According to a recently published report by Oxfam, 85 of the world’s richest people own as much wealth as almost half the world’s population.
The same report which details a widening wealth gap around the world also states that the richest 1% of Irish people own at least 10.5% of the wealth in Ireland. Although this figure for Ireland is extremely high it is nonetheless down 2.1% from a record high of 12.6% back in 2006.
However according to the Oxfam report and a graph recently published in The Irish Times, Ireland is still second on the list of “how much is owned by the 1%”, second only to Singapore. This news should not come as a surprise as it follows Ireland’s eleven year reign as one of the top three nations with the most wealth concentrated in the hands of the 1%.
With this news in hand The Eagle contacted Oxfam Ireland to ask what can be done to tackle such inequality and whether it not it is justified in a world where extreme poverty still reigns.
Oxfam told the Eagle “It’s a travesty that just 85 people now own the same wealth as half the world’s population. This is unsustainable and a recipe for social and economic disaster.”
In regards of whether there should be a cap on personal wealth as a way to tackle such inequality Oxfam the BCFE Eagle “Tackling inequality means that everyone pays their fair share. We are not advocating for a cap on personal wealth – instead we want a fairer, stronger and more transparent tax system that ensures the wealthy are not paying less than the poor” Oxfam continued “Also, inequality isn’t just about money. It’s about opportunity and power and decision-making too. It’s this “big picture” inequality that cements privilege and disadvantage down the generations and across countries,,,,, We acknowledge that some economic inequality is essential to drive growth and progress, rewarding those with talent, hard earned skills and ambition, but the extreme levels of wealth concentration occurring today threaten to exclude hundreds of millions of people from realising the benefits of their hard work.”. .
Oxfam continued to tell out reporter that more initiatives must be taken to tackle the widening wealth gap because, as of now, the government and governments around the world have failed to tackle the issue “Those with the most money often use that money to influence policy makers – this can be done either through illegal activities such as bribes or legal activities such as funding politicians or organisations that campaign for policies that benefit the wealthiest. This can undermine political institutions and means that governments serve the interest of the richest, at the expense of ordinary people. When rules are bent in favour of the rich, such as unfair global tax rules that allow wealthy people to hide their money in tax havens instead of paying the taxes they should, it is harmful to the rest of society”. When it comes to tackling wealth divisions Oxfam stated rules must be put in place to tackle tax evasion and they gave a conservative figure of 120 billion lost each year by governments around the world, on the topic of Irelands tax evasion problem Oxfam stated “On Ireland, our research last year showed that as much as €707 billion owned by wealthy individuals from overseas may be shielded from tax authorities around the world in Irish financial institutions”
Oxfam added that although cuts in Ireland effect the poorest in society to an unfair degree in poor continents like Africa the problem of wealth inequality is amplified At the same time cuts to public services and support disproportionately harm the poorest people, This problem is amplified in poor countries, especially those in Africa that are rich in natural resources. Global extractive companies (e.g. big corporations mining oil, gas or minerals) are able to use their influence to get generous subsidies and avoid paying taxes and royalties”.
When asked if such inequalities can be justified in a world where extreme poverty still plights the life of so many, Oxfam stated “Oxfam is concerned by global income inequality because it is hampering, if not exacerbating global poverty. Think of the money being lost by African countries because big multinational corporations are not paying their dues. In countries where children die needlessly from easily curable diseases this money would make a real difference to improve health and education systems. Some countries are actually losing more money in lost taxes than they receive in international aid. Evidence from across the world shows the price of inequality harms not just those at the bottom, but everyone in society. A highly unequal health system ultimately affects everyone’s health. Dismal education opportunities among a large section of the population harm the entire economy”
Although the report is from Oxfam they are not the only ones fighting against inequality as the stated “it’s not just Oxfam that is concerned. Last November the World Economic Forum ranked widening income disparities as the second greatest worldwide risk in the coming year to 18 months (after conflict in the Middle East), while the IMF echoed these concerns in recent days. US President Barack Obama this week pledged to tackle economic inequality in his annual State of the Union address. Also public opinion is increasingly on our side on this one. A survey in six countries (Spain, Brazil, India, South Africa, the UK and the US) showed that a majority of people believe that laws are skewed in favour of the rich – in Spain eight out of 10 people agreed”.
When asked what can be done in their opinion to tackle such inequalities Oxfam finished by stating “Global leaders must pledge to tackle inequality and to stimulate growth and economic progress for the many, not just the elite few. This means no more tax dodging and fairer taxation – the wealthy must never pay less than the poor. Governments can tackle inequality by cracking down on financial secrecy and tax dodging, investing in universal education and healthcare, and agreeing a global goal to end extreme inequality as part of the post-2015 negotiations on a new development framework. We want concrete steps to support progressive taxation on wealth and income so everyone pays their fair share. As billionaire Warren Buffet said, ‘I should not pay less tax than the office cleaner”.
(NOTE: First published in the Ballyfermot College student newspaper, March 2014)