Eight billionaires control as much wealth as the bottom half of the world’s population

Oxfam issues report on eve of Davos conference

davos-meeting-inequality

17 January 2016

Eight billionaires, six of them from the United States, own as much combined wealth as the bottom half of the world’s population, some 3.6 billion people, according to the latest report on global inequality from the British-based advocacy group Oxfam.

The report was released Monday, on the eve of the annual World Economic Forum in the mountain resort of Davos, Switzerland, at which many of the ultra-rich will converge this week. The Oxfam document contains a range of figures that highlight the staggering growth of social inequality, showing that the income and wealth gap between a tiny financial elite and the rest of the world’s people is widening at an accelerating rate.

New data made available to Oxfam reveals that wealth is even more concentrated than the organization had previously believed. Last year, Oxfam reported that 62 people controlled as much wealth as the bottom half of humanity. In its latest report, the charity notes that “had this new data been available last year, it would have shown that nine billionaires owned the same wealth as the poorest half of the planet.”

Oxfam writes that since 2015, the richest 1 percent of the world’s population has owned more than the rest of the world put together, and that over the past quarter century, the top 1 percent has gained more income than the bottom 50 percent combined.

“Far from trickling down, income and wealth are being sucked upwards at an alarming rate,” the report states. It notes that the 1,810 dollar billionaires on the Forbes 2016 rich list own $6.5 trillion, “as much wealth as the bottom 70 percent of humanity.”

Over the next 20 years, some 500 people will hand over to their heirs more than $2.1 trillion, an amount larger than the gross domestic product of India, a country of 1.3 billion people.

Oxfam cites recent research by the economist Thomas Piketty and others showing that in the United States, over the past 30 years the growth in incomes of the bottom 50 percent has been zero, while the incomes of the top 1 percent have risen by 300 percent.

The same process is taking place in the world’s poorest countries. Oxfam notes that Vietnam’s richest man earns more in a day than the country’s poorest person earns in 10 years.

The report points to the systematic character of the siphoning of global wealth to the heights of society. The business sector is focused on delivering “ever higher returns to wealthy owners and top executives,” with companies “structured to dodge taxes, drive down workers’ wages and squeeze producers.”

This involves the most barbaric and criminal practices. Oxfam cites a report by the International Labour Organisation estimating that 21 million people are forced labourers, generating $150 billion in profits every year. The world’s largest garment companies all have links to cotton-spinning mills in India that routinely use the forced labour of girls.

Small farmers are also being driven into poverty: in the 1980s, cocoa farmers received 18 percent of the value of a chocolate bar, compared to just 6 percent today.

The extent of corporate power is highlighted in a number of telling statistics. In terms of revenue, 69 of the world’s largest economic entities are now corporations, not countries. The world’s 10 largest companies, including firms such as Wal-Mart, Shell and Apple, have combined revenue greater than the total government revenue of 180 countries.

Although the authors avoid any condemnation of the profit system per se, the information provided in their report amounts to a stunning verdict on the capitalist system. It highlights in facts and figures two central processes delineated by Karl Marx, the founder of modern socialism.

In Capital, Marx explains that the objective logic of the capitalist system, based on the drive for profit, is to produce ever greater wealth at one pole and poverty, misery and degradation at the other. In the Communist Manifesto, he explains that all governments are but the executive committee for managing the affairs of the capitalist class.

This is exemplified in the tax policies and other “business-friendly” measures undertaken by governments around the world. The Oxfam report notes that technology giant Apple is alleged to have paid a tax of just 0.005 percent on its European profits.

Developing countries lose around $100 billion a year as a result of outright tax dodging and the exemptions granted to companies. In Kenya, $1.1 billion is lost to government revenue every year because of exemptions, an amount nearly twice the country’s annual health budget.

Government tax policies work hand in hand with tax dodging and criminality. The report cites economist Gabriel Zucman’s estimate that $7.6 trillion of global wealth is hidden in offshore tax havens. Africa alone loses $14 billion in annual revenues because of the use of tax havens: enough to pay for health care that would save the lives of four million children and employ enough teachers to ensure that every African child went to school.

