The rich are swallowing the world

The already lopsided distribution of global wealth is tilting even further towards the richest few. 

The world’s 62 richest individuals now boast wealth equivalent to that of 3.6 billion people, the “poorest” half of the world’s population, according to UK-based international charity Oxfam. Five years ago, it took 388 of the world’s wealthiest to complete that imbalance, says Oxfam’s report recent, “An Economy for the 1%”.

The wealth of the richest 62 people rose 44 per cent between 2010 and 2015, to US$1.76 trillion (Bt64 trillion). The same period saw the combined wealth of the poorest 50 per cent drop by 41 per cent, to $1 trillion (Bt36 trillion).

The richest 1 per cent now hold more wealth than the rest of the world combined, according to Oxfam, which based its calculations on the Global Wealth Databook 2015 report by multinational financial-services giant Credit Suisse.

The ever-widening gap is partly the result of national economic policies that favour the rich and others with the means to invest while placing the majority of people at a disadvantage. The inefficient distribution of wealth by governments and political systems also plays a role. 

Whatever the cause of widening economic inequality, clearly the wrong path has been taken. Measures to improve the distribution of wealth are necessary if we want to build more-just societies in which citizens are not divided at birth by privilege and family background.

Some wealthy individuals seek to redress the imbalance by donating to good causes, including funding research into cures for diseases. But the majority is far more interested in private gain rather than the public good. We have to get tough with this latter group and curb their ability to amass wealth at the expense of others, particularly the poor.

The big winners in the global economy are those at the top, and the financial system appears heavily skewed in their favour. Income and wealth are being sucked upwards at an alarming rate. The world economy has seen dramatic growth in recent years, yet income and wealth are increasingly detached from any measurement of worker productivity or “added value”. Hard-working people have lost out to those with superior political or financial resources. Economic data show that income is flowing more and more towards capital and away from labour. Income inequality is slowing overall economic growth, further hurting the poorest citizens and preventing millions of people from escaping poverty.

What has to be done is not making the rich poorer, but rather allowing them to amass wealth in a way that is fair to the rest of society. People should not take advantage of their political connections to gain wealth at the taxpayer’s expense. The authorities should make sure that business operators do not profit unfairly. For instance, with oil prices much cheaper now, businesses should no longer be allowed to cite rising costs due to expensive petrol as a rationale for increasing product and service prices.

We need to rebalance power within the economy, empowering people who are currently excluded and keeping the influence of the rich and powerful in check. This is necessary for economies to work better in the interests of the majority and in particular in the interests of the poorest people, who have the most to gain from a fairer distribution of income and wealth.