Rising inequality could set the fight against poverty back by decades, Oxfam has warned in a new report. The EU can help offset the imbalance through a different tax policy and by promoting health and education in the Transatlantic Trade and Investment Partnership (TTIP) with the US, the organisation says.
The report, Even it Up: Time to End Extreme Inequality, shows that the number of billionaires worldwide has more than doubled since the financial crisis, while hundreds of millions live in abject poverty without essential healthcare or basic education.
In countries around the world, prosperity is not trickling down to ordinary people. Instead, the richest 85 people saw their collective wealth increase by €525 million per day between 2013 and 2014.
Winnie Byanyima, Oxfam’s international executive director, stressed that extreme inequality is a barrier to prosperity for most people on the planet.
“Today wealth is trickling upwards, and will continue to do so until governments act. We should not allow narrow-minded economic doctrine and the self-interest of the rich and powerful blind us to these facts,” Byanyima said.
“Around the world, millions of people are dying due to a lack of healthcare and millions of children are missing out on school, while a small elite have more money than they could spend in a lifetime. Inequality hinders growth, corrupts politics, stifles opportunity and fuels instability while deepening discrimination, especially against women,” the executive director continued.
Oxfam believes the EU can play a crucial role in helping redress the balance in favour of the many, instead of the few, and sees upcoming political opportunities at the European level to make this happen, by ensuring fairer taxation and cracking down on tax dodging carried out by multinational corporations and the world’s richest individuals.
Oxfam said that big global corporations, and the wealthy, must pay their fair share to governments’ coffers, so that countries can tackle inequality and build fairer societies. Redistributing wealth by, for example, introducing a levy of 1.5% on the wealth of the world’s billionaires could raise enough each year to get every child into school and deliver healthcare in the poorest countries.
The EU could also set up a mandatory registry for European lobbyists to shed light on corporate practices, as well as excluding healthcare, medicines, medical technologies, knowledge and education from all trade and investment agreements the EU is negotiating, such as TTIP.
“Tackling inequality is not about being envious of fast cars and super yachts – it’s about the fact that the richest literally live longer and healthier lives than the poorest. We live in a world where there is plenty enough for everyone to improve their lot. Extreme inequality causes instability, conflict and even mental health problems that affect us all. It is time to even it up before it gets worse,” Byanyima said.
The effect of curbing inequality would be as dramatic as would be the failure to act. In India, for example, halting the recent increase in inequality could enable 90 million more people escape extreme poverty by 2019.
In Kenya, three million more people could be pushed below the poverty line by the same year if inequality there remains at current levels rather than declining slightly.
Oxfam, an international confederation of 17 organisations working together with partners and local communities in more than 90 countries, says that the widening gap between the richest and poorest is damaging economies and pushing more people into poverty.
Many still toil in extreme poverty. On the other extreme, wealth is increasingly concentrated in the hands of a few, who can use it to capture disproportionate power to shape the future.
In 2014 the richest 85 people on the planet owned as much as the poorest half of humanity. Today, seven out of ten people live in countries where the gap between the rich and poor is worse than thirty years ago. In Uganda, under-five mortality among the top 20% has halved, but for the bottom 20% it has only fallen by a fifth over the same period. Meanwhile in the UK, men born in the richest part of the country can expect to live 9 years longer than men from the most deprived areas.