In 2017, 82% of New Wealth Went to the Top 1%—While the Poor Got Nothing

Jon Queally

New report finds skyrocketing wealth growth among the already rich is coupled with stagnant wages and persistent poverty among the lowest economic rungs of society. (Maslowski Marcin / Shutterstock.com)

This orig­i­nal­ly appeared on Com­mon Dreams.

Call it the Year of the Billionaire.’

In 2017, a new bil­lion­aire was cre­at­ed every two days and while 82 per­cent of all wealth cre­at­ed went to the top 1 per­cent of the world’s rich­est while zero per­cent — absolute­ly noth­ing — went to the poor­est half of the glob­al population.

That trou­bling infor­ma­tion is includ­ed in Oxfam’s lat­est report on glob­al inequal­i­ty — titled Reward Work, Not Wealth—released Mon­day. In addi­tion to the above, the report details how sky­rock­et­ing wealth growth among the already rich cou­pled with stag­nant wages and per­sis­tent pover­ty among the low­est eco­nom­ic rungs of soci­ety means that just 42 indi­vid­u­als now hold as much wealth as the 3.7 bil­lion poor­est peo­ple on the planet.

The bil­lion­aire boom is not a sign of a thriv­ing econ­o­my but a symp­tom of a fail­ing eco­nom­ic sys­tem,” Win­nie Byany­i­ma, Oxfam’s exec­u­tive direc­tor of Oxfam Inter­na­tion­al. The peo­ple who make our clothes, assem­ble our phones and grow our food are being exploit­ed to ensure a steady sup­ply of cheap goods, and swell the prof­its of cor­po­ra­tions and bil­lion­aire investors.”

Among the report’s key findings:

  • Bil­lion­aire wealth has risen by an annu­al aver­age of 13 per­cent since 2010 – six times faster than the wages of ordi­nary work­ers, which have risen by a year­ly aver­age of just 2 per­cent. The num­ber of bil­lion­aires rose at an unprece­dent­ed rate of one every two days between March 2016 and March 2017.
  • It takes just four days for a CEO from one of the top five glob­al fash­ion brands to earn what a Bangladeshi gar­ment work­er will earn in her life­time. In the US, it takes slight­ly over one work­ing day for a CEO to earn what an ordi­nary work­er makes in a year.
  • It would cost $2.2 bil­lion a year to increase the wages of all 2.5 mil­lion Viet­namese gar­ment work­ers to a liv­ing wage. This is about a third of the amount paid out to wealthy share­hold­ers by the top 5 com­pa­nies in the gar­ment sec­tor in 2016.
  • Dan­ger­ous, poor­ly paid work for the many is sup­port­ing extreme wealth for the few. Women are in the worst work, and almost all the super-rich, nine out of ten, are men.

The report comes just as the world’s eco­nom­ic and polit­i­cal elite are set to open the World Eco­nom­ic Forum, held annu­al­ly in Davos, Switzer­land. And why the glob­al elite argue the sum­mit’s focus is address­ing the world’s most press­ing prob­lems, Oxfam found that the amount of new wealth which went to the world’s top one per­cent in 2017 was rough­ly $762 bil­lion — a fig­ure large enough, the group points out, to end extreme glob­al pover­ty sev­en times over.

What the report ulti­mate­ly expos­es, Mark Goldring, Oxfam GB chief exec­u­tive, told the Guardian, is a sys­tem that is fail­ing the mil­lions of hard­work­ing peo­ple on pover­ty wages who make our clothes and grow our food.”

For work to be a gen­uine route out of pover­ty we need to ensure that ordi­nary work­ers receive a liv­ing wage and can insist on decent con­di­tions, and that women are not dis­crim­i­nat­ed against,” he added. If that means less for the already wealthy then that is a price that we — and they — should be will­ing to pay.”

Not just cat­a­loging and lament­ing the met­rics of inequal­i­ty, the new report also puts forth a num­ber of pol­i­cy solu­tions that should be embraced by peo­ple and gov­ern­ments world­wide to reduce lev­els of inequal­i­ty and lift bil­lions of peo­ple out of extreme pover­ty. They include:

  • Lim­it returns to share­hold­ers and top exec­u­tives, and ensure all work­ers receive a min­i­mum liv­ing’ wage that would enable them to have a decent qual­i­ty of life. For exam­ple, in Nige­ria, the legal min­i­mum wage would need to be tripled to ensure decent liv­ing standards.
  • Elim­i­nate the gen­der pay gap and pro­tect the rights of women work­ers. At cur­rent rates of change, it will take 217 years to close the gap in pay and employ­ment oppor­tu­ni­ties between women and men.
  • Ensure the wealthy pay their fair share of tax through high­er tax­es and a crack­down on tax avoid­ance, and increase spend­ing on pub­lic ser­vices such as health­care and edu­ca­tion. Oxfam esti­mates a glob­al tax of 1.5 per­cent on bil­lion­aires’ wealth could pay for every child to go to school.

Though Oxfam has been cal­cu­lat­ing glob­al inequal­i­ty on an annueal basis for more than a decade, the anti-pover­ty group notes that this year’s report used new data from Cred­it Suisse and a sep­a­rate kind of mod­el. Specif­i­cal­ly, Oxfam not­ed, the fact that the world’s 42 rich­est bil­lion­aires have as much wealth as the poor­est bot­tom half can­not be com­pared to fig­ures from pre­vi­ous years — includ­ing the 201617 sta­tis­tic that eight men owned the same wealth as half the world — because it is based on an updat­ed and expand­ed data set pub­lished by Cred­it Suisse in Novem­ber 2017. When Oxfam recal­cu­lat­ed last year’s fig­ures using the lat­est data we found that 61 peo­ple owned the same wealth as half the world in 2016 – and not eight.”

Jon Queal­ly is senior edi­tor and staff writer for Com­mon Dreams.
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