By Winnie Byanyima
Executive Director, Oxfam International
The combined wealth of the richest 1 percent will overtake that of the other 99 percent of people next year unless the current trend of rising inequality is checked, Oxfam warned the annual World Economic Forum prior to its meeting in Davos, Switzerland January 21-24, 2015.
The explosion in inequality is holding back the fight against global poverty at a time when 1 in 9 people do not have enough to eat and more than a billion people still live on less than $1.25-a-day.
I called for urgent action to stem this rising tide of inequality, starting with a crackdown on tax dodging by corporations, and to push for progress towards a global deal on climate change.
Wealth: Having It All and Wanting More, a research paper by Oxfam, shows that the richest 1% have seen their share of global wealth increase from 44 percent in 2009 to 48 percent in 2014 and at this rate will possess more than 50% in 2016. Members of this global elite had an average wealth of $2.7 million per adult in 2014. The bottom 80% share just 5.5 percent and had an average wealth of $3,851 per adult.
In the past year we’ve seen world leaders from President Obama to Christine Lagarde (Managing Director of the IMF) talk about tackling extreme inequality but we’re still waiting for them to walk the walk. It’s time our leaders took on the vested interests that stand in the way of a fairer and more prosperous world.
Lady Lynn Forester de Rothschild, Chief Executive Officer of E.L. Rothschild and chairman of the Coalition for Inclusive Capitalism, who spoke at a joint Oxfam-University of Oxford event on inequality, called on business leaders meeting in Davos to play their part in tackling extreme inequality.
She said: Oxfamís report is just the latest evidence that inequality has reached shocking extremes, and continues to grow. It is time for the global leaders of modern capitalism, in addition to our politicians, to work to change the system to make it more inclusive, more equitable and more sustainable.
Extreme inequality isn’t just a moral wrong. It undermines economic growth and it threatens the private sector’s bottom line.”
Oxfam International is calling on governments to adopt a seven point plan to tackle inequality:
1. Clamp down on tax dodging by corporations and rich individuals
2. Invest in universal, free public services such as health and education
3. Share the tax burden fairly, shifting taxation from labor and consumption towards capital and wealth
4. Introduce minimum wages and move towards a living wage for all workers
5. Introduce equal pay legislation and promote economic policies to give women a fair deal
6. Ensure adequate safety-nets for the poorest, including a minimum income guarantee
7. Agree on a global goal to tackle inequality.
Twenty percent of billionaires have interests in the financial and insurance sectors, a group which saw their cash wealth increase by 11 percent in the 12 months to March 2014. These sectors spent $550 million lobbying policy makers in Washington and Brussels during 2013. During the 2012 US election cycle alone, the financial sector provided $571 million in campaign contributions. Billionaires listed as having interests in the pharmaceutical and healthcare sectors spent more than $500 million lobbying policy makers in Washington and Brussels.
See the full Oxfam research report here: httpss://www.oxfam.org/en/research/wealth-having-it-all-and-wanting-more