Billionaires are collectively adding $2.7 billion to their fortunes daily — and their growing share of wealth shows trickle-down doesn't work

• A new report from Oxfam looks at how much wealth billionaires have accumulated.
• The report finds billionaires are collectively adding $2.7 billion to their fortunes daily, as inflation eats up workers' wages.

The rich are getting richer, and it's an ever-growing problem as everyone else sees their wages eaten up by rising inflation.

A new report from Oxfam, called "Survival of the richest: How we must tax the super-rich now to fight inequality," finds that the richest 1% are increasingly capturing more and more wealth — snatching up two-thirds of all new wealth in the world since 2020.

"That's astonishing, right? Because it's the richest 1% grabbing twice as much money as the rest of humanity, the 99% of us, put together," Nabil Ahmed, Oxfam America's director of economic justice, told Insider.

It's no secret that the pandemic led to soaring inequality, as billionaires saw their fortunes balloon, particularly due to pandemic-era stock gains. The cure, according to Oxfam: Moving past the myth of trickle-down and imposing taxes on wealth and corporations.

"We used to talk about inequality as about the gap between rich and poor," he said. "But I think there's a new way to talk about inequality now — as the very richest pulling away from the rest of us."

The report finds that billionaires' fortunes are collectively growing by $2.7 billion daily, "even as inflation outpaces the wages of at least 1.7 billion workers, more than the population of India."

That's based on the difference between billionaires' wealth from March 18, 2020, adjusted for inflation, and November 30, 2022. Oxfam's analysis showed that there was a $2.6 trillion increase in this wealth during this time.

And while billionaires see their fortunes grow by almost $3 billion daily, millions of others are working low-paying jobs. In the US, 21 million workers are making less than $15 an hour, according to an analysis by Ben Zipperer of the Economic Policy Institute. The federal minimum wage has been the same for over a decade, and inflation is affecting its value

At the same time, three-quarters of the world's governments have announced plans to cut domestic spending. Oxfam estimated that would mean a total of $7.8 trillion in spending cuts over the next five years. That could worsen access to social services, with just over half the countries that plan on cutting back social spending budgets already offering "minimal to no maternity and child support."

The report also illustrates how taxes on the wealthiest have fallen over time. Specifically, the new report shows the decline for Africa, Latin America, Asia, and the OECD.

The Oxfam report states that "the average marginal tax rate on the highest incomes has fallen from 38% to 31% over the last 25 years" in Africa. For the OECD, it's seen a drop from 58% in the 1980s to 42% in present day, according to Oxfam's analysis.

The increased concentration of wealth at the top, as tax rates on the richest fell, is another indictment of the concept of trickle-down economics — the idea that cutting taxes on the rich will eventually "trickle down" to those below them.

"Trickle down has not only failed," Ahmed said. "Trickle down was always a lie, and it was a lie that was sold by the owners of capital backed by governments that really left so much of the world behind."

In the US, the top marginal tax rate on income has fallen from 92% in the early 1950's to 37% in 2022. The Biden administration's pushes to raise it to 39.6% ultimately failed.

Oxfam finds that a suite of tax changes could help raise revenues and cut down on inequality. For instance, a gradual wealth tax — 2% for millionaires, 3% for those holding over $50 million, and 5% on billionaires — could raise $1.7 trillion every year. However, while wealth taxes are popular, they're unlikely to ever advance in the US.

"When you hear from elites, they almost position the discussion about fairer taxation as radical," Ahmed said. "I actually believe the radical thing to do is to allow such extreme concentrations of wealth — to allow an economic system in which billionaires pay lower tax rates than daycare workers."