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Well, a new report from Oxfam, an international NGO, shows — hold your breath — 1 per cent of the world’s population will soon own more wealth than the other 99 per cent combined, if governments don’t act on rising levels of income inequality.
Shocking!Particularly if you consider that the richest 1 per cent already own more than the total wealth of the poorest 50 per cent. Interestingly, the wealth of the poorest 50 per cent fell 41 per cent between 2010 and 2015. That, despite the fact that the planet added 400 million people during the same period.
Oh, that’s terrible.In 2010, the 388 richest people owned the same wealth as the poorest 50 per cent. This came down to 80 in 2014 before falling again to 62 in 2015. The wealth of the richest 62 people increased by $500 billion to $1.76 trillion during the very same period.
Can I get an itemised bill here?About 20 per cent of billionaires are mainly into financing and insurance. This group saw its cash swell up 11 per cent in the 12 months to March 2014. And, curiously, these sectors shelled out $550 million lobbying policymakers in the US and the EU during 2013. Further, billionaires with interests in pharmaceuticals and healthcare saw their total worth increase by 47 per cent. During 2013, they spent more than $500 million in lobbying.
I’m sure widening inequality hits efforts to fight poverty.You said it. The wealth of the super rich has skyrocketed at a time when one in nine people does not have enough to eat and more than a billion people still live on less than ₹75 a day.
But I have read quotable quotes from eminent personalities on plugging income gaps.Yes, the issue has been raised by the likes of Pope Francis and IMF chief Christine Lagarde, but on the ground things do not look that rosy. Nothing much is being done to ensure that those at the bottom of the income ladder get their fair share of economic growth, charges Oxfam.
But how do we fix this?Tough question, given how the ultra rich influence policymaking and political parties across the globe. Sample this: During the 2012 US presidential polls alone, the financial sector pumped in $571 million in campaign donations. Still, Oxfam is hopeful and suggests a three-pronged approach to tackle income inequality: crack down on tax evasion; invest more in public services; and raise wages for low-paid workers.
Checking tax evasion is a big ask as things stand now.The report calls for closing down tax havens. As you may know, several companies and members of the super rich make good use of such geographies to avoid paying tax. And as a result, they deprive governments of the resources needed to address poverty and inequality. According to Oxfam, rich individuals have moved nearly $7.6 trillion to offshore accounts.
OMG, that’s truckloads of cash!Yes, if these monies were reported to the concerned (pun intended) authorities, governments would have earned an extra $190 billion every year. Mind you, reports suggest about 30 per cent of all African financial wealth sits offshore. Had they been reported back home, it would have added at least $14 billion in tax revenues.
And this money is enough to back the healthcare needs of mothers and children, helping save 4 million children’s lives a year. It can also help governments employ enough teachers to get every African child into school, according to Oxfam’s research.
A weekly column that helps you ask the right questions
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