There is one significant omission from Oxfam’s discussion of accelerating inequality. It makes no mention of the critical role of the policies of the world’s major governments and central banks in handing over trillions of dollars to the banks, major corporations and financial elites through bank bailouts and the policies of “quantitative easing” since the eruption of the global financial crisis in 2008.

A discussion of these facts would raise uncomfortable political issues. The report opens by favourably citing remarks by US President Barack Obama to the UN General Assembly in 2016 that a world in which 1 percent of the population owns as much as the other 99 percent can never be stable.

But the very policies of the Obama administration have played a key role in creating this world. After rescuing the financial oligarchs from the results of their own criminal actions with massive bank bailouts, the Obama administration and the US central bank ensured their further enrichment by providing a supply of ultra-cheap money that boosted the value of their assets.

Under Obama, the decades-long growth of inequality accelerated, along with the descent of the ruling class into parasitism and criminality. He paved the way for the financial oligarchy to directly seize the reins of power, embodied in the imminent presidency of casino and real estate billionaire Donald Trump, to whom Obama will hand over the keys to the White House on Friday.

The overriding motivation behind the Oxfam report is fear of the political consequences of ever-rising inequality and a desire to deflect mounting anger over its consequences into harmless channels. It advances the perspective of a “human economy,” but maintains that this can be achieved on the basis of the capitalist market, provided corporations and governments change their mindsets.

The absurdity of this perspective, based on the long-discredited outlook of British Fabianism, which has dominated the thinking of the English middle classes for well over a century, can be seen from the fact that the report is directed to the global financial elites gathered at the Davos summit this week, with a call for them to change their ways.

The bankruptcy of this outlook is demonstrated not only by present-day facts and figures, but by historical experience. A quarter century ago, following the liquidation of the Soviet Union, the air was filled with capitalist triumphalism. Freed from the encumbrance of the USSR, and able to dominate the globe, liberal capitalist democracy was going to show humanity what it could do.

And it certainly has, creating a world marked by ever-rising inequality, the accumulation of wealth to truly obscene levels, oppression and anti-democratic forms of rule, criminality at the very heights of society, and the increasingly ominous prospect of a third world war.

This history brings into focus another anniversary: the centenary of the Russian Revolution. Despite its subsequent betrayal at the hands of the Stalinist bureaucracy, the Russian Revolution demonstrated imperishably, and for all time, that a world beyond capitalism and all its social ills and malignancies is both possible and necessary. Its lessons must inform the guiding perspective for the immense social struggles that are going to erupt out of the social conditions detailed in the Oxfam report.

Nick Beams

WSWS 

Can’t bear to watch the Inauguration? Check out these political dystopian films instead

Art imitates life:

The dark and cynical “A Face in the Crowd” won’t make you feel better about politics, but at least it’s fiction

Art imitates life: Can't bear to watch the Inauguration? Check out these political dystopian films instead
“A Face in the Crowd” (Credit: Warner Bros.)

During inauguration weekend, the Anthology Film Archives in New York City is featuring a timely, cogent (and bitter) film series entitled “Inauguration of the Displeasure Dome: Coping with the Election.”

Jed Rapfogel, who co-programmed the film with his colleagues, said that the series came together quickly, “It was something we did out of necessity. When Trump won, we had to mark that weekend. The films reflect the sense that a dystopic, alternate reality has come to pass.”

There are numerous films that could have been screened, but the selection of “A Face in the Crowd,” “It Happened Here,” and “Punishment Park,” as well as Robert Kramer’s “Ice,” Stan Brakhage shorts, and other titles provides AFA the opportunity to present “radical, progressive, politically-engaged films” that reflect on the current political climate.

“A Face in the Crowd,” Rapfogel noted, “came first to mind because of how its hero, Lonesome Rhodes (Andy Griffith), is a celebrity and a demagogue who rises to political power. It is relevant in so many ways.”

