The world’s billionaires have amassed a fortune of £7.8 trillion through tax scams, inherited wealth—and the hard work of others.
You would have to spend almost £800 a day for 2,740 years before a billion ran out. As Luke Hildyard from the High Pay Centre says, it equates to a “fortune almost impossible to spend over multiple lifetimes of absolute luxury”.
Tesla boss Elon Musk has seen his fortune quadruple since the beginning of 2020. He now sits on almost £80 billion. And in August Amazon boss Jeff Bezos became the first person to be worth more than $200 billion—around £150 billion.
Supporters of the system claim profits are a “reward” for risks taken by capitalists.
If bosses make a wise investment, the argument goes, they should get the profits at the end of it.
UBS head Josef Stadler said billionaires had done “extremely well” during the coronavirus crisis because of their “significant risk appetite”.
Meanwhile, critics of free market capitalism say billionaires show the system is broken. Hildyard, for instance, argues the super-rich getting even richer is “a sign that capitalism isn’t working as it should”.
Both are wrong.
Profits are not a reward for risk. And billionaires are not an unfortunate side effect of unbridled capitalism. They are a product of capitalism—a profit system based on the exploitation of workers.
What’s become clearer during the pandemic and lockdowns, is that it’s not billionaires’ “risk appetite” that creates wealth. It’s workers’ labour.
That’s precisely why the Tories and bosses are so desperate to drive people back to work before it’s safe to get profits flowing again.
While workers’ labour is the source of value, they only get a small proportion of what they create back in wages. This gap is what Marxists call “surplus value”—which lays the basis for capitalists’ profits.
Even if some workers don’t directly produce profits, they are still integral to keep the profit system running. Without health or school workers, for instance, capitalism would find it harder to maintain a healthy, skilled workforce.
Bosses are undoubtedly greedy, but that’s not why they exploit workers. Competition forces them to invest into new technology and squeeze more out of workers in order to grab a bigger chunk of profit than rivals.
If bosses didn’t try to maximise profits at the expense of everything else, they’d be driven out of business.
Sometimes capitalists might borrow money for investments from banks or raise it on the stock exchange. Others have inherited fortunes or grab it through rents.
But that wealth, too, is based on value created by workers elsewhere in the system.
This system of capital accumulation creates exorbitant wealth alongside poverty.
Billionaires should not exist and their wealth should be used to meet the needs of the overwhelming majority in society.
We should tax the billionaires, abolish all rights of inheritance for the superrich, and fight for workers to have a bigger slice with higher wages.
But to get rid of billionaires altogether, we need to abolish the profit system and replace it with a socialist one geared towards meeting human need.
To be as rich as Amazon’s Jeff Bezos, you have to avoid tax.
In 2020 Amazon paid US federal income taxes for the first time in three years. Bezos’ profit-hungry empire said it paid $162 million in federal income taxes on $13.3 billion of US pre-tax income.
This is a tax rate of 1.2 percent—but the US corporate tax rate is 21 percent, lowered by Trump from 35 percent.
In 2018 and 2017, Amazon paid nothing in federal taxes on $11.2 billion and $5.6 billion profits. And in 2019 it paid just 3 percent of tax in Britain this year—despite profits rising by more than a third from the previous year.
Capitalists can avoid tax because the system is set up to let them.
Warren Buffett, the world’s seventh richest person, only paid 19 percent of tax from his income in 2006.
Yet his employees paid 33 percent. His response—“There’s class warfare, but it’s my class, the rich class, that’s making war, and we’re winning.”
Covid-19 has allowed billionaire tax evaders to benefit from tax‑funded assistance.
Over £16 billion of the Tories £30 billion lockdown stimulus package went straight into the pockets of billionaire-owned companies.
British billionaire James Ratcliffe, owner of chemical company Ineos, was one of the biggest benefactors of this.
His net worth grew from £8.75 billion to £13.83 billion during the three-month lockdown.
In 2010 Ratcliffe moved his companies’ head office from Hampshire to Switzerland, cutting the amount of tax his company paid by an estimated £100 million a year.
Virgin Atlantic boss Richard Branson’s net worth rose from £2.7 billion to £3.34 billion during the pandemic.
Virgin Atlantic has not paid corporation tax, which is a tax on profits, in two years according to its most recent accounts. It says this is because it has not made a profit.
In 2018 they received a tax credit of £22 million due to “losses”.
To maximise profits, bosses try to squeeze more out of workers through lower wages, longer hours and more surveillance at work.
One former Amazon warehouse worker, Emily Guendelsberger, wrote that they were treated like “robots”.
“Technology has enabled employers to enforce a work pace with no room for inefficiency, squeezing every ounce of downtime out of workers’ days,” she said.
“The scan gun I used to do my job was also my own personal digital manager. Every single thing I did was monitored and timed.
“After I completed a task, the scan gun not only immediately gave me a new one but also started counting down the seconds I had left to do it.”
It was exposed in 2011 that Amazon workers had to work in 38-degree heat in a Pennsylvania warehouse in the US.
Workers can also walk up to 15 miles during their shift and are reprimanded if they fall behind.
Amazon used surveillance to thwart workers joining a trade union and fighting to improve conditions.
A protest at a warehouse in New York led to the protest organiser being fired. And two Amazon employees were also sacked for circulating a petition about Covid-19 health risks.
The multi-billion company has a dark reputation for mistreating its workers.
In Britain billionaire Mike Ashley’s Sports Direct has been repeatedly called out over workplace conditions. In 2016 thousands of Sports Direct workers were owed back pay totalling almost £1 million, after the company admitted to not paying the national minimum wage.
Inequality flows from this system of exploitation.
In 2018 Walmart CEO Doug McMillon grabbed 1,188 times more than an average worker who earns £11 an hour. This low wage is still double the US minimum wage.
Clothing company Boohoo used factories with sweatshop conditions in Leicester, which led to an outbreak of Covid-19. Workers were paid as little as £3.50 an hour—well below the minimum wage.
It will come as no surprise that the owner of Boohoo, Mahmud Kamani, is a billionaire. These aren’t just extreme examples of a few greedy capitalists.
All bosses exploit workers—whether or not they pay the minimum wage or run a sweatshop.
If you are lucky enough to be born into a rich family, your chances of becoming a billionaire are greatly increased.
Family money means prospective billionaires can be given a helping hand to start up their company.
Billionaire US president Donald Trump was given a “very small” loan of $1 million by his father to start his company—or $60.7 million according to the New York Times.
And “self-made” billionaire Kylie Jenner launched her makeup brand using her family’s fame.
Bernard Arnault is the world’s sixth richest person, worth almost £80 billion.
He first worked for his family’s civil engineering company Ferret‑Savinel.
This gave him the financial springboard to later buy a luxury goods company, fashion houses Louis Vuitton and Christian Dior and department store Le Bon Marche.
The world’s richest woman, Francosie Bettencourt Meyers, made her fortune through family wealth. She is the chair of cosmetics company L’Oreal, which her mother was a leading shareholder of.
The Waltons—the family who own Walmart—hold a combined wealth of over £200 billion.
Rob, Jim and Alice, the children of Walmart founder Sam Walton, have consistently been in the top twenty of the Forbes 400 rich list since 2001.
The money they were gifted will have been produced through the same exploitative methods.
The quicker route to becoming a billionaire through family money does not mean billionaires who didn’t inherit are more deserving of their cash. In both scenarios, there is no such thing as a “self-made” capitalist—their wealth is made off the backs of workers’ labour.