The richest 1% have more wealth than the rest of the world combined and just 62 people in the world, 53 of them men, have as much wealth as the poorest 360 crore people, revealed a report, ‘Economy For the 99%’, released by Oxfam at Davos on Monday.
Stating that “it’s obscene for so much wealth to be held in the hands of so few”, the report holds that the global economy is actually being run for just 1% of the rich and the powerful. It goes on to make the following points:
You can read the report here.
The report finds that the global economy has been growing, but as incomes and wealth have become detached from productivity and real added value in societies, people who work hard but who are not in positions of economic and political power have lost out.
“The share of income going to labour compared with capital is in decline, the gap between wages and productivity is growing and income inequality is slowing overall growth, further hurting the poorest people most and preventing millions of people from escaping poverty,” the report adds.
The bulk of the wealth in 2015 is actually held by just eight men—Bill Gates, Mark Zuckerberg, Jeff Bezos, Warren Buffet, Carlos Slim, Larry Ellison, Amancio Ortega and Michael Bloomberg, says the Oxfam report
The report examined how the wealthy and powerful have used economic systems and structures to their benefit, to the exclusion of others. This is most apparent in tax systems, where companies and individuals actively seek to reduce their tax burden through the use of complex accounting mechanisms and international loopholes.
“This increases their profits, channelling returns to shareholders as opposed to society in general; societies need tax revenues to fund essential public services and infrastructure, on which these companies and individuals also depend. The existence of tax havens in particular allows income and wealth to flow offshore, untaxed and in secret – a legal means created for the rich to stay rich and to prevent essential redistribution that would reduce inequality and benefit society overall,” it goes on to add.
Tax havens are an injustice that undermines the progressive principles upon which most tax systems are based. Until the rules are changed and there is fairer global governance of tax matters, tax dodging will continue to drain public budgets and undermine the ability of governments to tackle inequality.