CEO Blog

Jan 19, 2015

Jan By 2016 the top 1% will be richer than the rest of the world combined

19
2015
High up in the Alps, world leaders will later this week make their annual pilgrimage to the Swiss resort of Davos for the World Economic Forum annual meeting.
 
The threat posed by growing inequality – one acknowledged by a diversity of attendees – will again be one of the main talking points at the invite-only event where politicians rub shoulders with business leaders, social entrepreneurs, technology innovator, philanthropists, media and NGOs. 
 
The summit last year identified economic inequality as a major risk to human progress, while Oxfam reported that just 85 people owned as much wealth as the poorest 50 per cent – or 3.5 billion people. 
 
Our new research paper published today shows that shows inequality is getting even worse – the exclusive club has now shrunk to just 80 people, a dramatic fall from 388 people in 2010.
 
 
Other key findings from the report – entitled Wealth: Having it all and wanting more – include: 
 
  • The richest 1 per cent have seen their share of global wealth increase from 44 per cent in 2009 to 48 per cent in 2014 
  • At this rate the richest 1% will own more than 50 per cent of global wealth in 2016. 
  • Almost all of the remaining 52% of global wealth is owned by the richest 20%. 
  • This leaves just 5.5%  of the global wealth for the remaining 80% of people in the world
  • The wealth of the richest 80 people doubled in cash terms between 2009-14.
  • More than a third of the 1,645 billionaires listed by Forbes inherited some or all of their riches.
 
This explosion in inequality is holding back the fight against global poverty at a time when 1 in 9 people do not have enough to eat and more than a billion people still live on less than $1.25 (€1.07/82p)-a-day. 
 
Inequality is not inevitable – it is the result of policy choices. There are solutions, ones we will be highlighting at the Davos meeting, which Oxfam International Executive Director Winnie Byanyima will co-chair.
 
 
Above: A twice-weekly vegetable market in the town of Bara Gaon, India. Inequality is rising at a time when 1 in 9 people do not have enough to eat and more than a billion people still live on less than $1.25 (€1.07/82p)-a-day. Photo: Tom Pietrasik / Oxfam
 
We propose a seven-point plan to tackle inequality:
 
  • Clamp down on tax dodging by corporations and rich individuals 
  • Invest in universal, free public services such as health and education
  • Share the tax burden fairly, shifting taxation from labour and consumption towards capital and wealth
  • Introduce minimum wages and move towards a living wage for all workers
  • Introduce equal pay legislation and promote economic policies to give women a fair deal
  • Ensure adequate safety-nets for the poorest, including a minimum income guarantee
  • Agree a global goal to tackle inequality.
 
 
Above: Zambia is one of the world’s fastest-growing economies yet Barbara Chinyeu is living in poverty, like three-quarters of the population. While Barbara struggles to grow vegetables to support her family and walks four hours every day just to collect water, multinational mining companies make huge amounts of money in her country. These giant corporations use international tax rules to avoid paying their fair share, meaning that families like Barbara’s lose out. "We are better off if we are all at the same level... If we were all equal, we could all have control of our own affairs." Photo: Abbie Trayler-Smith / Oxfam
 
Imagine the impact this could have. Cleaning up the toxic global tax system, to take one example, would give governments all over the world the vital revenues they have been deprived to invest in public services like health and education that can both help to fight poverty and reduce inequality. 
 
For example, the EU could receive an annual boost of €120/£100 billion in public money if Europe clamped down on tax dodging. €120/£100 billion is almost twice the annual global aid budget and this much cash could save the lives of 350,000 children under the age of five every year.
 
2015 presents a historic opportunity for world leaders to set a roadmap to eradicate extreme poverty and improve prospects for all citizens with the clock ticking for major decisions on the new UN development goals later this year. 
 
If we get it right, this generation can solve one of the major global challenges of our time and help people escape the stranglehold which keeps them in poverty.
Dec 1, 2014

Dec Rigged rules that create inequality can be changed

1
2014

Extracted from address given at a joint event hosted by Oxfam Ireland, the Institute for International and European Affairs (IIEA) and Irish Aid at the IIEA in Dublin on Thursday, November 27th. The theme of the discussion was 'Inequality: The defining challenge of our time'. The Millennium Development Goals were signed in 2000 with the intention of making substantial progress on human development by the year 2015.

