The richest 1% of the world’s population accumulates almost two thirds of the wealth created in the last two years, according to Oxfam. To put it in numbers: a billionaire earned roughly $1.7 million for every euro earned by someone in the bottom 90% of the world’s wealth. However, the super-rich, that 1%, are also responsible for much of global carbon emissions. In just one year, they emit the same as the poorest 10% for more than 20 years. A notable inequality as well.
To put an end to this imbalance, a group of economists and experts proposes applying a tax on the mega-rich to finance a global climate fund. Let’s see what it consists of.
A tax on the mega-rich. Several researchers of the Global Inequality Lab They have created a project that defends the creation of an international climatic rate applicable to the largest fortunes on the planet. Specifically, for the 65,130 people who have assets of more than 100 million euros. How much? It would be a tax of between 1.5% and 3% of his fortune to help poor countries adapt to the global warming crisis.
According to the authors, Lucas Chancel and Thomas Piketty, if this tax were established, the annual collection would be almost 300,000 million.
How would it work? In a progressive way. According to the World Inequality Laboratory, which has the support of the Norwegian Agency for Development Cooperation and the United Nations Development Program, the ideal would be to apply a rate of 1.5% for those whose fortunes are between 100 and 1,000 million (62,380 people). 2% for those between 1,000 and 10,000 million (2,584 people). 2.5% for those between 10,000 and 100,000 million (155 people). And 3% for the 11 people who have more than 100,000 million.
“Given the extreme levels of wealth concentration in the world today, even modest tax rates on the greatest wealth can generate substantial tax revenue,” the authors explain.
a trend. So far nothing similar has ever been carried out, but some countries have recently introduced progressive wealth taxes, such as Norway or Argentina. Europe and China have established so-called cap-and-trade emission schemes, issuing a fixed number of pollution permits to companies, which can then trade them based on their output.
In fact, EU carbon permit prices have risen over the past 10 years from around €6 to over €70 per metric ton of carbon dioxide, despite a recent drop due to ongoing geopolitical turmoil and economic. And the idea of applying CO2 taxes for frequent air travelers has also been discussed.
The impact for the “weak”. The climatic consequences are not evenly distributed throughout the world. Basically because low- and middle-income countries suffer greater impacts than their wealthier counterparts. Especially considering that the 10% of the world’s largest emitters of carbon dioxide generate almost half of all greenhouse gas emissions on the planet.
This is where one of the pillars of global climate policy comes in: countries that got rich emitting greenhouse gases have a responsibility to cut emissions faster than those that didn’t, while investing money to help the poor adapt. . But it is not being so. According to this article in EL PAÍS, it is estimated that financing flows for adaptation to developing countries are around 29,000 million, well below the real needs in this field, which amount to 200,000 million.
The big emitters. Many studies over the past few decades show that the very wealthy are the biggest drivers of global emissions growth. A recent paper from France’s Sciences Po University suggests that the bottom 50% of the world’s population emitted 12% of global emissions in 2019, while the top 10% emitted 48%. It would take 26 years for a low-income person to produce as much carbon dioxide as the richest do in a year, according to an analysis by Autonomy.
And they also appear to be increasing their emissions at a faster rate. Emissions by the world’s richest 1% have increased since 1990, while emissions by low- and middle-income groups within rich countries have declined. These are what are called the “polluting elite”, people whose lifestyles and companies produce a high carbon content and fuel the climate crisis while the poorest countries suffer it.