- The gap between very large fortunes and the rest of society is beyond comprehension, Oxfam believes. The decrease in taxation for large fortunes and multinationals that the NGO is observing overall tends to make it even worse.
- All the more so when these fiscal policies result in dark cuts in public services which weaken the poorest. Oxfam is focusing in particular this year on the care work that goes disproportionately to girls and women
- Pauline Leclère, Oxfam France Tax Justice and Inequalities campaign manager, answers the questions of "20 Minutes".
"If you had been able to save the equivalent of 8,000 euros per day since the storming of the Bastille on July 4, 1789, today you will only get 1% of Bernard Arnault's fortune [French CEO of the group of luxury LVMH]. Nothing better to understand the magnitude of the gap that exists between the very great fortunes of this world and the rest of the population.
Oxfam has many such parallels in mind *. The NGO uses it to feed its latest report on economic inequalities that it publishes on Monday. As every year since 2014, and always on the eve of the World Forum in Davos, a small Swiss town where the world's political and economic elite meet in winter.
The observation made by Oxfam is always that of a gap which exceeds the understanding between the 2.153 billionaires and the rest of the world. "The wealth of the richest 1% of the planet corresponds to more than twice the wealth of 90% of the world population, or 6.9 billion people," illustrates Pauline Leclère, head of the Tax Justice and Inequalities campaign. Oxfam France. She answers questions from 20 Minutes.
A year ago, Oxfam indicated that the wealth of billionaires increased by $ 900 billion in 2018. There is no such precision, for 2019, in the report published on Monday ...
We are often asked, in fact, to have points of comparison from one year to the next, to measure the evolution of this gap between great fortunes and the rest of society. This is not obvious. In these reports, we mainly rely on two sources of data. Those of the review Forbes, on the wealth of billionaires, and those of the bank Credit Suisse which analyzes the distribution of world wealth by collecting the information given by the States. However, they sometimes change their methodologies in the collection of data.
On the other hand, on a longer time scale, trends are emerging and show a widening of inequalities. The number of billionaires has almost tripled in ten years [2,153 according to Forbes in 2019, against 792 in 2009]. At the other end of the economic system, according to World Bank forecasts, almost half the world's population will live on less than $ 5.50 a day and the pace of poverty reduction has halved since then. 2013. If, since the 1990s, progress has reduced extreme poverty [people living on less than $ 1.90 a day, or 10% of the population in 2015], there are "pockets of resistance" . This extreme poverty is even gaining ground in sub-Saharan Africa.
Is this widening of inequalities also seen in France?
France currently has 41 billionaires, four times more than after the 2008 financial crisis. Their cumulative wealth amounts to $ 329.9 billion, five times more than after the financial crisis. Conversely, according to estimates from INSEE published in mid-October, the poverty rate increased in France between 2017 and 2018, going from 14.1% to 14.7%. 9.3 million French people live below the poverty line, that is to say on less than 1,050 euros per month. The salary differences between CEOs and employees within companies remain insane. A CAC 40 boss won an average of 277 times the minimum wage in 2018. Above all, the inequalities in wealth are staggering. Between 1998 and 2015, the share of wealth of the richest 10% increased by 113% while that of the poorest 10% fell by 31%.
Can we expect these inequalities to widen further in the years to come?
The situation can only get worse without decisive measures in the direction of better sharing of wealth. However, this is not the direction taken to date if we look at the way in which states raise taxes. The taxation of the wealthiest classes is always reduced. In the United States, the top income tax rate - that is, the rate applied to the wealthiest - was 70% until the 1980s. It has been cut in half since then. In France, the creation of the Flat Tax and the abolition of wealth tax (ISF) have led to substantial gains for the wealthy, with no visible impact on investment. It was, however, the promise of this reform.
These tax policies favorable to the wealthy are often done at the cost of cuts in social spending. And these weaken the poorest classes. We come back to the $ 5.50 a day with which almost half of the world's population lives. For many people, all it takes is a hospital bill or a bad harvest to fall into misery. Added to this are the threats to come. That of climate change in particular. The poorest populations are often the most vulnerable. This is not only measured by the financial and material losses that natural disasters can cause. The effects are often more insidious. It is estimated that by 2025, up to 2.4 billion people could live in areas where water supplies are insufficient. One can imagine then that people have longer distances to cover on foot to collect water. In this case, girls and women who often bear this burden.
We come to "care work", one of the focus of your report this year ...
Absolutely. This care work brings together various tasks, from babysitting to supporting the elderly, including a whole range of daily household tasks (cooking, washing clothes, collecting water and firewood ...) . If no one invested time, effort and resources in these essential daily tasks, communities, businesses and entire sectors of the economy would be crippled. However, all over the world, in developing countries as well as in France, this care work, low or unpaid, is provided disproportionately by girls and women. It is time they have less to educate themselves, participate in political and social activities, prosper economically ... Economic inequalities are also based on gender inequalities.
What would be the solution for Oxfam? Tax more of the ultra-rich to finance public services?
It's the big idea, yes. These political and economic elites who meet in Davos have helped to widen economic inequality. It is also through them that solutions must come. This requires more progressive taxation, that is to say that put more to use those who have the most. This also involves an effective fight against tax evasion or, in particular in France, by eliminating tax loopholes which disproportionately benefit large companies without benefit to the economy. And this money thus recovered must be invested in public services, in particular to rebalance the responsibility for the care work which most often falls to girls and women. This is another aspect of our recommendations: tackling gender inequalities in the world of work. In France, this would notably involve a significant increase in paternity leave in order to limit the "maternity risk" discriminating against women on the labor market.
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* Here is another one given by Oxfam: "if you had set aside 10,000 dollars a day since the construction of the pyramids in Egypt, you would have accumulated a fifth of the average fortune of the five richest billionaires in the world"
- Davos
- Billionaire
- Poverty
- Oxfam
- Wage inequality