The rich get richer and the poor get poorer.Percy Bysshe Shelley
Shelley was a remarkable poet and his work mainly comprises of romantic and philosophical poetry. But Mr Shelly was a visionary and far ahead of his time when he coined the above statement. He noticed a pattern which is thriving even after 200 years of his demise.
OXFAM — a confederation of 20 independent charitable organizations focuses on alleviation of global poverty, recently released its annual report. According to it, the top 1 per cent of India’s wealthiest holds 51.53 per cent of total national wealth. And the top 10 per cent hold 77.4 per cent of the total national wealth. While the bottom 10 per cent of the population which amounts to roughly 13.6 crore Indians remain under debt.
The disparity in growth percentage per annum when quantified comes out to be – Top 1 per cent wealth growth in the financial year 2017-18 — 39 per cent and the lower half’s wealth growth in the same year — 3 per cent.
While the number of billionaires in India is on the continuous rise since the past 3 years, the poor remain to be poor if not poorer. Oxfam says 26 of the world richest people now hold the same amount of wealth as the 3.8 billion people who make up the poorest half of the world’s population. Last year this number was 43 and in 2016 the number was 61.
OXFAM denotes if India’s richest 1 per cent pays 0.5 per cent extra tax on their wealth, it would raise an amount abundant enough to increase government’s spending on healthcare by 50 per cent.
The reports were unveiled while the political and business leaders gathered for the World Economic Forum at Davos, Switzerland. Winnie Byanyima, Executive Director of Oxfam International, said – “The size of your bank account should not dictate how many years your children spend in school, or how long you live – yet this is the reality in too many countries across the globe. While corporations and the super-rich enjoy low tax bills, millions of girls are denied a decent education and women are dying for lack of maternity care.”
The management students back in the country scoffed at the statistics provided by OXFAM. “The disparity is appalling and mortifying. These facts are nothing but filthy” says Tina Mehta.
Amitabh Behar, CEO, OXFAM India stated, “It is morally outrageous that a few wealthy individuals are amassing a growing share of India’s wealth while the poor are struggling to eat their next meal or pay for their child’s medicines. If this obscene inequality between the top 1 per cent and the rest of India continues then it will lead to a complete collapse of the social and democratic structure of this country.”
The numbers of economic imbalance can often be seen by the naked eye and found in the rise of poverty along with social unrests like Jat Andolan, Pattidar unrest, and increased burden of subsidies on the government, distress mitigation from poorer to richer districts leading to collapse of city governance and derailing of the pace of Economic Reforms.
Investing in Women
The amount received through taxes paid by the rich can be utilized to strengthen the female section of the society. The lack of funds results in the neglecting of the public services, therefore hitting the women and girls hardly. The gender favoring regions in our country deprive the girl child of the basic necessities when the hole in the pocket of the family widens.
As International Monetary Fund Chief Christine Lagarde recently said, if women’s participation in the workforce matched men’s, India could grow at 27 per cent per annum. She added India could add $700 billion to its GDP in 2025 by closing this gap. Helping women stay active in the workplace while raising a family is the key to achieving this growth and can be achieved through family-friendly work policies, such as paid parental leave and men taking equal responsibility in raising kids and managing household chores.
Infuse and re-boost Agriculture
According to the 2011 Agricultural Census of India, an estimated 61.5% of the 1300 million Indian population is rural and dependent on agriculture. The number of farming households is 159.6 million. Farmers are the backbone of the country and every desperate measure should be taken to solidify the roots which in turn could help in reducing the growing disparity. Providing farmers with a bundle of services like access to seeds, plant nutrients and production practices are critical. But today, climate smartness and climate resilience also need a special focus.
Reforming Workplace Laws
Reforms in workers’ laws can reduce inequalities. Minimum wages and universal basic income (UBI) are two of the popular ways to reform workplace laws. They both have the same aim — raising incomes of the least fortunate to reduce the income gap. These are imposed by law and paid by the employer. Minimum wages should have inflation adjustment and a premium for inequality reduction.
In developing countries such as India, despite having hundreds of pro-poor schemes, the biggest question is whether such benefit is reaching the poor.
The Roman Empire was one of the richest on the planet, and the kingdom’s assets were concentrated in the hands of a few senatorial elites and like today world’s half population they too were utterly poor. Warning signs of inequality were ignored and it resulted in civil war and the entire empire collapsed. Only the wise learn from history while the fool likes to make the same mistake again and again.