For every new billionaire created during the pandemic (one every 30 hours), nearly a million people are pushed into extreme poverty in 2022 at nearly the same rate, said Oxfam.
The new Oxfam brief “Profiting from Pain” is published as the World Economic Forum takes place for the first time face-to-face since COVID-19, a period during which billionaires have enjoyed a huge boost to their fortunes,
“’Billionaires are arriving in Davos to celebrate an incredible surge in their fortunes. The pandemic and now the steep increases in food and energy prices have, simply put, been a bonanza for them. Meanwhile, decades of progress on extreme poverty are now in reverse and millions of people are facing impossible rises in the cost of simply staying alive,” said Gabriela Bucher, Executive Director of Oxfam International.
BEST TIMES FOR THE BILLIONAIRES
The Brief said that as billionaires gather in Davos. Switzerland, in person for the first time in over two years, they have a lot to celebrate. “During the COVID-19 pandemic their mountain of wealth has reached unprecedented and dizzying heights. The pandemic – full of sorrow and disruption for most of humanity – has been one of the best times in recorded history for the billionaire class,” the Oxfam said,
The brief shows that 573 people became new billionaires during the pandemic, at the rate of one every 30 hours. The Oxfam said that 263 million more people are expected this year who will crash into extreme poverty, at a rate of a million people every 33 hours.
Billionaire’ wealth has risen more in the first 24 months of COVD-19 than in 23 years combined. The total wealth of the world’s billionaires is now equivalent to 13.9 percent of global GDP. This is a three-fold increase (up from 4.4 percent) in 2000.
Billionaires fortunes have not increased because they are now smarter or working harder. Workers are working harder, for less pay and in worse conditions. The super-rich have rigged the system with impunity for decades and they are now reaping the benefits. They have seized a shocking amount of the world’s wealth as a result of privatization and monopolies, gutting regulation and workers’ rights while stashing their cash in tax havens — all with the complicity of governments,” said Bucha.
SUFFERING OF THE ORDINARY
The Oxfam brief said that ordinary people are suffering all over the world. Prices everywhere are rising – of flour, cooking oil, fuel, electricity. People everywhere are being forced to cut back, forced to face the cold rather than heat their homes. Forced to skip medical care to ensure that there is food on the table. Parents forced to pick which – if any – of their children they can afford to send to school, it said.
Meanwhile, millions of others are skipping meals, turning off the heating, falling behind on bills and wondering what they can possibly do next to survive. Across East Africa, one person is likely dying every minute from hunger. “This grotesque inequality is breaking the bonds that hold us together as humanity. It is divisive corrosive and dangerous. This is inequality that literally kills,” Bucher,
RECORD-HIGH PROFITS
Oxfam’s new research also reveals that corporations in the energy, food and pharmaceutical sectors — where monopolies are especially common – are posting record-high profits, even as wages have barely budged and workers struggle with decades-high prices amid COVD-19. The fortunes of food and energy billionaires have risen by 453 billion dollar in the last two years, equivalent to one billion dollar every two days. Five of the largest energy companies (BP, Shell, TotalEnergies, Exxon and Chevron) are together making 2,600 dollars profit every second, and there are now 62 new food billionaires,
The pandemic has created 40 new pharma billionaires. Pharmaceutical corporations like Moderna and Pfizer are making $1,000 profit every second just from their monopoly oontrol of the COVID-19 vaccine, despite its development having been supported by billions of dollars in public investments. They are charging governments up to 24 times. more than the potential cost of generic production. 87 percent of people in low-income countries have still not been fully vaccinated,
The extremely rich and powerful are profiting from pain and suffering. This is unconscionable, the brief said. “Some have grown rich by denying billions of people access to access, others by exploiting rising food and energy prices. They are paying out massive bonuses and dividends while paying as little tax as possible. This rising wealth and rising poverty are two sides of the same coin, proof that our economic system is functioning exactly how the rich and powerful designed it to do, said Bucher,
SOME MAJOR FINDINGS
- The combined crises of COVID-19, rising inequality, and rising food price could push as many as 263 million people into extreme poverty in 2022, reversing decades of progress. This is the equivalent of one million people every 33 hours.. At the same time a new billionaire has been minted on average every 30 hours during the pandemic.
- This means that in the same time it took on average to create a new billionaire during the pandemic, one million people could be pushed into extreme poverty this year.
WEALTH INEQUALITY
- These billionaires are collectively worth $12.7 trillion – a real-tems increase of $3.78 trillion (42%) during the COVID-19 pandemic.
- Total billionaire wealth is now the equivalent of 13.9% of global gross domestic product (GDP), up from 4.4% in 2000, – The richest 10 men have greater wealth than the poorest 40% of humanity combined.
- The richest 20 billionaires are worth more than the entire GDP of sub-Saharan Africa.
- Elon Musk, the wealth iest man in the world, is so rich that he could lose 99% of his wealth and still be in the top 0.0001% of the world’s richest people. Since 2019 his wealth has increased by 699%.
INCOME INEQUALITY
- The incomes of the richest have already recovered rapidly from the hit they took at the beginning of the pandemnic while the incomes of the poorest have yet to recover, which is driving up income inequality.
GENDER INEQUALITY
- In 2020, there were 3 million fewer women in employment compared with 2019, while men’s employment recovered to 2019 levels
- More than four million women workers have not been able to return to work in Latin America and the Caribbean, a trend driven by high levels of informal employment and increased care work.
RACIAL INEQUALITY
- 3.4 million more Black Americans would be alive today if their life expectancy was the same as White people. Before COVID -19, that alarming number was already 2.1 million
- Half of all working women of colour in the US earn less than $15 an hour, a widely used threshold for distinguishing low-wage workers in that country,
HEALTH INEQUALITY
- An estimated 5.6 million people die in poor countries every year due to lack of access to healthcare. That is more than 15,000 people every day.
INEQUALITY BETWEEN COUNTRIES
- Debt servicing for all the world’s poor countries is estimated at $43 billion in 2022 – equivalent to nearly half their food import bills and public spending on health care combined. In 2022, debt represented 71% of all spending on healthcare, education and social protection combined for low-income countries
- 87 per cent of Covid 19 loans made by the International Monetary Fund (IMF) come with conditions that demand that low- and middle-income county tough austerity measures that will further exacerbate poverty and inequality.
- 60% of low-income countries are now on the brink of debt distress.
RECOMMENDATIONS
- Introduce one-off solidarity taxes on billionaires’ pandemic windfalls to fund support for people facing rising food and energy costs and a fair and sustainable recovery from COVID-19. Argentina adopted a one-off special levy dubbed the ‘millionaire’s tax’ and is now considering introducing a windfall tax on energy profits as well as a tax on undeclared assets held overseas to repay IMF debt. The super-rich have stashed nearly $8 trillion in tax havens
- End crisis profiteering by introducing a temporary excess profit tax of 90 percent to capture the windfall profits of big corporations across all industries. Oxfam estimated that such a tax on just 32 super-profitable multinational companies could have generated $104 billion in revenue in 2020.
- Introduce permanent wealth taxes to rein in extreme wealth and monopoly powa, as well as the outsized carbon emissions of the super-rich. An annual wealth tax on millionaires starting at just 2 percent, and 5 percent on billionaires, could generate $2.52 trillion a year-enough to lift 2.3 billion people out of poverty, make enough vaccines for the world, and deliver universal health care and social protection for everyone living in low- and lower middle-income countries