• Based on conservative estimates, inequality contributes to the deaths of at least 21,000 people each day.
  • The impact of COVID-19 has been much worse for those on lower incomes.
  • A one-off 99% windfall tax on the COVID-19 wealth gains of just the world’s ten richest men alone could pay to make enough vaccines for the world and more.

I recall the early days of the pandemic. There was a sense of togetherness, and an awareness that our mutual risk would be overcome through solidarity. It seemed possible that a new, fairer society could be created; that through the pain, the pandemic would at least lead to a rebalancing of our economies. It is now clear that, on the contrary, the pandemic has been fuelled by inequality, and has in turn increased levels of inequality all over the world.

Since the pandemic began, a new billionaire has been created every 26 hours. The world’s ten richest men have more than doubled their fortunes, while 99% of humanity is worse off. For decades, movements across the world have been pressing the panic button about the dangers of rising and extreme inequality.

Oxfam has done so at each World Economic Forum's Annual Meeting in past years and throughout this pandemic. And it isn’t just advocates and activists: the IMF, World Bank and Crédit Suisse have all projected the pandemic triggering a spike in inequality worldwide.

How the pandemic has fuelled inequality

The impact of COVID-19 has been much worse for those on lower incomes. Your level of income is a stronger indicator of whether you will die from COVID-19 than age, with the poorest people, women and racialized and marginalized groups hit hardest. And this in turn has compounded existing health inequalities: McKinsey data shows 3.4 million black Americans would be alive today if their life expectancy, worsened by COVID-19, was the same as their white peers.

As the Forum has shown, achieving gender parity has been set back an entire generation for women and girls – that’s now 135 years – as in many countries, women are facing a surge of gender-based violence and unpaid care work. People who live in developing countries are around twice as likely to die from COVID-19 than someone from a rich country.

Meanwhile, billionaire wealth has risen more during the pandemic than it has in the past 14 years put together – the biggest surge since records began. As governments pumped $16 trillion into economies to save our lives and jobs, many wealthy people have profited from a stock market boom.

While governments and pharmaceutical companies pulled off a magnificent feat to fund and secure the development of ground-breaking vaccine technology to tackle COVID-19, their failure to ensure this is shared equitably around the world is slowing down the supply to billions of people and prolonging the pandemic for us all.

Our new analysis shows that inequality in income and wealth does far more damage than simply creating unfair societies: inequality kills. Based on conservative estimates, inequality contributes to the deaths of at least 21,000 people each day. These are the lives lost when access to quality healthcare is a luxury not a right; when gender-based violence persists; when people starve in a world with no shortage of food. Reducing inequality would save lives.

How can we reduce inequality?

Permanent taxes on wealth and capital are the lifeblood of healthy economies. But as a short-term measure, windfall taxes could immediately claw back extreme wealth into the real economy and save lives. For example, a one-off 99% windfall tax on the COVID-19 wealth gains of just the world’s ten richest men alone could not only pay to make enough vaccines for the world, but also fill financing gaps in climate measures, increase universal health and social protection, and boost efforts to address gender-based violence in over 80 countries. All this – and these ten men would still be $8 billion richer than they were pre-pandemic.

A one-off 99% windfall tax on the COVID-19 wealth gains of just the world’s ten richest men alone could pay to make enough vaccines for the world
A one-off 99% windfall tax on the COVID-19 wealth gains of just the world’s ten richest men alone could pay to make enough vaccines for the world
Image: Oxfam

There are precedents for the idea of an emergency windfall tax. The French government taxed excessive wartime wealth at 100% after the Second World War. In the US, President Franklin D. Roosevelt proposed a 100% tax on high incomes during the war, and a tax rate of 94% on high incomes remained in place for a decade after it ended. With adequate taxation we could invest in reducing inequality through universal healthcare and social protection, and in climate adaptation. We could fund efforts to challenge the social and cultural norms that silence women, exploit them and deny them opportunities, and that fuel gender-based violence.

What's the World Economic Forum doing about diversity, equity and inclusion?

The COVID-19 pandemic and recent social and political unrest have created a profound sense of urgency for companies to actively work to tackle inequity.

The Forum's work on Diversity, Equality, Inclusion and Social Justice is driven by the New Economy and Society Platform, which is focused on building prosperous, inclusive and just economies and societies. In addition to its work on economic growth, revival and transformation, work, wages and job creation, and education, skills and learning, the Platform takes an integrated and holistic approach to diversity, equity, inclusion and social justice, and aims to tackle exclusion, bias and discrimination related to race, gender, ability, sexual orientation and all other forms of human diversity.

Above all, we need to change the rules that make our economies so unequal in the first place. This is an ideal moment in history to establish a model of stakeholder capitalism that can address societal divisions created by income inequality. It's going to take more than money. We need smart state institutions to work with smart companies to deliver really important solutions to public problems like this one.

We need to reform sexist laws and rescind laws that undermine the rights of workers to unionize and strike. We need to tackle the barriers to political representation for women, racialized groups, and working-class people.

Governments in rich countries should work to ensure that we can supply and distribute vaccines to everyone, everywhere. That means immediately waiving intellectual property rules over COVID-19 vaccine technologies to allow more countries to produce safe and effective vaccines and usher in the end of the pandemic. The most universal crisis of our time deserves this simple, universal response. Ending this pandemic will require the imagination and courage to make our economies work better for everybody.