Billionaires made $2 trillion last year while it’s austerity for the rest of us

Oxfam’s latest study into contemporary inequality – produced while the ruling class and their minions were rubbing shoulders in Davos – revealed that in 2024, each of the world's 2,640 billionaires increased their wealth by $2 million daily. Meanwhile, since 1990, there has been no improvement in the number of those living on less than $6.85 a day, which still represents 3,600,000,000 people.

Every year Oxfam publishes a study which again and again lays bare the unbelievable – and widening – gulf between rich and poor. In 2016, they reported that 62 people own as much as the poorest 3.5 billion. In 2020 they reported that the richest 10 people doubled their wealth during the COVID pandemic, whereas 160 million were driven into poverty. In 2023, they reported that the richest 1 percent captured two-thirds of all new wealth since 2020, simultaneous with the largest increase in global poverty since WW2. In 2024 they predicted that Earth would have its first trillionaire by 2035. Now they are predicting 5 trillionaires by then!

Such statistics serve to confirm that inequality is in the nature of capitalism. In spite of the dazzling abundance of wealth, which is more than sufficient to tackle the problems facing mankind, inequality has never been greater. Why? Because we live in a system in which a privileged minority of society owns all of the means of producing wealth, forcing the propertyless majority to sell their ability to work in order to survive. As the capitalists get richer from the ceaseless exploitation of their workers, the poor sink deeper into misery, as Marx explained long ago.

Age of excess, age of austerity

Inequality has been sharply rising since the 1970s. But once the revolutionary upsurge that closed the post-war boom had been defeated, governments came to power which were willing to issue the necessary medicine to stabilise capitalism and ‘restore business confidence’. Organised labour suffered defeats in a number of countries, taxes on the rich were axed, nationalised industries were pawned off, and financial services were deregulated.

Inequality has now risen to unparalleled extremes / Image: RoyBoy, Wikimedia Commons

A bonanza of profits followed, propelled by globalisation, rising productivity coupled with stagnant wages, and an astronomical boom in the value of assets. Neither the 2008 financial crisis nor the economic slowdown during the COVID-19 pandemic slowed down the immense accumulation of wealth at the top. On the contrary, the rich were handed trillions of dollars in bailouts to continue with their reckless gambling, while the poor were forced to shoulder the crisis, in the form of ruthless austerity.

As a result, inequality has now risen to unparalleled extremes. The top 1 percent now owns more than the bottom 95 percent of humanity combined. Of all the wealth created since 1990, the top 1 percent have captured 38 percent of it, whereas the bottom 50 percent have taken just 2 percent.

In the US, the richest country on the planet, whereas in the 1960s an average CEO was paid about 21 times that of a worker, by 2022 this had risen to 344 times. And while US workers lost $1.5 trillion over the last two years to inflation, billionaire wealth since 2010 has grown three times as fast as the rate of inflation.

Even within the rich elite, this increase in wealth has benefited the top of the top most of all. The top 0.01 percent of individuals – the world’s richest 520,000 people who each own at least $19 million – now hold 11 percent of the world’s wealth. Within that, the 2,640 billionaires alone control 3 percent of it, up from 366 billionaires which controlled 1 percent in 1995. Last year, global billionaire wealth grew by $2 trillion to $15 trillion, three times the rate of 2023 and the second fastest increase in billionaire wealth ever recorded (after 2020).

Parasitism, corruption and plunder

These are by no means innovating, enterprising, hard-grafting capitalists, as the billionaire media would like us to believe. The vast majority of this wealth derives from idle parasitism.

Oxfam reports that 36 percent of all current billionaires inherited their wealth, including all billionaires under 30. In fact, as older billionaires die off, we are passing through the greatest wealth transfer in history, with $5.2 trillion set to be transferred to their scions by 2030.

Even for those who didn’t inherit their money, the vast majority of their wealth is made simply by virtue of owning property and stocks. In Britain, half of all wealth accumulated since 2008 came from the rising value of assets alone. And in the USA, the top 10 percent now control 92 percent of the value of the S&P 500, which, since 1990, has grown in value by 901 percent.