He continued, “‘Face’ as well as the other films in the series are going to look different now, coming at a time when we don’t have that benefit of thinking of it as dystopic. The perspective has changed, and these films are all interesting and useful in some way: How do we deal with this situation?”

For those not able to get to Anthology Film Archives, the titles reviewed below are available on DVD and/or online. Folks not wanting to watch Trump’s inauguration are urged to check out these essential classics instead.

“A Face in the Crowd”

Elia Kazan’s electrifying 1957 film, written by Budd Schulberg (who adapted his own story), is about a “gentleman loafer” (hobo) named Lonesome Rhodes (Andy Griffith, in his debut) who becomes a media sensation when his grassroots wisdom connects with the common people. He can say anything to sway the listeners of his radio and TV shows — and he sure does. Marcia Jeffries (Patricia Neal) is a radio host who discovers Lonesome in an Arkansas jail. She follows him from local radio to a TV gig in Memphis and ultimately a national program in New York. Lonesome raises ad revenues and gets high ratings because he is able to guide the masses with a strong hand. However, marketer Macey (Paul McGrath) is fearful of Lonesome using TV to persuade the general public and calls the media sensation “a risk, uncooperative and unpredictable.” [Sound familiar?]

It is no surprise that Lonesome doesn’t care who he walks over as his success grows. He wants love, not respect, and soon finds work as a political consultant for a right-wing presidential candidate. TV writer Mel Miller (Walter Matthau) sees through Lonesome, observing, “He’s got the courage of his ignorance,” a fact that Lonesome proves when he sounds off in a hotel room to Marcia, “This whole country’s just like my flock of sheep! . . . Rednecks, crackers, hillbillies, hausfraus, shut-ins, pea-pickers . . . I own ’em! They think like I do. Only they’re even more stupid that I am, so I gotta think for ’em . . . I’m gonna be the power behind the president . . .” Marcia’s expression can only be described as terrified at hearing his abuse of the public confidence.

“A Face in the Crowd” is dark and cynical, and the acting is as superb as the script. When Mel says at the end of the film, “We got wise to him, that’s our strength” it is a rallying cry for those who can’t endorse a Trumpian world.

“It Happened Here”

This remarkable film, made in 1965 by Kevin Brownlow and Andrew Mollo, eerily feels like a documentary, it seems so real. The filmmakers came up with the idea — a “fantasy” imagining a Nazi-occupied Britain in 1944 — when they were teenagers, eventually shooting it eight years later on film stock donated by Stanley Kubrick.

The film’s heroine is Pauline (Pauline Murray), an Irish nurse who is evacuated from the British countryside and sent to London where Nazi propaganda posters line the Thames. She decides to join the Party to be helpful by working as a nurse, only to be told by a clerk, “We don’t accept your decisions. You accept ours.” While Pauline observes that the Party has a “faintly military flavor,” National Socialism offers a new way of life, one that is “backed by the people of Britain” to outlaw Bolshevism, establish a corporate state, help solve the “Jewish problem,” and conquer unemployment with a labor front. A highly disturbing sequence in the film — one that was censored by the studio — involves Pauline participating in a discussion that claims “Jews are parasites” and they will be sent to Madagascar.

As Pauline slowly awakens to the perils of the Party, “It Happened Here” gets more intense and more alarming. A pivotal scene has Pauline meeting her friend Dr. Richard Fletcher (Sebastian Shaw), who berates her for being a Party member. She admits to being ignorant, stating, “I know as much about politics as a lamppost.” Pauline’s innocence and her desire for “law and order” contrast with Richard and his wife’s struggle for freedom, which include harboring a partisan in their apartment. Pauline may believe that resistance is futile, and she calls Richard’s activism out as a response to his guilt for doing nothing before then.

Yet Richard chides Pauline in the film’s most quotable (and prescient) line, “The appalling thing about fascism is that you’ve got to use fascist methods to get rid of it.”

