Just 8 men own same wealth as half the world
Eight men own the same wealth as the 3.6 billion people who make up the poorest half of humanity, according to a new report published by Oxfam today to mark the annual meeting of political and business leaders in Davos.
Oxfam’s report, ‘An economy for the 99 percent’, shows that the gap between rich and poor is far greater than had been feared. It details how big business and the super-rich are fuelling the inequality crisis by dodging taxes, driving down wages and using their power to influence politics. It calls for a fundamental change in the way we manage our economies so that they work for all people, and not just a fortunate few.
New and better data on the distribution of global wealth – particularly in India and China – indicates that the poorest half of the world has less wealth than had been previously thought. Had this new data been available last year, it would have shown that nine billionaires owned the same wealth as the poorest half of the planet, and not 62, as Oxfam calculated at the time.
In India, the richest 1 per cent of Indians have 58 per cent of total Indian wealth. Fifty seven billionaires have the same amount of wealth as the bottom 70 per cent of India. The CEO of India’s top information firm earns 416 times the salary of a typical employee in his company.
Nisha Agrawal, CEO of Oxfam India said:
“India is hitting the global headlines for many reasons, but one of them is for being one of the most unequal countries in the world with a very high and sharply rising concentration of income and wealth. The Budget for 2017-18 provides a major opportunity to reverse that and to put in place policies that will raise more taxes in a more progressive way and to spend those on basic education and basic healthcare to create a more equal opportunity country.”
The report outlines how the super-rich use a network of tax havens to avoid paying their fair share of tax and an army of wealth managers to secure returns on their investments that would not be available to ordinary savers. Contrary to popular belief, many of the super-rich are not ‘self-made’. Oxfam analysis shows that half the world’s billionaires have inherited their wealth or accumulated it through the use of crony connections with government.
It also demonstrates how big business and the super-rich use their money and connections to ensure government policy works for them.
Agrawal added “The Indian tax structure looks reasonably progressive on paper, but in practice much of the progressive tax is not collected. The Indian Government has to introduce slew of measures to ensure implementation of progressive taxation as well as crack down on tax dodging by rich, and end the era of tax havens.”
Winnie Byanyima, Executive Director of Oxfam International, said:
“It is obscene for so much wealth to be held in the hands of so few when 1 in 10 people survive on less than $2 a day. Inequality is trapping hundreds of millions in poverty; it is fracturing our societies and undermining democracy.”
Oxfam’s report shows how our broken economies are funnelling wealth to a rich elite at the expense of the poorest in society, the majority of whom are women. The richest are accumulating wealth at such an astonishing rate that the world could see its first trillionaire in just 25 years. To put this figure in perspective – you would need to spend $1 million every day for 2738 years to spend $1 trillion.
Public anger with inequality is already creating political shockwaves across the globe. Inequality has been cited as a significant factor in the election of Donald Trump in the US, the election of President Duterte in the Philippines, and Brexit in the UK.
Seven out of 10 people live in a country that has seen a rise in inequality in the last 30 years. Between 1988 and 2011 the incomes of the poorest 10 percent increased by an average of just $65 per year, while the incomes of the richest 1 percent grew by an average of $11,800 a year – 182 times as much.
‘An Economy for the 99 percent’ also reveals how big business and the super-rich are fuelling the inequality crisis. It shows how big corporations are dodging taxes, driving down wages for their workers and the prices paid to producers, and investing less in their business in order to maximize returns to their wealthy shareholders.
Byanyima said: “The millions of people who have been left behind by our broken economies need solutions, not scapegoats. That is why Oxfam is setting out a new common sense approach to managing our economies so that they work for the majority and not just the fortunate few.”
“Governments are not helpless in the face of technological change and market forces. If politicians stop obsessing with GDP, and focus on delivering for all their citizens and not just a wealthy few, a better future is possible for everyone.”
Oxfam’s blueprint for a more human economy in India includes:
- Introducing an Inheritance Tax and Raising the Wealth Tax;
- Not reducing existing Corporate Tax rates and eliminating tax exemptions for Corporates;
- Cracking down on tax dodging by corporates and rich individuals - ending the era of tax havens;
- Increasing public expenditure on health from 1 per cent to 3 per cent of GDP;
- Increasing expenditure on education from 3 per cent of GDP to 6 per cent
Oxfam is also calling on business leaders to play their part in building a human economy. The World Economic Forum has responsive and responsible leadership as its key theme this year. They can make a start by committing to pay their fair share of tax and by ensuring their businesses pay a living wage. People around the global can also join the campaign at www.evenitup.org.
Himanshi Matta, 8860182310, email@example.com
The following materials are available for download here:
•Full report and executive summary of ‘An Economy for the 99 percent’
•A document outlining the methodology behind the statistics in the report
•VNR footage and shot list featuring the stories of people in Kenya, Vietnam and Brazil who face a daily struggle with inequality
Oxfam’s calculations are based on global wealth distribution data provided by the Credit Suisse Global Wealth Data book 2016.