World Economic Olympics
2022 Davos Forum opens
Every January, the world's attention is focused on Davos, a resort city in Switzerland where the World Economic Forum is held, and the reason why the world pays so much attention to this convention, also called ‘Davos Forum’ after the venue, is that major financial representatives gather from around the world.
Davos Forum is a private international forum where 2,000 to 3,000 prominent businessmen, politicians, scholars, and journalists gather annually to discuss global political, economic, and social issues. It has global authority and influence.
This year 2022, with the world still reeling from the effects of COVID-19, the WEF Annual Meeting was convened for four days beginning May 23rd.
This year's theme focused on 'History at a Turning Point', with global change accelerating due to the pandemic. In this year's forum, discussions and alternatives were sought in about 200 sessions on ▲climate issues ▲COVID-19 ▲technology and innovation ▲global cooperation ▲society and equity.
2022 Davos Forum. US climate envoy John Kerry, Bill Gates, Google CFO Rusporat (Source: WEF)
(Source: WEF website)
Profiting from Pain
(Link to the Oxfam report)
Oxfam, an international relief organization that has been publishing an annual report on wealth inequality at the Davos Forum since 2014, this year has issued a report titled ‘Profiting from Pain’.
The crux of this report is deepening global inequality. Oxfam's research shows that global companies and billionaires in the food, energy, medical, and tech sectors have amassed enormous wealth during the COVID-19 pandemic, while the vulnerable, struggling to make a living with increased price pressures, have evidently lapsed into a crisis situation.
According to the "Profiting from Pain” report, the number of billionaires is growing by one every 30 hours.
The number of billionaires worldwide has increased fivefold from 573 in 2020, when the coronavirus broke out, to 2,668 by March this year.
The combined wealth of these billionaires totaled $12.7 trillion dollars, an increase of $3.78 trillion (42%) during the pandemic alone.
It turns out that the world's 10 richest people own more wealth than the world's bottom 40%, namely 3.1 billion people, and the world's 20 richest people own more than the combined GDP of all sub-Saharan African countries.
On the other hand, it is estimated that up to 263 million people will fall into extreme poverty in 2022 due to the COVID-19 crisis and rising food prices, and it is estimated that there are an additional 1 million people entering poverty every 33 hours. This means in the time that one billionaire is born, a million people are driven into dire poverty.
In January, Oxfam also published the report “Inequality Kills.” The report airs a shocking study finding that the wealth of the world's 10 richest people doubles while the income of 99% of the world's people falls.
(Link to report)
Poorer Countries, Races and Gender
The report points out that wealth inequality also exists between races, genders and countries.
○ Inequality among countries
Inequality between rich and low-income countries has been lessening for the past 30 years, but during the COVID-19 pandemic, this trend has reversed: rich countries have widened the gap, causing middle and low-income countries to retreat 10 years.
Vaccine inequality is also a major cause of rising inequality among nations. The report points out that around 11.66 billion coronavirus vaccinations have been administered worldwide; meanwhile poverty has worsened in low-income countries as 87% of low-income countries are unable to complete vaccination of their citizens due to unfair drug distribution.
○ Gender inequality
Growing job insecurity has caused 4 million women to lose their jobs in Latin America and the Caribbean alone, and similar trends are occurring elsewhere.
○ Inequality between races
Inequality based on skin color also persists. In the UK, when the second wave of COVID-19 resurged, people from Bangladesh were five times more likely to die from coronavirus than the white population in the UK.
The industries that wiped out the world's wealth
There are certain industries that have accumulated unprecedented wealth. These are the fields of energy, pharmaceuticals, and big tech.
The major shareholders of global food conglomerate Cargill and the five largest energy companies (BP, Shell, TotalEnergies, Exxon, and Chevron) have made huge profits.
The pandemic has also spawned 40 new billionaires in the pharmaceutical sector alone.
While many small and medium-sized enterprises have closed due to the pandemic, global tech companies such as Apple, Microsoft, Tesla, Amazon, and Google are producing the world's richest people when they achieve better results than any other industry.
In fact, 7 of the 10 richest people in the world work in the big tech sector. Tesla CEO Elon Musk, known as the world's richest person, is still among the richest 0.0001% of the world, even if he lost or gave away 99% of his assets!
Solution: Tax the profits earned
during the pandemic!
