The Covid-19 pandemic has the potential to increase economic inequality in practically all the countries in the world at the same time. While the world’s poorest will need at least a decade to recover from the current crisis, multimillionaires – the thousand largest fortunes on the planet – recovered their momentary losses in just nine months.
Oxfam is part of the Global Protest fighting against inequality, an international alliance which organised demonstrations in several countries in Asia, Africa and Latin America in the last week of January.
In its report it asks how to bring together a world torn apart by coronavirus, in which more than two million people have lost their lives and hundreds of millions are finding themselves dragged into poverty.
And it puts forward a global response: “Transformative policies that seemed unthinkable before the crisis have suddenly been shown to be possible. There can be no return to where we were before. Instead, citizens and governments must act on the urgency to create a more equal and sustainable world,” it emphasises. With the conviction that action by governments is essential to protect health and livelihoods, it underlines.
The pre-crisis diagnosis, according to the NGO, proves “our collective frailty and the inability of our deeply unequal economy to work for all.”
And it recalls, for example, that according to Forbes, between March and December 2020 the fortunes of the world’s ten richest people (billionaires) grew by 540 billion dollars.
This refers to: Jeff Bezos, Elon Musk, Bernard Arnault (and his family), Bill Gates, Mark Zuckerberg, Larry Ellison, Warren Buffett, Zhong Shanshan, Larry Page and Mukesh Ambani. To put together The Inequality Virus, 295 economists from 79 countries were interviewed. 87% of them share this characterisation of the crisis and the future options.
And they concur with the forecast that inequality of income will continue growing in their respective countries, as a consequence of the health crisis.
A world in which almost half of humanity has to survive on less than $5.50 per day, in which – for 40 years – the richest 1% of the population has had double the income of the poorest half of the world’s population and in which, in the last quarter of a century, the richest 1% of the population has generated twice the carbon emissions of the poorest 50%, worsening the destruction caused by climate change.
Oxfam states that Covid-19 has the potential to increase economic inequality in practically all the countries in the world at the same time, and that this increase could mean that it takes, at a minimum, 14 times longer to reduce poverty to pre-pandemic levels than the time it has taken the planet’s thousand richest people, mostly white men, to recover their wealth.
Since the start of the pandemic, even, the fortune of the world’s ten richest people has grown by half a billion dollars, a figure that would be enough to finance the universal vaccine against Covid-19 without any difficulty at all.
In parallel, this health situation unleashed “the worst labour crisis in over 90 years, and hundreds of millions of people find themselves underemployed or out of work”.
Once again women and the marginalised sectors are paying the highest prices of the crisis, affirms the NGO agreeing with several reports published in recent months by United Nations agencies such as the ILO (International Labour Organisation), FAO (Food and Agriculture Organisation), UNDP (United Nations Development Programme) etc. Globally, women are over-represented in poorly paid and precarious jobs, the ones that have been most affected by the Covid-19 crisis.
Women make up approximately 70% of the world’s labour force in the fields of health and social care, often badly paid jobs which in addition expose them to a greater risk of contracting the virus.
In Brazil, people of African descent are 40% more likely than white people to die from coronavirus. In the United States, if the mortality rate for people of Latino and Afro-American origin had been the same as that of white people, 22,000 deaths among these groups would have been avoided.
The poorest areas of countries like Spain, France and India present higher rates of infection and mortality.
In the case of England, mortality rates in the poorest regions are double those of the richest areas.
The United Nations World Food Programme (WFP) estimates that, as a result of the pandemic, the number of people in a situation of extreme hunger could reach 270 million by the end of 2020, in other words an 82% increase compared to 2019.
With these figures, Oxfam calculated that the crisis caused by the pandemic would be the reason between six and twelve thousand people a day died of hunger at the end of 2020.
For Oxfam the key to bringing about a rapid economic recovery from the pandemic is the adoption of fairer economic models. And taking measures that are within reach and that only require a clear political will from governments.
For example, the levying of a temporary tax on the excessive profits made by the 32 multinationals which have accumulated the most wealth since the beginning of the crisis would have enabled the collection of 104 billion dollars in 2020.
That is a sufficient quantity to fund unemployment benefits for working men and women, along with providing economic support to all children and elderly people in low and middle income countries.
Transformative policies that seemed unthinkable before the crisis have suddenly been shown to be possible. There can be no return to where we were before.
For Oxfam the building of “our new world must be based, first and foremost, on a radical and sustained reduction in inequality”.
Governments must set concrete targets – with precise timescales – for the reduction of inequality. The objective must not be limited to returning to pre-crisis levels of inequality but should go further to build, as a matter of urgency, a fairer world. (PL)
*Sergio Ferrari, from the UN, Geneva, Switzerland