The world’s richest 1 percent grabbed £4 out of every £5 of new wealth created in the world last year says the Oxfam charity.
Meanwhile the poorest half of the world saw the amount of money they had stagnate. And in its latest update to its indices of gross inequality, Oxfam found 42 people hold as much wealth as the poorest half of the world’s population.
Booming global stock markets, fuelled by money pumped out at low interest rates by governments, were the main reason for the increase in the wealth of the rich during 2017. The founder of Amazon, Jeff Bezos, saw his wealth rise by £4.3 billion in the first ten days of 2017.
Overall, of the £7.3 trillion increase in global wealth between July 2016 and June 2017, around £6 trillion (82 percent) went to 75 million people, while the bottom 3.7 billion saw no increase.
It helped spark the sharpest increase in the number of billionaires ever recorded, to 2,043, with one created every two days, according to Oxfam’s report. It was published ahead of the annual World Economic Forum of global political and business leaders in the Swiss ski resort of Davos.
The wealth of those billionaires increased by £550 billion over 12 months.
Mark Goldring, chief executive of Oxfam GB, said the statistics signal that “something is very wrong with the global economy”.
“The concentration of extreme wealth at the top is not a sign of a thriving economy but a symptom of a system that is failing the millions of hard-working people on poverty wages who make our clothes and grow our food.”
He said a living wage, “decent conditions” and equality for women were essential if work was to be a “genuine route out of poverty”.
“If that means less for the already wealthy then that is a price that we – and they – should be willing to pay,” Goldring added, as he pushed for a crackdown on tax avoidance and other measures.
Oxfam said tax avoidance by businesses and wealthy individuals is costing developing countries and poorer regions around £123 billion a year which could otherwise be allocated towards public services and “used to fight poverty”.
Capitalism is an engine for creating and accelerating a chasm between those at the top and the rest.
Under socialism, where the means of producing wealth would be collectively owned and democratically controlled, any meaningful inequality would be sharply reduced and then effectively eliminated.
This would be popular. An Oxfam survey found people believed the ideal ratio of the pay of those at the top and bottom of a company should be 7 to1. At present chief executives of big firms quoted on the London stock exchange earn on average 120 times more than the average employee.
The measures called for by Oxfam would be welcome, but the rich are very good at finding ways to avoid and evade taxes. A tenth of global wealth is held in tax havens.
And to win such reforms will take a war on all the mantras of the last 40 years about the need to slash taxes for companies and the rich, shrink the welfare state and weaken trade unions.
The ruling class has greeted the prospect of Jeremy Corbyn as prime minister with a mix of fear, outrage and preparation for resistance. Imagine how they would react to a government that really started to address not just the rise in inequality but the driver of inequality in the first place—capitalism.
Large and growing inequality is another reason for revolution.
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