Billionaires' wealth increased last year - the poorest lost money

Oxfam inequality report: The world's poorest half saw their assets fall by 4 billion a day last year.

The world's approximately 2,000 dollar billionaires earned a combined SEK 23 billion a day last year, while the 3.8 billion people who make up the world's poorest half saw their assets fall by SEK 4 billion a day. This is according to Oxfam's inequality report Public Good or Private Wealth, released today in conjunction with the World Economic Forum in Davos, Switzerland.

The report shows that the widening gap between rich and poor is undermining the fight against poverty, damaging our economic systems and creating social divisions across the world, and reveals how governments are exacerbating inequality by underfunding social services such as healthcare and education, failing to collect sufficient taxes from corporations and super-rich individuals, and failing to tackle tax evasion. It also shows that women and girls are the hardest hit by rising economic inequality.

"The size of your bank account shouldn't determine how many years of education you get or how long you live - but this is the reality in far too many countries. While corporations and the super-rich enjoy low taxes, millions of girls are denied education and women die from lack of maternal care."

Winnie Byanyima, CEO Oxfam International

The report shows that the number of billionaires has almost doubled since the financial crisis, with a new billionaire every two days between 2017 and 2018. In addition, wealthy individuals and corporations are paying lower tax rates than in decades.

- Meanwhile, 100 million people are forced into extreme poverty each year due to healthcare costs and half the world's population lives on less than $0.50 a day.
- Just 4 cents of every dollar of global tax revenue came from taxing wealth such as inheritance or real estate in 2015. These types of taxes have been reduced or eliminated in many rich countries and have barely been implemented in developing countries.
- Tax rates for wealthy individuals and corporations have been cut significantly. For example, the top personal income tax rate in rich countries fell from 62% in 1970 to just 38% in 2013. The average in poor countries is just 28%.
- The very rich are also hiding large sums - around SEK 70 trillion - from tax authorities.
- In some countries, such as Brazil, the poorest 10% of the population pay a higher proportion of tax relative to their income than the richest 10%.
- If the richest one percent paid 0.5 percentage points more in taxes on their wealth, the total would be enough to educate all the 262 million children who are currently out of school and provide health care that could save the lives of 3.3 million people.
- The permanent underfunding of public services hits the poor hardest, just as the poorest are excluded when public services are sold off to private companies. In many countries, education and health care have become a luxury only the rich can afford. Every day 10 000 people die because they cannot afford healthcare. In developing countries, a child from a poor family is twice as likely to die before the age of five than a child from a rich family. In countries such as Kenya, children from rich families stay in school twice as long as children from poor families.

"We do not have enough. We don't have appropriate classroom furniture or equipment. In addition, many children in rural areas feel that they are less prioritized, less valued, and they do not reach the expected results. Some children have to work while they study. Some have to walk two hours to get to school and some are malnourished"

Betty, teacher in Bolivia

Reducing wealth taxes mainly benefits men, who control over 86% of companies and have 50% more wealth than women globally. Conversely, poor women and girls are hit hardest when social services are downgraded. Girls are forced to drop out of school when school fees are too high and women stay at home to care for sick relatives when the health system fails. Oxfam estimates that if all the unpaid domestic work women do globally per year was done by one company, it would have an annual turnover of $10 trillion, 43 times more than Apple, the world's largest company.

"People all over the world are angry and frustrated. Governments can create real change by ensuring that corporations and wealthy individuals pay their fair share of taxes and invest that money in free healthcare and education that meets the needs of all people - especially women and girls who are so often overlooked. Governments can build a better future for everyone, not just the privileged few."

Winnie Byanyima, CEO Oxfam International