Three Ways to Keep the Global Economic System from Working Only for Rich White Men

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Image: Woman carrying water from a fire hydrant in Laos. Credit: Jim Holmes / AUSAid / Flickr, CC 2.0.

A new Oxfam report suggests that a generation of reckless financial deregulation, the accumulation of wealth by the world’s richest 1%, and the decline in essential state services have resulted in extreme levels of social and economic polarization . The title of the report is that in the decade since the 2008 global financial crisis, the number of billionaires nearly doubled and their wealth increased by $ 900 billion in the last year alone, or 2.5. billion dollars a day. In the same period, the wealth of the poorest half of humanity, 3.8 billion people, fell by 11%. In other words, this means that only 26 billionaires – up from 43 in 2017 – have the same wealth as the poorest half of humanity. To quantify this wealth in terms of development, the report states that Amazon owner Jeff Bezos has amassed a fortune of $ 112 billion. Only 1% of this is equivalent to Ethiopia’s entire health budget. In summary, rich and poor are increasingly polarized and the wealth is concentrated in fewer hands.

Oxfam argues that one of the main reasons for this grotesque distortion in the distribution of wealth is the under-taxation of the super-rich, who it says secretes some $ 7.6 trillion abroad. The report calls for “a new set of global rules and institutions to fundamentally rethink the tax system to make it fair.” But tax evasion is only one of the underlying factors of the inequalities that are captured in the Oxfam report; two other important factors of poverty are gender discrimination and the erosion of public services.

Women’s unpaid work is worth $ 10,000 billion

Globally, women earn 23% less than men, and in the United States, single white men have a hundred times more wealth than single Hispanic women. Oxfam argues that where the poverty gap is greater between the rich and the poor, so is the level of inequality between men and women. The report calculates that if all the unpaid work that women and girls do on a daily basis, such as caring, cooking and cleaning, were done by a single company, it would have an annual turnover of $ 10,000 billion. dollars. This would represent 43 times more revenue than multinational giant Apple – but is not included in the development indices and reports of most multilateral development organizations that rely on the brutal economic instrument of domestic product. raw. What is also largely ignored is the time stolen from women, especially low-income women, who are denied the opportunity to pursue education, political and economic opportunities that would support both individual and community development.

Oxfam says the disinvestment in public services following neoliberal “reforms” has also contributed significantly to gender inequality. The report says:

“The economic rules were written by rich and powerful men for their own benefit. Today’s neoliberal economic model has only made matters worse: cuts to public services, tax cuts for the wealthiest individuals and businesses, and a race to the bottom of wages have all hurt women more than men ”.

Investing in public services not only narrows the gender poverty gap, but improves the development prospects of communities at the heart of neoliberalism in the North and South. Health, education and social protection are identified by Oxfam as essential to overcome barriers to inequality and expand life opportunities for millions of low-income people. Today, nearly half of the world’s population (3.4 billion) live on less than $ 5.50 a day while the rich are consistently under-taxed. Only 4 cents of every dollar in tax revenue comes from the rich and in some countries, including the UK and Brazil, the poorest 10% pay proportionately as much in tax as the richest 10%. This situation is untenable because an increasing number of working poor are forced into poverty. As the UN rapporteur’s report on austerity in the UK made clear last year, the decade following the 2008 financial crisis has been characterized by growing poverty in the North. For example, the Trussell Trust distributed 1.3 million three-day emergency food supplies in the UK to people in crisis between April 2017 and March 2018, a 13% increase from 2017, with 484,026 of these supplies intended for children. Our economy is down and Oxfam is calling for a realignment of taxes to ensure the rich pay their way. The report calculates that a modest 0.5% tax increase on the incomes of the top 1% would generate enough income to educate the 262 million currently out of school children and provide health care for 3.3 millions of people.

Sustainable Development Goals – Strewn with Contradictions?

Governments, civil society movements and development NGOs base their hopes for a more equal society on the 17 sustainable development goals agreed in 2015 “to end poverty, protect the planet and guarantee peace and prosperity ”by 2030. SDGs designed and equipped to answer fundamental questions about wealth accumulation and distribution raised by Oxfam’s report and can they ensure that vital public services can be fully funded and available for anyone who needs it? In short, can the SDGs resist the wave of neoliberalism and curb the power of private companies and wealthy individuals? The goals themselves suggest no and seem contradictory. For example, Goal 13 calls for “urgent action to combat climate change and its impacts” while Goal 8 aims to “Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work. for everyone “. As Hickel puts it about this apparent contradiction:

“All of this reflects the realization that something in our economic system has gone terribly wrong. The pursuit of endless industrial growth eats away at our living planet, produces poverty and threatens our existence. And yet the heart of the SDG agenda for development and poverty reduction rests precisely on the old model of industrial growth – ever higher levels of extraction, production and consumption ”.

So there are significant doubts as to whether the SDGs can close the current poverty gap while working within the same old, proven neoliberal economic model. There is no indication to date that the richest 1% is interested in more proportionate and fairer tax contributions; which goes against their neoliberal grain.

Oxfam makes three key, sensible recommendations based on the evidence in its report. First, the provision of “free universal health care, education and other public services that work equally for women and girls”. Easier said than done – but made more possible with the implementation of the second recommendation to ‘end the under-taxation of wealthy individuals and businesses’, which could potentially free billions in additional revenue for public funds. And, third, to alleviate the millions of unpaid hours women spend “looking after their families and their homes.”

The hard alternatives are: deeper poverty among the working poor, especially women; a greater disconnect between people and the politicians who represent them; more support for the populist right; and greater social upheaval resulting from the economic pressures of austerity and welfare reform. As Oxfam puts it: “Today’s levels of inequality and poverty are a choice. We can continue to choose to reward those who are already rich or we can choose to fight inequality and end poverty ”.


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