Inequalities in Italy, the Oxfam

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Published by Sabrina Bergamini on 8 February 2023

Extreme wealth and extreme poverty are on the increase

«The multiple crises that the world is experiencing, the pandemic first, the energy crisis, inflationary pressures and the winds of a new recession now, have grafted onto long-running, structural socio-economic gaps and further exacerbated them in an explosion of inequality. For the first time in 25 years, extreme wealth and extreme poverty have increased dramatically and simultaneously» (1).

Thus begins the Oxfam report, which presents an in-depth analysis of Italian dynamics – disuguItalia is the label given to the country. In Italy absolute poverty has more than doubled in 16 years, the high cost of living is eroding the purchasing power of families, wages are not keeping pace with inflation.

Inequality global phenomenon

Inequality it is a global phenomenon. Oxfam rattles off a series of numbers one after the other that capture the gravity of the situation and the unequal distribution of wealth.

«Even taking into account the collapse of the markets in 2022, the wealth of Forbes billionaires grew between March 2020 and November 2022 at a rate of $2,7 billion a day, while the increase in inflation exceeded the average growth in 2022 of wages in 79 countries with a combined workforce of nearly 1,7 billion workers».

In the last ten years billionaires have doubled their wealth in real terms. Then the price crisis and the pandemic intervened, with the result that «in the two-year period 2020-2021 for every dollar of increase in the wealth of a person located in the poorest 90% of the world, a billionaire earned an average of 1,7 million. For every $100 increase in global wealth between December 2019 and December 2021, $63 went to the top 1% and just $10 to the bottom 90%. From 2020 to today, the wealth of billionaires has grown at the rate of 2,7 billion dollars a day, in real terms.

The result is that today the richest 1% of the population owns almost half, 45,6%, of global wealth. By contrast, the poorest half of the world owns less than 1% – just 0,75%. There are 81 billionaires in the world who own more wealth than half the world's population. And the fortunes of just 10 billionaires exceed the amount of wealth possessed by 200 million African women, the Oxfam report recalls.

Italy is unequal

Inequalities are also increasing in Italy. Here the super rich with assets exceeding 5 million dollars (equal to just 0,134% of Italians) were owners, at the end of 2021, of an amount of wealth equivalent to that possessed by 60% of the poorest Italians. More wealth is concentrated in the hands of the richest 5% than that of the poorest 80% of the population.

Between 2020 and 2021 the concentration of wealth in Italy has increased. The share held by the richest 10% of Italians, already 6 times higher than that held by the poorest half of the population, has increased by 1,3% per year against a substantial stability in the share of the poorest 20% and a falling wealth shares for others.

«The richness of the richest 5% of Italians (owner of 41,7% of net national wealth) was higher, at the end of 2021, than the stock of wealth held by the poorest 80% of our compatriots (31,4%). The net asset position of the richest 1% (which held 2021% of national wealth at the end of 23,3) was worth more than 40 times the wealth held overall by the poorest 20% of the Italian population.

Despite the bending of the financial assets of Italian billionaires in 2022, after the peak of the previous year, there are 14 billionaires more in Italy than in 2019 and the value of the fortunes of the super rich increases by almost 13 billion dollars (+8,8%) , in real terms, compared to the pre-pandemic period.

Almost 2 million families in absolute poverty

All this in a context in which absolute poverty (stable in 2021 after the growth in 2020) concerns almost 2 million families: 7,5% of families, equal to 1 million 960 thousand in absolute terms, and equal to 5,6 million people.

In 16 years families with an insufficient level of spending to guarantee themselves a dignified standard of living have doubled. Today then the poor families they are exposed more than the others to price increases, above all for those relating to food and energy. Indeed, inflation affects the poorest families the hardest because the percentage weight of compulsory expenditure on the already low income is greater.

The stigmatization of poverty

In Italy then there is the diffusion of poor work, a structural feature of the Italian labor market, to consider, together with the low participation in the work of women and young people, income inequality and non-standard and precarious forms of work which increase the disparities.

Oxfam's assessment it is then a total rejection of government policies which have not yet addressed the issue of reducing inequalities.

In the relationship Oxfam finds the reference to Government choices accompanied by «unprecedented public stigma and growing disgust mixed with indifference towards the poor in a country where social cohesion is a poorly pursued political goal».

It is an assessment connected to the choices made on the basic income - which will be repealed from 2024 and confirmed for 2023 for seven months only for "employable" people.

The political agenda for equity

«The reduction of inequalities it represents an issue to which no government has so far attributed centrality of action and which has found itself reduced both in the last electoral campaign and at the start of the legislature. The new political season is distinguishing itself more for the recognition and rewarding of contexts and individuals who are already at an advantage than for the protection of the weakest subjects.

Instead of making the basic income more equitable and efficient, it will be repealed from 2024, adopting a categorical approach to poverty for 2023 which, regardless of the context and local job opportunities, sees the impossibility of working and not the condition of need public support pass. Instead of putting an end to unfair differential tax treatments between taxpayers, schemes such as the flat-tax for VAT numbers are being strengthened(2).

on the political agenda for the equity proposed by Oxfam there is therefore room for a series of interventions. Among these, just to name a handful, the request to abandon the transitional regime of basic income for 2023 and reform this measure to make it more equitable and efficient. That of acting on the expensive energy front and “strengthen the tax on extra profits payable by operators in the fossil energy sector, increasing the rate from 50% to 80% and extending the measure to the pharmaceutical and insurance sectors”. And that of introducing a legal minimum wage.

Sabrina Bergamini