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South Africa is still the most of the unequal country in the world, while Oxfam estimates it will take 230 years to end global poverty at current rates.
Meanwhile the wealthiest five men in the world have doubled their fortunes since 2020 and we could see the first trillionaire on earth within the next ten years.
While the five richest men got richer, from $405 billion in 2019 to $869 billion by 2024, 4.8 billion people across the globe became poorer and hardship and hunger are now a daily reality for many people, according to Oxfam’s latest briefing paper, Inequality Inc. released this week.
The organisation estimates that of the five wealthiest people in the world spend $1 million per day, their riches will only be depleted after 476 years.
The world’s richest 1% own 43% of all global financial assets, while men own US$105 trillion more wealth than women, a difference equivalent to more than four times the size of the US economy. The wealthiest 1% also globally emit as much carbon pollution as the poorest two-thirds of humanity.
This wealth is concentrated in the Global North, Oxfam says. Only 21% of humanity lives in the countries of the Global North, but these countries are home to 69% of private wealth and 74% of the world’s billionaire wealth.
The other big winners in this period of crisis are global corporations. For huge corporations, just as for super-rich individuals, the last two decades have been extraordinarily lucrative and the last few years have been better still: the biggest firms experienced an 89% leap in profits in 2021 and 2022, Oxfam says.
New data shows that 2023 is set to shatter all records as the most profitable year yet and 82% of these profits will benefit shareholders who are already overwhelmingly among the richest people in every society.
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Corporate power fuels inequality by rewarding the wealthy and not the workers, dodging taxes, privatising public services and driving climate breakdown, but Oxfam says it does not have to be this way.
Instead, Oxfam says governments must set goals and plans to radically reduce inequality fast and the richest governments have a particular responsibility given their disproportionate influence in setting global rules and norms.
Corporate power can be reined in by revitalising the state, regulating corporations and reinventing business. “Governments must use their power to rein in the runaway power of corporates and prevent injustices across their supply chains.”
Oxfam says for years it has raised the alarm about widening and extreme inequality. “As we enter 2024, the very real danger is that these extraordinary extremes are becoming the new normal. Corporate and monopoly power, as this paper shows, is an unrelenting inequality-generating machine.”
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The 2020s offer opportunities for leaders to take our world in a bold, new, fairer direction, the organisation says, but this is yet to happen. “An era of widening inequality has coincided with a narrowing of economic imagination.
“We are living through what appears to be the start of a decade of division: in just three years, we experienced a global pandemic, war, a cost-of-living crisis and climate breakdown. Each crisis widened the gulf: not so much between the rich and people living in poverty, but between an oligarchic few and the vast majority.”
The paper also demonstrates a huge disparity between white and black households, with the wealth of a typical black household in the US just 15.8% of that of a typical white household. In Brazil, on average the income of white people is more than 70% higher than those of Afro-descendants.
When it comes to wages, just 0.4% of over 1 600 of the world’s largest and most influential companies are publicly committed to paying their workers a living wage and support payment of a living wage in their value chains.
According to the paper it will take 1 200 years for a female worker in the health and social sector to earn what a CEO in the biggest Fortune 100 companies earns on average in one year.
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Oxfam says a huge concentration of global corporate and monopoly power is exacerbating inequality economy-wide, with seven out of ten of the world’s biggest corporates having either a billionaire CEO or a billionaire as principal shareholder.
“Through squeezing workers, dodging tax, privatising the state and spurring climate breakdown, corporations are driving inequality and acting in the service of delivering ever greater wealth to their rich owners.”
To end extreme inequality, governments must radically redistribute the power of billionaires and corporations back to ordinary people, Oxfam says. “A more equal world is possible if governments effectively regulate and reimagine the private sector.”
Oxfam also notes that prices are outpacing pay the world over, with hundreds of millions of people seeing their wages buy less each month and their prospects of a better future disappear. Climate breakdown, driven by the super-rich, is dramatically increasing global inequality.
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