Share of global wealth held by billionaires climbs during pandemic
Inequality across the world has worsened during the COVID-19 pandemic, and the gap between the wealthy and the poor within countries continues to widen, according to the latest World Inequality Report released on Tuesday.
The top 10 percent of the highest earners in the world now own 76 percent of all wealth, while the bottom 50 percent owns just 2 percent. That translates to an average purchasing power, or buying power for an individual, of $4,100 for the bottom half of the world, and $550,900 for the top earners.
The data confirms a trend of global inequality that has only increased in recent decades. The top .01 percent, or 520,000 adults in the world, now owns 11 percent of all wealth, up from 7 percent in 1995. The billionaires in the world own 3.5 percent of all wealth, as compared to .5 percent in 1995, according to the report.
“At the heart of this explosion is the extreme concentration of the economic power in the hands of a very small minority of the super-rich,” the authors of the report wrote. “This report once again makes it clear that profound policy changes are needed for things to fall back in place.”
Inequality is the worst in the Middle East, Africa, Russia, Central Asia and Latin America — the top 10 percent of which all own more than 70 percent of the wealth.
Europe has the shortest gap between the top earners and the bottom earners but still has a significant chasm between the two groups, with the lowest 50 percent holding around 2 percent of all wealth and the top 10 percent owning close to 60 percent.
In the U.S., the wealth gap between the top earners and the lowest earners has leveled off. About 35 percent of the wealth is owned by the richest 10 percent in the country, and 2 percent of wealth is owned by the bottom 50 percent.
One positive from the report is that the wealth gap between poor and rich countries has actually decreased. The top 10 percent in the wealthiest countries own 38 times more wealth than the bottom 50 percent in poorer nations — down from 53 times higher in 1980.
Inequality across the U.S. has given rise to worker-focused and anti-establishment movements on both sides of the political spectrum, and contributed to the U.K.’s decision to leave the European Union.
And historic spending during the Biden administration — some already passed and some still being negotiated — is aimed at addressing poverty, strengthening the social safety net and creating jobs.
The continued gaps in wealth, largely unchanged since data was tracked in the 19th century, continue to worry those who study the issue.
Robert Reich, the founder of the organization Inequality Media, said corporations have “scored record profits” and used the 21 months of the pandemic “to siphon off whatever additional power and wealth they could.”
Those with power and wealth could have shown leadership during this pandemic. Instead, in large part, they chose greed.https://t.co/woM6tyI137
— Robert Reich (@RBReich) December 6, 2021
Climate change has also been a major factor in rising inequality, with poorer citizens more likely to be affected by increasing natural disasters and pollution. The United Nations has repeatedly warned that global warming could continue to widen the gap between the wealthy and the poor unless it’s addressed.
In the latest inequality report, the top 10 percent of earners emit close to 50 percent of carbon emissions, while the bottom 50 percent emits just 12 percent.
The report comes from the work of 100 researchers with the World Inequality Lab. Researchers studied and collected data across a four-year time span.