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Shameful inequality must end

By Jim Clarken

Published 25/01/2016

Jim Clarken is chief executive of Oxfam Ireland
Jim Clarken is chief executive of Oxfam Ireland

Runaway inequality has created a staggering wealth divide. Chancellor George Osborne recently warned of "a dangerous cocktail of new threats" to the economy's recovery, but measuring GDP growth is meaningless for most people when the vast majority of economic growth worldwide is primarily benefiting the wealthy.

A new Oxfam report, to mark the World Economic Forum meeting in Davos, shows that just 62 people own as much wealth as the poorer half the world's population - approximately £1.22 trillion.

The problem with inequality is not rich people or profits. A thriving private sector plays a key role in lifting people out of poverty.

But having the lion's share of wealth going to those at the top allows them to write the rules of the game in their favour.

A global spider's web of tax havens and the industry of tax avoidance have blossomed. Profits disappear from countries where real economic activity is taking place, to exist only in tax havens.

At the Lough Erne G8 in 2013 David Cameron promised a crackdown on shell companies - vehicles for business transactions without themselves having significant assets - to avoid tax.

The UK has fulfilled that promise, but so far only one overseas territory and not a single Crown dependency has followed suit.

Tax-dodging by multinational corporations costs developing countries at least $100bn every year, denying them the resources they need to tackle poverty, educate children and stop citizens dying from easily curable diseases.

Fantastic progress has helped to halve the number of people living below the extreme poverty line between 1990 and 2010.

Yet had inequality within countries not grown during that period, an extra 200 million people would have escaped poverty.

When economic benefits aren't passed to the poor, it makes little sense to measure society's success or failure in economic terms.

Governments should measure the health of societies by the gap between the wealthy and most vulnerable and levels of access to services essential to well-being, such as education and healthcare.

Those figures actually mean something to ordinary people.

Jim Clarken is chief executive of Oxfam Ireland

Belfast Telegraph

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