From left to right: Michael Gaffey, Director General, Irish Aid; Cormac Lucey, Chartered Accountant and Lecturer in Finance at UCD, IMI and Chartered Accountants Ireland; Dearbhail McDonald, Associate Editor and Legal Editor of the Irish Independent; Alison O’Connor, Irish Examiner; Jim Clarken, CEO, Oxfam Ireland; Winnie Byanyima, Executive Director, Oxfam International; Dr Colm O’Reardon, Economist and former Government Advisor at the inequality debate at the Institute of International and European Affairs in Dublin. Mark Stedman/Photocall Ireland

2015 is almost upon us and next September, world leaders will be reflecting on the fact that during that period:

  • Extreme poverty was reduced by 50%
  • 90% of all children are now attending primary school
  • Maternal mortality has been reduced by 50%
  • We have reached the Millennium Development Goal target in relation to the number of people who have access to safe sanitation
  • We have made good progress on the fight against major killer diseases such as HIV and AIDS, TB and malaria
  • We are very slowly winning the fight against extreme poverty.

However, these successes and our realistic ambition to end extreme poverty by 2030 and to advance many other areas of human development during this next period are deeply threatened by the extreme and rising inequality.

The emergence of some parts of the world from what appears to be extreme poverty is heavily masked by the fact that wealthy elites in poor and middle income countries have become extremely wealthy whilst poor people have remained stuck in poverty.

Two countries that have emerged as economic powerhouses (albeit of differing scales and on different trajectories) in recent years are India and Brazil. In the past 20 years, India has emerged as one of the most important economies on the planet. Within the next couple of years, it will have more billionaires than the US and it has its own space programme. Yet 400 million Indian citizens live in extreme poverty. For most, the economic miracle has had little or no impact.

Brazil has also emerged as a global power with tremendous economic success. But it is a country where the bottom half did not get left behind – or certainly not to the same extent. The main reason why India is so unequal while Brazil is reducing inequality among its citizens is simple – government policy.

Brazil had a very focused investment in health, education and a social protection floor to protect people on the bottom rung, where India did not. The trajectory for most Brazilians is now one where optimism and hope for a better life is a reality. The same cannot be said for 400 million Indians.

Emerging from the financial crisis, the global economy is slowly strengthening and growing. Ireland too is currently emerging from the worst economic crisis in living memory. No part of society here has been spared from the impact of this but we know that those most well off were least affected.

According to Social Justice Ireland Budget Review 2015, more than 750,000 people live in poverty (including one in five children) and Budget 2015 has widened the rich/poor gap in Ireland by €499 per year.

Too much of today’s global growth is neither inclusive nor sustainable. Governments, institutions and corporations have a collective responsibility to tackle extreme inequality.

And the right policy choices are crucial in changing the tide and allowing many more millions of people to lift themselves out of poverty instead of condemning future generations to it.

Above: Leonard Kufeketa (39), a brush seller, stands in front of Ferarri in Parkhurst, an expensive suburb of Johannesburg. “Things are changing in South Africa for the worst,” he says. “The public schools are no good. Those in the government, they are very rich, the rest of us are poor.” South Africa is one of the most unequal societies in the world. Zed Nelson/Oxfam

Oxfam’s new report, Even it Up: Time to end extreme inequality, shows the scale of the problem of extreme economic inequality, and reveals the multiple dangers it poses to people everywhere.

Most importantly, the report highlights some of the concrete steps that can be taken to change things. So, let’s talk about the solutions.

These measures are:

1. Support a global goal to end extreme economic inequality in every country by 2030. (The effect of curbing inequality would be as dramatic as would be the failure to act. In India, for example, halting the recent increase in inequality could enable 90 million more people escape extreme poverty by 2019).

2. Act decisively on the toxic global taxation system which has been denying citizens in developing countries and in this part of the world the resource which is duly theirs.

3. Aim to achieve universal free public services by 2020. People’s right to free public health and education should be a cornerstone of policy and investment in health and education makes a huge impact on the lives of poorer people.

4. Pay workers a living wage instead of minimum wage (a fair amount to allow them to live rather than just survive) and close the income inequality gap.

5. Promote women’s economic equality and women’s rights (Women in many countries won’t be paid as much as men for another 75 years) and within that focus on a woman’s right to live free from violence.

6. Implement a universal social protection floor.

7. Target development finance at reducing inequality and poverty.

While all these measures deserve a full debate, I’d like to particularly focus on taxation as a key tool.

There is evidence that globally our economic system is set up to facilitate tax dodging by multinationals and wealthy individuals.

