Fat cats out of control: 1% owns 82% of wealth

[Wilfire]

The gap between the super rich and the rest of the world widened last year as wealth continued to be owned by a small minority, Oxfam has claimed.

Some 82% of money generated last year went to the richest 1% of the global population while the poorest half saw no increase at all, the charity said.

Oxfam said its figures - which critics have queried - showed a failing system.

It blamed tax evasion, firms' influence on policy, erosion of workers' rights, and cost cutting for the widening gap.

Oxfam has produced similar reports for the past five years. In 2017 it calculated that the world's eight richest individuals had as much wealth as the poorest half of the world.

This year, it said 42 people now had as much wealth as the poorest half, but it revised last year's figure to 61. Oxfam said the revision was due to improved data and said the trend of "widening inequality" remained.

'Unacceptable'

Oxfam chief executive Mark Goldring said its constant readjustment of the figures reflected the fact that the report was based "on the best data available at the time".

"However you look at it, this is an unacceptable level of inequality," he said.

Oxfam's report coincides with the start of the World Economic Forum in Davos, a Swiss ski resort. The annual conference attracts many of the world's top political and business leaders.

Inequality typically features high on the agenda, but Mr Goldring said that too often "tough talk fades away at the first resistance".

Analysis by Anthony Reuben, BBC Reality Check

It's really hard working out how much wealth the super-rich and the very poor have.

The super-rich tend not to publicise their worth and many of the world's poorest countries keep poor statistics.

To illustrate that, this time last year, Oxfam told us that eight individuals have as much wealth as the poorest half of the world's population. Now it has revised that figure to 61 people for last year, falling to 42 people this year - that's a pretty big revision.

And there are other caveats around the data on which all this is based, such as that the people on the list with the lowest wealth are not necessarily poor at all - they may be highly qualified professionals with large amounts of student debt, for example, or people with high incomes but enormous mortgages.

But whether it's eight people, 42 people or 61 people who have the same wealth as half of the world, there is still great wealth inequality around the world, which is the message Oxfam is taking to Davos.

The charity is urging a rethink of business models, arguing their focus on maximising shareholder returns over broader social impact is wrong.

It said there was "huge support" for action with two thirds (72%) of 70,000 people it surveyed in ten countries saying they wanted their governments to "urgently address the income gap between rich and poor".

But Mark Littlewood, director general at free market think tank The Institute of Economic Affairs, said Oxfam was becoming "obsessed with the rich rather than the poor".

"Higher taxes and redistribution will do nothing to help the poor; wealth is not a fixed pie. Richer people are also highly taxed people - reducing their wealth won't lead to redistribution, it will destroy it to the benefit of no one," he added.

It was a criticism echoed by Sam Dumitriu, head of research at another free market think tank - the Adam Smith Institute - who said the charity's inequality stats "always paint the wrong picture".

"In reality, global inequality has fallen massively over the past few decades.

"As China, India and Vietnam embraced neoliberal reforms that enforce property rights, reduce regulations and increase competition, the world's poorest have received a massive pay rise leading to a more equal global income distribution."

How does Oxfam work out the figures?

Oxfam's report is based on data from Forbes and the annual Credit Suisse Global Wealth databook, which gives the distribution of global wealth going back to 2000.

The survey uses the value of an individual's assets, mainly property and land, minus debts, to determine what he or she "owns". The data excludes wages or income.

The methodology has been criticised as it means that a student with high debts, but with high future earning potential, for example, would be considered poor under the criteria used.

But Oxfam said even if the wealth of the poorest half of the world was recalculated to exclude people in net debt their combined wealth was still equal to that of just 128 billionaires.

http://www.bbc.com/news/business-42745853

Still waiting for jobs and cash to trickle down.

[TheBeardedOne]

You do understand a lot of posters here are part of that 1% purely based on where we live.

[Fincayra]

trickle down economics would work, in an environment that encourages business to exist. In America, it is cheaper to tear down your factory, rebuild it in a different country, pay those workers peanuts, and ship your product back to America. That means that business's jobs are gone from the country, and all those people either find a new job or go on financial assistance. The business owner becomes richer, and the poor become poorer. Business 101.

[Jeezy911]

Everyone agrees that the income gap needs addressed, but I am yet to see a solution that doesn't border on government thievery. The issue with the taxes is when you raise them too high, it also hurts those working for the 1%. No simple answer to such a complex problem.

[Deleted]

42 individual people have more wealth than 50% of the planet's population. That's more wealth in the hands of 42 individuals than a combined total of 3.8 billion people.

