Oxfam released a new report in conjunction with the World Economic Forum in Davos:
Almost half of the world’s wealth is now owned by just one percent of the population, and seven out of ten people live in countries where economic inequality has increased in the last 30 years. The World Economic Forum has identified economic inequality as a major risk to human progress, impacting social stability within countries and threatening security on a global scale.
This massive concentration of economic resources in the hands of fewer people presents a real threat to inclusive political and economic systems, and compounds other inequalities – such as those between women and men. Left unchecked, political institutions are undermined and governments overwhelmingly serve the interests of economic elites – to the detriment of ordinary people.
In this paper, Oxfam shows how extreme inequality is not inevitable, with examples of policies from around the world which have reduced inequality and developed more representative politics, benefiting all, both rich and poor. Oxfam calls on leaders at the 2014 World Economic Forum at Davos to make the commitments needed to counter the growing tide of inequality.
Just a sampling of their findings (taken from the summary):
- Almost half of the world’s wealth is now owned by just one percent of the population.
- The wealth of the one percent richest people in the world amounts to $110 trillion. That’s 65 times the total wealth of the bottom half of the world’s population.
- The bottom half of the world’s population owns the same as the richest 85 people in the world.
- Seven out of ten people live in countries where economic inequality has increased in the last 30 years.
- The richest one percent increased their share of income in 24 out of 26 countries for which we have data between 1980 and 2012.
- In the US, the wealthiest one percent captured 95 percent of post-financial crisis growth since 2009, while the bottom 90 percent became poorer.
Stultifying numbers indeed. There are a set of policy recommendations that we should take a serious look at, given Malaysia’s also relatively high level of income and wealth inequality:
- Cracking down on financial secrecy and tax dodging;
- Redistributive transfers; and strengthening of social protection schemes;
- Investment in universal access to healthcare and education;
- Progressive taxation;
- Strengthening wage floors and worker rights;
- Removing the barriers to equal rights and opportunities for women.
Yes, BR1M actually makes sense and so will unemployment insurance when and if it actually comes in; though income tax cuts do not. We also need a mechanism for the automatic adjustment of the minimum wage, which I’m uncertain whether it is in place.