Oxfam report says Australia’s billionaires and world’s richest men have doubled their wealth during the pandemic
As the world grapples with lockdowns, supply chain issues and economic chaos, 99% of humanity is worse off due to COVID-19, but “billionaires have had a terrible pandemic “, according to a new report.
- New Oxfam report finds inequality has worsened during the pandemic
- Charity says World Bank predicted COVID-19 pushed more than 160 million people into poverty
- Oxfam calls on governments to consider a one-time 99% wealth tax on windfall gains related to COVID-19
Over the past two years, the wealth of Australia’s 47 billionaires has doubled to $255 billion.
That’s more wealth in the hands of 47 people than about 7.7 million Australians.
Globally, the 10 richest men in the world more than doubled their fortunes to $1.9 trillion, at a rate of $1.6 billion a day.
Here are some of the many eye-catching figures of Oxfam’s latest report, Inequality Kills, which was released as global business leaders gather virtually this week for the World Economic Forum (WEF) in Davos, Switzerland.
“We have a situation where 10 men hold more wealth than two-thirds of humanity,” Lyn Morgain, chief executive of Oxfam Australia, told ABC’s RN program.
“Not only that, but that bottom 40% is hanging by a thread.”
The report highlights what the charity says are “unprecedented” levels of global inequality as COVID-19 widens the gap between “haves and have-nots”.
Best year ever for the super rich
The booming wealth of the super rich 10, which includes Tesla co-founder Elon Musk, Amazon’s Jeff Bezos and Facebook’s Mark Zuckerberg, has seen the strongest year-over-year growth since records began.
At a time when a group of these men were using their wealth to launch themselves into space, the charity said, the World Bank had projected that more than 160 million people had been pushed into poverty.
“Central banks pumped trillions of dollars into financial markets to save the economy, but much of that money ended up lining the pockets of billionaires in the midst of a stock market boom,” Ms Morgain said.
“There have been a significant number of people who have experienced some sort of windfall benefit due to the performance of the stock market.”
Twenty new “pandemic billionaires” have also been created in Asia thanks to the international response to COVID-19, according to the charity.
Oxfam is urging governments to consider a one-off 99% tax on wealth gains linked to COVID-19, calling the form of inequality “economic violence”.
The report says that, based on its findings and “conservative estimates”, inequality contributes to the deaths of at least 21,300 people every day.
“It is time for the Australian Government to take this issue seriously and take action to close the gap between rich and poor. We have calculated that an annual wealth tax of $30 billion would have a huge impact” , said Ms. Morgain.
What is a wealth tax?
A wealth tax is a tax on personal property, which can include cash, bank deposits and real estate.
Amanda Robbins, founder and chief executive of Equity Economics, said that when discussing a wealth tax, it was important to keep in mind that it did not involve attacking the housing of everyone. the world.
“It’s actually about the very rich, it’s so often called a billionaire’s tax,” she said.
“In Australia, around a few hundred people would potentially be affected, depending on the design of the wealth tax, so we have to be mindful not to think this is a tax that will hit everyone who works hard. .”
The difficulty with a wealth tax is that it encourages the wealthy to relocate their assets, so it requires a global conversation.
Ms Robbins said it was time for Australia to start participating in these discussions.
“It’s not just the poorest parts of the world that are experiencing growing wealth inequality,” she said.
“Australians have definitely experienced it to the point now that the richest 20% in Australia earn 90 times more than [those] at the lowest 20 percent.
“So that’s something Australia should think about. But of course the politics make it very difficult to implement.”
Asked about the issue of reducing inequality, Treasurer Josh Frydenberg told the ABC that a tax was not the answer.
Wealth tax could support vaccine rollout
The Oxfam report noted the significance of the fact that the world’s two largest economies – the United States and China – are beginning to consider policies that would reduce inequality, including imposing higher tax rates on rich.
“This gives us measured hope that a new economic consensus is emerging,” Ms Morgain said.
However, out of 38 member countries, the OECD reports that only five have had a wealth tax in the past five years.
Wealth taxes are generally quite low.
In France, the rates range from 0.5% to 1.5% on personal net real estate worth over 1.3 million euros ($2 million).
In Switzerland, it can range from 0.05% to 4.5% depending on the city.
“It’s usually a very small tax, but since we’re talking about large assets and large amounts of wealth, it can still generate relatively large revenue gains for governments,” Ms Robbins said.
Last week, the WEF released its 2022 Global Risks Report, warning that inequality in vaccines and an uneven economic recovery risked “deepening social fractures and geopolitical tensions”.
Oxfam hopes the more than 100 billionaires and business people in Davos this week will use the opportunity to focus on the mechanics of distributing wealth and putting resources back where they are needed in areas of health, education and support.
“What the report says is that inequality kills. There are very real deaths because of our failure to distribute the benefits of our economies more effectively,” Ms Morgain said.
She added that in Australia alone, a wealth tax “could cover nearly half the cost of meeting the World Health Organization‘s mid-2022 vaccination target for low-income countries.” income”.
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