The richest 1% of the population has accumulated almost two-thirds of the new wealth (valued at $42 trillion), generated globally between December 2019 and December 2021, almost twice as much as the remaining 99% of Humanity.
According to a new report by Oxfam Intermón, ‘The Law of the Richest’, which is published to coincide with the start of the World Economic Forum in Davos, during the last decade, the richest 1% has accumulated around 50% of the new wealth.
«Elites are gathering in a context where extreme wealth and extreme poverty in the world have increased simultaneously for the first time in 25 years,» said Franc Cortada, director of Oxfam Intermón.
The NGO explains that for every dollar of new global wealth that a person from the poorest 90% of humanity receives, a billionaire keeps 1.7 million dollars. Thus, the fortune of billionaires grows at a rate of 2.7 billion dollars a day.
In a decade, the number of billionaires and their wealth have doubled. Since 2020, the combined value of the wealth of Spanish billionaires has increased by nearly $3 billion, equivalent to an increase of about $3 million a day, according to Oxfam.
On the other hand, he warned that the current price crisis is also «a crisis of inequality», since, according to the World Bank, it would be the greatest increase in poverty and inequality between countries since the Second World War.
Specifically, he explained that the poorest countries allocate four times more resources to debt servicing («in the hands of rich creditors») than to public health services. As an example, he pointed out that in 2021 Brazil spent three times more on debt service than on investment in health.
«While the most vulnerable households suffer to fill the fridge or maintain an adequate temperature, the extraordinary growth of corporate profits in sectors such as energy and food has once again boosted the wealth of the richest,» he said.
According to the organization’s estimates, 95 major energy and food companies have more than doubled their profits by 2022, generating extraordinary profits totaling 306 billion, and allocating 257 billion (84%) to remunerate their wealthy shareholders. In Australia, the United States and the United Kingdom, these corporate profits have contributed to at least 50% of inflation growth.
The NGO also pointed out that at least 1.7 billion workers live in countries where inflation growth is higher than wage growth, and more than 820 million people worldwide (about one in ten) go hungry. «Women and girls often eat last and in smaller quantities at home, and account for nearly 60% of the world’s hungry population,» he stressed.
TOWARDS STRUCTURAL INEQUALITY IN SPAIN Regarding Spain, the organization has assured that, in 2008, the 1% with the greatest wealth concentrated 15.3% of total net wealth, and in 2021 it already represented 23.1%, approximately one out of every four euros. «The evolution of inequality in Spain is a worrying phenomenon: while salaries lose weight and purchasing power, large companies increase profits and wealth in Spain continues to concentrate in the hands of a few,» said Cortada.
Oxfam Intermón added that billionaires have also been affected by the current crisis and the value of their wealth is falling, but they manage to recover their profits quickly, above the country’s growth. «Quite the opposite of the reality of millions of households in Spain where making ends meet is an increasingly difficult task,» he said.
Between January and November 2022, as highlighted by the NGO, inflation has reduced the purchasing power of the worst-off households by 26% more than those with higher incomes.
Meanwhile, wages in real terms have fallen to levels similar to those experienced during the worst years of the 2008 crisis and are already 4% lower than they were then. At the same time, profits, especially of large companies, have been maintained and have even grown.
According to Oxfam Intermón, in 2021, the profit of IBEX 35 companies as a whole was 63% higher than in 2019, and 55% above the average of the results of the five pre-pandemic years (between 2015 and 2019). In the third quarter of 2022 they announced results 30% higher than in the same period of the previous year.
«We are facing a crisis fueled because some of the big companies and superrich have taken advantage of the context of uncertainty, the pandemic and the war in Ukraine and are taking advantage, inflating prices and margins, at the expense of a large majority,» said Cortada.
Thus, Oxfam Intermón asks the Spanish government to «immediately promote an income pact together with all social actors, to prevent wages from continuing to suffer the direct effect of inflation».
Among other issues, it calls for further tax reform to raise the rates applied to capital income to bring them into line with the tax treatment of labor; to strengthen the fight against tax evasion and avoidance; and to review taxes on profits and wealth tax.
As for social policies, it considers it «vital» to extend the coverage of the Minimum Vital Income (IMV), as well as to streamline procedures and requirements, together with social policies focused on the most vulnerable households and companies as long as the cost of living crisis continues.
Source: (EUROPA PRESS)