Can you guess who these 8 billionaires are?
We are all aware that income inequality is one largest global issues of our time. However, it’s not always easy to visualize the sheer scale of imbalance in wealth. While the magnum opus, Capital by French economist Thomas Piketty, brought enormous attention to the magnitude of the problem amongst intellectual circles last year, the effects of income inequality can be felt most vividly by those who endure the cruel end of the spectrum.
Mark Zuckerberg, Bill Gates, Warren Buffett, Jeff Bezos, Michael Bloomberg, Larry Ellison, Carlos Sim, Amancio Ortega.
These 8 people have more wealth than half the world’s population combined. Yes, that is 8 humans having the same amount of money as 3.6 billion people. That thought in itself should be mind-boggling, if not downright disturbing.
This was reported in a study by Oxfam that combined value of the world’s richest to find the equivalence with the half the world’s population.This combined wealth of the world’s poorer half totals at $409billion.
Mark Goldring, Oxfam chief executive described the situation as “beyond grotesque”. Economic mobility is extremely weak, with the incomes of the poorest 10% increasing by just $65, compared to the top 1% with an income increase of $11,800. As Thomas Piketty argued in Capital, invested capital is growing faster than incomes. This leads to a disturbing reality— in order to have invested capital, you must already be rich. If you depend on income and not existing wealth, Piketty argues, you will never catch up. This leads to an ever growing cycle of wealth concentration with no foreseeable end in sight.
Singapore fares near the bottom
Singapore, if you don’t know by now, has one of the worst income inequality in the world. We have the highest proportion of millionaires in the world (with 1 in 30 expected to be millionaires in 2020), and one the highest GDP per capita. With talks on how Singapore is presumably the most expensive city in the world with our high costs of living, along with complaints about stagnating wages, inequality seems to be hitting home in a very real sense.
Based on the latest updated data, Singapore’s Gini coefficient is at 0.463 compared to say, the US of 0.486.
A global problem with no solution
There is really no easy answer to this issue. The rise of right-wing populist parties in the United States and Europe reflect the growing frustration with the political establishment in dealing with this problem. Their common target being globalization, where the benefits are perceived to accumulate within the 1%. The middle class feels squeezed with stagnating wages from the influx of cheap labour, while unfair competition is often blamed for the failure of local industries. However, some hint at a deeper root cause— the unprecedented rate of technological change and automation. While there are many ways to pick at the causes, there’s one thing everyone can agree on— the divide between the rich and the poor will continue to grow wider, not smaller.
