We’ve all heard the phrase, “The rich get richer and the poor get poorer.” Seems like the people with all the money not only hang on to their money, but continue accumulating more, while those with little money struggle to keep what they have.
Well, according to a new report, it’s not just a phrase. It’s long been happening and will continue to happen. Consider this: “The world’s richest 1 percent will soon amass wealth that represents more than the entirety of that owned by the rest of the people on our planet.”
That’s according to a report by the British anti-poverty charity Oxfam. That sounds preposterous. How could 1 percent have more than the rest of the world? That’s what this report says, which was published ahead of this week’s annual meeting of the World Economic Forum in Davos, Switzerland. It also suggests that by 2016, the gap between the world’s rich and poor will widen to the extent that those at the top of the income pile will control over 50 percent of total global wealth. Wow. That’s a lot of power in the hands of a few. And money is power.
You can’t begrudge people who are smart enough to have amassed all their money. It’s great they’re financially savvy enough to have more money than pretty much the rest of the world combined. It would be nice, though, if this accumulation of great wealth didn’t come at the same time the middle class is essentially being squeezed out and the lower-income are barely getting by, if they are at all. It would be nice if blue-collar folks received sufficient pay and benefits that they didn’t have to hold down two and three jobs. Many families on Kauai know well what it takes to get by with little money — they do this at a time when a major private development for the wealthy is in the works in Princeville. Kauai, like many places, has its share of people with plenty of money and people with little money.
This isn’t anything new. What’s new is that the gap between rich and poor is growing and will keep growing. And that growth will become even more pronounced on Kauai and around the world in the years ahead if nothing changes.
In 2014, the 80 richest people had a collective wealth of $1.9 trillion — a rise of $600 billion, or 50 percent in four years, according to the report, “Wealth: Having It All and Wanting More.”
The report notes that in 2014, there were 1,645 people listed by Forbes as being billionaires and that around 30 percent of them (492) are from the USA. One-third of billionaires on this list started from a position of wealth, with 34 percent of them having inherited some or all of their riches. Some 85 percent of these people are over age 50 and 90 percent of them are male.
“Do we really want to live in a world where the 1 percent own more than the rest of us combined?” said Oxfam’s Executive Director Winnie Byanyima. “The scale of global inequality is quite simply staggering and despite the issue shooting up the global agenda, the gap between the richest and the rest is widening fast.”
One of the topics expected to be discussed at the gathering in the Swiss Alps is to find ways to reduce inequality.
One of President Obama’s ways, a proposal pitched recently, is to provide free community college to any student who wants it. That’s a start, though it would cost the federal government $60 billion over 10 years. Education is critical in determining future earning power. Pope Francis has also talked about rising inequality levels. Some say the government has to get tough on tax dodging by corporations and rich folks. While housing and education have skyrocketed in the past decades, the earning power of blue-collar workers has remained flat (unless you have a government job), raising the minimum wage will help, though not much. And providing low-cost housing will help, but such housing is very limited on Kauai and always will be.
It’s not just a matter of working hard. People need opportunities. For education. For jobs. For housing. Perhaps the leaders of this economic forum can create such opportunities.