Governments around the world are losing €120 billion in revenue each year, according to a 2013 Oxfam study, putting more pressure on their finances as they look to balance their budgets by hitting ordinary citizens with higher taxes.

The tax gap for developing countries – the amount of unpaid tax liability of companies – is estimated at $104bn every year, including profits shifted in and out of tax havens.

Until the rules are changed and there is a fairer global governance of tax matters, tax dodging will continue to drain public budgets and undermine the ability of governments to tackle inequality.

To give a specific example, the world is now grappling with the Ebola crisis. Liberia is one of the worst affected countries. Liberia has 51 doctors for its entire population. This is a country the same size as Ireland. If Liberia received what it is entitled to it would be much better equipped to handle this crisis.

Above: Children learn about the importance of hand-washing training through an Oxfam Ebola programme in Liberia where there are only 51 doctors for a population of 4.2 million people. Pablo Tosco/Oxfam

The economic inequality demonstrated in Liberia also highlights the fact that the world’s poorest citizens are also the world’s most vulnerable citizens – without the resilience and support systems to be able to cope with crisis. Oxfam sees evidence of this in every emergency response we carry out – responding to disasters costs a lot more than preventing them in the first place. Reducing inequality would reduce the need for support when a disaster strikes.

Inequality is not inevitable – it’s the result of years of rigged rules, like rigged tax rules that allow the richest people and corporations to avoid paying their fair share.

But these rules can be changed in favour of the many.

There is a lot to do. Tonight, one in every seven of us sharing this planet will go to bed hungry. Tomorrow morning, there will be 60 million children of primary school age who won’t be going to school. It is not so long ago that people across Ireland were in a similar position.

The answer is justice: fair use of the world’s natural resources; a global economy that reduces inequality; a world that does not discriminate against women or minorities.

Inequality and sustainability are unifying global concerns. People across all walks of life, across the political spectrum, and even the richest people on earth are close to agreement that major change is needed.

So we have a shared agenda. Now what's needed is a shared plan of action. If we don’t take action fast, we will soon live in a world where equal opportunity is just a dream.

Jim Clarken is Chief Executive of Oxfam Ireland

Jim Clarken on inequality

RTE’s Morning Ireland interview with Jim Clarken on inequality and Lux Leaks

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Oct 23, 2014

Oct Hunger and conflict pushing South Sudan to the brink of famine

23
2014
As humanitarian crises in the Middle East dominate news headlines and the world rallies to tackle the ebola outbreak, hunger and conflict have combined to push South Sudan – the world’s newest country – to the very brink of famine.
 
The recent Scottish referendum is a stark reminder that even in times of peace and democracy, the path to independence can divide a nation. In Ireland, we know too well the enduring struggles the journey towards independence can bring.
 
South Sudan became the newest country in the world in 2011 following two decades of civil war in what was then part of Sudan. A green country not unlike our own where the River Nile flows, independence brought optimism for a brighter future.
 
 
But the high hopes of just three years ago now lie in tatters. At least 10,000 people have lost their lives and over one million have fled their homes. Around four million people (more than the population of Leinster and Munster combined) are struggling to find enough to eat.
 
In a report titled ‘From Crisis to Catastrophe’, Oxfam Ireland and other aid agencies including Christian Aid, Concern, Goal, Trócaire, Tearfund and World Vision have warned that the number of people facing dangerous levels of hunger is expected to increase by 1 million between January and March next year.
 
They are not the victims of nature, but of a disaster which is the result of a political dispute between two leaders that has escalated into a conflict rooted in the unresolved tensions of the Sudan civil war combined with the proliferation of arms and the lack of development in what is one of the poorest countries in the world.
 
There are fears among those working on the ground that efforts so far this year to prevent the crisis from deteriorating will falter as rival sides are regrouping ready to resume violence once the rainy seasons end this month. The threat of famine is very real.
 
Despite this, the sheer number and scale of crises worldwide – Iraq, Syria, Gaza, Ukraine, the Central African Republic and now the ebola virus among them – means the rapidly deteriorating situation in South Sudan has slipped off the news agenda.
 
The UN has declared South Sudan the world’s worst food crisis. But if we wait for an official declaration of famine to put South Sudan in the global spotlight, it will be too late. By the time famine was declared in Somalia and the Horn of Africa in July 2011, more than 125,000 people, half of the famine’s victims, had already died.
 
