Oxfam report on income inequality

BREAKTHROUGH - Elfren S. Cruz - The Philippine Star

Every year, Oxfam International, a global NGO founded in 1942, prepares a briefing paper on the state of wealth inequality in the world. This month, January 2024, saw the latest paper issued by Oxfam. Oxfam is a British-founded confederation of 21 independent charitable organizations focusing on the alleviation of global poverty.

The findings can be described as either shocking or tragic. The rise of income inequality has given impetus also to the rise of populism. This is a form of movement that has no ideology but simply arouses the masses to blame all their problems on the abuses of the elite.

This latest Oxfam report reveals that the state of income and wealth inequality today is the worst in human history. Here are some of the findings of the report.

Since 2020, the beginning of this decade, the world’s five richest men have seen their fortunes more than double. During the same period, almost five billion people in the world have become poorer.

While millions of people in the world live in extreme poverty without clean drinking water, adequate health care, decent housing and education for their children, the world’s billionaires have increased their wealth by over $3 trillion in the last three years alone. Approximately 4.8 billion people are poorer now than in 2019.

The world’s richest 1 percent own 43 percent of all global financial assets. At the same time, this richest 1 percent globally emit as much carbon pollution as the poorest two-thirds of humanity.

In the Middle East, the richest 1 percent own 48 percent of financial wealth. In Asia, the richest 1 percent own 50 percent of the wealth. In Europe, the richest 1 percent own 47 percent of the wealth. This shows that the extreme concentration of wealth is a global phenomenon.

Billionaires have also increased their control of corporations. A study of the 50 biggest corporations in the world with capitalization of $13.3 trillion has billionaires either as the principal shareholder or the CEO. Seven out of the ten biggest publicly listed companies in the world have a billionaire as CEO or as principal shareholder.

Oxfam estimates that only 0.4 percent of over 1,600 of the world’s largest and most influential companies are publicly committed to paying their workers a living wage. Globally, men own $105 trillion more than women.

According to the Oxfam report: “We are living through a new era of monopoly power. A small number of ever swelling corporations wield extraordinary influence over economies and governments, with – as the paper shows – largely unbridled power to price gouge consumers; suppress wages and abuse workers; limit access to critical goods and services; thwart innovation and entrepreneurship and privatize public services and utilities for private profit.”

This market concentration is part of the study of Oxfam. Here are some findings related to this:

• Ten giant global ‘Big Pharma’ firms merge from 60 companies over two decades.

• Two global companies control over 40 percent of the global seed market compared with ten companies owning 40 percent of the global seed market 25 years ago.

• Four firms control 62 percent of the world’s pesticide market.

• Three-quarters of global advertisement spending pays Meta, Alphabet and Amazon.

• More than 90 percent of online search is done via Google.

• The Big Four companies dominate the global accounting market holding 74 percent market share.

• Agriculture has seen increasing concentration in the production and trading of agriculture and food products.

Oxfam also points out that “numerous seemingly unique products on store shelves from cereal to shampoo are in fact owned by the same corporations. For example, the beer giant Aneuser-Busch Inbed owns over 500 brands of beer including Budweiser, Becks, Corona and Stella Artois.”

Measuring income and wealth inequality involves assessing the distribution of resources, opportunities or outcomes among individuals or groups within a society. There are various methods and indicators used to gauge inequality.

The Oxfam report also details prescriptions on how to end monopoly power. These are key steps that can be taken to increase the level of equality in the world. Secondly, these steps will also rein in corporate power and build in economies for all rather than just the richest. I will discuss these in my next column.

In a very short paragraph, Oxfam ends its report with what it calls room for hope. One example is that 10 percent of the world works for cooperatives and the share is growing. Even some rich individuals like Warren Buffett have publicly acknowledged that the very wealthy multibillionaires should be taxed more.

In November 2022, a new resolution by the African group was agreed upon, which gives the UN a mandate to develop inter-governmental talks on tax. This could take control of global tax policy away from corporate and rich country interests and could be a breakthrough for progressive taxation.

Oxfam has dedicated its report to those fighting for a more equal world.

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