Hi everyone, this article is mostly quotes from Oxfam’s 2022 report, available here. It’s quite a small report and shouldn’t take more than half an hour to read, though of course there are citations to other documents.
It points to a relationship between a rise in the cost of living, and a rise in billionaire wealth. To put it bluntly, BILLIONAIRES ARE MOSTLY PARASITIC. Another five hundred or so billionaires have been created over the last two years. My point of view is in italics, “like this”. Oxfam’s words are in normal font, “like this”. I have omitted the citations to make reading easier.
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According to Oxfam’s analysis of the latest data from Forbes:
• There are 2,668 billionaires in the world, 573 more than in 2020 when the pandemic began.
• These billionaires are collectively worth $12.7 trillion – a real-terms increase of $3.78 trillion (42%) during the COVID-19 pandemic.
• Total billionaire wealth is now the equivalent of 13.9% of global gross domestic product (GDP), up from 4.4% in 2000.
• The richest 10 men have greater wealth than the poorest 40% of humanity combined.
• The richest 20 billionaires are worth more than the entire GDP of sub-Saharan Africa.
• Elon Musk, the wealthiest man in the world, is so rich that he could lose 99% of his wealth and still be in the top 0.0001% of the world’s richest people. Since 2019 his wealth has increased by 699%.
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During the pandemic women were disproportionately pushed out of employment, especially as lockdowns and social distancing affected highly feminized workforces in the service sectors, such as tourism, hospitality, and care work. Increased unpaid work has barred millions of women from rejoining labor markets. And now, worldwide, women are expected to cope with the huge rises in food and energy prices in order to keep their families fed.
The gender pay gap has widened: before the pandemic it was forecast to take 100 years to close; now it will take 136 years.
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Half of all working women of color in the US earn less than $15 an hour, a widely used threshold for distinguishing low-wage workers in that country.
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In São Paulo, Brazil, people in the richest areas can expect to live 14 years longer than those who live in the poorest areas.
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87% of COVID-19 loans made by the International Monetary Fund (IMF) come with conditions that demand that low- and middle-income country recipients adopt tough austerity measures that will further exacerbate poverty and inequality.
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Wages in many places are falling in real terms as they fail to keep pace with the cost of living. It has never been more expensive to be poor.
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Corporations and the billionaire dynasties who control so much of our food system are seeing their profits soar. Billionaires involved in the food and agribusiness sector have seen their collective wealth increase by $382bn (45%) over the past two years. There have been 62 food billionaires created in the last two years.
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Walmart’s focus on its shareholders has a shocking impact on levels of income inequality in the US. Last year the company paid $16bn to shareholders in the form of dividends and buybacks. The median average salary for a worker at Walmart is $20,942. If the shareholder payout was spent on salaries for the company’s 1.6 million employees instead, then average wages could be boosted to $30,904. Even with such an increase, the average Walmart worker would still be making less than the $15 per hour threshold, but it would make a world of a difference in the face of the spiraling cost of living.
THE ENERGY SECTOR
Big oil's profit margins have doubled during the pandemic, while the cost of energy is projected to soar by 50% in 2022.
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The impact of climate change – a crisis that the oil and gas companies have so often denied and obfuscated – has contributed to a humanitarian crisis in East Africa, which is facing drought and famine after repeated failure of the rains: 28 million people there are at risk of severe hunger.
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The companies that are part of the world’s energy supply chains are making a killing out of these price increases. Over the past year, profits across the energy sector have increased by 45% ; margins have soared (Figure 2) and earnings growth for the industry far outstrips that of any other (Figure 3). Billionaires in the oil, gas and coal sector have seen their wealth increase by $53.3bn (24%) in real terms in the last two years.
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In 2021, these companies paid $51bn in dividends, meaning that fully 63% of net profit went directly to shareholders. Some of this will benefit the pensions of ordinary people, but as the richest 10% of Americans own 89% of US stocks, it means that high energy prices are mainly benefiting a small group, while the majority are losing out financially by having to pay higher energy prices.
