Oxfam: The cost of inequality: how wealth and income extremes hurt us all

[G_j]

http://www.oxfam.org/sites/www.oxfam.org/files/cost-of-inequality-oxfam-mb180113.pdf

The cost of inequality: how wealth and income
extremes hurt us all

The world must urgently set goals to tackle extreme inequality and extreme wealth
It is now widely accepted that rapidly growing extreme wealth and inequality are harmful to
human progress, and that something needs to be done. Already this year, the World Economic
Forum’s Global Risk Report rated inequality as one of the top global risks of 2013. The IMF and
the Economist2 agree. Around the world, the Occupy protests demonstrated the increasing public
anger and feeling that inequality has gone too far.

In the last decade, the focus has been exclusively on one half of the inequality equation - ending
extreme poverty. Inequality and the extreme wealth that contributes to it were seen as either not
relevant, or a prerequisite for the growth that would also help the poorest, as the wealth created
trickled down to the benefit of everyone.

There has been great progress in the fight against extreme poverty. Hundreds of millions of
people have seen their lives improve dramatically – an historically unprecedented achievement
of which the world should be proud4. But as we look to the next decade, and new development
goals we need to define progress, we must demonstrate that we are also tackling inequality- and
that means looking at not just the poorest but the richest5. Oxfam believes that reducing
inequality is a key part of fighting poverty and securing a sustainable future for all. In a world of
finite resources, we cannot end poverty unless we reduce inequality rapidly.

That is why we are calling for a new global goal to end extreme wealth by 2025, and reverse the
rapid increase in inequality seen in the majority of countries in the last twenty years, taking
inequality back to 1990 levels67.


Extreme wealth and inequality are reaching levels never before seen and are getting
worse

Over the last thirty years inequality has grown dramatically in many countries. In the US the
share of national income going to the top 1% has doubled since 1980 from 10 to 20%. For the
top 0.01% it has quadrupled8 to levels never seen before. At a global level, the top 1% (60 million
people)9, and particularly the even more select few in the top 0.01% (600,000 individuals - there
are around 1200 billionaires in the world), the last thirty years has been an incredible feeding
frenzy10. This is not confined to the US, or indeed to rich countries. In the UK inequality is rapidly
returning to levels not seen since the time of Charles Dickens11. In China the top 10% now take
home nearly 60% of the income. Chinese inequality levels are now similar to those in South
Africa,12 which are now the most unequal country on earth and significantly more unequal than at
the end of apartheid13. Even in many of the poorest countries, inequality has rapidly grown14.

Globally the incomes of the top 1% have increased 60% in twenty years.15 The growth in income
for the 0.01% has been even greater16.
Following the financial crisis, the process has accelerated, with the top 1% further 17 increasing
their share of income18. The luxury goods market has registered double digit growth every year
since the crisis hit19. Whether it is a sports car or a super-yacht, caviar or champagne, there has
never been a bigger demand for the most expensive luxuries.

The IMF has said that inequality is dangerous and divisive and could lead to civil unrest20. Polling
shows the public is increasingly concerned about growing inequality in many countries, and by
people across the political spectrum.

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