Good economic news

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 Tyler 20 May 2022

According to the Times annual rich list the wealth of those on the list has grown by 8% in the last twelve months. If that's you, well done. If its not you have you thought about getting a better paid job or working more hours?

I've just read this quote on Twitter, not sure who it is attributable to but it seems fitting: "If a monkey hoarded more bananas than it could eat while most of the other monkeys starved, scientists would try to figure out what's wrong. When humans do it we put them on the cover of Forbes."

To the mods: This is not a party political issue but a sociological one so I've put this in the Off Belay forum deliberately.

Post edited at 13:48
3
In reply to Tyler:

Eat the rich, its not like you can afford food anyway

 magma 20 May 2022
In reply to Tyler:

any crisis increases inequality - discusst...

 Offwidth 20 May 2022
In reply to Tyler:

They say it's for the good of future banana supply for monkeys of course..... and dead monkeys don't eat bananas other desperately hungry monkeys need. You're right about it being a sociological issue: their arguments flip Maslow's triangle upside down. 

 henwardian 20 May 2022
In reply to Offwidth:

>  their arguments flip Maslow's triangle upside down. 

I don't put a lot of store by Maslow's convenient diagram, it's basically an idea he made up while bored and there's plenty of evidence it doesn't hold water.

4
In reply to Tyler:

The problem is that if anyone tried to take the bananas off the monkeys with the surplus they would resist and there would be violence. In any case the analagy is flawed as bananas degrade if not eaten, money endures and grows

I do agree however that it doesn't seem right.

Post edited at 14:36
 magma 20 May 2022
In reply to Gaston Rubberpants:

Gates would short the bananas to increase competition

 henwardian 20 May 2022
In reply to Tyler:

A few interesting points it's worth baring in mind:

- It's not going to be the same people on the list as last year, so it doesn't represent that some static group of the same rich people are gently rising in worth despite the all the turmoil.

- Two of the top 20 have lost about a third of their net worth. I'm not going to cry for them but it's an interesting thought experiment to imagine personally how you might feel if you lost a third of all your stuff in just 1 year.

- Capitalism is a terrible idea, but all the others are so much worse (he plagiarised). I might argue that if we were a bit more effective at highly taxing these people (and their companies), their personal greed and lust for power could be made to greatly improve the lot of those in the bread line when that wealth was re-distributed (i.e. socialist policies, NOT trickle-down economics!). After all, what is the real alternative?

People want stuff. When they have stuff they want more stuff. Economics in is about infinite desires and finite resources. I can't imagine any way you could effectively annul that human desire for more stuff. So in lieu of some antidote to the materialistic disease, we might as well try and get some benefit from it. (obviously there are many people are not very materialistic)

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 magma 20 May 2022
In reply to henwardian:

what 'we' is that?

 neilh 20 May 2022
In reply to Tyler:

What they never put is how much wealthier other people are over the same period.

Read a book on Stats once and they tore shreads out of this type of headline argurment.It was by Tim Hartford the well know BBC commentator.

Anybody who owns a house will have seen their wealth increasing by similar amounts due to escalting house prices.

His message- dig behind misleading headline grabbing stats.

4
OP Tyler 20 May 2022
In reply to henwardian:

> A few interesting points it's worth baring in mind:

I'm not sure they are worth baring in mind as they make no difference to the point being made (obscenely rich people are getting richer at a disproportionate rate to world growth in an era of increasing poverty for many).

- The cut-off is arbitrary, I imagine most who have dropped out the list have only dropped into the top 500, still extremely wealthy. The names on the list are pretty static year to year.

- This just reinforces the depth of the problem. Those in the top 20 could lose 99.999% of their wealth and still be richer than they would ever need to be.

- Strawman, no one is arguing for the overthrow of capitalism

3
 yorkshireman 20 May 2022
In reply to neilh:

> Anybody who owns a house will have seen their wealth increasing by similar amounts due to escalting house prices.

True, but unless they realise the capital (sell it) then it's academic and they then have to buy another house which has likely gone up by the same amount. 

Somebody mentioned someone on the rich list had lost 30% of their net worth and said how would you feel if that were you? But if your house dropped in value by 30%, assuming everything else was the same and you didn't need to move, it would make no difference to your everyday quality of life. 

Elon Musk having 220bn or 150bn is not really going  impact his life. The fact that he can dick about buying Twitter (or not maybe) for 44bn shows this is just pocket change to him anyway. 

3
OP Tyler 20 May 2022
In reply to neilh:

> What they never put is how much wealthier other people are over the same period.

Wealth inequality isn't confined to the 250 people on the list. People with money tied up in assets will be nominally richer, the more assets they have the richer they have got. People without money tied up in assets will not have. I'm not sure of the proportion of people with money tied up in assets other than their pension, the house they live in and a few £ in savings to see them through a rough patch is a big as you seem to be implying.

> Read a book on Stats once and they tore shreds out of this type of headline argurment.It was by Tim Hartford the well know BBC commentator.