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The pandemic has created 40 new pharmaceutical billionaires, profiting from the monopolies their companies hold over vaccines, treatments, tests, and personal protective equipment. Most of this personal fortune is thanks to billions in public funding…
… the pandemic has wrought a terrible human and economic cost, causing the deaths of over 20 million people worldwide. Over half of these deaths have been in low- and lower-middle-income countries.
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BILLIONAIRE TAX BREAKS…
Pharmaceutical giants are making over $1,000 a second in profit from vaccines alone100 and they are charging governments up to 24 times more than it would cost to produce vaccines on a generic basis. Companies in the pharmaceutical sector have repeatedly been found to be dodging their tax responsibilities across the world by using tax havens and aggressive tax practices.
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Pfizer: The company has sold the most vaccines in the world but has delivered the least to lowincome countries (as a proportion of total doses sold). At a conservative estimate, the pre-tax profit margin of the Pfizer/BioNTech vaccine is 43%. In 2021, Pfizer paid out $8.7bn in dividends to shareholders.110 Pfizer has been accused of using dirty tactics to boost its profits, including funding misinformation about the Oxford University/AstraZeneca vaccine, insisting on clauses in contracts that can be used to silence critics, demanding state assets as collateral, and controlling delivery dates. In South Africa, a country that has been pushing for intellectual property (IP) rights to be waived on vaccines and other COVID-19 medical tools such as tests and treatments, Pfizer and Johnson & Johnson reportedly “pressed officials to drop the country’s waiver campaign during months of talks over terms of a supply contract”…
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Initiatives such as waiving IP barriers and promoting local production have the potential to improve access to medicines in developing countries, taking the power and control to decide who gets lifesaving treatment away from a handful of corporations and putting it into the hands of the people. Ensuring that everyone has access to mRNA vaccines could save 1.5 million lives. However, the companies producing vaccines have refused to cooperate and are vehemently opposed to the proposed IP waiver because these vaccines are amongst the most profitable pharmaceutical products in history. Removing their monopoly and their ability to dictate market prices would inevitably see vaccine prices plummet and the billions of dollars in guaranteed revenue eroded. No wonder then that more than 100 drug lobbyists were dispatched to Washington and €36m was spent in Brussels to fight against the proposed waiver.
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THE WAY FORWARD
Governments have significant scope to act and to rein in the extreme growth in billionaire wealth and corporate profits, and in turn ward off the unprecedented cost-of-living crisis that people are facing today.
My opinion: This is why the most ardent of the political right and their media and intellectual lackeys have always wanted people to hate the government, “get the government off our backs” etc, because the government has the power and ability to limit and regulate the abusive actions of the corporate world.
Fill out a Freedom of Information Act Request to a politician or government ministry, they’re legally bound to respond (though naturally exceptions exist). Write one of these to a huge corporation or a billionaire, they don’t have to do anything about it.
The government, though its faults may be many, is at least accountable to the public. Corporations are basically totalitarian in nature, orders go from the top down, corporations are FAR LESS accountable to the public. Most of the time it’s very difficult for the public to get information on what corporations do behind the scenes.
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Oxfam’s “Inequality Kills” and “First Crisis, Then Catastrophe” papers, published in January and April of this year, provide details of the urgent action necessary, while its Power, profits and the pandemic report sets out the steps that governments and corporations must take to ensure that businesses are governed in the interests of people and planet.
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Governments, business leaders, and billionaires are meeting at Davos for the first time in person since the pandemic began, against a backdrop of unprecedented inequality. Oxfam is above all underlining that the rapid rise in billionaire wealth today and the cost-of-living crisis faced by billions of people are one and the same phenomenon. This is not something that is just happening on their watch but that has been deliberately crafted with their support. The single most urgent and structural action that governments must take now is to implement highly progressive taxation measures that in turn must be used to invest in powerful and proven measures that reduce inequality, such as universal social protection and universal healthcare.
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END
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