US billionaires gaining net worth during pandemic as lowest earners struggle

Billionaires such as Amazon founder Jeff Bezos and Tesla CEO Elon Musk have gained net worth of around 10% during the ongoing pandemic while an increasing number of US households struggle, living "paycheck to paycheck".

The report published on Thursday by the Institute for Policy Studies showed that the wealth of both billionaires combined had increased by nearly 10% during the crisis as many customers turn to online sales and ecommerce sites.

This turn to online sales due to the lockdown that has proved so beneficial for some of the richest people in the US has also been met by a rise in unemployment levels and hardship for the lowest earners.

Between March 18 and April 10, 2020, over 22m people lost their jobs in the US as the unemployment rate surged toward 15%. Over the same three weeks, US billionaire wealth increased by $282bn, an almost 10% gain.

“This is the tale of two pandemics, with very unequal sacrifice,” said Chuck Collins, a co-author of the report.

During the period between January 1 to April 10 this year, 34 of the nation’s wealthiest billionaires have seen their net worth increase by tens of millions of dollars.

Meanwhile, an estimated 78% of households are "living paycheck to paycheck", while 20% have zero or negative net worth.

As of April 15, Jeff Bezos’s fortune had increased by an estimated $25bn since January 1, 2020 (which is larger than the Gross Domestic Product of Honduras, $23.9bn in 2018).

Zoom Video Communications founder Eric Yuan saw a $1-billion jump in his total net worth as his video conferencing app becomes increasingly more popular among friends and family during lockdown.

According to the IPS: “The current pandemic is exposing our central economic and social reality: Extreme wealth inequality has become America’s “pre-existing condition.””.

But the pandemic acts only as a magnifying glass for a situation that has been developing in the past two decades.

The report also revealed that between 1990 and 2020, US billionaire wealth soared 1,130%— an increase more than 200 times greater than the 5.37% growth of US median wealth.

This can be exemplified with the fact that the three billionaires in the US Jeff Bezos, Bill Gates, and Warren Buffett — continue to own as much wealth as the bottom half of all US households combined.

In comparison, measured as a percentage of their wealth, the tax obligations of America’s billionaires decreased 79% between 1980 and 2018.