Feel free to make those arguments here but you'd have to go some to undermine the point that there is a wealth inequality issue in the UK (let alone the world). 

> Anybody who owns a house will have seen their wealth increasing by similar amounts due to escalting house prices.

Not everybody owns a house. Even those that do are not better off than at the beginning of the year because they only have the same as they had at the start, i.e. a home. If you own two houses you are richer because you have your home and an asset that has gone up in value.

 neilh 20 May 2022
In reply to yorkshireman:

House prices have gone up by 9.6% in the last year.

So anybody who owns a house ......their wealth has gone up more than the top few percent at 8% growth.

So its a useless stat  which means nothing.

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 montyjohn 20 May 2022
In reply to henwardian:

> Economics in is about infinite desires and finite resources.

Are resources finite tho'?

Obviously some are, but as technology develops we find other ways of making things using materials that may as well be abundant. 

The limitation, rather than materials, is a reliable economy. And like it or not the economy relies on entrepreneurs to risk everything to build that economy. Wealth after-all is created, and therefore has no limit to how much wealth can exist.

So I think we should be celebrating those that make it for the wealth they have created along the way.

Post edited at 16:10
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 Bottom Clinger 20 May 2022
In reply to henwardian:

>  I'm not going to cry for them but it's an interesting thought experiment to imagine personally how you might feel if you lost a third of all your stuff in just 1 year.

A more interesting thought experiment is to imagine if you were a billionaire and you lost a third of your stuff. I’ve imagined it, and I still feel totally loaded. 

OP Tyler 20 May 2022
In reply to neilh:

> House prices have gone up by 9.6% in the last year.

> So anybody who owns a house ......their wealth has gone up more than the top few percent at 8% growth.

> So its a useless stat  which means nothing.

It might be simplistic but not as simplistic as dismissing it as meaningless. It’s a very useful data point, just because categories other than billionaires might have got richer does not mean the information is meaningless. I’m not sure what the term for discretionary wealth (akin to discretionary spending) but I think you should consider it because for most people their house is not an asset. You know this though what I don’t understand is why you are leaping to the defence of billionaires

 Timmd 20 May 2022
In reply to magma:

> any crisis increases inequality - discusst...

A (busy) painter friend had covid set her back in terms of being okayed for buying a house, she needs to build up a couple of decent looking tax years, and I've been thinking that a crisis which knocks house prices combined with her currently living cheaply with her parents could set her up okay, which probably confirms what you say.

 ExiledScot 20 May 2022
In reply to Timmd:

Or if the bulk of your wealth is tied up in office space, over priced sandwich retailers etc.  then covid and wfh hasn't added to your wealth, however if you sold home office furniture you'd be laughing! For every winner there's generally a loser. 

Post edited at 16:37
 dsh 20 May 2022
In reply to neilh:

In reply to neilh:

> Anybody who owns a house will have seen their wealth increasing by similar amounts due to escalting house prices.

> House prices have gone up by 9.6% in the last year.

> So anybody who owns a house ......their wealth has gone up more than the top few percent at 8% growth.

> So its a useless stat  which means nothing.

See now I feel like this is dismissing the incomprehensible difference between the billionaires and the rest of us when homeowners wealth is brought up in the same context.

It's meaningless to talk about house prices for this discussion in the context of single home owner wealth. Better to talk about how people can't afford houses due to policies set by the ultra wealthy landowners.

More home ownership amongst normal people and more middle class is the sign of a healthy society, in as far as a capitalist system with strict regulation on large business, and socialist policies could be healthy. It means less wealth is being hoarded by the ultra wealthy. Generally middle class people don't hoard wealth they save for emergencies/retirement otherwise they spend it, which again in a healthy society would be positive as it keeps wealth well distributed.

And everyone needs somewhere to live and having the value of your home go up for normal homeowners who actually live in a home doesn't make much difference for them but the media owned by the billionaires have successfully put a wedge between home owners and renters, working class and middle, even though we're all basically the same compared to them. It's easy to do because middle and working class people see each other every day and it's easy to manipulated people into seeing eachother as scroungers, or pretentious snobs.

It's no accident that many working class see the "liberal elites" as the enemy, when these are just educated city dwellers, and that many middle class want conservative policies due to taxes, even though society would be much healthier with socialist policies paid more proportionately by taxes on large corporations and the ultra wealthy who benefit so much from our society. But really we're all peasants compared to the ultra wealthy.

They can shape government policy, and the legal system to meet their ends using their money. We can, and should vote but the voting system is set up to support the status quo. UK FPTP means that you can take all with a minority of votes, and makes it harder for minor parties to gain representation. Look in the US where the republican controlled state legislature are actively introducing laws all over the country to gerrymander even more, and actively make it harder to vote in democratic areas.

So for most people if their wealth increases by the same % as the billionaires (it doesn't) then it improves their lives but doesn't ruin other people's. The billionaires wealth is coming from somewhere. When they get richer we all disproportionately get poorer.

