62 People Make as Much Money as Half the World – Report

The gap between the world’s richest and poorest people has widened in the past year with 62 people now owning as much wealth as half of the global population, and Australia is not immune to the trend, according to a new report.

The report, An Economy for the 1%, released by international aid organisation, Oxfam, found that “although world leaders have increasingly talked about the need to tackle inequality, the rich have continued to become richer while the poor have been left behind”.

It comes as business leaders meet in Switzerland to attend the World Economic Forum.

Oxfam said that in 2015 just 62 individuals had the same wealth as 3.6 billion people – the bottom half of humanity. This figure was down from 388 individuals as recently as 2010.

The report also found that the wealth of the richest 62 people had risen by 44 per cent in the five years since 2010 – an increase of more than half a trillion dollars USD (A$542 billion).

Oxfam Australia’s CEO, Dr Helen Szoke, said the “runaway inequality” now seen across the globe could derail the fight against poverty.

“Ahead of last year’s Forum Oxfam predicted that the richest 1 per cent would soon own more than the rest of us. Shockingly, this came true in 2015 – a year earlier than we expected,” Szoke said.

“This extreme inequality crisis threatens to undermine the progress made in tackling poverty in the last quarter of a century. Had inequality within countries not grown between 1990 and 2010, an extra 200 million people would no longer be living in extreme poverty today.”

Image courtesy of Oxfam Australia

Szoke said Australia could not escape the global trend.

“In Australia, new global wealth data shows since 2000, 50 per cent of the total increase in national wealth went to the richest 10 per cent of Australians,” she said.

“During the same period, the poorest 10 per cent of Australians share of this increased wealth was almost zero.”

Oxfam Australia used the release of the report to call for urgent action to make tax fair and tackle the inequality crisis.

“As a first priority, there must be an end to the dodgy tax practices and use of tax havens that allow corporations and individuals to accrue phenomenal wealth while others’ suffer,” Szoke said.

“There are children all over the world whose chance to escape poverty is stashed away in places like the Cayman Islands at the moment.

“Australia too is dragging its feet on stamping out tax dodging. Australian multinational companies, and those that operate here, should be required to publish their profits and taxes paid in every country in which they operate.

“The amount held in tax havens worldwide is increasing at an alarming rate. We estimate a four-fold increase in investment in tax havens globally during 2000-2014 – that’s 1.7 times faster than the growth of GDP.”

Szoke said allowing governments to collect the taxes that companies and rich individuals should be paying would be vital if world leaders were to meet their new goal, set last September, to eliminate extreme poverty by 2030.

She said the use of tax havens was one of the most glaring examples set out in the report, showing how “the rules of the economic game have been rewritten to supercharge the ability of the rich and powerful to entrench their wealth”.

Szoke said action against tax havens must be part of a three-pronged attack on inequality.

“Action to recover the missing billions lost to tax havens needs to be accompanied by a commitment by governments to invest in healthcare, schools and other vital public services that make such a big difference to the lives of the poorest people,” she said.

“We also need corporations and governments to ensure that people earn a fair, living wage for the work they do and close the pay gap between men and women.

“The explosion in the wealth of the super-rich has come at the expense of the majority – and particularly the poorest people. It is time that governments, companies and elites at Davos play their part to end this vicious cycle.”

Late last year the Turnbull government introduced legislation, that was supported by the Labor opposition, that would see multinational companies found to be cheating the Australian Taxation Office forced to pay back double what they owed plus interest.