Finance Finance News The pandemic has fuelled extreme inequality. It’s time for a global reset

The pandemic has fuelled extreme inequality. It’s time for a global reset

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For many Australians, 2020 was a year they’d prefer to forget. 

It brought health concerns, unemployment, social isolation, financial stress, home schooling, and the feeling that there was little to look forward to.

And now we are all coming to terms with the realisation that a new year does not mean a clean slate where this COVID-19 pandemic is concerned. 

However, for a small group of Australians, 2020 brought major profit.

Australia’s 31 billionaires raked in nearly $85 billion since the global pandemic was declared in March – an almost unimaginable sum that is enough to give the 2.5 million poorest Australians a one-off payment of just over $33,300 each.

Meanwhile, we are navigating our country’s first recession in almost 30 years. 

We have been told that everybody was suffering, that this virus wasn’t concerned with things like wealth or race or gender, that it was a great equaliser.

Nothing could be further from the truth.

This pandemic has laid bare the stark inequalities that are baked into a broken system.

While it’s true that the crisis isn’t over for anyone until it’s over for everyone, we haven’t all been impacted equally.

Oxfam Australia CEO Lyn Morgain says the pandemic has laid bare the inequalities of our broken economic system.

That this small group which already possesses incomparable wealth has gained so much, while ordinary Australian families struggle to comprehend what we have lost, demonstrates to us all the necessity for new approaches.

Our Oxfam-commissioned global survey of 295 economists from 79 countries revealed that 87 per cent of respondents expect an ‘increase’ or a ‘major increase’ in income inequality in their country as a result of the pandemic.

The four Australian economists who took part in the survey agreed the coronavirus crisis would lead to an increase or major increase in income inequality.

They said it would be the sharpest increase in inequality in at least 50 years, and that the widening gap would affect women and ethnic minorities most.

Worryingly, all four experts believed our government didn’t have an adequate plan in place to address the issue. 

SpaceX owner and Tesla CEO Elon Musk is the richest man in the world, according to Bloomberg. His wealth soared during lockdowns. Photo: Getty

This week, Oxfam has launched its global report, Inequality Virus, which highlights how the coronavirus crisis has exacerbated inequality and deepened poverty around the world. 

It shows how the current economic system is enabling a super-rich elite to amass wealth in the middle of the worst recession since the Great Depression, while millions of people have been plunged into poverty. 

It found the 1000 richest people on the planet recouped their COVID-19 losses within just nine months, while it could take more than a decade for the world’s poorest people to recover from the economic impacts of the pandemic.

And it also found the world’s 10 richest men have seen their combined wealth increase by half a trillion dollars since the pandemic began — more than enough to pay for a COVID-19 vaccine for everyone and to ensure no one is pushed into poverty by the pandemic. 

At the same time, the pandemic has ushered in the worst job crisis in more than 90 years, with hundreds of millions of people now underemployed or out of work. 

People are seen in long queues outside the Centrelink office in Southport on the Gold Coast, Monday, March 23, 2020. Centrelink offices around Australia have been inundated with people attempting to register for JobSeeker.
More than 910,000 Australians are officially unemployed. Photo: AAP

What’s more, if you’re poor, a woman or from marginalised racial and ethnic groups you’re more likely to have lost your income, or be pushed into poverty.

Around the world the virus is disproportionately taking the lives of poor people, and those from marginalised racial and ethnic groups.

Government interventions that fail to take into account work and care responsibilities are reversing decades of effort to improve the status of women, here in Australia and globally. 

It’s time for a global reset. For governments around the world to ensure communities emerge from this crisis with a better chance of surviving the next one. 

Extreme inequality is not inevitable, but a policy choice.

The Australian government must seize this opportunity to build a more equal, inclusive and greener economy that ends poverty and protects the planet.

The fight against inequality must be at the heart of economic recovery efforts.

Our government must invest in public services and low-carbon sectors to create millions of new jobs and ensure everyone has access to a sustainable social welfare safety net, and they must ensure the richest individuals and corporations contribute their fair share of tax to pay for it. 

These measures are necessary to help us build a better and more hopeful future that is fairer for all Australians.

In this pandemic we have demonstrated we can face challenges head on, act in our collective interest and acknowledge the vital role we all play in maintaining the wellbeing of our community. The time to plan on that basis is now. 

Lyn Morgain is chief executive of Oxfam Australia

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