Eight richest men in the world own the same wealth as the 3.6 billion people who make up the poorest half of humanity, said a study by Oxfam, an international confederation of 19 social organisations, on Monday.
“Just eight men own the same wealth as the 3.6 billion people. None of them has earned his fortune through talent or hard work, but by inheritance or accumulation through industries prone to corruption and cronyism,” claimed the study released ahead of the World Economic Forum annual meeting at Davos in Switzerland from Tuesday.
In India, the study recalled that lawmakers passed a disclosure mandate in 2013, requiring CEO-pay ratios to be made public, which is an important step towards informing the public about the level of inequality within companies.
“It is not only in rich countries that CEOs (Chief Executive Officers) are rewarded with salaries that far outstrip average incomes. A top executive in India’s largest cigarette manufacturer is being paid 439 times the median salary for employees at his company,” claimed the study, citing a report by the capital markets regulator Securities Exchange Board of India (Sebi).
“In contrast, a CEO in IT services firm receives 416 times as much as the average employee of his company,” the study revealed.
With the richest accumulating wealth at such an astonishing rate that the world could see its first trillionaire in 25 years, the study found that one has to spend $1 million every day for 2,738 years to spend $1 trillion.
“Power and privilege are being used to skew the economic system to increase the gap between the richest and the rest,” the study reiterated.
“A huge gap between the super rich and poor across the world traps millions in poverty, fracturing societies and undermining democracy,” said the study.
Cautioning world leaders about the inequality crisis, Oxfam said large corporations and world’s top leaders played a key role in widening the rich-poor gap globally.
“Super-rich people use tax havens to avoid paying fair share of tax, drive down wages for workers and the prices paid to producers and investing less in their business,” claimed the world body, which is focused on poverty alleviation.
Admitting that global inequality was having a huge impact on women’s lives, the study found that women, facing discrimination in the work place often find themselves at the bottom of the pile.
On current trends, it will take 170 years for women to be paid the same as men.
“Corporate tax dodging costs poor countries at least $100 billion every year. The amount is enough to provide education for 124 million children who are not in school,” the report observed.
The per capita income of the top one per cent increased from over $38,000 in 2005 purchasing power parity to $49,800 while that of the bottom 10 per cent increased from $196 to $261.
Although both groups experienced the same percentage of income growth over the period, the $65 per capita increase for the bottom 10 per cent was dwarfed by the increase for the top one per cent, which was 182 times greater.
“The average wealth of each adult belonging to the richest one per cent is $1.7 million, i.e., 300 times greater than the wealth of the average person in the poorest 90 per cent, although for many people in the bottom 10 per cent their wealth is zero or negative,” revealed the report.
Corporate tax dodging costs poor countries at least $100 billion every year. This is enough money to provide an education for the 124 million children who aren’t in school and prevent the deaths of at least six million children thanks to health care services.
“Extreme inequality across the globe is having tremendous impact on women’s lives. Employed women, who face high levels of discrimination in the work place, and take on a disproportionate amount of unpaid care work often find themselves at the bottom of the pile.”
Calling to reverse the trends through progressive policies that share economic rewards between people, rather than concentrating returns to capital the report said income and wealth invested in public services and infrastructure could be used to improve social and economic opportunities.
“We need a human economy that works for the 99 per cent of the world population and benefits everyone, not just the privileged few. A new human economy that will create better and fairer societies where workers receive decent wages, women and men get treated equally, children will have opportunities,” added the report.