Post edited at 16:39
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 Rick51 20 May 2022
In reply to neilh:

> House prices have gone up by 9.6% in the last year.

> So anybody who owns a house ......their wealth has gone up more than the top few percent at 8% growth.

> So its a useless stat  which means nothing.

I'll swap a billionaire's 8% for the 9.6% on my house in fact 0.1% would probably do very nicely.

 ExiledScot 20 May 2022
In reply to dsh:

Jeremy Vine everyday using 'us' and 'we' when talking about how cost of living, inflation etc.. is impacting everyone, in fact any r2 presenter this week especially zoe ball getting excited about money saving tips, she's on £1m a year! 

 neilh 20 May 2022
In reply to Tyler:

How about a different headline.

The wealth of the top few percent has declined by 1.6% over the past year.

Your average houseowners wealth has risen by more in % terms.

It proves that billionaires are not good at making money as really it shoud be 20% growth a year.

Its a misleading headline that plays to a baying crowd.

8
 neilh 20 May 2022
In reply to ExiledScot:

Does make you laugh....

 henwardian 20 May 2022
In reply to Bottom Clinger:

> A more interesting thought experiment is to imagine if you were a billionaire and you lost a third of your stuff. I’ve imagined it, and I still feel totally loaded. 

That's fair. But now lets imagine someone with a £600k house and £100k in other cash/investments: well off by any metric but not megarich. If you asked someone in a council flat with £3k net worth to do your thought experiment for the guy with the house then he'd probably say he'd still feel totally loaded. And if you took an afghan guy from an isolated mountain village and gave him the same thought experiment with the council flat guy then he'd most likely say he felt loaded...

How rich you feel has a lot more to do with how rich you have habitually been (and perhaps your peer group is) than how rich you are in absolute terms compared to the rest of the human race.

4
 henwardian 20 May 2022
In reply to magma:

> what 'we' is that?

That "we" is a generic catchall for governments and the civil service and judiciaries that enforce their legislation.

1
 ExiledScot 20 May 2022
In reply to henwardian:

> How rich you feel has a lot more to do with how rich you have habitually been (and perhaps your peer group is) than how rich you are in absolute terms compared to the rest of the human race.

Rich the majority now would be filling their car or shopping trolley and not feeling faint when they paid for it. 

 henwardian 20 May 2022
In reply to Tyler:

> - Strawman, no one is arguing for the overthrow of capitalism

I agree with the rest of what you said. I'm not sure about this one though, the inevitable consequence of capitalism, particularly at the laissez faire end but more generally too, is that some people will become unreasonably rich. I don't see how you stop the latter without dismantling the former. It's a cause and effect problem - how do you remove the effect without removing the cause?

1
 dsh 20 May 2022
In reply to neilh:

The

> How about a different headline.

> The wealth of the top few percent has declined by 1.6% over the past year.

Of course the top few percent has. You only need ~half a million dollars household income to be in the top 1% by income. But wealthy people often don't have any official income. So 11 million but net worth for us, not sure about UK. This sounds like a lot but the median house price in the US is ~$375,000 and is pretty close to this number in the UK. Now don't get me wrong it's obviously a lot easier in life to have this level of wealth than to be earning the median income. But it puts into perspective the top few percent will contain people who can barely afford a house with current prices. Again it's the top 0.001% of people who are f*cking us over, not the annoying dentist down the road with the big house and 3 cars.

And these 1%ers are far wealthier than the middle classes, even the bottom. So it's pretty silly to say the average home owner is doing well right now just cos their only house price where they live has gone up.

Post edited at 17:03
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OP Tyler 20 May 2022
In reply to neilh:

> How about a different headline.

> The wealth of the top few percent has declined by 1.6% over the past year.

You're going to have to explain this because, on the face of it, this just seems like nonsense.

> Your average houseowners wealth has risen by more in % terms.

Most people have got two working kidneys, maybe we should add them to a list of assets owned?

> It proves that billionaires are not good at making money as really it shoud be 20% growth a year.

Why is that?

> Its a misleading headline that plays to a baying crowd.

OK, you've won me over, this is a non story, people are richer and, if anything, its the billionaires who are suffering

Post edited at 17:03
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 Tonker 20 May 2022

In reply to Karabeener:

I don't remember lockdown sceptics predicting what is happening right now.... I do remember predictions galore from them of 8m unemployed and a prolonged great depression though.

Are you sure you are not making this up?

3
OP Tyler 20 May 2022
In reply to henwardian:

> I agree with the rest of what you said. I'm not sure about this one though, the inevitable consequence of capitalism, particularly at the laissez faire end but more generally too, is that some people will become unreasonably rich. I don't see how you stop the latter without dismantling the former. It's a cause and effect problem - how do you remove the effect without removing the cause?

