The impacts of climate change and a global pandemic that strained health systems, economies, mental health and family finances had another significant impact: “an explosion of inequality.”
This is a key finding of a report from Oxfam International published in mid-January, which stated that “the very richest have become dramatically richer and corporate profits have hit record highs” and asserted that “taxing the rich is vital to addressing this unprecedented polycrisis and skyrocketing inequality.”
The wealth of the richest global citizens is increasing by $2.7 billion each day, Oxfam reported. In addition, nearly two-thirds of all new wealth created from December 2019 to December 2021 was gained by the wealthiest 1% who possess 45.6% of global wealth.
“Since 2020, for every dollar of new global wealth gained by someone in the bottom 90%, one of the world’s billionaires has gained $1.7m,” the report stated.
While a small minority of the world’s citizens are amassing greater levels of wealth, the report highlighted the fact that inflation is outpacing wages for the average worker and that, in 2020, the number of people living in poverty increased for the first time in two decades.
Oxfam stated that “corporate price profiteering is driving at least 50% of inflation in Australia, the US and Europe, in what is as much a ‘cost-of-profit’ crisis as a cost-of-living one,” citing an Economic Policy Institute report that found profit margins rather than labor costs were driving the current inflation rate.
These sharply contrasting economic realities are “evidence of an economic system that fails to deliver for humanity,” the report stated, condemning the concept of trickle-down economics as “a fictional story … without any basis in truth.”
Governments were urged to increase taxes on the wealthiest 1% of citizens by ending tax breaks and tax havens that typically only apply to this group, since such tax approaches and policies have helped fuel increasing inequities.
“Inequality is not inevitable. Inequality is a policy choice,” Oxfam stated. “Governments can take clear and concrete, practical steps to radically reduce inequality and give themselves the fiscal firepower to protect their people.”