Extreme wealth destabilises democracy, distorts markets, blocks climate action, and drives the exploitation of people and nature.
The climate and biodiversity crises are symptoms of the same deeper issue: a global system that prioritises short-term profits, hoards resources in the hands of a few people, and allows unchecked wealth and power to be built on the exploitation of people and nature.
We cannot deliver a just transition to a climate-resilient world and restore nature unless we confront the corrosive impact of extreme wealth.
READ: EXPLORING AN EXTREME WEALTH LINE
The Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) recently highlighted this connection in its major report looking at the underlying causes of biodiversity loss and the determinants of transformative change.
Democracy
The report identifies the inequitable concentration of power and wealth as a root cause of biodiversity loss, alongside humanity’s disconnection from nature and prioritisation of material gains.
The report stresses that transforming economic systems is critical to reversing the decline of ecosystems and building a sustainable future. Shifting financial priorities is one strategy that stands out in the report.
Global subsidies driving environmental destruction amounted to as much as $3.3 trillion in 2022, while the funding gap for preserving biodiversity ranged between $598 billion and $824 billion per year. In short, global resources needed to protect life on earth are being funnelled instead into activities that harm it. This is not an accident – it’s a consequence of extreme wealth and the political, policy and legal systems that sustain it.
My latest report for the New Economics Foundation and Patriotic Millionaires explores the concept of an Extreme Wealth Line, offering a bold framework to address this issue.
The Extreme Wealth Line Initiative asks us to recognise that there is a point at which wealth not only stops benefiting society but actively undermines democracy, social well-being, and the environment.
Biodiversity
The environmental damage caused by extreme wealth is well-documented. Super-rich individuals and corporations often invest heavily in industries that drive deforestation, pollution, and the overexploitation of natural resources. For example, the Amazon rainforest, one of the world’s most critical carbon sinks, is being destroyed by industries dominated by a few powerful players.
Cattle ranching, soy production, and mining – the primary drivers of deforestation in the Amazon forest – are tied to global supply chains backed by billion-dollar investments.
Extreme wealth destabilises democracy, distorts markets, blocks climate action, and drives the exploitation of people and nature.
Companies like JBS, the world’s largest meat processor, have been repeatedly linked to illegal deforestation, yet continue to enjoy financing from major banks and investors. These practices not only destroy ecosystems but also accelerate climate change and displace indigenous communities.
The IPBES report underscores the urgent need to reform subsidies and investment patterns in these sectors. Those decisions lie in the hands of our elected leaders and institutions.
If global subsidies driving nature’s decline were redirected to biodiversity conservation and restoration, we could close the funding gap and protect critical ecosystems. Yet these changes are impossible unless we address the influence of extreme wealth in perpetuating environmentally harmful industries.
Climate
As Donald Trump begins his second term as US president, backed by a cabinet of billionaires, his administration exemplifies how extreme wealth distorts governance and undermines environmental progress. Early executive orders have already signalled a rollback of climate policies and environmental regulations.
During his previous term, Trump withdrew the US from the Paris Agreement and dismantled over 100 environmental protections. Now, with fossil fuel advocates and corporate magnates in key positions, his administration is poised to deepen these attacks on climate and biodiversity.
This political reality reinforces the urgency of an extreme wealth line.
Extreme wealth doesn’t just fund private jets and mega-yachts; it bankrolls political lobbying, media control, and corporate subsidies that entrench systems of exploitation. Without limits on wealth, there are no limits to the damage it can inflict on people and the planet.
Systems
While $135 billion is spent annually on biodiversity conservation, up to $3.3 trillion in public subsidies are directed toward sectors that harm nature.
This imbalance mirrors the broader issue of wealth concentration. The resources exist to tackle climate change and biodiversity loss – but they are locked up in the hands of the ultra-rich and funnelled into harmful industries.
An extreme wealth line would help address this imbalance by defining a metric or set of metrics for excessive wealth. This would support political action towards a fairer economy, grounded in effective measures to stop the rise in global temperatures and deliver ecosystem restoration.
Imagine the impact if just a fraction of billionaire wealth were invested in closing the biodiversity funding gap. Such a shift could finance the protection of critical habitats, rewild degraded landscapes, and support communities most affected by environmental decline.
Crossroads
The urgency of these changes will come into sharp focus later this year when COP30 convenes in Brazil, at the heart of the Amazon rainforest.
The Amazon represents both the promise of ecological renewal and the danger of inaction. If deforestation continues at its current pace, the Amazon risks reaching a tipping point where it can no longer function as a rainforest, triggering cascading effects on global climate and biodiversity.
Extreme wealth’s control of global decision-making is a key barrier to progress. As the IPBES report highlights, addressing biodiversity loss requires transforming systems that concentrate power and wealth.
COP30 offers an opportunity for governments to act decisively – but it will require confronting the vested interests of the ultra-rich who benefit from environmental exploitation.
Drawing the line
The climate and biodiversity crises demand systemic change, not incremental reforms. The Extreme Wealth Line offers a framework to redefine success, fairness, and sustainability in a world facing ecological collapse.
Extreme wealth isn’t just excessive – it’s destructive.
It destabilises democracy, distorts markets, blocks climate action, and drives the exploitation of people and nature. Without tackling the inequitable concentration of power and wealth, we cannot hope to reverse the environmental crises threatening life on earth.
This Author
Fernanda Balata is a senior political economist at the New Economics Foundation (NEF).