No one is arguing for the dismantling of anyone but if the richest 250 people in the UK find themselves with an extra 8% spare cash to spend (YoY) after reasonable living costs are taken into account it seems fair that that should be reflected throughout society.

1
 henwardian 20 May 2022
In reply to montyjohn:

> Are resources finite tho'?

Yes. Every single one is. We think of things like solar energy as infinite only because our current level of tech isn't sufficient to fully use it all (i.e. a dyson sphere).

> Obviously some are, but as technology develops we find other ways of making things using materials that may as well be abundant. 

We become more productive and more efficient, yes, but everything is still limited. I can't think of anything that you as a person can have in infinite quantities (if you were theoretically able to consume such quantity), even something like internet content is limited by the total store and bandwidth available which is limited by global infrastructure which is limited by silicon/steel/aluminium production.... 

> The limitation, rather than materials, is a reliable economy. And like it or not the economy relies on entrepreneurs to risk everything to build that economy. Wealth after-all is created, and therefore has no limit to how much wealth can exist.

Sort of. A reliable economy is definitely important for maximising our wealth and productivity, all other things being equal. The number of people, extent of our technology and various other things limit how much wealth can exist. Sure, you can print money almost infinitely (but not quite) but a) that unravels fast and b) it is not the same thing as wealth.

> So I think we should be celebrating those that make it for the wealth they have created along the way.

Again, sort of!

I think it depends a lot on what they have done, how they did it and the ramifications have been. I'm happy to celebrate Queen for bringing happyness to the lives of millions with their music. However I wonder how many of us would be happy to celebrate the Sackler family bringing opioid addiction to the lives of millions?

1
 ExiledScot 20 May 2022

In reply to Karabeener:

Curiously, after every major event in the last 100 years, either global, regional or national, that has seen society or economies suppressed, the release has produced high inflation. Ww1, Spanish flu, suez and more. The exception was ww2, because rationing continued for years, slowly releasing as supply caught up with post war demand.

In short, the boom after covid was predictable, putins actions aren't exactly a surprise after crimea in 2008 either. 

 montyjohn 20 May 2022
In reply to henwardian:

> Yes. Every single one is. We think of things like solar energy as infinite only because our current level of tech isn't sufficient to fully use it all (i.e. a dyson sphere).

If you believe the universe is infinite then nothing is finite.......

I'm messing, I just read by my original comment and it was badly thought out and a bit of a bran fart to be honest. 

What I meant, is finite materials are not a limiting factor in our production. I can't think of anything other than helium that we are likely to run out of anytime soon, and even helium can be synthesized.So I should have said, are finite materials really an issue?

I believe, call me a tinfoil hat wearer, but we'll be gathering resources from the solar system before we run out of anything critical on earth. Except maybe for that pesky helium. 

> The number of people, extent of our technology and various other things limit how much wealth can exist

I would have thought wealth is limited by work done. If everything could be automated, and I mean everything, and materials and power we're not a limiting factor you would have almost unlimited wealth (irrelevant of how many people there are). The challenge would then be how to distribute that wealth. So I think the technology part of it is most critical.

If you want to eradicate poverty, study a STEM subject.  

In fact, almost every problem we face comes down to solutions that require STEM education.

4
 Tonker 20 May 2022

In reply to Karabeener:

You don't understand the meaning of a smashed healthcare system.

There was a detailed government report on the potential impact on the NHS of Lockdown and the counterfactual of No Lockdown published in April 2020..... read it and educate yourself.... then consider what happens to society and the economy in the No lockdown scenario.

In summary it explains why every single pandemic plan we had since the Blair years was not fit for purpose...

Anyhow no more from me.

1
 Dax H 20 May 2022
In reply to yorkshireman:

> True, but unless they realise the capital (sell it) then it's academic and they then have to buy another house which has likely gone up by the same amount. 

> Elon Musk having 220bn or 150bn is not really going  impact his life. The fact that he can dick about buying Twitter (or not maybe) for 44bn shows this is just pocket change.

Does Elon have 220bn in the bank though? The answer would be no, it's his net worth based on his personal finances and the share of the companies he owns. His net worth is massively above his liquid cash.

He also won't be dipping in to his savings to splash 44bn on twitter, he will have investors and finance organised. 

1
 wbo2 20 May 2022
In reply to neilh: You can do what you want with stats, and it's true a lot of people will have got richer.

What your mean wealth increase ignores however is that for people below the mean, and especially below the poverty line the increase in wealth , coming with increasing inequality means that their lives are becoming a lot worse, and that pool of people will increase in size, and that has very bad effects on society and the economy as a whole.

You appear to have a naive faith in trickle down economics - forget it, it's demonstrably failed in the real world

1
 jethro kiernan 20 May 2022
In reply to montyjohn:

And like it or not the economy relies on entrepreneurs to risk everything to build that economy.

