World

World’s super rich are rigging and profiting off the cost of living crisis, report

It’s all a lie. That age old motto of “hard work always pay off” might be worthless in today’s world of privilege, inherited wealth and political power.

A report by British-founded confederation Oxfam has found the world’s billionaires are amassing eye-watering wealth amid the cost of living crisis.

Survival of the rich

“While tens of millions more people are facing hunger, hundreds of millions more face impossible rises in the cost of basic goods or heating their homes. Poverty has increased for the first time in 25 years,” the report found.

At the same time, the ultra wealthy have become dramatically richer and corporate profits have hit record highs, driving an explosion of inequality.

The report found that a total of $42 trillion (R722.4 trillion, calculated at exchange rate of R17.20 to the US Dollar) in new wealth has been created since 2020 (during the global pandemic), with $26 trillion (R447.2 trillion), or 63%, of that being amassed by the top 1% of richest people on the planet.

The remaining 99% of the global population collected just $16 trillion (R275.2 trillion) of new wealth, said Oxfam.

Essentially: Every dollar (R17.20) earned by a person from the 99% is matched by an obscene $1.7 million (R29.2 million) for a billionaire.

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Combating inequality lies with taxing the rich

Oxfam argues that taxes targeting the rich allows revenue collection to play its redistributive function by constraining the growth of income and wealth inequalities.

Billionaire fortunes are increasing by $2.7billion (R46.4 billion) a day, even as inflation outpaces the wages of at least 1.7 billion workers. That’s more than the population of India.

While food and energy companies more than doubled their profits in 2022, paying out $257billion (R4.4 trillion) to wealthy shareholders. This was while over 800 million people went to bed hungry.

Only 4 cents in every dollar of tax revenue comes from wealth taxes,10 and half the world’s billionaires live in countries with no inheritance tax on money they give to their children.

A tax of up to 5% on the world’s multi-millionaires and billionaires could raise $1.7 trillion (R29.2 trillion) a year, which is enough to lift at least 2 billion people out of poverty, and fund a global plan to end hunger.

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Last year, the World Bank announced that we will fail to meet the goal of ending extreme poverty by 2030. In fact, attempts to even reduce poverty has grinded to a halt.

The International Monetary Fund (IMF) has predicted that third of the global economy will be in recession this year.

At least 1.7 billion workers worldwide will have seen inflation outpace their wages in 2022, a real-terms cut in their ability to buy food or keep the lights on.