Income inequality creates what Oxfam International charity calls a "deeply shocking" trend: Billionaires are not only wealthier and richer, but the world's poorest half loses wealth at a time when its economy is expanding.
The economic climate is generating huge gains for billionaires, whose wealth rose by 12% last year, while the poorest half of humanity – 3.8 billion people – saw its wealth decline by 11%. %, revealed Oxfam. His report will be published at World Economic Forum in Davos, Switzerland, which begins Tuesday and attracts billionaires as co-founder of Microsoft, Bill Gates, decision makers and corporate executives.
With the benefits of economic expansion benefiting the world's richest, billionaires add $ 2.5 billion in wealth every day. And every other day, a millionaire enters the ranks of the billionaire class, Oxfam said.
Oxfam, which studies the dynamics of wealth inequality since 2011, said the latest findings suggest that a new economic approach is needed to help refocus the distribution of wealth. Many politicians and economists have estimated that economic growth would move all boats forward, but that did not affect billions of people around the world. One of the reasons is that tax rates have fallen to historic lows, allowing wealth and businesses to keep more wealth, said Paul O. Brien, Oxfam's Vice President of Policy and Advocacy. America.
"The economic numbers are going in the wrong direction – it's not just another year of the same old reality – it's getting worse in terms of accumulating extreme wealth," said O. Brien. "It's deeply shocking for us."
The richest people in the world
Tax reductions and fallout theories
The heaviest distribution of wealth coincided with a drastic reduction in tax rates for the world's richest, Oxfam said. He revealed that the maximum rate for rich people in developed countries had dropped from 62% in 1970 to 38% in 2013. In 2017, President Trump had cut personal and corporate tax rates. favors the rich and the companies.
"The leadership we have has put in place policies that deepen the inequality gap," said O. Brien. "What we are asking for is leadership and policies that reduce the gap."
Certainly, conservative policymakers believe that lowering the tax rates of the rich and corporations will spur growth, eventually generating more jobs and higher wages for middle and lower income workers. Yet there is little economic evidence that these policies keep their promises.
For most US workers, bearings remain elusive
A "human economy"
Instead of an economy that focuses on growth at all costs, Oxfam is pushing for what it calls a "human economy."
"Basically, the human economy is built from principles different from those of the growth economy," said O & # 39; Brien. "For years, the consensus was:" Growth solves everything. "But our planet has limited boundaries, we can not burn more, use more, and go beyond the ecological boundaries that are essential to sustaining human life."
"The human economy" would provide health care, education and gender equality to people around the world, he said. "All the evidence shows that educating your children is the best way to build a healthy economy and create true shared wealth.We need to educate children in quality schools and remove legal and cultural barriers that prevent women to be treated unfairly at their place of work, to be overwhelmed and updated. "
Increasing taxes on the world's richest people and societies would help fund these programs. Oxfam has calculated that a 0.5% increase in taxes on the richest would raise enough money to educate the 262 million children who are currently not receiving any money. Educating and providing health care saving 3.3 million people preventable deaths.
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Higher taxes for the rich?
The question of whether the rich should pay higher taxes entered the political discourse this month after new Congressman Alexandria Ocasio-Cortez said the United States should raise taxes on the rich to their highest level since 1980, just before the beginning of Ronald Reagan's work piracy rates.
The highest tax rate on the rich should reach 70%, according to Ocasio-Cortez said "60 Minutes" earlier this month. This approach contrasts with Mr. Trump's law of 2017 on reducing taxes and creating jobs.
However, higher marginal rates for wealthier Americans would mark a return to the more progressive tax structure of the 1950s and 1960s – under Presidents Harry S. Truman, Dwight D. Eisenhower, and John F. Kennedy, for example, the rate applied in the United States the upper support has exceeded 90%.
"We are totally in agreement with the congressman," said O & # 39; Brien of Oxfam. "We believe that raising taxes for extremely wealthy people must be a fundamental part of a healthy economy."