- From March 2020 to April 2021, America’s billionaires added $1.62 trillion to their wealth.
- A new report from IPS/ATF tracks how much billionaires have gained during the pandemic.
- These gains could signal that inequality keeps increasing during the pandemic.
- See more stories on Insider’s business page.
Over the last 13 months, American billionaires added $1.62 trillion to their wealth – a 55% increase.
This was a finding in the latest report from the left-leaning Institute for Policy Studies (IPS) and Americans for Tax Fairness (ATF). Both groups have tracked billionaire gains throughout the coronavirus pandemic, which has seen a K-shaped economic recovery for Americans: High-income workers have seen their jobs and pay grow, while low-wage workers have experienced the opposite.
“Billionaires’ huge pandemic-era wealth growth comes on top of a 19-fold increase in billionaire wealth over 31 years-from an inflation-adjusted $240 billion in 1990 to $4.56 trillion in 2021,” the report said. The report used data from Forbes to track billionaire gains from March 18, 2020 through April 12, 2021.
The number of billionaires has also grown, going from 66 in 1990 to 719 today.
“The concern is that we sort of further entrench the inequalities that we came into the pandemic with, meaning the number of households that are economically precarious grows,” Chuck Collins, director of the Program on Inequality at IPS, told Insider.
He said the “concentration” or “pooling” of wealth among billionaires has also accelerated.
“That’s the reality: We’re going to come out of the pandemic another degree of more unequal,” he said.
In the fourth quarter of 2020, the bottom 50% of Americans held $2.49 trillion in total household wealth. Meanwhile, the top 1% added about $4 trillion to their wealth during that time – more than the bottom 50% holds in total.
To offset the inequality that’s arisen during the pandemic, Collins recommends a combination of supporting frontline workers, lifting up the wage floor, and taxing the rich over the next six months.
If nothing is done, Collins said, that economic precarity could grow. He predicts that homeownership could decrease, as economic vulnerability – and the lack of savings – rises.
Additional taxes on the wealthy have become a hot-button topic during the pandemic. The International Monetary Fund has said that one-off taxes on the wealthy and corporations could help with coronavirus recovery; however, not everyone agrees, with Nobel Prize-winning inequality economist Angus Deaton saying the wealthy would find a way to dodge a tax. IRS Commissioner Charles Rettig also just said that $1 trillion or more in taxes could be going uncollected every year.
President Joe Biden has proposed a hike in the corporate tax to fund his infrastructure package, and has said that Americans earning over $400,000 could see a tax increase. In a speech defending the tax increase, he said that he was “sick and tired of ordinary people being fleeced.”
Collins said he thinks Biden has about two years to enact change and start making a meaningful difference in people’s lives.
“There’s a possibility of totally turning the course here,” Collins said. “But it is going to require some courage and boldness and spine, but I actually think the broader public is with the president on this.”