by Ayesha Alam (News & Analysis, Crescent International Vol. 43, No. 12, Rabi' al-Thani, 1436)
There is concentration of wealth in the hands of a tiny minority—the 1% that was identified by the Wall Street movement in 2011—and it is leading to serious problems globally.
In a report published by Oxfam International, a UK-based charity, the world’s richest 85 individuals own more wealth than the combined assets of half the world’s population. The report was unveiled in December 2014. In addition, the Oxfam report indicates that the ultra-rich are getting even richer. Further, if the trend of accumulating global wealth in the hands of the global elite continues, the richest 1% will own more than 50% of the world’s wealth by 2016.
Winnie Byanyima, executive director of Oxfam International and one of the six co-chairs of the 2014 Davos Economic Forum, said that the 2008–2009 financial crisis accelerated the elite’s grab of the world’s capital. The numbers in Oxfam’s report sketch a terrifying picture of mass inequality.The top 85 individuals noted in the report control around $1.9 trillion, enjoying greater economic clout than 3.3 billion people. The report also estimates that by 2016, 1% of the world’s population will own more wealth than the other 99%.
In an interview with the British newspaper The Guardian, Byanyima said, “We want to bring a message from the people in the poorest countries in the world to the forum of the most powerful business and political leaders. The message is that rising inequality is dangerous. It’s bad for growth and it’s bad for governance. We see a concentration of wealth capturing power and leaving ordinary people voiceless and their interests uncared for.” The Oxfam report’s portrait of the different stratifications of wealth distribution highlight the urgency of the situation: according to its research, 52% of global wealth not owned by the richest 1% is owned by those in the richest 20%. The remaining population accounts for just 5.5% of global wealth, and their average wealth was $3,851 (£2,544) per adult in 2014, Oxfam found.
“In the past 12 months we have seen world leaders from President Obama to Christine Lagarde talk more about tackling extreme inequality but we are still waiting for many of them to walk the talk,” Byanyima continued. “It is time our leaders took on the powerful vested interests that stand in the way of a fairer and more prosperous world. Business as usual for the elite isn’t a cost free option — failure to tackle inequality will set the fight against poverty back decades. The poor are hurt twice by rising inequality — they get a smaller share of the economic pie and because extreme inequality hurts growth, there is less pie to be shared around.”
These numbers published in the Oxfam report are not anti-capitalist mythology, even though some business forums would like to present them in that light. The title of a January 19, 2015 article in Forbes Magazine contemptuously declared, “Oxfam’s Whining Again; The Top 1% Will Own 50% Of Everything.” Rather, these numbers are widely confirmed by many other research groups and think tanks. For instance, the Equality Trust, which works to alleviate economic inequality in the UK, published research revealing that the richest 100 families in Britain in 2008 had witnessed their combined wealth increase by at least £15bn, a period during which average income increased by £1,233. According to the Equality Trust, Britain’s current richest 100 had the same wealth as 30% of UK households. Even Forbes Magazine, the publication that institutes star-struck hero-worship of capitalist robber barons, grudgingly admitted in its article, “It does have to be said that their numbers are correct: but also that they’re not very important.”
The post-2008 wealth polarization has been even more striking in the US. According to a January 26, 2015 report published in the Economic Analysis and Research Network (EARN), the elite used the financial crisis to consolidate wealth in fewer hands and disenfranchise the middle class. Besides the underhand 2008 Wall Street bailout, where the US government paid $800 billion to the same corrupt Wall Street financiers that caused the global financial meltdown, the economic recovery itself has been hijacked by the elite as a means of wealth accumulation.
This was highlighted by Zoe Carpenter in a January 26 article for the progressive US magazine, The Nation, on the implications of the EARN report. “In the vast majority of US states, the top 1 percent of earners captured at least half of the income gains during the first three years of the economic recovery,” notes Carpenter. “In seventeen states, the 1 percent raked in all of the income growth.”
“In seventeen states, the 1 percent raked in all of the income growth.”
“Policy choices and cultural forces have combined to put downward pressure on the wages and incomes of most Americans even as their productivity has risen,” write the EARN report’s authors, Mark Price and Estelle Sommeiller. Meanwhile, the Oxfam report observes that the 20% of the US elite whose wealth rests on finance and insurance saw their cash wealth increase by 11% in the 12 months to March 2014.
The US economy is skating on thin ice — the tenuous financial recovery achieved by the Obama administration, which has mostly manifested in the creation of 10.9 million jobs over his tenure in office, has been fueled by ghastly horrors of war. Ever since WWII, the US military and business elite have been joined in an unholy alliance to use perpetual war to rake in wealth that trickles down to the middle class in the form of contracts, security jobs, and investments. Since 2008, US military aggression in Africa and the Muslim East (whether directly as in the case of Afghanistan or indirectly, in the form of proxies such as ISIS and Boko Haram) has raked in profits that have driven the wolf of financial bankruptcy from the door. This is illustrated by Oxfam’s diagrams that show how the majority of the global 1% is located in the US, followed by Australia and West European countries.
According to many experts, the world has reached a tipping point — the expansion of global oppression is eroding not only the rights of freedom of speech and religion, but also even the basic right to life, which requires sustenance to be sustained with dignity. With over half the world’s population falling into unspeakable poverty as a tiny elite amasses vast amounts of wealth, the right to life is poised to become a privilege reserved for the super-rich.