62 people own same wealth as half the world

Runaway inequality has created a world where 62 people own as much wealth as the poorest half of the world’s population – a figure that has fallen from 388 just five years ago, according to an Oxfam report published today ahead of the annual gathering of the world’s financial and political elites in Davos.

Runaway inequality has created a world where 62 people own as much wealth as the poorest half of the world’s population – a figure that has fallen from 388 just five years ago, according to an Oxfam report published today ahead of the annual gathering of the world’s financial and political elites in Davos.

An Economy for the 1%

Oxfam’s new report, An Economy for the 1%, shows that the wealth of the poorest half of the world’s population has fallen by a trillion dollars since 2010, a drop of 38 per cent. This has occurred despite the global population increasing by around 400 million people during that period. Meanwhile the wealth of the richest 62 people has increased by more than half a trillion dollars to US$1.76 trillion.

Although world leaders have increasingly talked about the need to tackle inequality, and in September agreed a new Global Goal to reduce it, the gap between the richest and the rest has widened dramatically in the past 12 months. Oxfam’s prediction, made ahead of last year’s Davos meeting, that the richest 1% would soon own more than the remaining 99% combined, actually came true in 2015 – a year earlier than expected.

Rachael Le Mesurier, Executive Director of Oxfam New Zealand, said, “It is simply unacceptable that the poorest half of the world’s population owns no more than a few dozen super-rich people who could fit onto one bus.

“World leaders’ concern about the inequality crisis hasn’t translated into concrete action – the world has become a much more unequal place and the trend is accelerating. We cannot continue to allow hundreds of millions of people to go hungry while resources that could be used to help them are sucked up by those at the top.”

End tax havens

As a priority, Oxfam is calling for an end to the era of tax havens. The increasing use of these offshore centres by rich individuals and companies to avoid paying their fair share to society has denied governments valuable resources needed to tackle poverty and inequality.

“Tax havens are unjust. While the vast majority of us pay the taxes that are vital for countries to function effectively, hyper-rich elites and multinational companies refuse to pay up. They have rewritten the rules of the game. The fact that 188 of 201 leading companies have a presence in at least one tax haven shows it is time to act,” said Le Mesurier.

Globally, it is estimated that a total of US$7.6 trillion of individuals’ wealth sits offshore. If tax were paid on the income that this wealth generates, an extra US$190 billion would be available to governments every year.

Save 4 million children’s lives

As much as 30 per cent of all African financial wealth is estimated to be held offshore, costing an estimated US$14 billion in lost tax revenues every year. This is enough money to pay for healthcare that could save 4 million children’s lives a year, as well as employing enough teachers to get every African child into school.

In addition to the wealth of individuals, it is estimated that tax dodging by multinational corporations costs developing countries at least US$100 billion every year. Corporate investment in tax havens almost quadrupled between 2000 and 2014.

Le Mesurier added, “The richest can no longer pretend their wealth benefits everyone. In fact, extreme inequality is a sign of an ailing global economy. This explosion in the wealth of the super-rich has come at the expense of the majority – and in particular, the world’s poorest people.”

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