Since the violence broke out in December, men, women and children have been targeted because of their ethnicity and many have lost the people they love most in the world. They are scared and hungry.
 
Many have had to leave behind their possessions, crops and livestock or sell their assets to escape and have no means to buy food, water and other essentials. The conflict has meant that people were not able to plant crops. Camps are becoming overcrowded and poor sanitation is increasing the risk of disease.
 
Gwada Joseph (27) walks through open sewers in the Malakal camp for internally displaced people in the Upper Nile province, where heavy rains are making life intolerable for civilians. Gwada fled her home in Malakal town during the second rebel attack on her town in February 2014. Her husband was unable to escape and died in the fighting, while Gwada, her mother and four children made it to the safety of the UN camp.
 
 
Above: Gwada Joseph, 27, with son Mark, 1, in the Malakal IDP camp, South Sudan, where recent rains are making life intolerable for civilians. Photo: Simon Rawles/ Oxfam
 
Her home in the camp routinely floods in the rains, making life unbearable for her and her children. The rains in Malakal mean flooding is a regular occurrence and it is common to see people having to wade through water and mud that’s knee deep with little escape from mosquitoes, sewage and disease.
 
International aid – including Ireland’s contribution – has had a significant and positive impact on Gwada and her people’s lives. Food distributions make the difference in people eating even one meal a day and clean water has prevented more serious outbreaks of disease, while the distribution of solar lamps is helping keep girls and women safe.
 
Yet a massive funding gap remains (the UN World Food Programme estimates that $78 million is needed each month to deliver assistance) and the outlook for 2015 is of great concern, with news that 2.5 million people are projected to be in crisis or emergency from January to March 2015.
 
Sadly, this is not a crisis that will be ended simply with more aid. There needs to be political pressure to end this conflict. If the international community really wants to avert a famine then it must take a stronger stance towards the leaders of South Sudan increasing diplomatic efforts to end the fighting.
 
The UN Security Council must impose an embargo on the arms and ammunition that are sustaining the conflict and ensure that it is rigorously enforced. Every political negotiation should focus on the most important priorities; overcoming the obstacles that South Sudan’s people face in reaching aid; ending the violence immediately; and searching for a sustainable political solution.
 
The world must protect South Sudan’s people from violence; without ending the violence, the threat of famine will never be far away. With more vigorous diplomacy and swift action to convene a political solution inclusive of all people in South Sudan, the world has a chance to prevent that.
 
Otherwise 50,000 children will die from malnutrition unless we wake the world up and act now.
 
Because declaring a famine is like declaring a car crash – once it happens, it’s too late.
 
 

South Sudan: From the Other Side of the War

Jul 14, 2014

Jul 75 years is too long to wait for equal pay

14
2014

Women in many countries won’t be paid as much as men for another 75 years. That’s according to a new report released by Oxfam which shows that women are over-represented in part-time labour and are discriminated against across the G20 countries and beyond.

This is an issue that affects not only women, but all of us who live on this planet. Gender inequality is one of the biggest obstacles to ending poverty.

Above: Grandmothers, mothers, daughters, carers, and farmers at a rally in Biona Ranja village, Jalaun, Uttar Pradesh, India - ddemanding their right to be recognised for the work that they do. Photo: Rajendra Shaw / Oxfam
 

Women make up majority of those living in poverty and their unpaid but crucial contributions to our economy and our society are largely invisible in a system that does not value the impact of their work.

In the countries that make up the G20, women do an average of two to five hours unpaid work than men per day. The monetary value of unpaid care work which is mainly carried out by women is anything from 10% to 50% of GDP.

We know from experience that ending poverty starts with women, because when investment is directed into the hands of women, the whole community prospers.

That’s why women’s rights is at the heart of everything we do at Oxfam. A key part of our approach is empowering women to stand up for their rights, avail of the same opportunities and have their voices heard, which makes the world a better place.

For example, Oxfam’s Raising Her Voice project in Indonesia has helped to make local government more accessible to women, who have influenced the first participatory budget exercise in villages where the project was implemented. The impact of this greater participation in budgeting and planning is closer scrutiny and accountability of local government for the delivery of their programmes and plans.

And it’s not only society that benefits when women are treated as equal – the economy benefits too.

According to the report, the Eurozone’s GDP would increase by 13% if women’s paid employment rates were the same.

It clearly shows that the absence of women’s rights drives poverty, while their fulfilment drives development.

Gender equality is not a women’s only issue, it is a family issue, an economic issue and an issue for all of society. As long as women are denied equal opportunities all of us, in rich countries and in poor, are losing out.

