An study by the not for profit organization Oxfam identified that the eight richest people in the world have as much wealth as the bottom half of the world. The study performed by Oxfam used a wide range of sources for their calculation and is conducted in preparation of an economic forum at Davos Switzerland where the wealthiest people of the world congregate in order to discuss the current economy and world events. While many things are discussed at the Davos World Economic Forum, the Oxfam report is always a highlight of the event as it focuses on the current level of economic inequality in the world.
Joining these wealthy individuals at Davos are numerous world political leaders and other world visionaries. The Davos forum runs from January 17 to 20 and is expected to run through numerous important topics. However the World Economic Forum is often criticized for the limited way in which it handles inequality and other major factors, namely through only discussion and no real action.
The fact that only eight people in the world have as much wealth as the bottom half is a big step towards further inequality as compared to the prior year in which it took sixty two people to reach the bottom half. These eight people have as much money as the lowest 3.6 billion people.
Several notable Americans make up the right richest; Bill Gates the former Founder and CEO of Microsoft tops the list, with Warren Buffet of Berkshire Hathaway, Mark Zuckerberg of Facebook, Lawrence Ellison of Oracle, Michael Bloomberg who founded Bloomberg, and Jeff Bezos of Amazon.com. Rounding out the top eight are Carlos Slim Helu from Mexico who controls numerous cell phone companies in Latin America and Amancio Gaona who founded fashion company Zara.
Many of the world’s wealthiest people have a significant portion of their wealth in companies that they control and do not have assets that are fully liquid and easy to dispose of. Their wealth will often rise or fall based on the stock market values of the companies that they control. The recovery from the Great Recession of 2008 to 2009 has led to further wealth disparity partially due to the lack of wage growth despite increases in the asset values of various large companies.
Many of these eight wealthy individuals have signed up for the giving pledge in which they will donate significant portions of their wealth to charity. Bill Gates, Warren Buffet, and Mark Zuckerberg have all signed up for this giving pledge and Bill Gates, in particular, is significantly involved in his own charity to support numerous causes. The Gates Foundation has contributed to causes as diverse as wealth inequality, eradication of several worldwide diseases, and empowering communities to be self sufficient and is heavily contributed to by both Bill and Melinda Gates, as well as by Warren Buffet.
The Oxfam report indicated that inequality was significantly worse than feared and a sign of a warped economy. While the eight richest have more money than they could ever spend, while almost one in nine people don’t have enough money to eat. Part of the cause in the increase in inequality was attributed to better quality information coming from China and India which indicated that greater numbers of people were more poverty stricken than previously thought. This led to revised estimates of the poorest people in the world with lower wealth levels being applied to many of them.
Oxfam, an charity which has been in operation since 1942 and is based in the United Kingdom, has suggested several ways that the inequality can be reversed. First they identify that companies should be made to avoid tax dodging on a global basis and should proactively care for both their shareholders and their employees by paying a real living wage to employees. In addition Oxfam is indicating that wealth taxes should be collected and used to fund education, the creation of jobs, and provide healthcare for I individuals in need of it.
Oxfam further indicated that wealth disparity is not an inevitable outcome of capitalism and that proper policy can reallocate wealth appropriately and for the benefit of the world in a sustainable manner. However, per a statement by the Oxfam president Mark Goldring, the current report by Oxfam is not only more striking than prior reports, it is more accurate as well and shows the depth of the problem and the need to immediately right the economic ship before the problem of economic inequality gets worse.