Global inequality has increased to the extent that the €1.2 trillion combined wealth of the 85 richest people is equal to that of the poorest 3.5 billion — half of the world's population — according to a new report from development charity Oxfam.
And the report, entitled Working For The Few, claims that growing inequality has been driven by a “power grab” by wealthy elites, who have co-opted the political process to rig the rules of the economic system in their favour.
Oxfam called on attendees at this week’s World Economic Forum, which brings together politicians and business leaders in the Swiss ski resort of Davos, to take a personal pledge to tackle the problem by refraining from dodging taxes or using their wealth to seek political favours.
Polling for the report found people in countries around the world — including two-thirds of those questioned in Britain — believe that the rich have too much influence over the direction their country is heading.
Oxfam chief executive Winnie Byanyima said: "It is staggering that in the 21st century, half of the world's population — that's three and a half billion people - own no more than a tiny elite whose numbers could all fit comfortably on a double-decker bus.
“We cannot hope to win the fight against poverty without tackling inequality. Widening inequality is creating a vicious circle where wealth and power are increasingly concentrated in the hands of a few, leaving the rest of us to fight over crumbs from the top table.
“In developed and developing countries alike we are increasingly living in a world where the lowest tax rates, the best health and education and the opportunity to influence are being given not just to the rich but also to their children.
“Without a concerted effort to tackle inequality, the cascade of privilege and of disadvantage will continue down the generations. We will soon live in a world where equality of opportunity is just a dream. In too many countries economic growth already amounts to little more than a ‘winner takes all’ windfall for the richest.”
The Oxfam report found that over the past few decades, the rich have successfully wielded political influence to skew policies in their favour on issues ranging from financial deregulation, tax havens, anti-competitive business practices to lower tax rates on high incomes and cuts in public services for the majority.
Since the late 1970s, tax rates for the richest have fallen in 29 out of 30 countries for which data are available, said the report. This “capture of opportunities” by the rich at the expense of the poor and middle classes has led to a situation where 70 per cent of the world’s population live in countries where inequality has increased since the 1980s and 1 per cent of families own 46 per cent of global wealth — almost €85 trillion.
Opinion polls in Spain, Brazil, India, South Africa, the US, UK and Netherlands found that a majority in each country believe that wealthy people exert too much influence. Concern was strongest in Spain, followed by Brazil and India and least marked in the Netherlands.
The WEF’s own Global Risks report recently identified widening income disparities as one of the biggest threats to the world community.
Oxfam is calling on those gathered at WEF to pledge to support progressive taxation and not dodge their own taxes and refrain from using their wealth to seek political favours that undermine the democratic will of their fellow citizens