A sub Saharan farmer risks “everything”

A zero hours delivery driver risks “everything” (if they take time off for illness)

most billionaires don’t risk “everything’” and haven’t risked “everything” to get where they are

can we put the cult of the risk taker to bed in the graveyard of 80’s neo liberal bullshit

5
In reply to Tyler:

Governments and central banks are conspiring to protect asset prices - property, shares, money in bank accounts. They aren't doing anything to protect wages or prices so people who are working to acquire assets are falling back relative to people who already have them. Technology is providing more and more capability for the same amount of money and allowing the rich parasites to get away with this without people starving but people who work in innovation aren't being fairly rewarded unless they get to the point of establishing a monopoly.

Sooner or later the system has to change and we will need to tax land or wealth and gradually increase those taxes while reducing income and consumption taxes to rebalance things away from financial service cowboys and fat bastards with inherited wealth and towards people contributing productively and people who have basic unmet needs.

The transition from income and consumption taxes to wealth taxes as the main source of government revenue is going to be disruptive and it would be preferable to have it happen slowly over a couple of decades than suddenly after a crisis.

6
 Duncan Bourne 22 May 2022
In reply to magma:

That's it I'm buying BitBananas, they don't exist and you can't eat them but at this rate I'll only be virtual eating anyway

Deleted User 22 May 2022
In reply to Tyler:

Typical left wing opinion from a UKC supporter seeking confirmation bias

8
 Ciro 22 May 2022
In reply to montyjohn:

> What I meant, is finite materials are not a limiting factor in our production. I can't think of anything other than helium that we are likely to run out of anytime soon, and even helium can be synthesized.So I should have said, are finite materials really an issue?

> I believe, call me a tinfoil hat wearer, but we'll be gathering resources from the solar system before we run out of anything critical on earth. Except maybe for that pesky helium. 

That's not tinfoil hat territory, it's just naive.

In the last 50 years, we've burned through a hell of a chunk of the world's topsoil, and it's estimated we've got about 60 years of it left. The soil thats left can't support the same level of crop growth as topsoil, leading to food shortages and civil war.

We're in the middle of a mass extinction event.

We're tipping the planet into runaway heating.

All of this is caused by overconsumption of the world's natural resources by man.

3
 wintertree 22 May 2022
In reply to montyjohn:

> If you believe the universe is infinite then nothing is finite.......

Disagree.  If the universe is infinite their will be an infinite quantity of life and hence a finite quantity of every given resource per unit of life.

Overlooking such nuance, it’s a silly argument for where we are right now.

 ExiledScot 22 May 2022
In reply to Ciro:

Not strictly true, the soil is fine ish, it's like soil 100 years ago, now just like then it can't produce the kind of yields we need for everyone to eat without inputs. We plant denser high yielding crops than 'normal' soil could never provide nutritional demands to. Fertilisers are expensive, they aren't scattered randomly anymore. 

GM is likely the answer to produce optimum yields to inputs ratios in the future. Digesting waste, or growing deliberately for energy production isn't desirable long term either. 

3
 magma 22 May 2022
In reply to ExiledScot:

GM hasn't delivered so far and is likely to increase instability of global food market..

https://www.theguardian.com/commentisfree/2022/may/19/banks-collapsed-in-20...

Post edited at 15:43
 ExiledScot 22 May 2022
In reply to magma:

> GM hasn't delivered so far 

It's new tech relatively speaking, that's the problem really, society wants instant perfect solutions and if they aren't they'll call it a failure. EVs are a classic, it's taken a 100 plus years to refine ICE vehicles to where they are now and many moan because EVs aren't already full developed.

With crops, the bigger challenge will be climate change with drought, floods and associated storm damage.

 Jim Fraser 22 May 2022
In reply to Tyler:

If those barstewards were proper capitalists then they would be using their 8% to combat inequality on the basis that it would create a greater pool of viable CUSTOMERS.

 Michael Hood 22 May 2022
In reply to neilh:

> House prices have gone up by 9.6% in the last year.

> So anybody who owns a house ......their wealth has gone up more than the top few percent at 8% growth.

> So its a useless stat  which means nothing.

Increases in house prices are not really a measure of increase in wealth since your own home increasing in price doesn't really allow you to buy "more" home. If it's a second/investment property then that would be an increase in wealth.

2
 LarahPars5 22 May 2022
In reply to neilh:

> Anybody who owns a house will have seen their wealth increasing by similar amounts due to escalting house prices.

Many people don’t own a house.

2
In reply to Michael Hood:

> Increases in house prices are not really a measure of increase in wealth since your own home increasing in price doesn't really allow you to buy "more" home. If it's a second/investment property then that would be an increase in wealth.

They're a measure of family wealth because when you die you will pass it on to your children and they will then get a boost in wealth.  But because people are living longer they will quite likely not get the boost in wealth until they are retired or near-retired themselves and don't need a big house or have the cost of children to support. Then their children will get two generations worth of house wealth when they are old.

