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The world's wealthy once again gathered in the Alps last week to discuss how to 'solve' the world's problems. Their wealth, suggests a top global anti-poverty outfit, has become the problem.
Apologists for inequality have a standard retort to anyone who calls for a more equal distribution of the world’s treasure. If you took all the wealth of the wealthy and divvied it up equally among the poor, the retort goes, no one would gain nearly enough to accomplish much of anything.
Oxfam International, one of the world’s premiere anti-poverty charitable organizations, would beg to differ. The world’s top 100 billionaires now hold so much wealth, says a new Oxfam report, that just the increase in their net worth last year would be “enough to make extreme poverty history four times over.”
“Oxfam's mission is to work with others to end poverty,” Oxfam analyst Emma Seery noted last week. “But in a world with limited resources, this is no longer possible without an end to extreme wealth.”
Oxfam timed its new analysis, The cost of inequality: how wealth and income extremes hurt us all, to appear right on the eve of last week’s World Economic Forum in Davos, Switzerland. This earnest “issues” confab annually brings together a glittering array of global business and political leaders.
The world’s corporate and financial elites began this January trek into the Alps back in 1971. But the Davos sessions really didn’t start grabbing big-time global media attention until the go-go 1990s.
“Throughout the boom years,” as a UK Guardian profile last week noted, “chief executives would gather every winter high up in the Swiss Alps to discuss in a lordly fashion the world economy and how it could be revised to suit their objectives and views.”
But in these days of deep global economic uncertainty, the power suits that frequent Davos have lost their mojo — and even feel pressured to address the global economic inequality they've so long tried to sweep under the rug.
That pressure last week came from figures like Christine Lagarde, the former French finance minister who now directs the International Monetary Fund. Lagarde blasted outsized executive pay in high finance, attacked bankers for lobbying against new regulation, and called for more “robust social safety nets.”
Oxfam, for its part, is calling for much bolder steps to narrow the stunning gap between the global uber rich and everyone else. The group is urging world leaders to “commit to reducing inequality to at least 1990 levels.”
Meeting that goal, the new Oxfam report relates, would require a wide range of measures, everything from far more steeply graduated income tax rates to actual pay caps that limit how much corporate executives can take home to a multiple of what the lowest-paid workers in the firms they run are making.
But don’t hold your breath waiting for the Davos crowd to buy into any of this bolder agenda. Even the modest reforms that the IMF's Lagarde urged last week found no wide support among the corporate and banking movers and shakers who ambled up to the Alps for this year’s Davos gathering.Oxfam is also emphasizing the importance of cracking down on offshore tax havens. As much as a quarter of global wealth now sits shielded offshore.
One American on hand for the 2013 Davos festivities, JPMorgan Chase chief exec Jamie Dimon, made no move to hide his distaste for reformers. Bank regulators, he charged, were “trying to do too much, too fast” — and spreading “huge misinformation” about the noble work underway at banks like his.
“We’re doing the right thing,” Dimon assured his fellow Davos notables.
Other global corporate notables at Davos sang a similar tune. Azim Premji, the chairman of the Bangalore-based Indian high-tech giant Wipro, admitted that the new Oxfam data — on how the richest 100 people in the world are earning much more than enough to end the world’s worst poverty — do “sadden” him.
But Premji declined in an interview to term the incredible concentration of the world's wealth in any way “unethical.” We need not waste time, he suggested, worrying about “redistribution.” We need instead to help the rich grasp their “obligation,” their “trusteeship responsibility,” to wield their wealth for good.
Trust the rich, in other words, to solve our problems.
Not on your life, says Oxfam.
“In a world where even basic resources such as land and water are increasingly scarce,” Oxfam's Jeremy Hobbs sums up, “we cannot afford to concentrate assets in the hands of a few and leave the many to struggle over what's left.”
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28/01/2013 BY ZYGMUNT BAUMANRead the whole article.
A most recent study by the World Institute for Development Economics Research at the United Nations University reports that the richest 1% of adult humans alone owned 40% of global assets in the year 2000, and that the richest 10% of adults accounted for 85% of the total world wealth. The bottom half of the world adult population owned 1% of global wealth. [i] This is, though, but a snapshot of the on-going process… Yet more and more bad and ever worse news for equality of humans, and so also for the quality of life of all of us, are lining up daily.
“Social inequalities would have made the inventors of the modern project blush of shame” – so Michel Rocard, Dominique Bourg and Floran Augagner conclude in the article “Human species, endangered” they co-authored and published in Le Monde of 3rd April 2011. In the era of the Enlightenment, during the lifetimes of Francis Bacon, Descartes or even Hegel, in no place of Earth the standard of living was more than twice as high as in its poorest region. Today, the richest country, Qatar, boasts an income per head 428 times higher than the poorest, Zimbabwe. And these are, let’s never forget, comparisons between averages – and so akin to the facetious recipe for the hare-and-horsemeat paté: take one hare and one horse…
The stubborn persistence of poverty on a planet in the throes of economic-growth fundamentalism is enough to make thoughtful people to pause and reflect on the direct as much as the collateral casualties of that redistribution of wealth. The deepening abyss separating the poor and prospect-less from the well off, sanguine, self-confident and boisterous – an abyss of the depth already exceeding the ability of any but the most muscular and the least scrupulous hikers to climb – is an obvious reason to be gravely concerned.
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Read the whole article.
Posted by Olga Khazan on January 20, 2013
Nonprofits owe much of their budgets to wealthy donors, so it’s unusual for a major charity group to implicate extremely rich individuals as part of the problem.
A Yemeni shoe repairman, Zakaria Saleh, 25, left, works on a street in Sanaa, Yemen.(AP Photo/Hani Mohammed)
In a sign that the “Occupy” and “99 percent” movements that swept the United States in recent years have taken on increased global relevance, Oxfam International this week called for “a new global goal to end extreme wealth by 2025,” as a way to stem income inequality and continue the fight against poverty.
In a press release, the group wrote that the anti-poverty movement needs to include a new, anti-extreme-wealth component:
In the last decade, the focus has been exclusively on one half of the inequality equation – ending extreme poverty. Inequality and the extreme wealth that contributes to it were seen as either not relevant, or a prerequisite for the growth that would also help the poorest, as the wealth created trickled down to the benefit of everyone.
Oxfam does have a point. The movement against income inequality has been gaining momentum as the world’s rich have continued to amass larger shares of their countries’ fortunes. In the United States, according to the group, the share of national income going to the top 1 percent of the population has increased to 20 percent, from 10 percent in 1980.
Globally, 1 percent of the population have seen their incomes rise by 60 percent in recent years, according to Oxfam. In China, where the top 10 percent earn nearly 60 percent of the country’s income, Internet users regularly take to social networks to criticize public officials thought to be flaunting status items.
“The top 100 billionaires added $240 billion to their wealth in 2012- enough to end world poverty four times over,” Oxfam argues.
The World Economic Forum also recently rated “severe income disparity” as one of its top global risks for 2013.