That's fine. Seems justified. They probably deserve all that money. And need. They definitely need all that money.

[WskyDK]

You do understand a lot of posters here are part of that 1% purely based on where we live.

Exactly correct.
https://www.investopedia.com/article...cent-world.asp

[Deleted]

That's fine. Seems justified. They probably deserve all that money. And need. They definitely need all that money.

Bill Gates popularised computation for the entire world. That means he definitly deserves his money.
Now, does he actually need the money? Probably not. But you could also hope that he uses the money to bring the next big thing to the table.

[Corroc]

The funny thing that most people dont understand is that the 1% that owns 82% of the wealth actually supports most of the world with their money. Rich people make more money by investing that money, not holding it on bank account. That money is providing people jobs and industries more money to expand. And since the world keeps getting bigger there will be more people who need jobs and more people who will be working, indirectly, for that 1%.

[Orange Joe]

Bill Gates popularised computation for the entire world. That means he definitly deserves his money.
Now, does he actually need the money? Probably not. But you could also hope that he uses the money to bring the next big thing to the table.

He has also donated about 30% of his net worth.

http://www.businessinsider.com/most-...-bill-gates-20

[Dequanacus]

Still waiting for a solution to this problem instead of group cry circles.

[OrcsRLame]

Anyone here ever heard of the Pareto Principle? It's like this strange observation that across many events 80% of effects come from 20% of causes. This is so universal across reality that I'm tempted to say it's a natural law that we don't understand. It's like the universe tends towards an 80/20 distribution like how gravity pushes smaller objects towards the center of larger objects.

Something I've been musing about privately lately is that maybe social and economic unrest is caused by a violation of the Pareto Principle. It seems like a perfectly even distribution of resources, (communism) causes unrest. These days though I see a lot of social unrest caused by this huge wealth inequality, of 1% of people owning 82% of the wealth.

Obviously there's no way to run an experiment like this, but I wonder if a lot of social problems would just kind of fix themselves if 80% of the wealth was owned by 20% of the people, instead of 82% being owned by 1% of the people. It's like people can't tolerate perfect equity, but they also can't tolerate the 1% owning everything. I wonder if the best balance is an 80/20 distribution. Just a thought.

[Simca]

When I clicked on this thread I thought it was going to be about feline obesity.

Just saying.

[PosPosPos]

Still waiting for a solution to this problem instead of group cry circles.

Oh there are solutions, the problem is there isn't enough political will to carry them out.

[Linkedblade]

When I clicked on this thread I thought it was going to be about feline obesity.

Just saying.

Me too, me too. Shame.

[Self Inflicted Wounds]

I thought this would be about obese cats.

[Deleted]

Cats are fine. They are stupid warmongers. Every night I enjoy their warcries.

[Mojo03]

Bill Gates popularised computation for the entire world. That means he definitly deserves his money.
Now, does he actually need the money? Probably not. But you could also hope that he uses the money to bring the next big thing to the table.

He played a role in something that would of been inevitable with or without him. He didn't single handedly bring about the computer age (which is how you're making it sound)

He doesn't deserve that much money, no one does. No one. Does he deserve to be rich? Yes.

[Blur4stuff]

People deserve wealth for their contribution to society, sure. The problem is a relatively small handful of people are getting more wealth than they could reasonably spend in multiple lifetimes.

At some point we have to agree on something very basic. There's a certain amount of wealth that no one person should control. Just as there are certain basics that every person should have access to like clean water and healthcare.

But just saying something like "wealth cap" would send some people into a raging frenzy. Even if that cap is so fucking high that you couldn't spend it all anyways unless you go on an endless binge of hookers and blow while in orbit.

Just consider something very simple. If someone makes 20 million a year, would their life suddenly go to shit if it was 17? If it was 15? If someone is worth 1 billion would it be the end of the world if they were worth 750 million instead? Would they have to start buying Great Value fries instead of Ore-Ida? Not that they do their own shopping obviously.

[Stelio Kontos]

My first thought reading the title.

[tankbug]

Bill Gates popularised computation for the entire world. That means he definitly deserves his money.
Now, does he actually need the money? Probably not. But you could also hope that he uses the money to bring the next big thing to the table.

That would have happened anyway. Microsoft wasn't the only ones making home computer software. What's special about Bill Gates, is what he does with his money now. His (and his wife's) charity foundation is really a shining example for the super rich, and if I'm not mistaken, he has pledged to give away like 99% of his wealth before he dies, meaning his kids won't be super rich by inheritance. (Just still very rich )