‘The G20 and Gender Equality - How the G20 can advance women’s rights in employment, social protection and fiscal policies’ is co-published by Oxfam with the Heinrich Boell Foundation in advance of a G20 Business Summit being held this week in Australia.

Jim Clarken is Chief Executive of Oxfam Ireland.

Ending Poverty Starts With Women

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Jul 8, 2014

Jul We can’t look away from the crisis in South Sudan

8
2014

In a town called Kurmuk, on the eastern border with Ethiopia, I watched on in awe as refugees returned in 2006.

The trauma and hardship these people endured over more than two decades of civil war was replaced with a hope for the future and an overwhelming desire to return to their homeland.

Despite the multiple challenges the refugees knew they faced — a lack of safe clean water or physical infrastructure such as schools, hospitals and roads — I saw in them phenomenal strength and personal courage as they embraced rebuilding their land and their lives in their broken country.

It is devastating to witness yet again so many forced to flee their homes amid increasing conflict and disease in the region. South Sudan has experienced just three years of independence and already the seeds of hope sown then have turned to despair in the aftermath of violence that erupted last December.

The situation in South Sudan, the world’s newest country but where so many live in poverty, has gone beyond the forewarned tipping point, with its people now facing certain catastrophe in the months ahead.

The recent bloody conflict has left millions dependent on food aid to survive. Four million people are at risk of severe hunger. This is a humanitarian crisis of staggering proportions.

Above: Families arriving in Mingkaman after fleeing violence. Photos: Mackenzie Knowles-Coursin/Oxfam

Over 1.5m people have been forced to flee their homes, often with just the clothes on their backs, leaving behind what meagre possessions they had with no means to get food, water or other vital essentials.

Over 392,000 of refugees have fled to neighbouring countries of Uganda, Ethiopia, Kenya and Sudan lending to increased risk of regional insecurity as the spread of localised conflict in the Middle East has demonstrated.

In camps for those displaced, people are living in atrocious conditions and walking knee deep in mud and water. Poor sanitation has already taken many lives through the spread of cholera and other diseases, ever increasing with the seasonal heavy rains.

Now, many of South Sudan’s well-travelled but unsurfaced roads that form the arteries and veins of the country’s economy are left water logged and largely impassable.

The conflict has prevented people from planting seeds in time for harvest before the rains. Because of this, access to food will deteriorate even further, as access by aid agencies decreases and the risk of new peaks in fighting rise.

Oxfam is reaching out to thousands of vulnerable people with food and water but there are thousands more who need our help. We will be staring into an abyss if funds do not start arriving soon.

Clockwise from top: 7 tonnes of Oxfam aid arrives in Juba, South Sudan. Photo: Grace Cahill/Oxfam Oxfam is helping to purify 1m litres of water a day Photo: Mackenzie Knowles-Coursin/Oxfam Martha Yandt receives food at a distribution. Photo: Pablo Tosco/Oxfam

It is disappointing that while many nations pushed for and supported South Sudan’s independence from Sudan, little commitment is forthcoming from the international community in the form of aid.

The people of South Sudan need an end to the fighting, but with peace talks stalled, there is little hope of a swift end to the conflict.

We need to see a surge in the capacity of the response, which is very much dependent on funding. There must be a scaling-up of the activities of the international community to respond to this crisis.

A recent presentation by Irish aid agencies to the Oireachtas Foreign Affairs Committee resulted in cross party political acknowledgement of the scale of need in South Sudan and earnest commitment to supporting a peaceful resolution.

The international community can mirror Ireland’s diligence by increasing its diplomatic pressure on the two protagonists of the conflict, facilitating efforts to keep the situation in South Sudan on the international agenda, delivering on pledged funds to the UN appeal and deploying UN peacekeeping troops within capacity. It absolutely cannot resolve itself of responsibility.

Despite the flagging interest of news agencies, the conflict in South Sudan has not abated. The scenes of devastation may have become less visible but the suffering does not end.

The UN has warned that the worst hit areas are at risk of impending famine. We have a chance to act now to avoid the “Forgotten Crisis” becoming a crisis we cannot forget.

We need a massive and rapid global surge in aid. For the sake of our common humanity we cannot, we should not, look away at this time of crisis. Action must be taken now. The tide is already against us.

Jim Clarken is Oxfam Ireland’s CEO

South Sudan: From the Other Side of the War

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