Oxfam says ‘immense wealth concentration’ has created conditions for political oligarchy

The world's richest man Elon Musk with US President Donald Trump. Musk spent several months as a government adviser, influencing policies. Photo / Haiyun Jiang, the New York Times

Over the past decade, the world’s richest 1% have increased their wealth by at least US$33.9 trillion ($56t), according to a new analysis from the global anti-poverty group Oxfam International.

That amount is “more than enough to eliminate annual poverty 22 times over” when calculating at the World Bank’s highest poverty line of US$8.30 per day, the group said in a statement which also called for governments to invest in state-led development and to tax the ultra-rich, among other requests.

Billionaires alone - about 3000 people worldwide, the overwhelming majority of whom are men - have gained US$6.5t since 2015, according to the report, which was released ahead of an international conference in Spain on development financing.

“This immense concentration of wealth has translated to political power, in a movement towards oligarchy that sees ultra-wealthy individuals able to shape political and economic decision-making in ways that increase their wealth,” Oxfam said in its briefing paper, titled “From Private Profit to Public Power: Financing Development, Not Oligarchy.”

Concern about wealth inequality has risen in recent years.

British-founded Oxfam said in early 2024 that the world could have its first trillionaire within a decade if current inequality trends continued.

United States Senator Bernie Sanders (Independent -Vermont) has suggested that in a fair society billionaires should not exist, and he and other leaders including former president Joe Biden have warned of an oligarchy taking shape in the US.

Those frustrations coalesced this week in Venice, Italy, ahead of the star-studded wedding of Amazon founder and Washington Post owner Jeff Bezos and Lauren Sánchez, which has sparked a variety of demonstrations pushing back against what protesters see as a manifestation of the era of the 1%.

One protest sign unfurled on St Mark’s Square on Tuesday read: “If you can rent Venice for your wedding you can pay more tax”.

The proposals in the Oxfam report dovetail with such calls.

Discussing how private investment has affected development, it urges a rejection of what some scholars call the “Wall Street Consensus”, which pushes for greater involvement of the private sector in public services, such as education and healthcare.

Instead, the report calls for a “public sector-first” approach, starting by taxing the very wealthiest, who, the report says, “have transformed themselves from taxpaying stakeholders to creditors and shareholders, insulated from democratic demands”.

In the report, Oxfam points to a proposal introduced by economist Gabriel Zucman at the Group of 20 summit in Brazil in 2024, which called for a minimum 2% tax on the assets of the world’s 3000 billionaires with an annual revenue estimate of US$200b to US$250b.

The idea of taxing the fortunes of the wealthy has been debated for years. In an interview last year, Chris Evans, a professor of taxation at the University of New South Wales in Australia, described “gross inequality in wealth” as “a disaster for social cohesion”.

“There is certainly an argument for using some of the excess money at the top end to help some of the people at the bottom,” he said, “and we might just find that we’ll have a much fairer and more efficient society”.

Eric Zolt, a professor of law at the University of California at Los Angeles and an expert on taxation, said in an email that “despite the apparent appeal of using wealth taxes to reduce inequality, over the last 20 years the trend is against the increased use of wealth taxes”.

“The revenue yields are remarkably low for all types of wealth taxes,” he added, noting that any sort of global wealth tax would struggle to find support in the US, where “a remarkably large number of the 3000 billionaires are resident”.

“For me, the key question is not whether countries should tax wealth to reduce social and economic disparities, but whether individual countries or a coalition of countries can tax wealth effectively,” he said.

”For almost all countries, the chances of success are low.”