It would be far better to tax wealth and have a lower tax on income. That makes it easier for people to get rich by working hard rather through inheritances or investments. The difficult thing is managing the transition so you don't get the situation where people haven't managed to accumulate wealth because of high income tax and then get clobbered by inheritance tax too. What's needed is to kick off wealth taxes but at a low rate to start with and then gradually increase while cutting VAT and income tax.

7
 Michael Hood 23 May 2022
In reply to tom_in_edinburgh:

That's an interesting revision to our tax system, as you point out, the difficulty is in the transition.

A wealth tax regime will however produce its own undesirable side effects (every system does) which may not be immediately apparent.

I will however contest your "pass it on to the children". That will only occur in families where both parents die young enough or in good enough health (sic) to avoid care home costs. The proportion of families where this happens (passing it on) is decreasing and I'm not convinced that the government's proposed care homes cost cap (and other) revisions will actually lead to significantly more retention of wealth in the family.

 Andy Hardy 23 May 2022
In reply to Michael Hood:.

> I will however contest your "pass it on to the children". That will only occur in families where both parents die young enough or in good enough health (sic) to avoid care home costs. The proportion of families where this happens (passing it on) is decreasing and I'm not convinced that the government's proposed care homes cost cap (and other) revisions will actually lead to significantly more retention of wealth in the family.

Or if the estate is worth lots more than the costs of a care home.

 Murderous_Crow 23 May 2022
In reply to Tyler:

Some interesting points raised in this thread.

It seems the only sensible way to help combat widening wealth disparity is increased taxation on the super-rich. Some of this elite group agree:

https://www.theguardian.com/business/2022/may/22/millionaires-join-davos-pr...

I think the vast majority of people opposed to taxation on the rich, vastly underestimate true wealth. Because it's hard to comprehend what a million looks like, let alone a billion (there are now a record 177 billionnaires in the UK, an all-time high).

Something that might put this in perspective:

If you spend £1.00 every second, every minute, 24 hours a day, you will burn through a million pounds in under 12 days. 

It would take 32 years to get through a billion.

 NathanP 23 May 2022
In reply to tom_in_edinburgh:

> It would be far better to tax wealth and have a lower tax on income. That makes it easier for people to get rich by working hard rather through inheritances or investments. 

Are you sure about that? Investment has two sides. This tax plan sounds like a massive incentive to spend the money as soon as you get it, not accumulate wealth and certainly not to save for a rainy day, retirement or your children's future.

Also an incentive to rent property rather than buy, though I'm not sure who you could rent if off if nobody can afford to hold property.

Less savings means less money available to borrow and for businesses to invest with. Hard to set up your own business when you can't get a business loan and people have a disincentive against providing initial capital because, whilst they still bear all the risk of losses, any future upside will just going to be taken off them. 

2
 wercat 23 May 2022
In reply to Murderous_Crow:

you'd have to spend at that rate on stuff that had no worth to re-convert into money.  That might be quite hard to achieve

 Andrew95 23 May 2022

As I don't desperately want to be sued or tracked down by a private army I will leave the details quite sparse, but I will let you make up your own mind about it. 

In a past life at a previous employer we did some consultancy work for a very large company who incidentally almost has a monopoly on a particular resource generally found on or below the equator.

This resource is considered to be a luxury item and a precious resource.  Its always, at least in our industry, been fairly well known that the company holds onto a large proportion of its stock to limit the market and keep it high, I mean that's basic economics. 

It wasn't until we actually started working alongside them that I actually realised the lengths they went to protect the flow of the recourse onto the market.  They were often found to be mining this resource and then destroying it straight away so that it could never be stolen, took off them, or resoled by them of another company. 

They put more effort into destroying there products and ensuring nobody else could discover / sell it than they did selling the product in the first place. 

I suppose it comes back to the old quote - Its easy to get money once you have money. 

1
 montyjohn 23 May 2022
In reply to Ciro:

> In the last 50 years, we've burned through a hell of a chunk of the world's topsoil, and it's estimated we've got about 60 years of it left. The soil thats left can't support the same level of crop growth as topsoil, leading to food shortages and civil war.

> We're in the middle of a mass extinction event.

> We're tipping the planet into runaway heating.

You're letting scientific reports get you a bit too excited there.

Soil erosion is a major problem, but it can be managed. Remember, all the doomsday predictions from scientists assume we do nothing about it.

Soil erosion can be managed with crop rotations, erosion matting, planting hedges, proper drainage, retaining organic matter on site, cover crops.

The tricky bit is getting these practices to happen in poorer countries. This is why a focus on improving all economies is so critical. 

6
 montyjohn 23 May 2022
In reply to jethro kiernan:

> A sub Saharan farmer risks “everything”

> A zero hours delivery driver risks “everything” (if they take time off for illness)

> most billionaires don’t risk “everything’” and haven’t risked “everything” to get where they are

> can we put the cult of the risk taker to bed in the graveyard of 80’s neo liberal bullshit

I never said entrepreneurs are the only one ones that take risks, but since we are discussing economic news, I chose to mention the risks they take. Makes sense?

