The wealth of various billionaires has increased significantly since the start of the pandemic, while people in many developing countries have been pushed into poverty.
the story So Far: Last week, Tesla CEO Elon Musk challenged the World Food Program (WFP) to explain how his $6 billion wealth would “solve world hunger.” The billionaire’s tweet, in response to a fact-checking of a claim made by the director of the WFP, has brought attention back to issues of inequality and global hunger.
What is the controversy about?
WFP director David Beasley claimed in an interview last week that a tiny fraction of the wealth owned by billionaires like Jeff Bezos and Elon Musk could literally save millions of people from starvation deaths. Specifically, he claimed that $6 billion could save 42 million people from starving. This figure is said to be around 2% of Elon Musk’s net worth. In response to this claim, Elon Musk tweeted That he would be willing to sell his shares in his company if WFP could explain to him how his wealth would end world hunger.
It should be noted that the wealth of various billionaires has increased significantly since the start of the pandemic last year, while the incomes of other groups have declined. In many developing countries, people previously with incomes above the poverty line were pushed into poverty by the pandemic. This has increased the demand for greater redistribution of wealth.
How much money will it take to end world hunger?
Musk’s $6 billion demand won’t permanently solve global hunger, but could help avert an emergency hunger crisis. It is estimated that this money could help feed 42 million people for about a year. There are various estimates about how much money will be needed to end global hunger and other forms of poverty. Some researchers estimate that it will cost $330 billion to end global hunger by 2030. It should be noted that this is not the first time that people have called for redistribution of wealth to tackle one of the world’s most urgent humanitarian crises. Activists regularly come up with statistics on how much food, health care and other basic facilities can be provided to the poor with little money from the rich. For example, organizations such as Oxfam regularly report growing inequality highlighting how higher taxes on the rich can help the poor.
Can money really solve the problem of hunger?
The recipe for ending poverty in general varies depending on the ideological affiliation of economists. Many economists view the issue of global poverty as a cause of wealth inequality. In other words, they see the increasing accumulation of wealth by the rich as the poor having too little money to buy the goods necessary for their sustenance. Thus they recommend redistribution of wealth from the rich to the poor to improve the lives of the poor. However, others argue that the economy is not a zero-sum game and that the people at the bottom of the pyramid are poor, not because the people at the top of the pyramid are rich. He believes that the issue of poverty is only related to the inability of the poor to earn their livelihood due to various external reasons. For example, in poor countries the quality of institutions is usually low and the poor there have little economic freedom to make a decent living. As such, humanitarian aid can only provide temporary relief.
Critics of the redistribution of wealth further point out that aid allocation is often heavily influenced by politics and thus prone to corruption. Others also note that the wealth held by the wealthy is in the form of capital goods, which require constant maintenance and investment to maintain modern standards of living. To the extent that aid comes from money that would otherwise have gone to capital formation, it can actually lower the standard of living.
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