Even more profitable is the imperialist plunder of the world. The report shows that wealth is being drained at a rate of $30 million an hour from the ‘global south’ to the richest 1 percent of the ‘global north’. Much of this is in the form of debt repayments, which for low-income countries make up an estimated 48 percent of their budgets. This has meant that, between 1970 and 2023, poor governments paid $3.3 trillion in interest to rich creditors in the advanced capitalist world.

Wealth is being drained at a rate of $30 million an hour from the ‘global south’ to the richest 1 percent of the ‘global north’ / Image: Oxfam, fair use

The IMF – an institution par excellence for maintaining ‘free’ ex-colonial countries in a state of slavery – encouraged poor governments to cut $4 for every $1 they encouraged them to spend on public services, so that they could continue paying these debts. During the pandemic, this amounted to a cut of $10 billion in public services – equivalent to 3 million essential jobs – across the ‘global south’.

Oxfam’s report also estimates that 6 percent of the world’s billionaire wealth comes from ‘crony sources’ – i.e. corruption – and that 18 percent is from monopoly power. But their measures give a vast understatement of the reality.

Monopolies today absolutely dominate the world economy. For instance, in the US – whose corporations dominate most of the planet – 1 percent of corporations account for 81 percent of sales and 97 percent of business assets, with the top 0.1 percent accounting for 66 percent of sales and 88 percent of assets. Even where industries seem formally competitive, behind the brands are the domination of a few big banks. The world’s top three shareholders, for instance, have a controlling stake in half of the world's largest companies. Here too, even greater control of the world's wealth is falling into the hands of the elite of the elite: a billionaire runs or is the principal shareholder of a third or more of the 50 richest corporations.

And, while they might not openly bribe politicians, the billionaires of the ‘democratic’ world have all sorts of ‘by the book’ mechanisms for influencing the state machine in the interest of their profits.

For example, 40 percent of all ‘political donations’ now come from the top 0.01 percent and, in 2022 alone, the biggest US corporations spent $746 million on lobbying the government. The world’s biggest asset manager, Blackrock, has hired at least 84 former US government officials since 2004, whereas Goldman Sachs (nicknamed ‘Government Sachs’) alumni have served continuously as prime minister, finance minister or central bank chief in at least one of the G7 nations since 2006.

As Lenin asked,

“What would you call that? Direct or indirect bribery? An alliance of the government and the syndicates, or ‘merely’ friendly relations?”

Charity or class struggle?

Never has so much wealth been concentrated into so few hands / Image: Eric Tessmer, Flickr

Never has so much wealth been concentrated into so few hands. At the same time as the fatcats spend their fortunes holidaying in space or on billion-dollar super yachts, 700 million people are starving, 150 million people are homeless, and 41 million people die of preventable diseases each year. These are not just striking opposites: the wealth of the few is based upon the exploitation of the many.

By way of a solution, Oxfam supports the suggestions of a group called ‘Patriotic Millionaires’, a group of British CEOs, heirs to capitalist dynasties and bankers, who are begging that they and their class are taxed at a rate of 2 percent. They are doing so because they see the current level of wealth inequality as a threat to global social and economic stability. They are right to be worried.

Amid imperialist war and genocide, climate catastrophe, crushing debt, and savage austerity – all of which are symptoms of the anarchic pursuit of profits at any cost – such obscene inequality is polarising society. More and more, it is becoming obvious to all that society is run by and for the rich, at the expense of the poor. But taxation cannot resolve this.

For inequality to be abolished, capitalism must be abolished. The means of production, properly organised and operated in the interest of common need, represent a potential abundance of wealth for all humanity. To be freed, they must be seized out of the hands of the capitalist class, which is selfishly driving the human species into the abyss, and placed under the control of the billions of workers of the world, without whom not a wheel would turn.