By Thalif Deen
UNITED NATIONS, Jan 15 2024 (IPS)
The world’s rich are getting progressively richer while the world’s poor continue to be increasingly poorer.
In a new report released January 15, Oxfam says the wealth of the world’s five richest men has doubled since 2020 –even as five billion people were made poorer in a “decade of division.”
The study, published to coincide with the World Economic Forum in Davos, an annual gathering of mostly the world’s wealthiest and business elites, lists the top five billionaires: Elon Musk $245.5 billion, Bernard Arnault and family $191.3 billion, Jeff Bezos $167.4 billion, Larry Ellison $145.5 billion and Warren Buffett $119.2 billion— totaling about $869 billion in assets.
The fortunes of the five richest men have shot up by 114 percent since 2020 while the world’s poorest will not be eradicated for another 229 years, said Oxfam, a global organization that fights inequality to end poverty and injustice.
Oxfam predicts the world could have its first-ever trillionaire in just a decade while it would take more than two centuries to end poverty.
Asked about the status of women in a world of rising economic inequalities, Rebecca Riddell, policy lead for economic and racial justice at Oxfam America, told IPS: “Women pay the highest price for a broken global economy”.
Globally, she pointed out, men own US$105 trillion more wealth than women—equivalent to more than four times the size of the US economy—and women earn just 51 cents for every $1 made by men.
“Women are also especially harmed by the policies that fuel our inequality crisis, like tax breaks for the rich and cuts to public services,” said Riddell, one of the authors of the Oxfam report on inequality and global corporate power.
They carry out the vast majority of unpaid care work, which is vital to keeping our communities and economies afloat, and their labor is constantly undervalued in the workplace, she noted.
“We found it would take 1,200 years for women working in the health and social sector to earn what the average CEO at the biggest Fortune 100 companies makes in just one year,” declared Riddell.
Oxfam urges a new era of public action, including public services, corporate regulation, breaking up monopolies and enacting permanent wealth and excess profit taxes.
The study reveals that seven out of ten of the world’s biggest corporations have a billionaire as CEO or principal shareholder. These corporations are worth $10.2 trillion, equivalent to more than the combined GDPs of all countries in Africa and Latin America.
“We’re witnessing the beginnings of a decade of division, with billions of people shouldering the economic shockwaves of pandemic, inflation and war, while billionaires’ fortunes boom. This inequality is no accident; the billionaire class is ensuring corporations deliver more wealth to them at the expense of everyone else,” said Oxfam International interim Executive Director Amitabh Behar.
“Runaway corporate and monopoly power is an inequality-generating machine: through squeezing workers, dodging tax, privatizing the state, and spurring climate breakdown, corporations are funneling endless wealth to their ultra-rich owners. But they’re also funneling power, undermining our democracies and our rights. No corporation or individual should have this much power over our economies and our lives —to be clear, nobody should have a billion dollars,” he noted.
The study also singles out the following:
- – Despite representing just 21 percent of the global population, rich countries in the Global North own 69 percent of global wealth and are home to 74 percent of the world’s billionaire wealth.
– Share ownership overwhelmingly benefits the richest. The top 1 percent own 43 percent of all global financial assets. They hold 48 percent of financial wealth in the Middle East, 50 percent in Asia and 47 percent in Europe.
Mirroring the fortunes of the super-rich, large firms are set to smash their annual profit records in 2023. 148 of the world’s biggest corporations together raked in $1.8 trillion in total net profits in the year to June 2023, a 52 percent jump compared to average net profits in 2018-2021.
Their windfall profits surged to nearly $700 billion. The report finds that for every $100 of profit made by 96 major corporations between July 2022 and June 2023, $82 was paid out to rich shareholders.
Bernard Arnault, the world’s second richest man who presides over luxury goods empire LVMH, has been fined by France‘s anti-trust body. He also owns France’s biggest media outlet, Les Échos, as well as Le Parisien.
Aliko Dangote, Africa’s richest person, holds a “near-monopoly” on cement in Nigeria. His empire’s expansion into oil has raised concerns about a new private monopoly.
Jeff Bezos’s fortune of $167.4 billion increased by $32.7 billion since the beginning of the decade. The US government has sued Amazon, the source of Bezos’ fortune, for wielding its “monopoly power” to hike prices, degrade service for shoppers and stifle competition.
“Monopolies harm innovation and crush workers and smaller businesses. The world hasn’t forgotten how pharma monopolies deprived millions of people of COVID-19 vaccines, creating a racist vaccine apartheid, while minting a new club of billionaires,” said Behar.
People worldwide are working harder and longer hours, often for poverty wages in precarious and unsafe jobs. The wages of nearly 800 million workers have failed to keep up with inflation and they have lost $1.5 trillion over the last two years, equivalent to nearly a month (25 days) of lost wages for each worker, according to Oxfam.
The report also shows how a “war on taxation” by corporations has seen the effective corporate tax rate fall by roughly a third in recent decades, while corporations have relentlessly privatized the public sector and segregated services like education and water.
“We have the evidence. We know the history. Public power can rein in runaway corporate power and inequality —shaping the market to be fairer and free from billionaire control. Governments must intervene to break up monopolies, empower workers, tax these massive corporate profits and, crucially, invest in a new era of public goods and services,” said Behar.
“Every corporation has a responsibility to act but very few are. Governments must step up. There is action that lawmakers can learn from, from US anti-monopoly government enforcers suing Amazon in a landmark case, to the European Commission wanting Google to break up its online advertising business, and Africa’s historic fight to reshape international tax rules.”
Oxfam is calling on governments to rapidly and radically reduce the gap between the super-rich and the rest of society by:
- – Revitalizing the state. A dynamic and effective state is the best bulwark against extreme corporate power. Governments should ensure universal provision of healthcare and education, and explore publicly-delivered goods and public options in sectors from energy to transportation.
– Reining in corporate power, including by breaking up monopolies and democratizing patent rules. This also means legislating for living wages, capping CEO pay, and new taxes on the super-rich and corporations, including permanent wealth and excess profit taxes. Oxfam estimates that a wealth tax on the world’s millionaires and billionaires could generate $1.8 trillion a year.
– Reinventing business. Competitive and profitable businesses don’t have to be shackled by shareholder greed. Democratically-owned businesses better equalize the proceeds of business. If just 10 percent of US businesses were employee-owned, this could double the wealth share of the poorest half of the US population, including doubling the average wealth of Black households.
IPS UN Bureau Report