Without entrepreneurs there wouldn't have been a tech revolution, no industrial revolution and we'd all still be doing back breaking work in fields. Entrepreneurs do take risks. Richard Branson spoke about how he was contentiously minutes away form bankruptcy on a regular basis.

I'm not an entrepreneurs (as much as I would like to be) because I don't want to risk my family home and future. Fortunately, there are some that do take these risks.

This doesn't take away form risks others take.

2
 jkarran 23 May 2022
In reply to Andrew95:

> They put more effort into destroying there products and ensuring nobody else could discover / sell it than they did selling the product in the first place. 

Actually destroying it or industrialising material that could have gone into luxury goods?

jk

In reply to NathanP:

> Are you sure about that? Investment has two sides. This tax plan sounds like a massive incentive to spend the money as soon as you get it, not accumulate wealth and certainly not to save for a rainy day, retirement or your children's future.

The system needs to get more of the money in the hands of younger people who will spend it instead of old people who will save it. That will put demand back into the economy, demand will create jobs, increase wages and most importantly of all increase the rate of technical progress because companies will be selling more stuff and able to afford more R&D. Increasing the rate of technical progress should be the single most important goal of the entire financial system. It is what makes things better.

Housing based wealth is completely sterile. It's not even building many houses it's basically inflation as existing houses cost more on the basis of scarcity.  A house built in the 1920s costs maybe 1000 x what it did when it was built but it isn't a significantly better house. Imagine if that was true of cars or computers. Computers are the opposite - you get 1,000 x better computer for less money than 30 years ago.

> Also an incentive to rent property rather than buy, though I'm not sure who you could rent if off if nobody can afford to hold property.

Sure people can afford to hold property. It just won't be as ridiculously overpriced relative to other goods and services.

> Less savings means less money available to borrow and for businesses to invest with. Hard to set up your own business when you can't get a business loan and people have a disincentive against providing initial capital because, whilst they still bear all the risk of losses, any future upside will just going to be taken off them. 

I don't think so. If you can't get rich by sitting on houses or lending money and you want to invest you're going to have to buy shares in productive companies. It will shift money into industry and it will go in as risk capital in shares rather than loans which is far healthier. Also, it will be easier to  start up a small business using the team's savings rather than being forced to borrow money from a bank.

Banks, especially in the UK, are more interested in dicking about in futures markets and inventing shit like CDOs and safe investments in property and government bonds than providing funding to business. The system has been set up by government to create one way bets.

1
 seankenny 23 May 2022
In reply to Michael Hood:

> Increases in house prices are not really a measure of increase in wealth since your own home increasing in price doesn't really allow you to buy "more" home. If it's a second/investment property then that would be an increase in wealth.

Increases in the value of Google shares are not really a measure of an increase in wealth because your own Google shares increasing in price don’t allow you to buy more Google shares. And yet… and yet… people sell their Google shares and are wealthy.
 

1
 jkarran 23 May 2022
In reply to montyjohn:

> In fact, almost every problem we face comes down to solutions that require STEM education.

Technological solutions still need to be funded and sold, their social consequences understood and mitigated. Sure, STEM is essential but without politics, philosophy, sociology, economics and the rest playing their part for each problem the 'geeks' solve you just end up either with another shelved invention or a new different mess to fix.

jk

 neilh 23 May 2022
In reply to Tyler:

If you are really interested in the subject then have a read of Tim Hartfords excellent book on the misuse of stats and the chapter on wealth.

I assume you will have listened to him on Radio 4 etc.

Its a bit of an eyeopner.

But yes most people are richer year on year in Uk or other Western economies, whether its billionaires or the average adult...in a nutshell.Its just not popular to put across this message.

Post edited at 13:00
1
 neilh 23 May 2022
In reply to seankenny:

Facebook and othe FANG shares have dramtically fallen. As an example the price of a Facebook ( Meta) share is half what it was a year ago.There is a massive Tech sell off going on at the moment.

Cryptocurrence..the same.

Post edited at 13:04
1
 neilh 23 May 2022
In reply to tom_in_edinburgh:

You are right about so called rental capitalism..its a scourge.

But you are wrong about banks and financing investment. That really is not their primary role. Equity markets are there for investment, not banks.Banks can help for working capital.

 jethro kiernan 23 May 2022

In reply to montyjohn:

Richard Branson spoke about how he was contentiously minutes away form bankruptcy on a regular basis

When listening to the origin stories (especially as told by themselves) of successful entrepreneurs keep a large salt cellar handy and take frequent pinches of salt.

Very few people in the tech industry have risked it all, funding comes from outside and is spread out and once you have money it is very hard to “loose everything” as company structures prevent everything falling onto you as an individual. At worst you’ve gone from potential billionaire to another middle class person in the suburbs. 
Im not dismissing the hard work and financial risk that it takes to build up a small business, but your average restaurant or light engineering company or MOT centre isn’t at the table in Davos right now, and we really need to put the myth that these Davos billionaires  are indispensable super beings dragging humanity out of the dark ages by their sheer grit and courage.

