I first started to learn about billionaires and the wealth gap when I watched the Netflix documentary Explained. The series has a huge variety of short 20 to 30 minute documentaries on numerous topics. I couldn’t recommend the series enough, it is a great way to learn something new in just 20 minutes! I came across the billionaires episode and it sparked my interest in learning even more about it. This is one of my favourite topics to discuss and learn about because it is truly insane and mind blowing to understand how rich billionaires really are. This is a slightly longer post but I think its important to discuss!
Let’s put this into perspective
Understanding how much a billion is, is something that is genuinely difficult to comprehend. Here is a few statistics that I have found whilst researching billionaires that helps you to understand what you can do with the smallest percentage of the top 400 richest people in the world’s wealth.
- With less than 3% you could permanently eradicate malaria. Around 800 children will die today to malaria. 3% is so small billionaires would not even notice that loss of money, but that money could save thousands of lives.
- With less than 5% you could lift every American out of poverty.
- 6.8% could provide everyone in the world with clean drinking water and toilet access. 844 million people have zero access to this currently.
- You could end the Yemen humanitarian crisis.
- You could repair and rebuild Beirut, Lebanon after the recent and devastating explosion that killed and injured hundreds and has left many homeless.
Here are a few more statistics for you to bare in mind when discussing billionaires:
- “The worlds top 26 billionaires own as much wealth as the poorest 3.8 billion people.” TIME Magazine 2019
- “In 2019, the number of billionaires grew by 8.5% to 2,825 people. The combined wealth of the world’s billionaires reached 9.4 trillion dollars.” Wealth X: The Billionaires Census
- “Billionaires got 565 billion dollars richer during the pandemic, making 42 billion a week on average.” Business Insider
- In 1987 there were 140 billionaires, in 2019 there were 15x more billionaires with 30x more wealth. (Worth 8.7 trillion dollars according to Forbes 2019)
- If billionaires formed a country it would be the 8th wealthiest in the world.
- The richest 1% own half of the worlds wealth.
Many people underestimate the wealth of the super-rich, it is quite literally unimaginable wealth that one person cannot spend or even fully utilise themselves in a lifetime. More and more billionaires are being created and their wealth just keeps growing.
So how do people get THIS rich…
Forbes has done a lot of research into understanding how people become billionaires. The Explained episode on Netflix about billionaires explains really well how we ended up at this point.
The first ever billionaires surfaced in what was called The Gilded Age. They founded companies in the metal, oil and railroad industries. These billionaires corrupted the working class by paying low wages for labour. This theme remains similar with some of today’s richest billionaires such as the Walton Walmart family and Jeff Bezos the founder and creator of Amazon who is currently the richest person in the world.
The main reason why billionaires exist is due to capital. It is a known fact that money makes more money. The richer you become the less your income comes from labour and the more it ends up coming from capital that creates itself instantly. To take the quote from billionaire Edgar Bronfman Senior: “To turn 100 dollars into 110 dollars is work, to turn 100 million dollars into 110 million dollars is inevitable.” In the Explained episode they used the example of Michael Jordan. His hard work and labour to become one of the worlds greatest basketball players earned him his millions, but his capital sponsorship’s and deals made him into a billionaire. That money just keeps growing, and it doesn’t stop.
When we look at a company, for example Amazon, the wealth just keeps growing. Jeff Bezos makes more in one minute than what a labourer of his company would earn in one year. Business insider estimates that Jeff Bezos makes an average of 150 thousand dollars a minute. His money quite literally makes itself, he doesn’t even need to lift a finger.
So how should we feel about billioniares?
Well, they are scary, they have power. They can be in contact with a world leader in minutes. Some of them are world leaders such as Vladimir Putin and Donald Trump, and it’s not like Trump is the nicest guy in the world given recent world events such as protecting and upholding a system that dehumanises and attacks black lives, attempting to take away trans rights and referring to coronavirus in racially derogatory terms that incites violence against Chinese Americans, but that’s a whole other discussion for another day that deserves more attention.
Money buys power, and being a billionaire means that you can do literally anything you want, good or bad, and you will face very little threat to your wealth and power. Bad people, plus wealth leads to power in the wrong hands.
There has been a huge amount of controversy surrounding the ethical treatment of workers and labourers that work under billionaire companies. Places such as Walmart and Amazon pay low wages and there has been reports of employees losing their jobs for wanting bathroom breaks and time off, even for religious commitments. Even further than this there are constant reports of bad working conditions particularly in creating a safe working environment for Covid-19.
You would think billionaires would pay their employees more because they have the money to do so, but the way society is structured they literally don’t have to. People have to work, they need to, so they will work in poor conditions in order to live, they shouldn’t have to live like that but they do, and some billionaires exploit that need to work and survive which has been established by capitalism. Paying for better working conditions and higher wages would have a minuscule impact on the wealth of a billionaire. They choose to turn a blind eye and not properly support their labourers because there will always be people that need work, no matter the working condition. Paying for cheap labour is how companies thrive and grow. This theme is prevalent within the fast fashion industry because it is how stock is created so quickly and in turn that brings in more profit. This is the way working conditions have become and it isn’t right.
