Inequality soars, billionaires cash in, workers face economic crisis. Fight for socialism

By Philip Stott

The global rich have seen their wealth soar during the Covid-19 pandemic. While hundreds of millions of workers – 40 million in the US alone – have seen their jobs go altogether or now face unemployment as furlough schemes end, the capitalist elite have undergone a colossal wealth infusion.

According to Forbes, 53 of the UK’s billionaires saw their “worth” leap by 14.3% (£26.3 billion) to approximately £211 billion over the past six months. That puts the so-called “unsustainable” £80 billion estimated bill for the 9.6 million UK workers who have been furloughed under the job retention scheme into real context.

With furlough and the self-employed support scheme due to end in October, and with unemployment likely to explode, trade unions should demand its extension to cover 100% of wages/income. As it is, in the months between February and June 2020, the number of claims for Universal Credit doubled from 2.7 million to 5.4 million. 

With the UK economy set to contract by 10% this year the FTSE 100 index of the UK’s largest firms has risen more than 17.2%, while in the US shares are up more than 54% since March 2020.

Soaring stock markets – especially tech shares – as well as government bailouts and “free money” for the bosses have driven an expansion of wealth for the capitalist class internationally. 

Some of those cashing in on the Covid crisis include

• Richard Branson, despite calling for a bailout of his airline, saw his net worth grow £3.3 billion due to the rising value of shares in Virgin Galactic.
• Billionaire boss of the Ineos group Jim Ratcliffe saw his wealth increase by half to £13.6 billion after converting part of his business to produce hand sanitiser.
• Mike Ashley, the boss of Sports Direct, saw his fortune soar by 22.3% to £2.5 billion.

But that’s small change compared to the eye-watering gains made in the US by the billionaire class, who are now $637bn richer compared to prior to the pandemic. 

What makes things worse is that only the top 20% of US households had fully recovered the wealth they had prior to the Great Recession of 2008/2009. Food insecurity is rising in the US, where more than one in five households do not have enough to eat. In contrast, the uber-rich, the wealthiest 400 billionaires in the United States, have seen their wealth increase over 80% in a decade.

Many will remember the fanfare of publicity when Microsoft boss Bill Gates and others, in 2010, announced their intention to give away half their wealth to charity. Over the last decade, they’ve been joined by many more. Of the 62 “Pledgers” who were billionaires in 2010, their personal wealth has increased by 95%, from $376bn to $734bn in 2020. They’d pledged to give away half their wealth but instead their wealth has almost doubled.

Incredibly, the income of the 10 richest people in the US is more than the combined GDP of the 91 poorest countries. Indeed, if the richest 100 billionaires and the productive forces they control formed themselves into a country they would have a GDP of $3.3 trillion, greater than the UK. Only the US, China, Japan and Germany would rank higher. 

The world’s richest man, Amazon owner Jeff Bezos’s net worth is now $200 billion. “Entrepreneur” Ellon Musk of Tesla fame holds $100 billion. Facebook’s Mark Zuckerberg is now also a so-called “centibillionaire” for the first time, with an increase of $22 billion in 2020 

For the working class and poor, not so much a world away but a universe removed from this nauseating wealth accumulation, the situation is dire. 

• The Center for Strategic and International Studies estimates that the number of people globally who face acute food insecurity will nearly double this year to 265m. 
• The UN’s Committee on World Food Security forecasts that malnutrition will double as a direct result of the pandemic. 
• Oxfam forecasts that 12,000 people could die every day from hunger by the end of the year.
• Food bank usage in Scotland has more than doubled since the pandemic, up 108 per cent on the year previously according to the Independent Food Aid Network.
• Half of the 325,000 people in Scotland who have taken a mortgage payment holiday during the pandemic have no savings. 
• There was a loss of 14% in global working hours this year so far – the equivalent to 400 million full time workers losing their jobs – according to the International Labour Organisation. 

The capitalist system is in its deepest crisis since the 1930s and yet the billionaire class have never been richer. What a confirmation, yet again, that capitalism and soaring inequality are two sides of the same coin.

As Marx so eloquently described in Capital Vol 1, capitalism is the “Accumulation of wealth at one pole is … at the same time accumulation of misery, agony of toil slavery, ignorance, brutality, mental degradation, at the opposite pole, ie, on the side of the class that produces its own product in the form of capital.”

When governments and bosses say there is no money for job creation, public services, a living wage for all, health and safety at work, free education etc, the billionaire wealth hoarders show that is a lie.

The trade unions and a new workers’ party can and must fight and organise to demand that the wealth is used for the interests of the working-class majority. That working people and youth cannot be made to pay the price of the Covid crisis. 

Marxists support taxing the rich and big business more and indeed much more. But we also know that to build a society free from inequality then we need to take the means to produce wealth – the factories, offices, banks, big supermarkets etc – out of the hands of the ruling class.

That can only be done by bringing into public ownership, under democratic workers’ control and management, the main industries, financial institutions, land and the productive forces of society. 

Profit is extracted from the labour power of the working class by the bourgeois class. Socialism would ensure that society’s wealth produced by the toilers would transform the living conditions of the billions, not the bank accounts of the billionaires.

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