Inequality Inc. Part 1 – The world’s first trillionaire?
Oxfam’s new report on a “decade of division”
It’s Davos week and as the rich and powerful flocked to the Swiss ski resort, Oxfam dropped its annual report on the state of global inequality. This year it’s about how corporate and billionaire power is dividing the world.
Over the next three weeks, Equals will be covering how corporate monopolies and power are fuelling inequality. Today, we start by looking at the state of play of global inequality and the link between corporate power and extreme wealth.
Extreme inequality in numbers
A decade of division. The start of this decade has been impossibly tough for a lot of people: COVID-19, escalating conflicts, the visible acceleration of the climate crisis and surging costs of living. 4.8 billion people are poorer than at the turn of the decade, and in the poorest countries, poverty is higher than in 2019. But the fortunes of a few people have boomed. Billionaires are $3.3 trillion (34%) richer than before the pandemic and the five richest (all men) have doubled their wealth.
Colonialism redux. The gap between the Global North and the Global South has grown for the first time in 25 years. Despite representing only 21% of the world population, countries in the Global North own 69% of global wealth and are home to 74% of the world’s billionaire wealth. Since the formal end of colonialism, neocolonial relationships with the Global South persist. Multinational corporations were invented in the colonial era, which helped facilitate the extraction of wealth from the Global South to the Global North.
Profiting from pain. Profits of the world’s largest corporations jumped by 89% for the years 2021 and 2022, compared to the 2017–2020 average. 2023 is set to shatter all records as the most profitable year yet for big business. Together, 148 of the world’s biggest corporations made nearly $1.8 trillion in profits in the 12 months leading up to June 2023. A particularly egregious example of this crisis profiteering is oil and gas companies whose half-year 2023 profits were 278% above the 2018–21 average.
Reaping the rewards. From a sample of 96 major global companies, 82% of profits went to shareholders in the form of stock buybacks and dividends, mainly benefiting the richest. The world’s richest 1% own 43% of all global financial assets. Of the 50 largest listed companies in the world, 17 (34%) have a billionaire as either a principal shareholder or a CEO. If shareholder payouts were redistributed from the top 10% to the bottom 40%, global income inequality could decrease by 21.5%.
Male, pale and stale. Racialized groups are less likely to own corporations. In the US, 89% of shares are owned by White people, 1.1% by Black people and 0.5% by Hispanic people. In South Africa, only 39% of companies listed on the Johannesburg Stock Exchange were controlled by Black people. Globally, only one in three businesses are owned by women, and men own $105 trillion more wealth than women.
Predictions for the years ahead. Journalists have been asking us to stare into our crystal ball – this is what we see:
Based on current trends, within a decade we’ll see our first trillionaire.
UBS predicts a record number of new millionaires and billionaires.
Based on the latest ILO research, 2024 will see increased global unemployment and the number of working poor while income inequality will widen.
We see glimpses of hope. For example, the G20 under the leadership of Brazil has made it clear that inequality and progressive taxation are top of the agenda.
Subscribe to get the rest of the series where we will look at corporate power and the close relationship between the explosion in corporate power and the growth in global inequality.
Something to read and listen to
A new EQUALS podcast episode is out. Find out how traffic lights, neoliberalism and the Catholic Church relate in the fight for a more equal world.
Fill your boots with even more corporate monopoly research. The Balanced Economy Project, SOMO, Global Justice Now and LobbyControl report on how monopolists drive the world’s power and wealth divide
Deep dive into corporate profiteering in this joint Oxfam and ActionAid research.
Brian Cox joins other millionaires calling for higher taxes - pretty sure Logan Roy would have told them to f*** off.