This is how hyperconcentration of wealth is fueling economic inequality

The richest 1% of the population owns more wealth than the rest of the world’s population in the 95%, According to a report on economic inequality Published this Monday, September 23, by the NGO Oxfam Intermón within the framework of the United Nations General Assembly.

Furthermore, Oxfam has stressed that The influence of billionaires on the economy has skyrocketed, as more than a third of the world’s 50 largest companies have a billionaire as their CEO or major shareholder.

(See: Unions warn Congress of the harmful effects on poverty and employment due to labor).

The Oxfam Intermón report also warns that global efforts to respond to the planet’s greatest challenges, such as the climate crisis or persistent levels of poverty and inequality, are being “threatened” by the concentration of power in the hands of the ultra-rich and mega-corporations.

This hyper-concentration of power and wealth, the report argues, “fuels” inequality both within and between countries. Indeed, despite representing 79% of the world’s population, countries in the global South only account for 31% of global wealth.

(See: Tax measures proposed by Oxfam to mitigate inequality in Colombia and Latin America).

The report describes how a “intensification of the weight of a global oligarchy“, in which the ultra-rich -often at the head of companies with enormous market power- influence political decision-making and the rules of the game.

“While they are getting richer, progress towards greater global progress is being slowed down.“, states the work of Oxfam Intermón.

On the other hand, the report draws attention to two multinationals that own 40% of the world seed market and The three largest US fund managers (BlackRock, State Street and Vanguard) manage $20 trillion in assets, nearly one-fifth of all investment assets worldwide.

(See: Why does Bogotá have the highest inequality rate in the country?).

Three examples of abuse of power

Oxfam Intermón cites three examples to show how the abuse of power is being put into practice, undermining multilateral progress.

In your opinionlarge corporations violate international tax cooperation, Big pharmaceutical companies are resisting attempts to dismantle their monopolies on Covid-19 vaccine technologies, and private creditors are exacerbating the global crisis.

(See: Colombia remains among the most unequal countries in Latin America).

Regarding this last example, Oxfam Intermon points out that Low-income countries spend almost 40% of their annual budgets on debt service, which represents 60% more than what they jointly spend on education, health and social protection.

More than half of the external debt of low- and middle-income countries is owed to private lenders such as banks or hedge funds, he adds.

Some of these creditors are ‘vulture funds’, which buy debt in contexts of over-indebtedness at a low price, and “exploit” legal mechanisms to receive payment in full, reaping huge profits at the expense of the countries.

EFE