Oxfam said that a structural solution is needed to tackle wealth inequality, suggesting that governments should use their taxes to reduce inequality and suffering through tax reform.
○ Excess profit tax on energy companies!
Oxfam argues for excess profit tax on energy companies that made huge profits from soaring energy prices, and a 90% tax rate on temporary excess profits in all industries.
It is estimated that taxing only the 32 highest-profit-earning companies during the pandemic could generate $104 billion in tax revenue.
○ 99% tax on billionaire's new wealth!
Oxfam advocates supporting the world's most vulnerable by implementing a one-time emergency tax of 99% on new wealth of billionaires who have risen during the pandemic, and progressive, asset-by-asset taxes on the richest.
(Go to report)
In January, Oxfam, the Patriotic Millionaires and the Institute for Policy Studies jointly published a report titled "Taxing Extreme Wealth."
According to the report, a 2% annual property tax on millionaires and 5% on billionaires could raise $2.52 trillion a year and lift the world's 2.3 billion people out of poverty.
It would also be able to supply enough COVID-19 vaccines around the world, and provide universal health care and social protection to 3.6 billion citizens of low- and middle-low income countries.
Vaccine inequality is racial inequality.
(Photo source: Reuters)
Oxfam was not alone in pointing out the growing inequality. Many Davos Forum participants expressed their concern about the inequality, and among them were many voices of self-reflection on vaccine inequality.
UN Deputy Secretary-General Winnie Byanyima said only 13% of people in low-income countries (mostly people of color) have been vaccinated, while 75% of people in high-income countries, mostly white, are fully vaccinated. She pointed out that this is racism.
Seth Berkeley at the Davos Forum (Photo by Bloomberg)
Seth Berkeley, president of the Global Vaccine Alliance (GAVI, winner of the 5th Sunhak Peace Prize) pointed out the strengthening of nationalism in the course of the pandemic.
“At the beginning of the pandemic, the goal was to make a vaccine available to every country in the world, but it was met with nationalism and export bans,” he said. He emphasized, “We need to diversify vaccine manufacturing by establishing a sustainable vaccine manufacturing system centered on developing countries.”
Pharmaceutical companies have also come up with alternatives. “We will work with global health leaders to improve diagnosis, education, infrastructure and storage,” said Albert Bourla, president of US pharmaceutical company Pfizer. We will sell vaccines and medicines to 20 million people at 'non-profit prices' (cost).”
Stefan Bansel, CEO of vaccine maker Moderna, said, "Most of our fortune, worth $4.1 billion, will be donated to advance medical technology and solve the food crisis." During the pandemic, Moderna's stock price more than doubled, making him rich.
Please tax me!!
Meanwhile, this year's Forum also featured unusual protests that have drawn global attention. The protesters made a rather plain argument that a new tax should be levied on the rich to close the gap between the rich and the poor.
What is unusual is that they are multinational super-rich. The protesters are members of the organization "Patriotic Millionaires", whose members must have an annual income of at least $1 million or at least $5 million in assets.
‘Patriotic Millionaires’ consists of 102 millionaires and billionaires, including Walt Disney heir Abigail Disney and venture capitalist Nick Hanauer.
Why are they protesting like this? They emphasize ‘social trust’. To restore social trust, they argue, the world must demand a fair share from the rich, and the state must immediately impose a tax on the rich.
The group also sent an open letter to the Davos delegation twice in January and May, stating that the world suffered during the two years of the pandemic but that their wealth had increased and that the rich must be taxed.
(Marlene Engelhorn, Left Picketden protest, demand taxes on the rich. Source: Guardian)
Marlene Engelhorn, heir to BASF, a global chemical company, who attended the protest, said, “The government is hanging out beyond the doors of the private luxury event of Davos Forum, doing nothing to address serious inequalities. It’s time to rebalance and tax the rich.”
(Source: BBC News)
"Billionaires' wealth did not grow because they were smarter or worked harder, but through privatization, monopolies and deprivation of workers' rights," Oxfam said in a statement , and urged governments around the world to take immediate action.
I don't know how many countries will agree with Oxfam's claims and take action. However, it's a huge irony that, during the brief period of the COVID-19 pandemic and the Ukraine war, the few on the planet are getting richer and the livelihoods and health of many are threatened.