Alternative View
Except on the extreme right, there is widespread agreement amongst economists and social researchers that ever-increasing levels of inequality need to be addressed for many reasons: for example, they offend basic fairness/ethics, threaten social cohesion, erode democracy and weaken the economy. However, many argue that all this is irrelevant to the actions needed to solve the climate crisis – and that messaging making inequality reductions central to climate actions could even weaken efforts to reduce emissions.
There are two main arguments being made here. First, the clean energy revolution – based on plunging costs of solar, wind and battery technologies ‒ is now unstoppable and will soon deliver such abundant, ever cheaper energy for everyone that the market will rapidly make fossil fuels redundant. In this view, climate change is purely a technology problem, a matter of markets delivering based on economic efficiency – with maybe a little help via subsidies, regulatory standards and carbon pricing.
Secondly, it is also argued that adding social justice programs, however worthy, will complicate and reduce support for the decarbonisation initiatives. For example, here is distinguished climate scientist Michael Mann, writing in Nature:
"Saddling a climate movement with a laundry list of other social programs risks alienating needed supporters (say, independents and moderate conservatives) who are apprehensive about a broader agenda of progressive social change."
I guess this may explain why the Teal Climate Independents are largely silent on reducing inequality, reassuring their well-off constituents that ‘we will deliver a safe climate for your children, but your wealth is safe with us.’
Inequality – how bad is it?
Extremely bad and getting worse – Green Issue readers won’t need much convincing about this. At the global level, Oxfam and other organisations continue to produce ever more mind-boggling data. The wealthiest 10% own 75% of the world’s wealth, while the poorest 50% own just 2%. Just the 56,000 wealthiest individuals (entry level $200 million, median wealth nudging towards $1 billion) have three times the wealth of the poorest 50%. While the number living below the World Bank Poverty Line has barely changed since 1990, in just 2024 alone the world’s billionaires grew their wealth by $2 trillion.
Research by ACOSS shows that Australia is keeping up with world inequality trends and our wealthy are looking after themselves very well, thank you. In 2019, the highest 10% of households ranked by income had an average after-tax income of $5,200 per week, or seven times that of the lowest 20% (average below $800). The highest 10% of households ranked by wealth possess 44% of all wealth in Australia, averaging $5.2m per household. Wealth inequality has escalated over the past two decades, with the highest 10% capturing almost half (45%) of the overall increase in wealth between 2003 – 2022. In 2023, the share of wealth accruing to the highest 10% grew from 42% to 44% while that of the lowest 60% declined from 20% to 18%. In 2023, there were 159 billionaires in Australia with average wealth of $3.2 billion each. Nice work if you can get it – though as Oxfam argues, when it comes to billionaires it’s a case of TAKE rather than MAKE wealth.
How Inequality Fuels the Climate Crisis
I’m indebted to books by Thomas Piketty and Naomi Klein, also several articles by proponents of the Green New Deal. They all describe several ways in which inequality is an important driver of carbon emissions. Therefore, moving rapidly towards a world where income and wealth are much more equally shared is essential if we are to have any hope of ensuring a safe climate for our children and grandchildren.
The wealthy are champion polluters. First of all, let’s look at the wealthy’s huge carbon footprint. Everyone knows that the richest 10% with their extravagant lifestyles are responsible for a vastly disproportionate share of global emissions, much greater than that of the poorest 50%.