UK wealth inequality

How billionaires extract wealth rather than create it

M/Y Topaz is a 147m motor yacht making it the fourth-largest Superyacht in the world. It was custom built in 2012 by Lurssen Yachts in Bremen, Germany and registered in the Cayman Islands. Pic by Yoshi Anahory This file is licensed under the Creative Commons Attribution-Share Alike 2.0 Generic license

It is difficult to comprehend the sheer scale of UK wealth inequality, which is twice as high as income inequality. New research published today by the Equality Trust has shown that the five richest families in the UK control as much wealth as the poorest 13 million people and that the number of billionaires has almost doubled over the last decade. The top 1 per cent of the population now owns the same wealth as the bottom 80 per cent of the population.

The other side of the wealth of the property tycoon is the poverty of the family being shunted between different forms of temporary accommodation because they cannot afford to keep a roof over their heads. The other side of the wealth of the private equity manager is the poverty of the worker he laid off to “turn around” his latest investment.

The other side of the wealth of the few is the poverty of the many. Fourteen million people in the UK are living in poverty — 4.6 million of whom are children. Children are going to school “unwashed” and “hungry” — nine out of ten schools in the UK are being forced to distribute clothes to students. 135,000 children will be homeless this Christmas, in a society with hundreds of people so rich that they couldn’t even count their wealth.

These patterns are replicated at the level of the international economy. Globally, the 26 wealthiest billionaires own as much wealth as the bottom 50 per cent of the population. And their wealth is not “earned” either. According to Oxfam, one-third of global billionaire wealth comes from an inheritance while another third comes from “crony connections to government and monopoly”. Much of the rest originates from land, oil or finance.

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