Economy

Twenty-six billionaires and the 3.8 billion: the shocking inequality that plagues global society

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We all love to be outraged.  Headlines covering the strange and the shocking are ever prominent, and stories featuring people behaving in reprehensible ways are very popular in the media.  A favourite with the tabloid press is the story of the ‘Benefits Cheat’, who swindles the UK taxpayer of their hard earned cash in order to enjoy excessive and undeserved luxury.  Naturally, we are scandalised by the recent story of the woman who claimed disability benefits for ten years whilst actually living in Spain with her property developer husband.  It is unfair that she should have gained so much at the expense of others.

So why are we not more outraged at the news that the twenty-six richest people in the world own as much wealth as the poorest 50%?  That’s 26 people with as much money between them as 3.8 billion others.  The Sun, a longstanding critic of the ‘Benefits Cheat’, responds to this news in a rather less outraged fashion.  It considers the report, issued by Oxfam and lamenting the wealth inequality in society, from the perspective of The Institute of Economic Affairs.  This right-wing think tank claims that Oxfam is ‘obsessed with the rich’ and that ‘capitalism has the best track record for lifting people out of poverty’.

So why, if capitalism is working so well, did we see the wealth of the poorest half of the world’s population fall by 11% in 2018, while that of the richest 2000 or so billionaires rose by 12%? Why does the number of rough sleepers in the UK rise year on year?  Why did food bank usage reach record highs last year?  

The inequality that the wealthiest 26 represent is something that is seen increasingly in societies all over the world, to differing extents.  This state of affairs is not the variation of wealth around a median point, but an indication of a huge chasm existent in global society.  It is a very real and frightening example of an excessive wealth that can only exist through the suppression of others in poverty.  

Because although the Institute of Economic Affairs appears to think that poverty and wealth inequality are unrelated, it is impossible to eradicate poverty while all the wealth of a society is concentrated in the hands of a few.  Although it is apparent that wealth needs to be shared in order for societies to be fairer and afford a good quality of life to all, notions still exist that those who have the most wealth really deserve it.

That image of the ‘Benefits Cheat’ has been a British phenomenon which periodically grips the nation with fury at the money that is being squandered by our government.  But in fact, the money lost to benefit fraud is significantly lower than the money that is lost to tax avoidance and evasion.  

And yet, even though half of British wealth is in the hands of the richest 10%, and only 10% belongs to the poorest half of the population, the British public in general appears to be oddly convinced that this is how things should be.  Three-fifths of British voters believe that inheritance taxes are unfair.  But inheritance represents money that is unearned.  Do we really believe that unearned wealth should continue to pass from generation to generation without some intervention to make sure that other families can at least have some financial security?

Unfortunately, a myth has been perpetrated by diverse means for a long time.  It says that those that own the most only do so because they are deserving of it.  The myth of meritocracy convinces us that those who are richest have achieved their financial status by working the hardest and the most successfully.

But are those 26 people really deserving of all their wealth?  Is the billionaire really one hundred thousand times more hard-working, or one hundred thousand times more successful a human being than someone with a thousand pounds to their name?  Of course not.  Just because a person’s wealth is gained by means that have been socially legitimised – such as inheritance, or property that rapidly increases in value – it does not make those means legitimate.  It certainly does not make that person more successful.  And it definitely does not mean they deserve their wealth.

I feel that a global tax on wealth, as the French economist Thomas Piketty suggests, is the only solution to this crisis of inequality and consequent poverty.  As for the 26, do not be fooled into thinking that the statistics are inconsequential.  They indicate what an unequal and polarised world we are becoming – not just in wealth but in so many other things.  This is the time to feel outraged.  And let us use that outrage wisely, so that we can collectively challenge an inequality in society that is holding the majority of us back.  

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