There is a new estimation which shows that just eight men own the same wealth as the poorest half of the world.
In a report published by Oxfam, it stated that as growth benefits the richest, the rest of society, especially the poorest, suffers.
“The very design of our economies and the principles of our economics have taken us to this extreme, unsustainable and unjust point. Our economy must stop excessively rewarding those at the top and start working for all people,” it wrote.
It also mentioned accountable and visionary governments, businesses that work in the interests of workers and producers, a valued environment, women’s rights and a strong system of fair taxation, are central to this more human economy.
It is four years since the World Economic Forum identified rising economic inequality as a major threat to social stability and three years since the World Bank twinned its goal for ending poverty with the need for shared prosperity.
Since then, and despite world leaders signing up to a global goal to reduce inequality, Oxfam said that the gap between the rich and the rest has widened, stressing that this cannot be allowed to continue.
As President Obama told the UN General Assembly in his departing speech in September 2016: ‘A world where 1% of humanity controls as much wealth as the bottom 99% will never be stable.’ Yet the global inequality crisis continues unabated:
- Since 2015, the richest 1 percent has owned more wealth than the rest of the planet.
- Eight men now own the same amount of wealth as the poorest half of the world.
- Over the next 20 years, 500 people will hand over $2.1 trillion to their heirs – a sum larger than the GDP of India, a country of 1.3 billion people.
- The incomes of the poorest 10 percent of people increased by less than $3 a year between 1988 and 2011, while the incomes of the richest 1 percent increased 182 times as much.
- A FTSE-100 CEO earns as much in a year as 10,000 people in working in garment factories in Bangladesh.
- In the US, new research by economist Thomas Piketty shows that over the last 30 years the growth in the incomes of the bottom 50 percent has been zero, whereas incomes of the top 1 percent have grown 300 percent.
- In Vietnam, the country’s richest man earns more in a day than the poorest person earns in 10 years.
Oxfam stressed that growing inequality threatens to pull our societies apart, which in the end increases crime and insecurity, and undermines the fight to end poverty.
From Brexit to the success of Donald Trump’s presidential campaign, Oxfam said that a worrying rise in racism and the widespread disillusionment with mainstream politics, there are increasing signs that more and more people in rich countries are no longer willing to tolerate the status quo.
“Why would they, when experience suggests that what it delivers is wage stagnation, insecure jobs and a widening gap between the haves and the have-nots?” it asked.
Hundreds of millions of people have been lifted out of poverty in recent decades. An achievement of which the world should be proud, it noted. Yet one in nine people still go to bed hungry.
“Had growth been pro-poor between 1990 and 2010, 700 million more people, most of them women, would not be living in poverty today,” Oxfam said.
Research finds that three-quarters of extreme poverty could in fact be eliminated now using existing resources, by increasing taxation and cutting down on military and other regressive spending.
The World Bank is clear that without redoubling their efforts to tackle inequality, world leaders will miss their goal of ending extreme poverty by 2030.
There are several reason which cause the inequality. The main keys are corporations work for those at the top, squeezing workers and producers, dodging tax, super-charged shared holder capitalism, crony capitalism, the role of the rich in the inequality crisis, avoiding tax, and buying politics.
However, there are false assumptions which drive the economy of the 1 percent. The IMF has identified neoliberalism as a key cause of growing inequality and stated that unless we tackle these false assumptions, we will be unable to turn the situation around:
- The market is always right, and the role of governments should be minimized.
- Corporations need to maximize profits and returns to shareholders at all costs.
- Extreme individual wealth is benign and a sign of success, and inequality is not relevant.
- GDP growth should be the primary goal of policy making.
- Our economic model is gender-neutral.
- Our planet’s resources are limitless.
There is a need to create a new common sense, and turn things on their head to design an economy whose primary purpose is to benefit the 99 percent, not the 1 percent. Work to be done to create a more human economy that benefits everyone, not just the privileged few. A human economy which would create fairer, better societies.
A human economy would have a number of core ingredients aimed at tackling the problems that have contributed to today’s inequality crisis.
- Governments will work for the 99 percent.
- Governments will cooperate, not just compete.
- Companies will work for the benefit of everyone.
- Ending the extreme concentration of wealth to end extreme poverty.
- A human economy will work equally for men and women.
- Technology will be harnessed for the interests of the 99 percent.
- A human economy will be powered by sustainable renewable energy.
- Valuing and measuring what really matters.
“We can and must build a more human economy before it is too late,” Oxfam stressed.
The world’s 8 richest people are, in order of net worth:
- Bill Gates: America founder of Microsoft (net worth $75 billion)
- Amancio Ortega: Spanish founder of Inditex which owns the Zara fashion chain (net worth $67 billion)
- Warren Buffett: American CEO and largest shareholder in Berkshire Hathaway (net worth $60.8 billion)
- Carlos Slim Helu: Mexican owner of Grupo Carso (net worth: $50 billion)
- Jeff Bezos: American founder, chairman and chief executive of Amazon (net worth: $45.2 billion)
- Mark Zuckerberg: American chairman, chief executive officer, and co-founder of Facebook (net worth $44.6 billion)
- Larry Ellison: American co-founder and CEO of Oracle (net worth $43.6 billion)
- Michael Bloomberg: American founder, owner and CEO of Bloomberg LP (net worth: $40 billion)
Oxfam’s calculations are based on global wealth distribution data provided by the Credit Suisse Global Wealth Data book 2016
The wealth of the world’s richest people was calculated using Forbes’ billionaires list last published in March 2016.