Oxfam: Super-rich endanger German democracy

The new US president: a billionaire. His deputy: multimillionaire. And the richest man in the world also has a hand in it. In Germany, many people are watching with horror as a few super-rich people are currently taking over the most powerful democracy in the world. Luckily, some people may console themselves, everything is different here. Or?

The aid and development organization Oxfam has a more critical view. She says: Increasing individual wealth and extreme social inequality are also massively endangering democracy in Germany.

Just in time for the start of the World Economic Forum in Davos and the inauguration of the new Trump administration, Oxfam has released a new report on wealth and global inequality. The number of billionaires worldwide increased by 204 people to 2,769 last year. According to Oxfam, the wealth of this super-exclusive group increased by an incredible two trillion US dollars in 2024, three times faster than in 2023. The number of people in poverty, however, is stagnating.

In Germany, too, the super-rich did not fare badly in 2024. While the economy in this country shrank overall, the assets of billionaires increased by 26.8 billion US dollars (equivalent to 26 billion euros). The German billionaires’ club grew by nine members to 130. There are only more billionaires in the significantly more populous USA, China and India.

In Germany, billionaires are less in the front row than in the USA. In the background, however, they also exercised power to influence politics in their favor, Oxfam criticizes. The organization cites lobbying associations such as “The Family Businesses” or the “Family Business and Politics Foundation” as examples, which spent a lot of money working towards low taxation of the rich.

And with success: “Germany is now also a high-tax country for people who work for their money, but a low-tax country for the super-rich who can let their money work for them,” writes Oxfam. Middle-class families paid proportionally more taxes on their working income than the super-rich, who also receive income from other sources such as capital gains and corporate profits.

Oxfam sees the lack of a wealth tax (suspended since 1997) and the exemptions for large corporate assets from inheritance tax as key tax factors that increase inequality in Germany. This means that wealth in Germany is inherited rather than earned even more than elsewhere. Oxfam estimates that 36 percent of all billion-dollar assets worldwide come from inheritances, compared to 71 percent in Germany.

The Oxfam report analyzes that growing inequality is increasingly becoming a problem in Germany. Policies that favor the rich and neglect the interests of the poor undermine many people’s faith in democracy. “This creates the ideal breeding ground for right-wing extremist and populist forces.” People in poverty and with low incomes generally have less trust in the system. In Germany, however, material concerns and fears of social decline now extend well into the middle class.

To reduce inequality, Oxfam has three key demands for the next federal government.

For its report, Oxfam relies, among other things, on wealth estimates from the US magazine “Forbes”, on the wealth report by the major bank UBS and data from the World Bank.

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