Wealth inequality is starkly highlighted by the rapid accumulation of billionaires’ fortunes, with 204 new billionaires and a rise in their collective wealth to 15 trillion US dollars, while 733 million people face hunger. Inheritance plays a significant role in this wealth concentration, particularly in Germany, where 71% of billionaire wealth comes from inheritances. This disparity, exacerbated by favorable tax policies for the wealthy, threatens democratic structures and underscores the growing influence of the ultra-rich in shaping economic policies.
Wealth Disparity: The Rise of Billionaires Amidst Global Hunger
The world’s wealthiest individuals are amassing fortunes at an astonishing rate, with some seeing increases of up to 100 million US dollars each day. Meanwhile, a staggering number of people are grappling with hunger, highlighting a stark contrast in wealth distribution.
As reported at the World Economic Forum in Davos, a staggering 204 new billionaires emerged globally last year. The collective wealth of these ultra-wealthy individuals surged from 13 trillion US dollars to a staggering 15 trillion US dollars in just one year. In contrast, approximately 733 million people are facing food insecurity—a rise of about 152 million since 2019.
The Impact of Inheritance on Wealth Distribution
According to the findings from the study ‘Takers not Makers,’ there are currently 2,769 billionaires across the globe. Their wealth has expanded three times faster in 2024 compared to the previous year, with the top ten billionaires witnessing daily increases averaging 100 million US dollars. Alarmingly, the number of individuals living below the World Bank’s expanded poverty line of 6.85 US dollars a day has remained stagnant since 1990, affecting nearly 3.6 billion people.
In Germany, the wealth of billionaires has also soared, with a total increase of 26.8 billion US dollars, bringing their combined wealth to 625.4 billion US dollars in 2024. The country now boasts 130 billionaires, ranking fourth globally after the USA, China, and India. Notably, 71 percent of the wealth among German billionaires is attributed to inheritances, a stark contrast to the global average of 36 percent.
Oxfam representative Manuel Schmitt points out that this extreme wealth inequality is largely driven by unfair tax policies, where the ultra-rich often pay lower taxes compared to middle-class families. The trend of inheritance contributing to wealth accumulation among billionaires is on the rise, raising concerns about the implications for democratic societies.
As highlighted by Serap Altinisik, managing director of Oxfam Germany, the intertwining of wealth and political power poses a threat to democracy. The report suggests that the affluent are the primary beneficiaries during economic crises, as they maintain a status quo that favors their interests.
The influence of tech billionaires in shaping policies is notable, with figures like Jeff Bezos, Mark Zuckerberg, and Bill Gates consistently ranking among the wealthiest individuals in the Forbes listings. Despite potential substantial losses, these entrepreneurs would still retain their billionaire status, underscoring the immense wealth concentration within a select few.
Furthermore, the report indicates that the ultra-rich are increasingly impacting tax legislation, advocating for lower corporate taxes and exemptions from inheritance and wealth taxes. Between 1990 and 2017, the number of countries implementing value-added taxes rose dramatically, while those with net wealth taxes plummeted from twelve to just four.
In light of these findings, Development Minister Schulze has expressed support for proposals aimed at addressing these disparities, particularly those initiated by the Brazilian government.