Oxfam: 85 richest people as wealthy as poorest half of the world

The world’s wealthiest people aren’t known for travelling by bus, but if they fancied a change of scene then the richest 85 people on the globe – who between them control as much wealth as the poorest half of the global population put together – could squeeze onto a single double-decker. 

The extent to which so much global wealth has become corralled by a virtual handful of the so-called ‘global elite’ is exposed in a new report from Oxfam . It warned that those richest 85 people across the globe share a combined wealth of £1tn, as much as the poorest 3.5 billion of the world’s population.

The wealth of the 1% richest people in the world amounts to $110tn (£60.88tn), or 65 times as much as the poorest half of the world, added the development charity, which fears this concentration of economic resources is threatening political stability and driving up social tensions.

It’s a chilling reminder of the depths of wealth inequality as political leaders and top business people head to the snowy peaks of Davos for this week’s World Economic Forum. Few, if any, will be arriving on anything as common as a bus, with private jets and helicopters pressed into service as many of the world’s most powerful people convene to discuss the state of the global economy over four hectic days of meetings, seminars and parties in the exclusive ski resort.

Winnie Byanyima, the Oxfam executive director who will attend the Davos meetings, said: “It is staggering that in the 21st Century, half of the world’s population – that’s three and a half billion people – own no more than a tiny elite whose numbers could all fit comfortably on a double-decker bus.”

Oxfam also argues that this is no accident either, saying growing inequality has been driven by a “power grab” by wealthy elites, who have co-opted the political process to rig the rules of the economic system in their favour.

In the report, entitled Working For The Few (summary here), Oxfam warned that the fight against poverty cannot be won until wealth inequality has been tackled.

“Widening inequality is creating a vicious circle where wealth and power are increasingly concentrated in the hands of a few, leaving the rest of us to fight over crumbs from the top table,” Byanyima said.

How richest use their wealth to capture opportunities

Polling for Oxfam’s report found people in countries around the world – including two-thirds of those questioned in Britain – believe that the rich have too much influence over the direction their country is heading.

Byanyima explained:

“In developed and developing countries alike we are increasingly living in a world where the lowest tax rates, the best health and education and the opportunity to influence are being given not just to the rich but also to their children.

“Without a concerted effort to tackle inequality, the cascade of privilege and of disadvantage will continue down the generations. We will soon live in a world where equality of opportunity is just a dream. In too many countries economic growth already amounts to little more than a ‘winner takes all’ windfall for the richest.”

The Oxfam report found that over the past few decades, the rich have successfully wielded political influence to skew policies in their favour on issues ranging from financial deregulation, tax havens, anti-competitive business practices to lower tax rates on high incomes and cuts in public services for the majority. Since the late 1970s, tax rates for the richest have fallen in 29 out of 30 countries for which data are available, said the report.

This “capture of opportunities” by the rich at the expense of the poor and middle classes has led to a situation where 70% of the world’s population live in countries where inequality has increased since the 1980s and 1% of families own 46% of global wealth – almost £70tn.

Opinion polls in Spain, Brazil, India, South Africa, the US, UK and Netherlands found that a majority in each country believe that wealthy people exert too much influence. Concern was strongest in Spain, followed by Brazil and India and least marked in the Netherlands.

In the UK, some 67% agreed that “the rich have too much influence over where this country is headed” – 37% saying that they agreed “strongly” with the statement – against just 10% who disagreed, 2% of them strongly.

The WEF’s own Global Risks report recently identified widening income disparities as one of the biggest threats to the world community.

Oxfam is calling on those gathered at WEF to pledge: to support progressive taxation and not dodge their own taxes; refrain from using their wealth to seek political favours that undermine the democratic will of their fellow citizens; make public all investments in companies and trusts for which they are the ultimate beneficial owners; challenge governments to use tax revenue to provide universal healthcare, education and social protection; demand a living wage in all companies they own or control; and challenge other members of the economic elite to join them in these pledges.

20 January 2014

The 85 richest people in the world: men still in the driving seat

Women need only seven seats, mostly on the bottom deck, on the £1tn double-decker bus revealed by Oxfam this week 

At its snowy retreat in the Swiss Alps, the World Economic Forum is debating how much inequality is too much. The aid charity Oxfam pointed out that a glance through the richest 100 people in the world shows that the pendulum has already swung heavily in favour of an elite group: the top 85 in the Forbes rich list control as much wealth as the poorest half of the global population put together.

A look down the list of 85 shows that if this group – whose wealth tops £1tn – can squeeze on a double decker bus, then Mexico’s telecoms magnate Carlos Slim swaps driving responsibilities with Microsoft’s Bill Gates and the tiny group of wealthy women need only seven seats, mostly on the bottom deck.

Liliane Bettencourt qualifies as the world’s richest woman (and ninth richest indiviual) after a dramatic rise in the value of her 30% holding in cosmetics group L’Oreal, which her father founded. Famous for her family feuds, the 90-year old is the world’s ninth richest person with a fortune worth $30bn (£18bn), though she suffers from dementia and no longer sits on the board.

Christy Walton is the richest of the Walton clan and 11th richest in the world. She inherited $28.2bn when husband John died in an airplane crash in 2005. Her lead over other Waltons follows a side investment by John in solar panel maker First Solar. Like her sister-in-law Alice, she received nearly $350m in Wal-Mart dividends after taxes in 2013.

Success in the confectionary business pushed Jacqueline Mars to joint number 36 with her brother John and Forrest. They inherited the maker of Mars and Snickers bars in 1999 when their father died.

Australian Georgina Rinehart, like the Mars siblings, is worth $17bn. Charity is not her middle name. In her self-published book she recommended all Aussie workers accept the $2-a-day wages commonly paid in Africa.

Susanne Klatten inherited a 12.6% stake in car maker BMW. Along with her brother Stefan Quandt(81st richest in the world) and mother Johanna Quandt she owns almost 50% of the company. A trained economist, Klatten is Germany’s richest woman with assets worth $14.3bn (and 58th richest in the world).

Germans do well in the rankings of the world’s richest. Contrary to the stereotype of a collectivist social democracy from the boardroom to the shop floor, company owners are much better than their UK counterparts at amassing huge fortunes.

Karl Albrecht (number 18) owns all of Aldi Sud, Germany’s largest discount supermarket chain. With stores across Europe and the US, he outstrips his brother Theo, who inherited the other half of the business. Aldo Sud is worth $26bn while Aldi Nord is worth almost $19bn.

Dieter Schwarz (number 29) inherited Lidl, the discount retailer that had $85bn in revenues in 2012 and is the second biggest discounter behind Aldi. Dividends are donated to a chiritable company that Schwarz controls. The Schwarz Foundation supports education and daycare facilities for children, according to Forbes.

Michael Otto and his four siblings (61st in the world) are another German success story. They share ownership of Otto Group, a conglomerate they inherited that includes a US home furnishings retailer and German toy chain myToys.

Otto claims the group is the second largest internet retailer after Amazon.

The last woman on the list is Abigail Johnson, who is a third-generation executive at Fidelity Investments, the second-largest US investment fund manager. Her estimated 24% stake gives her an asset worth $12.7bn and a place at number 74.

Interactive graphic: Who are the 85?

24 January 2014

Source: The Guardian