Coronavirus: US billionaires add $282bn to their wealth in just 23 days as millions lose jobs

Eight of the richest people in the US have added more than $1bn each to their wealth since the start of 2020

Andrew Naughtie
Monday 27 April 2020 15:45 BST
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A new study from a progressive think tank has found that while the coronavirus pandemic was exploding across the US, the country’s billionaires saw their combined wealth surge by $282bn – with eight of them netting more than $1bn each since the beginning of the year.

According to the Institute for Policy Studies’s “Billionaire Bonanza 2020”, while the total number of billionaires around the world has dropped slightly, the US contingent enjoyed a dramatic wealth increase between 18 March and 10 April even as the markets went haywire and tens of millions of Americans filed for unemployment.

Beyond the overall figures, the report also singles out several individual billionaires as what it calls “pandemic profiteers”. Among them is Elon Musk, who has profited to the tune of around $5bn from Tesla and SpaceX’s involvement in developing and producing new ventilators.

At the very top of the scale is Amazon CEO Jeff Bezos – already the world’s richest person – who the institute says has seen his wealth grow by $25bn since 1 January this year, an increase the institute says is “unprecedented in modern financial history” and larger than the GDP of Honduras.

And to the extent billionaires have initially taken hits to their wealth thanks to the pandemic’s economic fallout, they seem to be mostly recovering even as the crisis continues.

As the report notes, billionaire wealth “tends to rebound from market meltdowns”: after the 2008 crash, most billionaires saw a decline but recovered within about 30 months, and over the course of the 2010s, the combined wealth of the American billionaire class surged by more than 80 per cent.

The institute ends its report with a series of short- and long-term recommendations, including establishing a congressional “pandemic profiteering oversight committee” that would augment the work of new bodies set up to ensure that the trillions of dollars allocated to bail out the economy.

It also suggests the creation of an excess profits tax meant to “discourage speculating and profiteering around the basic needs of life”, as was done successfully during both world wars. In the longer term, the report argues for a progressive estate tax and a wealth tax, both ideas circulating strongly within the Democratic party.

There is some support for such measures among the American public, though it appears to be somewhat split along party lines.

According to polling from the Pew Research Center, Democratic voters broadly share some of the same beliefs about wealth, in particular that the economic system unfairly favours powerful interests (84 per cent). They also tend to believe that rich people are generally rich because they had advantages in life (62 per cent). Republicans tend to believe the opposite – and the partisan gap on that second question has roughly doubled in just the last four years.

However, a recent poll by Reuters and Ipsos asked respondents how much they agreed with the following statement: “The very rich should be allowed to keep the money they have, even if that means increasing inequality.” Nearly three quarters of Democrats disagreed – and across parties, the whole sample came down on the side of wealth redistribution by 54-33.

This isn’t a recent development. As Gallup reports, proposals to change the top rate of income tax have been a feature of US political discourse for a century, and that a majority of Americans have agreed that wealth should be more evenly distributed for 35 years.

Given the chance to choose a billionaire as their presidential nominee in their primary this year, Democratic voters declined: Michael Bloomberg, one of the ten richest men in America, spent nearly a billion dollars of his own money on his campaign, but won just a handful of delegates in American Samoa and dropped out shortly afterwards.

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