The last act of “It Happened Here” gets even more frightening as it presents a funeral that looks like a Klan rally, and an extended sequence set in a medical hospital that is revealed to be performing “cleansing” operations.

The fantasy of “It Happened Here” is scarily Trumpian; this forceful drama will still cause viewers to bristle more than 50 years after it was made.

“Punishment Park”

This is Peter Watkins’ gripping (and grim) 1971 pseudo-documentary film in which the McCarran Act is invoked. The Act — which was enacted in 1950 over President Truman’s veto, and in force until the early 1970s — enables the president to declare an “internal security emergency” and “apprehend and detain persons who may cause sabotage.” In the film, groups of subversives — draft-dodgers, conscientious objectors, black militants, feminists and the like — have been apprehended and detained. They are sentenced at a tribunal where they are given two options: years in a federal penitentiary or days in “Punishment Park.”

However, Punishment Park may be worse than jail. As one fatalistic female prisoner states quite bluntly, “It’s win or die.” The park is a section of the Bear Mountain National Park in Southern California, where the criminals must walk 53 miles in the 90+ degree desert without water for three days to a designated location marked by an American flag. They must also evade capture by the police and national guardsman on call to keep the prisoners in line. If the prisoners fail to complete the course, they must serve out their sentence in federal prison, unless they die (or are killed) first.

A documentary film crew (lead by Watkins) follows the prisoners’ efforts, and also captures scenes of the law enforcement officers conducting target practice as well as the heated exchanges at the various tribunals.

In the intense, exciting courtroom scenes, non-professional actors improvise their roles as defendants. They complain about being detained for months without knowing why, are denied a “jury of their peers,” and are argumentative and combative in ways that will make every liberal viewer proud. They testify against the violence in society, the repressiveness of the government, and the immorality of war (the film makes connections to the Vietnam War and Nixon). They champion ideas of freedom, uphold moral values, and emphasize the importance of thinking for themselves. These “disruptive outbursts” are the most stirring in the film.

Watkins shrewdly intercuts the three storylines for maximum impact. A defendant’s tribunal speech about violence is juxtaposed with the military’s gun lessons, and scenes of brutality experienced by the prisoners who are running for their lives. The film may feel almost too on the nose with its messaging, but “Punishment Park” was a timely response to Kent State, the Chicago 10 Conspiracy Trial and other real-life events. That said, when a radio announcer recounts a senator resigning his position because “he refused to participate in dismantling basic freedoms and repressive legislation” (e.g., immigration reforms, stop-and-frisk measures, etc.), it’s eerily prescient of contemporary politics. How is that for art imitating life?

Gary M. Kramer is a writer and film critic based in Philadelphia. Follow him on Twitter.

US Millennials face higher unemployment, lower income than parents’ generation

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By Shelley Connor
16 January 2017

A report released by Young Invincibles last week outlines key areas in which so-called Millennials—Americans between the ages of 18 and 34—face unprecedented financial difficulties.

The brief, which compares the financial health of Millennials to that of Baby Boomers in the 1980s, demonstrates that wages and home ownership have declined significantly within a generation. The authors measured five factors of Millennials’ financial health against that of young adults in the 1980s: income, assets, net wealth, home ownership and retirement planning.

The discrepancies in income alone are shocking; wages have declined by 20 percent from 1989 to the present, with Millennials earning about $10,000 less than Baby Boomers did as young adults. In 1989, a high school graduate earned about the same income as a college graduate with a degree today. The report also notes that an astounding 1 million young adults experienced long-term unemployment during the Great Recession of 2008-09.

The report’s authors maintain that, although income declined across all education levels for Millennials, a college degree remains a worthwhile investment. According to the Young Invincibles’ analysis, “intergenerational declines in income were steepest for those with no degree.” Nevertheless, years of deep cuts to state education budgets force today’s college students to contend with ever-rising tuition costs and increasing amounts of student loan debt.

