‘Rich becoming richer and poor becoming poorer’ is an old proverb and the same can now be little rephrased as ‘rich become richer, poor and middle-class stand where they are or fall further’!
This was evident in a recent study published by Oxfam, a global movement for alleviating poverty and addressing inequality.
In its annual study published ahead of the five-day World Economic Forum (WEF) Annual Meeting, the international body said billionaires’ fortunes swell by 12 percent or USD 2.5 billion a day in 2018.
While the poorest half of the population suffered an 11 percent decline in their overall wealth.
Surprisingly, India had 10 percent of the poorest (13.6 crore population) continuing in debt since 2004, while the country’s billionaires had their wealth growing Rs 2,200 crore a day in 2018.
The world’s richest man Jeff Bezos had his wealth grow to USD 112 billion and 1% of his wealth is equivalent to health budget of Ethiopia with 115 million population.
Top 1% of India’s richest Grew 39%
The top 1% of India’s richest grew richer by 39 percent against 3 percent growth witnessed by the bottom half of the population, the study found.
“India’s top 10 percent of the population holds 77.4 percent of the total national wealth. The contrast is even sharper for the top 1 percent that holds 51.53 percent of the national wealth…
…The bottom 60 percent, the majority of the population, own merely 4.8 percent of the national wealth. Wealth of top 9 billionaires is equivalent to the wealth of the bottom 50 percent of the population,” Oxfam said in its study, citing wide disparity in wealth in the country.
According to the study, India added 18 new billionaires to its list in 2018, making up 119 in total with total wealth touching USD 400 billion (Rs 28 lakh crore) mark for the first time.
Thus, the total wealth of Indian billionaires grew from USD 325.5 billion in 2017 to USD 440 billion by 2018, the single largest annual rise in wealth since the 2008 global financial crisis.
The study estimates that India will produce 70 new dollar millionaires every day.
If India’s richest 1 percent can pay an extra 0.5% extra tax on their wealth, that alone can increase the government healthcare spending by 50 percent.
The Center and states’ combined revenue and capital expenditure, for medical, public health, sanitation and water supply (Rs 2,08,166 crore) is less than Mukesh Ambani’s wealth of Rs 2.8 lakh crore.
Wide Wealth Disparity, Public Services in Vain
While the billionaires’ wealth is on upward trend, the public services are suffering from fund crunch or being outsourced to private companies that exclude the poorest people, the survey found.
According to the study, many countries including India have decent education or quality healthcare a costly affair suitable for rich.
“Children from poor families in India are three times more likely to die before their first birthday than children from rich families,” the study found.
Oxfam made its numbers based on the publicly-available data from the Credit Suisse Wealth Databook and the annual Forbes Billionaires List.
Oxfam International Executive Director Winnie Byanyima said this disparity will lead to a complete collapse of the social and democratic structure of this country.
She raised a concern that the size of a bank account is deciding the future of kids in many countries.
“It (the survey) reveals how governments are exacerbating inequality by underfunding public services, such as healthcare and education, on the one hand, while under taxing corporations and the wealthy, and failing to clamp down on tax dodging on the other,” says Oxfam India CEO Amitabh Behar.