Billionaires’ wealth soars in 2021 amid rising inequalities

Paris, Dec 7 (EFE).- Billionaires’ wealth soared this year due to the economic impact of the Covid-19 crisis, which has led to an increase in inequalities, particularly among the poorest half of the global population, which only owns 2 percent of the total wealth.

The wealth of the 520,000 people that make up the top 0.01 percent of the world’s richest has grown in relative terms this year – marked by the boom in the stock market – to represent 11 percent of the total wealth, the World Inequality Lab said in the second edition of its report released on Tuesday.

That top 0.01 percent owned 7 percent of the total wealth in 1995, a percentage that rose slightly above 10 percent before the global financial crisis, which reduced it to 8 percent in 2010 before a recovery trend which has accelerated this year, according to the authors of this study coordinated by economists Thomas Piketty and Gabriel Zucman, among others.

While billionaires owned about 1 percent of the world’s wealth in 1995, that figure rose to just over 2 percent in 2020 and has climbed to 3.5 percent this year.

If the sample group is widened a little more, the top 1 percent have captured 38 percent of the global increase in wealth between 1995 and 2021, while 50 percent of the poorest have only captured 2.3 percent.

As a result of this, half of the population has an average wealth of 2,900 euros ($3,274) per adult, which together accounts for only 2 percent of the world’s total, while the top 10 percent own 76 percent.

When income is examined, the 10 percent of the richest in 2021 have captured 52 percent ??of the total – an average of 87,200 euros per adult -, while the poorest 50 percent have had to be content with 8.5 percent with an average of 2,800 euros for the whole year.

Latin America, together with North Africa and the Middle East (MENA), is the region with the most inequalities in the world.

The income share of the top 10 percent in MENA is 58 percent, 55 percent in Latin America and 45.5 percent in the United States.

The top 10 percent income share in Europe is 36 percent.

The authors of the report point out that while inequalities between the populations of the poorest and richest states have decreased in the last two decades, they have increased within countries to reach levels that existed during the height of colonialism at the beginning of the 20th century.

In practice, the average income of the richest 10 percent is 38 times that of the poorest 50 percent, more than double the gap that existed in 1820.

The authors have also presented a new indicator in this year’s edition: that of gender inequalities, which shows that women’s share of total incomes from work was at less than 35 percent.

Taking into account that in 1990 women’s share stood at 30 percent, progress in these three decades has been “too slow,” according to the report.

The study also notes that income and wealth are directly linked to emissions of carbon dioxide (CO2), the main greenhouse gas.

The 0.01 percent of the world’s richest is responsible for 11 percent of these emissions.

However, the report stresses that “ inequality is not inevitable, it is a political choice.”

Among its proposals to achieve equality is a progressive wealth tax on global multimillionaires – at an average rate of 1 percent of wealth – which would generate the equivalent of 1.6 percent of global income to be reinvested in education, health and ecological transition. EFE

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