Over the past two years, a new billionaire has popped up about every 30 hours as moguls from the pharma, food, energy and tech industries reaped the rewards of a “rigged” economic system, Oxfam reported on Monday. With commodity prices skyrocketing, 263 million more people will crash into extreme poverty this year, unless the windfall is redistributed, the charity warned, directing the message to a gathering of the ultra-rich in the Swiss resort of Davos.
The release of the Oxfam report titled “Profiting from Pain” was timed with the first World Economic Forum to be held face-to-face since the Covid-19 pandemic began. Oxfam called on the wealthy and powerful individuals gathering this week in Switzerland to choose whether they wanted to be “proxies for the billionaire class who plunder their economies” or act in the interest of humankind.
“The extremely rich and powerful are profiting from pain and suffering. This is unconscionable,” Gabriela Bucher, Executive Director of Oxfam International, warned. “This grotesque inequality is breaking the bonds that hold us together as humanity. It is divisive, corrosive, and dangerous. This is inequality that literally kills.”
According to Oxfam’s calculations, 573 people became new billionaires during the pandemic. The combined wealth of the class rose more in the first 24 months of the Covid-19 crisis than it did over the previous 23 years. The total wealth of billionaires equals 13.9% of global GDP now, up from 4.4% in 2000, the brief outlined.
The pharmaceutical, food, energy and tech sectors saw the biggest benefits from the transfer of wealth, Oxfam said. The pandemic created 40 new pharmaceutical billionaires as companies like Moderna and Pfizer enjoyed a bonanza from their vaccines against Covid-19.
The development of their products was funded by public investment, but despite this they are charging governments up to 24 times more than the cost of generic production, Oxfam argued. The vaccines alone brought Big Pharma $1,000 a second in profit, the group estimated.
Food and agribusiness billionaires saw a 45% increase of their wealth over two years, reaching $382 billion and adding 62 people to their ranks. The American Cargill family alone now has 12 billionaires, up from eight before the pandemic, Oxfam noted. Their peers, the Waltons, who own roughly half of the retail chain Walmart, are now collectively worth $238 billion, the calculation said.
The five largest energy companies, including BP, Shell, TotalEnergies, Exxon, and Chevron, made a combined profit of $82 billion last year alone. The oil sector saw its profit margins double during the pandemic as prices soared, Oxfam said. Oil, gas, and coal billionaires have increased their wealth by $53.3 billion, or 24% in two years.
The tech sector likewise enjoyed rapid growth amid the pandemic and produced some of the wealthiest individuals as a result, the brief said. Apple, Microsoft, Tesla, Amazon, and Alphabet made $271 billion in profit in 2021, almost twice as much as in 2019. Seven of the ten richest people in the world are tech entrepreneurs.
“Billionaires’ fortunes have not increased because they are now smarter or working harder. Workers are working harder, for less pay and in worse conditions. The super-rich have rigged the system with impunity for decades and they are now reaping the benefits,” Bucher said.
“They have seized a shocking amount of the world’s wealth as a result of privatization and monopolies, gutting regulation and workers’ rights while stashing their cash in tax havens – all with the complicity of governments,” she added.
With prices of essential products like food going through the roof, Oxfam expects 263 million more people to plunge into extreme poverty in 2022. It recommends addressing the situation by taxing the ultra-rich. The group called for a one-time solidarity tax on the pandemic windfalls, taxes on excess profits to end crisis profiteering and permanent wealth taxes to rein in the economic and political power of wealthy individuals and big corporations.