Reward Work, Not Wealth

The year 2017 saw the largest ever increase in billionaires globally: one every two days. Their wealth increased by $762 billion – a sum which could end global extreme poverty seven times over.

Around 82 per cent of all the wealth created in 2017 went to the top 1 per cent of the world’s population, while the bottom 50 per cent saw no increase in wealth at all.

Women had fewer economic rights than men in 155 countries, but they provided $10 trillion in unpaid care every year to support the global economy. According to the International Labour Organisation (ILO), 95 per cent of women working outside the home in Asia were in the informal sector.

Approximately one-third of the world’s billionaires inherited their wealth. Over the next 20 years, 500 billionaires are estimated to hand over $2.4 trillion to their heirs, a sum larger than India’s GDP.

The Panama and Paradise Papers revealed that the super-rich were hiding at least $7.6 trillion from the tax authorities. The economist Gabriel Zucman showed that the top 1 per cent was evading an estimated $200 billion in taxes. And developing countries were losing at least $170 billion each year in foregone tax revenues from corporations and the super-rich.

According to the World Inequality Report 2018, 13 cents of each dollar of global income growth went to the bottom 50 per cent while 42 cents went to the top 10 per cent. The global economy would have to be 175 times bigger than it presently is just to push everyone (living in poverty) above $5 a day, which would be environmentally catastrophic.

In developing countries, 260 million young people were estimated to be living without employment, education or training. This was true for one in three young women. 

In Oxfam’s poll of over 70,000 people in 10 countries, 73 per cent of the Indian respondents felt that the gap between the rich and the poor needed to be addressed urgently or very urgently.

In India, those living on $2 a day had a mortality rate three times the global average. 

Around 56 per cent of the global population lived on between $2 and $10 a day, including the majority of the world’s workers and small-scale food producers. Women were heavily over-represented among the working poor.

According to the ILO, in 2011-12, 50.7 per cent of wage employees in India’s garment sector earned less than minimum wage. Of these, 74 per cent of all women and 45.3 per cent of all men were paid less than minimum wage.

The report recommended that in order to design a fairer economy, governments must make it mandatory for all multinational corporations to ensure that workers are paid a living wage and to observe the UN Guiding Principles on Business and Human Rights. Further, they must ensure that their top executives are paid no more than 20 times their median employees’ pay, preferably less.

The report also said that governments must implement laws to eliminate the gender pay gap. In addition, they must transition from minimum wage levels to ‘living wages’ for all workers (based on the cost of living) and progressively formalise the informal economy with the participation of informal workers, among other things.

Each year, 374 million accidents on the job resulted in extended absences by workers. According to the ILO, more than 2.78 million workers died every year because of occupational accidents or work-related diseases – that is, one death every 11 seconds.

Oxfam’s 10-country poll showed that the respondents generally felt that CEOs should have their pay cut. In the U.K., U.S. and India, people thought that CEOs should take a 60 per cent pay cut. 

The same poll found that among people in India who thought they were poor, seeing where they were in the national income distribution resulted in almost 15 per cent more respondents agreeing that it was difficult for a person to increase the amount of money he/she had despite working hard.