Controversy and unrest has begun to grow surrounding billionaires and the wealth gap. Exposing information on billionaires stashing their assets in offshore accounts and avoiding taxes have recently surfaced in the past couple of years. The Cayman Islands being a popular one that takes advantage of the tax breaks, as well as Crooked Island in the Bahamas. Billionaires hide their assets so much that it has become impossible to accurately predict how much their net worth really is. The news that billionaires hide their wealth and avoid paying tax has become more mainstream, and it angers many. It was found that the wealthiest people in the world do not pay around 25% of the taxes they should be paying, that is 10% of the worlds GDP stashed in offshore bank accounts, amounting to trillions of dollars. That is a huge amount of tax not being used for public services. Tax avoidance is a huge issue with the super rich and legal action is beginning to be taken, but in most cases, loopholes can be found, and legality cannot do enough to correct this injustice.
I think people are sick and tired of living in a nation and a world where, so few have so much and so many have so little.Bernie Sanders
Whilst the super rich avoid their taxes, the middle class begin to pay more taxes than the super rich. “The 400 richest U.S. families now pay a lower overall tax rate than the middle-class, the first time that’s happened in 100 years, according to economists Emmanuel Saez and Gabriel Zucman…Factoring in federal, state and local taxes, those ultra-wealthy households pay a total rate of about 23% — that compares with just over 24% for the bottom half of households.” CBS News. That means a middle class family pays slightly more tax than some billionaires. This is because most of their income comes from capital and not labour which means they are taxed less compared to the working and middle class. This is an income inequality issue that some democrats in America campaign to resolve. While the US tax system is supposed to be progressive there is no wealth tax on the ultra rich. Some billionaires are even open to be taxed more but the system is not in place in the US.
Stop trying to defend billionaires
A huge response to people who speak out against billionaires is an immediate naive attempt to call that person a communist or radical liberal. My response to that would be, one, challenging the super rich doesn’t automatically mean we need to redistribute all global wealth so that everyone is equal, and we live in a communist society. That is a radical value that we do not need to immediately jump to. We don’t need to destroy all wealthy people. We need to understand the difference between a millionaire and a billionaire because they keep getting richer and we are living in their world. There is a difference between being rich and super rich. Sure, the rich can buy a nice house and a nice car. But the super rich have the power in their hands to end some of the world’s largest humanitarian crises and still be the richest people in the world. It would cost around 29 billion dollars to end the Yemen famine crisis. That is 20% of Jeff Bezos’ net worth. Imagine what would happen if all the billionaires put forward a small amount of their whole earnings. Now I am by no means expecting all these billionaires to do this, we shouldn’t have to rely on billionaires to end the largest humanitarian crisis in the world, that is up to a failure of our government systems to control wealth inequality. But imagine if they did because they have that much money to do it and still be insanely rich.
Two, why do you want to protect someone that has literally a billion times more power than you anyway, they really don’t need your support unless they feed off of your labour. They have the power to influence government and politics, avoid tax, and earn thousands within a minute without even lifting a finger. They really don’t need your support. Billionaires have power and influence; they are un-elected political influences that cannot be held accountable. Billionaires are self-interested and they will promote themselves before anyone else. Don’t defend someone who is purely untouchable, when you are sat stuck in a system that prevents you from ever earning close to the wealth they acquire.
Another response people give is, well they worked hard surely they deserve it. There are hundreds of millionaires out there that worked hard and deserve their earnings. To become a billionaire is a whole other ball park. I came across a post online that compared millions and billions. A million seconds is 11 days, a billion seconds is 32 years. Let that sink in! Being rich and super rich are different, don’t assume they are the same. They may have worked really hard, but newsflash, everyone does. If you make the American minimum wage it would take 70,000 years to become a billionaire, a billionaire is not working 70,000 times harder than a labourer. It just so happens that the billionaire got lucky and their money started creating more money and will continue too. People who work 16 hour days on minimum wage work very very hard. People on the average living salary work very very hard. These people work just as hard, if not harder than most billionaires and will never reap the value or the lifestyle that a billionaire has. Billionaires are not gods, although their money has the ability to make them powerful enough to act like one.
Although I did say do not defend billionaires it would be unfair to assume that they are all evil, some do give back and pledge millions or billions towards social and global issues. However, it is important to know the difference between a performative amount of money that puts them in the good books of the public (when in reality they just earn’t that amount of money in the time it took you to read this far on this post), and genuinely wanting to see real global and social change. We need to learn to see the difference. Some billionaires exploited the working class to gain their wealth, being charitable means giving back what they avoided through taxes and fair wage policies to begin with. People shouldn’t be put on a pedestal for that.
Quite frankly, billionaires should not exist, literally no one needs all of that money and for most of them it just sits there and wont even be used in their lifetime. When you really put into perspective how much a billion is and what you can do with even 5% of that, it is truly terrifying that one single human controls that much.
This is just a basic understanding of the impact billionaires have and the amount of money they really have. The discussion on income inequality and wealth gaps is a huge and long one, I have only touched on the basics today.
There is even more to discuss surrounding the morality of billionaires, philanthropy, celebrity billionaires and how the governmental structures we live under furthers this income inequality. I would also love to learn more myself about the paper billionaire argument which aims to dismantle the thought that billionaires aren’t actually that wealthy because their wealth is tied up in assets when this is simply untrue. Also I’d like to further explore how the capitalist system supports billionaires and income inequality.
Income inequality is a huge topic and the morality of billionaires is a sensitive one to some because people can view them as god like for creating a product they may enjoy. But to me that doesn’t mean they need more wealth than they even know what to do with, whilst the rest of us struggle under a system that is working against us and supporting them. Whilst I do not know the solution to wealth inequality, it is interesting to discuss and to examine how billionaires came to be in the position they are in.
I hope you enjoyed this post! I have upcoming posts on perfectionism and analysing the capitalistic social themes in the movie Parasite by Bong Joon-Ho, so please do come back to check those out!