Billionaire fortunes increased by 12 percent in 2018, or $2.5 billion a day, while the 3.8 billion people who make up the poorest half of humanity saw their wealth decline by 11 percent, reveals a new report from Oxfam.
According to the report dubbed ‘Public Good or Private Wealth’, the growing gap between the rich and the poor is undermining the fight against poverty thus damaging global economies and fueling public anger across the globe.
The report reveals that the number of billionaires has almost doubled since the financial crisis, with a new billionaire created every two days between 2017 and 2018, yet wealthy individuals and corporations are paying lower rates of tax than they have in decades.
The wealth of the world’s billionaires increased by $900bn in the last year alone and thus billionaires now have more wealth than ever before. Wealth is becoming even more concentrated – last year 26 people owned the same as the 3.8 billion people who make up the poorest half of humanity, down from 43 people the year before.
The world’s richest man, Jeff Bezos, owner of Amazon, saw his fortune increase to $112bn. Just 1 percent of his fortune is the equivalent to the whole health budget for Ethiopia, a country of 105 million people.
If all the unpaid care work done by women across the globe was carried out by a single company, it would have an annual turnover of $10 trillion27 – 43 times that of Apple.
The report has gone further to reveal how governments exacerbate inequality by underfunding public services, such as healthcare and education, on the one hand, while under-taxing corporations and the wealthy and failing to clamp down on tax dodging, on the other.
From the finding of the report, women and girls are hardest hit by rising economic inequality.
One of the great achievements in recent decades has been a huge reduction in the numbers of people living in extreme poverty, defined by the World Bank as $1.90 per person per day. Yet new evidence from the World Bank also showed that the rate of poverty reduction halved since 2013. Extreme poverty, therefore, is actually increasing in sub-Saharan Africa.
Getting the richest one percent to pay just 0.5 percent extra tax on their wealth could raise more money than it would cost to educate the 262 million children out of school and provide healthcare that would save the lives of 3.3 million people.
Just four cents in every dollar of tax revenue collected globally came from taxes on wealth such as inheritance or property in 2015. These types of tax have been reduced or eliminated in many rich countries and are barely implemented in the developing world.
In some countries, such as Brazil, the poorest 10 percent of society are now paying a higher proportion of their incomes in tax than the richest 10 percent.
At the same time, public services are suffering from chronic underfunding or being outsourced to private companies that exclude the poorest people. In many countries, a decent education or quality healthcare has become a luxury only the rich can afford.
Every day 10,000 people die because they lack access to affordable healthcare. In developing countries, a child from a poor family is twice as likely to die before the age of five than a child from a rich family. In countries like Kenya, a child from a rich family will spend twice as long in education as one from a poor family.