In spite of the global COVID-19 crisis, which has put 38.6 million Americans out of work and upended entire industries, the wealthiest people in the country are thriving.
According to a new report by Americans for Tax Fairness and the Institute for Policy Studies (IPS), the nation’s 623 billionaires saw their net worth increase by $434 billion in the first two months of the pandemic thanks in large part to tax cuts and loopholes. As a result, while much of the country was locked down, the wealth of the billionaire class grew 15% from $2.9 trillion to $3.4 trillion between March 19 to May 19.
The five richest billionaires — Amazon CEO Jeff Bezos, Microsoft co-founder Bill Gates, Facebook co-founder Mark Zuckerberg, investor Warren Buffett, and Oracle founder Larry Ellison – had the biggest gains, with a 19% jump or a total increase of $75.5 billion. Tech magnate Elon Musk, however, had the largest percentage gain during the two months, seeing his net worth jump by 48% to $36 billion. Zuckerberg came in second as his net worth surged by 46%, giving him an added $80 billion. Bezos gained $34.6 billion, bringing his fortune to $147 billion.
On the other end of the spectrum, hip hop’s first billionaire Shawn “Jay-Z” Carter, gained just 4.2% of wealth during that time, while Kanye West reached the billionaire benchmark in April. Media mogul Oprah Winfrey saw an increase of 5.6% and black billionaire David Stewart, the founder of World Wide Technology, saw a 0.5% jump in his net worth. The two other African American billionaires, philanthropist Robert F. Smith and Michael Jordan, didn’t gain at all or saw their wealth take a slight hit, respectively.
The report comes as the economy and labor force continue to grapple with the worst economic crisis in recent history. Low-income workers and particularly those of color have been hit hardest over the last two months. Forbes reports that 40% of people earning less than $40,000 annually back in February have since lost their jobs.
The “Millionaires Giveaway”
Decades of tax cuts for the rich have fueled the growth of billionaires and their wealth, according to the ATF and IPS. The left-leaning think tanks argue that the wealthy received its most recent tax handout in the CARES pandemic relief law enacted in late March, which gives an average tax cut of $1.6 million this year to 43,000 millionaires and billionaires. Rather than what it calls the “Millionaires Giveaway,” the orgs say closing this loophole would raise $246 billion, which could be used for pandemic relief.
“While millions risk their lives and livelihoods as first responders and front line workers, these billionaires benefit from an economy and tax system that is wired to funnel wealth to the top,” said Chuck Collins, director of the IPS Program on Inequality, in a press release.
The wealth gap between the 1% on the economic ladder and the rest of the country was already immense before the coronavirus began to wreak havoc on the U.S. economy. Forbes reports:
That existing rift has increased over the last two months, as evidenced by the inverse relationship between employment numbers (particularly for low-income earners) and the composite wealth of America’s billionaire class. In addition to job losses, an estimated 16 million U.S. workers have likely lost employer-provided health insurance since the pandemic first began to impact America. Those with considerable wealth have benefited from the stock market’s recovery, after an initial crash in the early stages of the pandemic, rallying on promises of assistance from the Federal Reserve. Ultimately, the global economy, in a worst-case scenario, could take an $80 trillion hit, according to a recent study.
“The pandemic has revealed the deadly consequences of America’s yawning wealth gap, and billionaires are the glaring symbol of that economic inequality,” Americans for Tax Fairness executive director Frank Clemente said in the report. He added, “Post-pandemic, the rich and corporations must begin to pay their fair share of taxes so we can build a society that works for everyone, not just billionaires and others at the top.”