EIGHT billionaires own the same wealth as the 3.6 billion people who form the poorest half of the world’s population, new research reveals.
A report published today, as global political and business elites gather in Davos for the annual World Economic Forum, shows the gap between rich and poor is far greater than had been feared.
“This year’s snapshot of inequality is clearer, more accurate and more shocking than ever before,” said Mark Goldring, GB chief executive of Oxfam, which published the report. “It is beyond grotesque that a group of men who could easily fit in a single golf buggy own more than the poorest half of humanity.
“While one in nine people on the planet will go to bed hungry tonight, a small handful of billionaires have so much wealth they would need several lifetimes to spend it. The fact that a super-rich elite are able to prosper at the expense of the rest of us at home and overseas shows how warped our economy has become.
“Inequality is not only keeping millions of people trapped in poverty, it is fracturing our societies and poisoning our politics. It’s just not right that top executives take home massive bonuses while workers’ wages are stagnating, or that multinationals and millionaires dodge taxes while public services are being cut.”
The charity is calling for a more human economy where markets are better managed in order to ensure no-one is left out or denied basic rights such as decent work, healthcare and education.
Key features would include improved co-operation between governments to prevent tax dodging that costs poor countries at least £82 billion a year; government action to encourage companies to act for the benefit of their workforces and wider society as well as executives and shareholders; taxes on wealth to generate funds for healthcare, education and job creation; and action to tackle the barriers that hold back women including lack of education opportunities and the burden of unpaid care work.
Oxfam is also calling on business leaders to play their part in creating a more human economy by committing to pay both a living wage and their fair share of tax. The report highlights progressive business practices such as Spanish multinational Mondragon, owned by its 74,000-strong workforce, which structures pay to ensure the highest-paid employee earns no more than nine times the lowest.
In the UK, the average pay of FTSE100 chief executives is 129 times that of the average employee – and equivalent to the earnings of 10,000 people working in garment factories in Bangladesh. Investors’ share of UK corporate profits has soared to 70 per cent from 10 per cent in the 1970s, meaning that less is being reinvested in workers and the long-term health of the business. Meanwhile, pension funds’ holdings of UK shares have plummeted from 30 per cent 30 years ago to just three per cent today.
“Extreme inequality isn’t inevitable – with the right policies, world leaders can rebalance our broken economies so they work for all of us and bring the end of poverty closer,” said Dr Katherine Trebeck, Oxfam GB senior researcher, who is based in Scotland.
“The extreme economic inequality challenge is global, but action to tackle it is needed at national level too. On these issues, Scotland is already much more awake – but it’s still hiding under the covers. It has been great to see and hear increasing commitment to tackling economic inequality in Scotland – now let’s get the changes needed implemented to bring about real change, with the new Inequality Commission promised by the Scottish Government a significant opportunity.”
During the World Economic Forum, people are being urged to sign a petition asking the world’s 1,810 billionaires to help build an economy that works for everyone.
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