If you don't know Nick Hanauer by name, you know his work: About two decades ago he was the first non-family-member investor in Amazon. He's referred to himself as part of the .01 percent — even richer than the regular old 1 percent. He's also labeled himself a plutocrat, someone who has power because of their wealth.
Hanauer is keenly aware that he is on the fortunate side of America's wealth gap ("Truly, my success is the consequence of spectacular luck, of birth, of circumstance and of timing," he said in 2014 TED Talk); a crisis that he says is "the direct result" of a "moral failure."
"I am a practitioner of capitalism," Hanauer writes in Oxfam's state of wealth inequality report published Monday. "The most important lesson I have learned from these decades of experience with market capitalism is that morality and justice are the fundamental prerequisites for prosperity and economic growth.
"Greed is not good," continues Hanauer, who is a signer of The Giving Pledge, an elite philanthropy circle co-founded by Warren Buffett and Bill Gates. "The problem is that almost every authority figure — from economists to politicians to the media — tells us otherwise. Our current crisis of inequality is the direct result of this moral failure."
In the Oxfam report, "Public Good or Private Wealth?" which was released as some of the biggest names in finance convened in Davos, Switzerland for the World Economic Forum, Hanauer says the path the world is on will lead to chaos for everyone.
"This exclusive, highly unequal society based on extreme wealth for the few may seem sturdy and inevitable right now, but eventually it will collapse," writes Hanauer. "Eventually the pitchforks will come out, and the ensuing chaos will not benefit anyone — not wealthy people like me, and not the poorest people who have already been left behind."
Indeed, the inequality Hanauer speaks of is getting worse. The richest 26 people currently own the same wealth as the poorest half of the world, according to the report from charity Oxfam. The collective fortunes of the world's billionaires rose by 12 percent in 2018 — or $2.5 billion each day. At the same time, the wealth of the poorest half of the global population fell by 11 percent last year, Oxfam says.
To counteract the extreme wealth inequality currently being accelerated by capitalism, the richest must pay "their fair share of tax," which is not happening, according to the report.
In recent decades, tax rates for wealthy individuals and corporations have been reduced around the world, the report finds. In particular, the Oxfam report calls out the tax laws in the United States.
"The recent US tax law is a master class on how to favor massive corporations and the richest citizens," Paul O'Brien, Oxfam America's Vice President for Policy and Campaigns, writes in a statement accompanying the report. "The law rewards US companies that have trillions stashed offshore, encourages US companies to dodge foreign taxes on their foreign profits, and fuels a global race to the bottom that benefits big business and wealthy individuals at the expense of poor people everywhere."
