By Dr. Gyan Pathak
India is facing rising industrial concentration in just five hands, and is enriching billionaires, private equity funds, and crony capitalists driving unprecedented level of inequalities and poverty among people. Dalits are facing high and unaffordable out-of-pocket fees in the private healthcare sector, financial exclusion in the private healthcare sector, and overt discrimination in both.
It has been mentioned in the Oxfam’s annual global inequality report released on Sunday, coincided with World Economic Forum meeting in Davos. Globally, since 2020, the richest five men have doubled their fortunes, but during the same period almost five billion people globally have become poorer. Hardship and hunger are daily reality, and at the current rate, it will take 230 years to end poverty, but we could have the world’s first trillionaire in just 10 years.
“A new era of monopoly: The supercharging of Corporate Power”, the newly released Oxfam report says that we are living through an era of monopoly power that enables corporations to control markets, set the terms of exchange, and profit without fear of losing business. Far from being an abstract phenomenon, this impacts us in many ways: influencing the wages we are paid, the foods we eat and can afford, and the medicines we can access. Far from being accidental, this power has been handed to monopolies by our governments.
In sector after sector, the report says, increased market concentration can be seen everywhere. Globally, over two decades, 60pharmaceutical companies merged into just 10 giant, global ‘Big Pharma’ firms between 1995 and 2015. Two international companies now own more than 40% of the global seed market. ‘Big Tech’ firms dominate markets: three-quarters of global online advertising spending pays Meta, Alphabet and Amazon; and more than 90% of global online search is done via Google. Agriculture has seen consolidation within Africa. India faces ’rising industrial concentration’, especially by the top five firms.
Corporate power fuels inequality in four ways: Rewarding the wealthy, not the workers; Dodging taxes; Privatising public services; and Driving climate breakdown. Corporations drive inequality by forcing wages down and direct profits to the ultra-wealthy. Oxfam analysis finds that 791 million workers have seen their wages fail globally to keep up with inflation and as a result each worker lost wages of nearly a month (25 days) in the last two years. Further, corporations have used their influence to oppose labour laws and policies that could benefit workers, such as minimum wage increases. They supported reforms that undermine workers’ rights, and also political restrictions on unionization.
Corporations and their wealthy owners also undertake sustained and highly effective war on taxation, resulting in cut in taxes. Aggressive tax planning, abuse of tax havens, and incentives also result in tax rates that are much lower, often closer to zero. It has deprived governments around the world, but especially in the Global South, of trillions of US dollars in revenue that could be used to reduce inequality and end poverty.
Privatising public services has affected the people. Basic services are being treated as asset classes and public money is used to guarantee corporate returns rather than human rights. Private equity firms are snapping up everything from water systems to healthcare providers and nursing homes, amid a litany of concerns about poor and even tragic outcomes.
Essential services constitute trillion-dollar industries and represent immense opportunities for generating profit and wealth for billionaires. The sectors include water, healthcare, public transport etc. These sectors are generating massive wealth for billionaire owners. For example, the global hospital services market is expected to be valued at US$19 trillion by 2023, and in India alone, four billionaires are invested in the private hospital and diagnostic sector. Even global water and sewage market is estimated to reach US$ 886 billion in 2027.
Privatization can drive and reinforce inequalities in vital public services, entrenching gaps between rich and poor, excluding and impoverishing those who cannot pay while those who can pay are able to access good healthcare and education. Privatization can also drive inequalities on the basis of gender, race, and caste. For example, Oxfam found that Dalits in India face high and unaffordable out-of-pocket fees in the private healthcare sector; financial exclusion in the private education sector; and overt discrimination in both.
Privatisation often occurs in sectors with few competitors and high barriers to entry, and sometimes even with the benefit of state-granted monopolies and taxpayer-guaranteed returns. With massive amounts of public money on the line, and policymakers in a position to enrich their friends, donors and other allies, privatization creates opportunities for corruption and state capture. Corporate interests can seek to shape arrangements to benefit their bottom line instead of the public interest. Privatization thus opens the door to cronyism – the ability of powerful private interests to manipulate public policy and enrich themselves at the public’s expense.
Private hospitals backed by development finance is also harm. Oxfam report finds that private healthcare providers in India also were pushing patients into poverty. Their investigation found cases of extorting and imprisoning patients for non-payment of bills; denying treatment to those who can’t afford it – even in emergencies; failing to prevent human rights abuses, including organ trafficking by staff; and exploitative practices, such as by pressuring patients to have unnecessary and expensive medical procedures.
In India, where the private healthcare sector is now worth US$236bn and rising rapidly, the World Bank’s private sector arm, the International Finance Corporation (IFC), has directly invested over half a billion dollars in some of the country’s largest corporate hospital chains owned by some of its richest billionaires. Yet in June 2023, Oxfam found that the IFC has not published a single evaluation of its health projects in India since these started over 25 years ago. Indian health regulators have upheld multiple complaints, including cases of hospitals overcharging, rigging prices and refusing to treat patients living in poverty for free, despite this being a condition of receiving government land for free. Furthermore, of the 144 hospitals funded, only one is located in a rural area.
Corporates powers are also driving climate breakdown, in turn causing great suffering and exacerbating inequalities. They own, control, shape, and financially profit from processes that emit greenhouse gases, and benefit while crushing those who oppose. Huge concentration of global corporate and monopoly power is exacerbating inequality. Through squeezing workers, dodging tax, privatizing the state and spurring climate breakdown, corporations are driving inequality.
While millions of people throughout the world live in dire poverty, without clean drinking water, adequate healthcare, decent housing, or education for their kids, the world’s billionaires have increased their wealth by over US $3 trillion in the last three years alone. … Billionaires become richer, the working class struggles, and the poor live in desperation, said Bernie Sanders, US Senator in the report.
For years, Oxfam has raised alarm about widening and extreme inequality. As we enter 2024, the very real danger is that these extraordinary extremes are becoming the new normal. Corporate and monopoly power is an unrelenting inequality-generating machine, the report says, adding that we are living through what appears to be the start of a decade of division: in just three years, we have experienced a global pandemic, war, a cost-of-living crisis and climate breakdown. Each crisis has widened the gulf – not so much between the rich and people living in poverty, but between an oligarchic few and the vast majority. (IPA Service)
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