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Wealth shock: 8 men own same as half of world's poorest

Jan 16 2017 10:26
Lameez Omarjee

Johannesburg – The gap between rich and the poor is widening, with the world’s richest eight men owning the same wealth as the poorest half of the world, research by Oxfam reveals.

In its latest inequality report, An economy for the 99%, the organisation explains that three-quarters of extreme poverty could be eliminated by using existing resources, increasing taxation and cutting down on military and “other regressive” spending.

Oxfam is launching the report to coincide with the 47th World Economic Forum annual meeting in Davos.

“Our economy must stop excessively rewarding those at the top and start working for all people,” the report stated. It called for accountable and visionary governments, and businesses that work in the interests of workers and producers.

Among the findings, research showed that since 2015 the richest 1% has owned more wealth than the rest of the planet. Over the next 20 years, 500 people will hand over $2.1trn to their heirs. This is larger than the gross domestic product of India, with a population of 1.3 billion people.

Furthermore, the incomes of the poorest 10% of people increased by less than $3 a year between 1988 and 2011. This contrasts with the incomes of the rich, which increased 182 times.

The World Bank has raised concerns that world leaders may not meet their goal of ending extreme poverty by 2030.

Oxfam listed tax evasion through the use of tax havens, corporations that work to benefit those at the top at the expense of those at the bottom and poor wages for workers as contributing factors.

How to solve the ills of inequality

The report proposes an economy redesign which benefits the world’s 99%, and not just the 1% who enjoy extreme wealth.

“Humanity has incredible talent, huge wealth and infinite imagination. We need to put this to work to create a more human economy that benefits everyone, not just the privileged few,” the report stated.

READ: 5 ways leaders can fix the world in 2017 - Klaus Schwab

Among the solutions suggested is an accountable government, which listens to all and not the “wealthy minority”. “We need to see a reinvigoration of civic space, especially for the voices of women and marginalized groups.” Governments must also cooperate to tackle the existence of tax havens.

Companies should work to benefit everyone, the report stated. “The proceeds of business activity should go to those who enabled and created them – society, workers, and local communities.” Governments should also support corporations that pay fair wages and fair taxes, and which take into account the impact of their operations on the environment.

The report also suggests that the rich pay a wealth tax for their high incomes.

ALSO READ: Pravin Gordhan’s 10-point solution to tax evasion

Gender equality should be addressed, and barriers to women’s progress must end.

Also, governments should ensure that innovation and technology work to reduce inequality, and not drive it.

Sustainable renewable energy should also come to the fore to ensure the sustainability of the planet.

Finally, it suggests that progress not be measured by GDP. “(It) must reflect not just the scale of economic activity, but how the income and wealth are distributed.” Ensuring a better world for today for future generations is a better measure of the progress of societies, the report stated.

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oxfam  |  economy  |  wef 2017  |  inequality

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