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IBNS: The world’s five richest men have more than doubled their fortunes from $405 billion to $869 billion since 2020 —at a rate of $14 million per hour— while nearly five billion people have been made poorer, reveals a new Oxfam report on inequality and global corporate power.
If current trends continue, the world will have its first trillionaire within a decade but poverty won’t be eradicated for another 229 years.
“Inequality Inc.”, published recently as business elites gather in the Swiss resort town of Davos, reveals that seven out of ten of the world’s biggest corporations have a billionaire as CEO or principal shareholder. These corporations are worth $10.2 trillion, equivalent to more than the combined GDPs of all countries in Africa and Latin America.
“We’re witnessing the beginnings of a decade of division, with billions of people shouldering the economic shockwaves of pandemic, inflation and war, while billionaires’ fortunes boom. This inequality is no accident; the billionaire class is ensuring corporations deliver more wealth to them at the expense of everyone else,” said Oxfam International interim Executive Director Amitabh Behar.
“Runaway corporate and monopoly power is an inequality-generating machine: through squeezing workers, dodging tax, privatizing the state, and spurring climate breakdown, corporations are funneling endless wealth to their ultra-rich owners. But they’re also funneling power, undermining our democracies and our rights. No corporation or individual should have this much power over our economies and our lives —to be clear, nobody should have a billion dollars”.
The past three years’ supercharged surge in extreme wealth has solidified while global poverty remains mired at pre-pandemic levels. Billionaires are $3.3 trillion richer than in 2020, and their wealth has grown three times faster than the rate of inflation.
Despite representing just 21 percent of the global population, rich countries in the Global North own 69 percent of global wealth and are home to 74 percent of the world’s billionaire wealth.
Share ownership overwhelmingly benefits the richest. The top 1 percent own 43 percent of all global financial assets. They hold 48 percent of financial wealth in the Middle East, 50 percent in Asia and 47 percent in Europe.
Mirroring the fortunes of the super-rich, large firms are set to smash their annual profit records in 2023. 148 of the world’s biggest corporations together raked in $1.8 trillion in total net profits in the year to June 2023, a 52 percent jump compared to average net profits in 2018-2021. Their windfall profits surged to nearly $700 billion.
The report finds that for every $100 of profit made by 96 major corporations between July 2022 and June 2023, $82 was paid out to rich shareholders.
Bernard Arnault is the world’s second richest man who presides over luxury goods empire LVMH, which has been fined by France‘s anti-trust body. He also owns France’s biggest media outlet, Les Échos, as well as Le Parisien.
Aliko Dangote, Africa’s richest person, holds a “near-monopoly” on cement in Nigeria. His empire’s expansion into oil has raised concerns about a new private monopoly.
Jeff Bezos’s fortune of $167.4 billion increased by $32.7 billion since the beginning of the decade. The US government has sued Amazon, the source of Bezos’ fortune, for wielding its “monopoly power” to hike prices, degrade service for shoppers and stifle competition.
“Monopolies harm innovation and crush workers and smaller businesses. The world hasn’t forgotten how pharma monopolies deprived millions of people of COVID-19 vaccines, creating a racist vaccine apartheid, while minting a new club of billionaires,” said Behar.
People worldwide are working harder and longer hours, often for poverty wages in precarious and unsafe jobs. The wages of nearly 800 million workers have failed to keep up with inflation and they have lost $1.5 trillion over the last two years, equivalent to nearly a month (25 days) of lost wages for each worker.
New Oxfam analysis of World Benchmarking Alliance data on more than 1,600 of the largest corporations worldwide shows that 0.4 percent of them are publicly committed to paying workers a living wage and support a living wage in their value chains. It would take 1,200 years for a woman working in the health and social sector to earn what the average CEO in the biggest 100 Fortune companies earns in a year.
Oxfam’s report also shows how a “war on taxation” by corporations has seen the effective corporate tax rate fall by roughly a third in recent decades, while corporations have relentlessly privatized the public sector and segregated services like education and water.
“We have the evidence. We know the history. Public power can rein in runaway corporate power and inequality —shaping the market to be fairer and free from billionaire control. Governments must intervene to break up monopolies, empower workers, tax these massive corporate profits and, crucially, invest in a new era of public goods and services,” said Behar.
“Every corporation has a responsibility to act but very few are. Governments must step up. There is action that lawmakers can learn from, from US anti-monopoly government enforcers suing Amazon in a landmark case, to the European Commission wanting Google to break up its online advertising business, and Africa’s historic fight to reshape international tax rules.”
