The world is facing what economists are calling an “inequality emergency.” A panel of international experts led by Nobel Prize-winning economist Joseph Stiglitz has warned that the richest people on Earth are capturing a disproportionate share of global wealth and preparing to pass it down to their heirs—largely untaxed—further widening the gap between the few who hold immense fortunes and the billions left behind.
The new report, commissioned by South African President Cyril Ramaphosa and released ahead of the upcoming G20 meetings in Johannesburg, found that over $70 trillion in wealth will be transferred to heirs over the next decade. In the next 30 years, the panel estimates that 1,000 billionaires will transfer more than $5.2 trillion to their heirs mostly untaxed.
“Inequality is one of the most urgent concerns in the world today, generating many other problems in economies, societies, polities and the environment,” the report states. “Inequality is not a given; combating it is necessary and possible. Inequality results from policy choices that reflect ethical attitudes and morals, as well as economic trade-offs. It is not just a matter of concern for individual countries, but a global concern that should be on the international agenda—and therefore the G20’s.”
The panel, formally called the Extraordinary Committee of Independent Experts on Global Inequality, includes Stiglitz along with Adriana Abdenur of Brazil, Winnie Byanyima of Uganda, Jayati Ghosh of India, and Imraan Valodia and Wanga Zembe-Mkabile of South Africa.
The committee’s findings show how sharply the concentration of wealth has increased in recent decades. Since 2000, the world’s top one percent has captured more than 40 percent of all new wealth, while the bottom half of humanity saw its wealth grow by just one percent. The panel reports that more than 80 percent of countries—accounting for roughly 90 percent of the global population—now experience high levels of income inequality.
The report warns that the consequences of this inequality extend far beyond economics, undermining social cohesion, economic functioning, and democratic stability. It cites evidence that countries with high inequality are seven times more likely to experience democratic decline than more equal countries.
The experts attribute much of the problem to inherited wealth, which they say compounds inequality across generations. They note that a groundbreaking study by Italian economist Salvatore Morelli found that as much as $70 trillion of wealth will be passed to the next generations by 2035. “Wealth inequalities have a forward momentum, as compound interest increases fortunes and, in the absence of effective inheritance taxes, wealth is handed down from one generation to another, undermining social mobility and economic efficiency,” the report says.
Stiglitz and his colleagues argue that the global system has allowed wealth accumulation to expand without sufficient checks, concentrating economic and political power in fewer hands. “The committee’s work showed us that inequality is a crisis in need of concerted action,” Stiglitz said Tuesday. “The necessary step to taking this action is for policymakers, political leaders, the private sector, journalists and academia to have accurate and timely information and analysis of the inequality crisis. This is why our recommendation above all is for a new International Panel on Inequality.”
According to Stiglitz, this new institution would serve as a permanent global body to monitor inequality, similar to how the Intergovernmental Panel on Climate Change tracks the scientific understanding of global warming. “It would learn from the remarkable job the IPCC has done for climate change, bringing together technical expertise worldwide to track inequality and assess what is driving it,” he said.
South African President Cyril Ramaphosa endorsed the committee’s report and said it provides a strong foundation for reform. He called the findings “a blueprint for greater equality” and said they support South Africa’s goal of making inequality a central issue at the G20. “Inequality is a betrayal of people’s dignity, an impediment to inclusive growth and a threat to democracy itself,” Ramaphosa said. “Addressing inequality is our inescapable generational challenge. This report lays out prudent and pragmatic steps we can take to reduce it.”
The report’s recommendations include ensuring fair taxation of multinational corporations and ultra-wealthy individuals, adopting antitrust policies to curb corporate concentration, and making major investments in public services. The experts emphasize that these measures are not only feasible but essential to prevent global inequality from reaching destabilizing levels.
The G20 meetings later this month will provide an opportunity for world leaders to decide whether inequality becomes a permanent focus of international economic governance. The G20 was established after the 2008 banking crash to be a more representative group than the G7, incorporating both industrialized and emerging economies such as Saudi Arabia, Mexico, South Africa, and the United Kingdom. Campaigners expect several G20 nations, including Germany, to support the creation of a permanent inequality monitoring body.
Stiglitz, who serves as a professor at Columbia University and chairs the independent committee, said the proposed panel would “monitor trends and assess its consequences and evaluate alternative policies for addressing it, to inform governments, policymakers, and the international community.”
The report’s authors also make clear that inequality is not inevitable. “Inequality is not a given; combating it is necessary and possible,” they write. “Inequality results from policy choices that reflect ethical attitudes and morals, as well as economic trade-offs.”
The report argues that with accurate monitoring, political will, and fairer taxation, the global community can prevent inequality from eroding social stability and democracy. Stiglitz said that policymakers must see inequality not just as an economic issue, but as a crisis that threatens the world’s future.
By the end of the decade, the experts warn, the massive transfer of wealth from today’s billionaires to their heirs could further entrench economic divides unless the global community acts. For now, the committee’s message to the G20 is clear: the concentration of wealth is accelerating, the risks are mounting, and global inequality is a policy choice.
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