To really make you understand the gravity of this issue, Let’s start with an example. If you made $1000 an hour, for 24 hours a day it would take you approximately 41 days to become a millionaire, 115 years to become a billionaire, and 114,156 years to become a trillionaire. Of course these figures are under the assumption that there is absolutely no expenditure and with no account for inflation. In the same country where in the last 30 years the top 1% have become about $21 trillion wealthier, the bottom 50% have lost about $900 billion in wealth. The income disparity in a country that houses the “Big Four” technology companies, with thousands of workers, is vast, so how is it that trillionaires are allowed to exist while millions don’t have their basic needs?
Recently, news has spread that with the help amazon is doing during this pandemic, Jeff Bezos is predicted to hit the trillion mark, by 2026. That would mean, that with the expenditure, and with the inflation, Jeff Bezos makes around 4 million dollars an hour to reach to his level of income. Though the trillion would reflect only his net worth, it most definitely means, he has billions in pocket. Before we can even touch upon the most pressing and obvious aspects of the nation that can be fixed with immediate and abundant funding, maybe taking a look at the state of amazon’s working conditions would be a better start. During peak season, amazon warehouse workers are forced to work for an average of 55 hour weeks, just 5 hours below the legal maximum, with an expectation of packing around 120 boxes an hour. Several ex employee reviews show the truly horrific state the lowest level of workers at the company had to face, including the physical and mental exhaustion they were left with after 10 hour shifts. Only after the richest man in the world had been criticised for the shockingly low worker’s annual median pay ($28,446) , the decision to raise their minimum wage employees to $15 an hour was made. An improvement, but a clear reflection of the greater issue of inequality that still lies deep within the soil of the country.
One of the main aims of a government for efficient functioning of their country, pertains to redistribution of income. The idea behind this objective has to do with equitable distribution of income rather than equal. Such that standard of living improvements can actually account for the entire population as a whole as economic growth increases. The government is to spend from their fiscal budget on everything they possibly can to aid in the better welfare of their people. So essentially the problem isn’t the billionaire, but rather the market system and authority that allows it to co exist with millions under the poverty line.
Amazon, a company that makes billions in profits a year, for the first time, filed for federal income taxes this year at a 1.2% of its gross profit, 13% lower than the average American’s tax rates. But amazon isn’t alone. Though definitely not as staggeringly low, a study conducted by the liberal Institute on Taxation and Economic Policy showed that fortune 500 companies pay an average tax rate of 11.3%. One strategic tool that many large companies take advantage of, is tax avoidance. While tax evasion is illegal, tax avoidance is the legal usage of the tax regime to defer/reduce your liabilities. For example, for many of these companies, investment in R&D, property, plant, and equipment, as well as employee stock compensation makes them eligible to large tax breaks, without which, public revenue would increase by billions. Additionally, By allowing tax deductions (rate cuts), tax credits, and other incentives the government aims for organisations to then stimulate economic activity, job creation, and innovation. But as working conditions have proven, that aim seems to have missed and headed straight for capitalistic gain.
While it is important, as another macro economic objective, to focus on economic growth, it would amount to nothing if the majority of the people are left at lows to keep the rich afloat. After all, the rich would make no more money if the rest are left with close to nothing. “A team is only as good as it’s weakest player” fits adequately in this scenario because of how well it illustrates development in a country. The increase in GDP cannot, does not, and should not undermine the other aspects of humanitarian responsibility that the government chooses to neglect or carelessly “take care of.” Officially, the united states is a mixed economy, one that allows for private ownership and government intervention as well. The rationale behind this model is to eradicate the cons of both an entirely free market and planned economy and reap the benefits of both. However, the idealistic model fails to consider what plays a big part in this issue as well; corruption and collusion. With the top 1% having the power over what seems to drive the world- economic growth- one may not be wrong to assume that the influence is being taken advantage of. It can be noted that president Trump promised the people a rise in minimum wages for the exact reason that he didn’t understand how people made it with $7.50 an hour, and yet just a couple of speeches later, stated that it can’t be done, once again, to compete with the global market. But at what cost?
China and India are considered second and third world countries respectively, yet they are also expecting to see their wealthiest few prosper some more with Chinese real-estate tycoon Xu Jiayin, Alibaba's Jack Ma, and India’s Mukesh Ambani projected to become trillionaires in the next decade itself. These handful individuals have enough money to last them a couple hundred, luxury filled lives with absolutely no additional income. At the same time, millions in their countries continue to live their lives in preposterous conditions, due to no fault of the market forces but rather of those who allowed them to remain unchecked and unregulated.
To give perspective, here is a list of issues around the world that can be solved just by the correct instalment of progressive methods and proper planning by those in charge of public expenditure. Each and every one of these issues requires the amount of money equivalent or less than that in possession of the world’s top wealthiest individuals.
$1.6 trillion of student loan debt currently in the United States can begin to be forgiven, slowly but indefinitely
Funding for proper sex and mental health education in countries with very high sexual assault and suicide rates
$216 million to fix the flint water contamination issue in the united states
$390 million to extract 40% debris from the great pacific garbage patch
Funding to provide food, clothes, soap, tooth brushes, and other hygiene necessities to those stuck at the Mexico border
$1.5 billion to eradicate polio in countries like Pakistan, Afghanistan, and Nigeria (less than the 1.2% of taxes amazon payed).
$30 billion a year to eradicate world hunger (just under the sum of money MacKenzie Bezos was given after her divorce)
$150 billion a year to deliver universal safe drinking water and adequate sanitation.
$175 billion a year to end extreme poverty world wide
$13 trillion to stabilise greenhouse gas levels in the next 10 years
$23 billion a year to provide universal education especially in the poorest of countries.
It is inhumane to accept and allow billions of people worldwide, to suffer in desperation, without making the very feasible, and most basic adjustments to the system has created the obscene gap between extremes in the first place. There is no developed world where billionaires and the downtrodden can co exist, and that is entirely on failed leadership and policy making.
Nicely expressed Saumya! Also read up in details about a communist economy and a capitalist economy. And why communism isn’t chosen by the rest of the world? Why capitalism prevailed in the end?