The Young Invicibles’ report acknowledges that “student debt blunts some of education’s benefits,” which stands out as an impossibly sanguine understatement in light of the numbers they present. By their own analysis, median assets declined at a rate of 71 percent for college graduates with student debt, in contrast to a decline of 45 percent for college graduates without student loans.

Student debt is at an all-time high, with 42 percent of all 18-29 year olds reporting that they bear student loan debt. In addition, the average debt burden for students has nearly doubled within a single generation, with Millennials owing an average of $37,000 upon graduation.

In years past, a college degree was regarded as an important aspect of preparing for a career and gaining enough wealth to own a home and retire comfortably. The economic burdens of today’s college graduates, however, demonstrate that the economic downturn has cut deeply throughout all educational levels for working and lower-middle class youth.

When Baby Boomers graduated college, those with outstanding student loans earned an average of $68,000 annually. Student borrowers today, by contrast, can expect to earn an average of $51,000—a 25 percent decrease.

Another cornerstone of financial security for Americans, home ownership, has declined by about eight percent between the Baby Boom and the Millennial generations. When separating out those without college degrees, however, the decline is a much steeper 22 percent. College graduates with student loan debt are also less likely to own their homes.

Only half of today’s young adults own their own homes, according to Young Invincibles, and the authors point to studies that show an estimated 2.8 million 25- to 34-year-olds contend with severe rental burdens.

Housing accounts for over 60 percent of assets held by the middle class; it represents about 15 percent of gross domestic product. Given that fewer than half of today’s young adults can attain home ownership, while many others cannot afford to rent, the implications for the economy as a whole are sobering.

This is a particularly strong indicator of the depth of economic decline. Last year, a study by the Pew Research Center revealed that, for the first time since 1880, young adults between the ages of 18 and 34 were more likely to live with a parent than in any other living arrangement. Pew’s researchers pointed to an anemic job market, where 5.7 percent of men between ages 25 and 34 are unemployed. On top of this, rental costs have risen disproportionately to wages since 2008.

Housing is not the only area in which Millennials lag behind Baby Boomers. Young adults in the 1980s owned twice the amount of assets as young adults in 2013. Research highlights the impact of student debt on this decline; non-borrowers amongst this cohort own over three times the assets of borrowers. In 1989 college graduates with student debt enjoyed a median net wealth of $86,500; by 2014 the same cohort had a median net worth of only $6,600.

On its face, retirement seems to be the one area in which Millennials are on stronger footing than Baby Boomers; retirement plan ownership increased by 150 percent between 1989 and today. However, beneath the surface of this seemingly hopeful number lies the virtual disappearance of pension plans, which decreased from 27.1 million in 1989 to 15.2 million in 2013.

The Young Invincibles’ report was notably released amidst a storm of pageantry surrounding President Barack Obama’s exit from the White House. The New York Times, which pumps out wholesale lies and half-truths on a daily basis, published an editorial in its Sunday edition praising Obama’s “optimism.”

The Times heralded Obama’s ascension to the White House as a surprising victory over racism and greed and compares him to Abraham Lincoln, insinuating that he has made America a more equitable and prosperous country.

The Times also praised Obama’s stimulus plan, which they assert staved off another Great Depression, and hailed the federal investment in General Motors and Chrysler. This move, they claim, preserved more than a million jobs. They casually ignore the fact that the investment was predicated upon stripping autoworkers of their hard-earned pensions and dramatically cutting wages. Autoworkers today are forced to work grueling hours and face hazardous working conditions for poverty wages.

“Even now,” the Times’ chides, “…stubborn biases and beliefs… have blinded many Americans to their own good fortune, fortune that flowed from policies set in motion by this president.” The startling numbers quoted by the Young Invincibles—declining home ownership, disappearing pensions, rent that outstrips earning, and crippling student debt—give the lie to this offensive statement.

http://www.wsws.org/en/articles/2017/01/16/mill-j16.html