It's a boom time for billionaires. As for everyone else, not so much. More billionaires were minted in 2017 than in any other year in history, according to a new report from the charity Oxfam International, which will present its findings at the annual meeting of the World Economic Forum in Davos, Switzerland.
While the world's economies are growing, four-fifths of the wealth created in 2017 was claimed by the top 1% of income earners, the report found.
Income inequality is worsening across the globe, which has a corrosive impact on social institutions, the standard of living for the poor and near-poor, and is linked to political unrest, Oxfam said. The dangers of inequality aren't a new rallying point, yet despite a lip service lawmakers and the rich pay to it, the wealthy continue to pull away from the poor and middle class, CBSnews reported.
"In the last year, there has been a new billionaire created every two days, and of the wealth that got created, the top 1% got 82% of it, and the poorest half got nothing," said Paul O'Brien, vice president for policy and advocacy at Oxfam America, a nonprofit institution, focused on alleviating poverty. "That means 3.7 billion people got nothing of that new wealth."
The wealth boom tends to reward men, while women are predominately drawing the short straw. Structural issues such as the gender pay gap, a devaluation of women and their contributions, and discrimination are contributing factors to women's weaker economic positions, Oxfam said.
It noted that women have fewer economic rights than men in 155 countries, including 18 where husbands can legally prevent their wives from working.
Rank and File Excluded in US
US President Donald Trump, who is heading to Davos to attend the meeting, recently signed a new law that provides tax cuts for corporations and the rich, while middle- and low-income workers are receiving smaller reductions that will expire in a decade.
"The real issue is Donald Trump campaigned that he would unrig the rules in favor of giving hardworking Americans a better chance to lift them out of poverty, and as he heads to Davos, there are very few people who think he represents those issues," O'Brien said.
A few companies, including Walmart, have recently cited the tax bill in boosting wages, yet critics say the prime beneficiaries will be the richest Americans, not the rank and file.
Republicans argue that a growing economy will lift all boats, but Oxfam's view is that better policy would be to fund social services like education and health care.
The facts don't bear out the belief, held by some, that billionaires will create new jobs, O'Brien said. "We're seeing lots of new billionaires, but we aren't seeing new wealth," he added.
India’s Richest 1%
The richest 1% in India cornered 73% of the wealth generated in the country last year, Oxfam report showed, presenting a worrying picture of rising income inequality, even in India. Last year’s survey had showed that India’s richest 1% held 58% of the country’s total wealth—higher than the global figure of about 50%.
Besides, 670 million Indians comprising the population’s poorest half saw their wealth rise by just 1%, as per the survey.
The report titled ‘Reward Work, Not Wealth’, Oxfam said, reveals how the global economy enables wealthy elite to accumulate vast wealth even as hundreds of millions of people struggle to survive on poverty pay.
Oxfam also sought sealing of the “leaking wealth bucket” by taking stringent measures against tax evasion and avoidance, imposing higher tax on super-rich and removing corporate tax breaks. The survey respondents in countries like the US, UK and India also favored 60% pay cut for CEOs.
More Findings
Here are more findings from Oxfam's report:
- There are now 2,043 billionaires across the globe. Nine out of 10 are men.
- In the last year, the wealth of the billionaires rose by $762 billion.
- Ordinary workers saw their income rise by an average of 2% a year from 2006 to 2015, while billionaire wealth rose 13% a year during the same period.
- The richest 1% own more wealth than whole of the rest of the world's population.