A lot of the tech that heralded as great such as Uber, air bnb, Facebook is really just about generating a good old fashioned monopoly with a nice app.

we talk about financial inequality but the political inequality is also huge, the amount of influence billionaires have in the political space is way too much, pay your taxes and shut the F£&k up!

First rule of billionaires club, don’t break the myth

Post edited at 13:23
 seankenny 23 May 2022
In reply to neilh:

> Facebook and othe FANG shares have dramtically fallen. As an example the price of a Facebook ( Meta) share is half what it was a year ago.There is a massive Tech sell off going on at the moment.

> Cryptocurrence..the same.

Sure. Perhaps I should have written “an appreciating asset” for the hard of imagination!

In reply to Andrew95:

They sound like a bunch of truly diamond geezers...

OP Tyler 23 May 2022
In reply to David Cannon:

> Typical left wing opinion from a UKC supporter seeking confirmation bias

Is it really left wing to look at billionaire’s wealth  increasing by billions, through no discernable effort, and think there’s something wrong with society when, over the same time period, people from the same country are unable pay for basic necessities?
If that is a ‘left wing’ position then what’s the ‘centrist’ position on this, that it’s all ok and perfectly healthy? If this is a left v right issue the Tories should be a bit more explicit about how they support burgeoning wealth inequality and put it in their manifesto. Or, maybe, it’s not a left v right issue at all but just a common decency and fairness issue?

1
OP Tyler 23 May 2022
In reply to neilh:

> But yes most people are richer year on year in Uk or other Western economies, whether its billionaires or the average adult...in a nutshell.Its just not popular to put across this message.

You keep saying this but there has, surely, got to be a certain level of resources that someone should have access to before it starts being counted as wealth. That includes housing (up to a point) and a pension (up to a point). For the purposes of a reasonable debate wealth has to mean assets above those required to get by (comfortably in the case of a developed western economy). Most people are not in a position to swap their pensions for a new Bentley without making themselves destitute in their old age, nor sell their homes without making themselves worse off.

Besides, why are you so keen to focus on such marginal cases, when the issue at hand is the egregiousness of the super wealthy becoming even more wealthy when such increases in wealth are unnoticeable to them whilst the decline in wealth at the other end of the scale is very noticeable to those experiencing it?

Post edited at 14:22
1
 Andrew95 23 May 2022
In reply to captain paranoia:

For legal reasons I can't comment, but I am currently moving my head in a totally un-related up and down motion. 

 montyjohn 23 May 2022
In reply to wintertree:

 > Disagree.  If the universe is infinite their will be an infinite quantity of life and hence a finite quantity of every given resource per unit of life.

oooooh, interesting response. I like it. Unless, life on Earth is the only life in an infinite Universe. I'm not saying it is, but it might be.

> Overlooking such nuance, it’s a silly argument for where we are right now.

Well it was a joke, so of course it's silly. 

 redjerry 23 May 2022
In reply to Tyler:

I think one of the most problematic aspects of conservative economic thinking is that it's basically fundamentalist. It's just not a very flexible way of thinking about problems and potential solutions. 
As with many fundamentalist ideologies, the whole structure of thought is threatened when a problem arises that requires a solution that is outside that structure.
Climate change is the glaringly obvious example (less so the UK, but especially in the US) but wealth inequality is very much in the same category. 
It's just easier to pretend that, it doesn't exist or that its not a problem or that... etc, etc.

 LarahPars5 23 May 2022
In reply to redjerry:

> I think one of the most problematic aspects of conservative economic thinking is that it's basically fundamentalist. It's just not a very flexible way of thinking about problems and potential solutions. 

The economic thinking of the government is far from conservative, it is populist radical.

Conservatism is supposed to be about caution and not doing too many changes.

In the space of ten years they did massive money printing, massive quantitative easing, added trade friction with hard brexit, imposed draconian restriction on the mobility of European labour to the UK, more massive money printing, more massive bail outs.

And now they are wondering why we have the highest inflation in the G7, and what is now a very clearly a destructive wage price spiral.

This is all because of radical economic policies from a populist government. 

If they had been true conservatives they would have bailed out no one, preserved economic freedoms, let businesses fail during the pandemic. It would have been unpopular, and probably would have a led temporarily to a smaller economy.

But we also wouldn’t have large number of people unable to afford food, and savings they have accumulated their entire life being reduced to nothing in a matter of years because of inflation.

Post edited at 18:10
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 Michael Hood 23 May 2022
In reply to seankenny:

> Increases in the value of Google shares are not really a measure of an increase in wealth because your own Google shares increasing in price don’t allow you to buy more Google shares. And yet… and yet… people sell their Google shares and are wealthy.

>  

That's a completely fallacious comparison, you can live with or without Google shares, most of us can't live without somewhere to live. Of course there are situations where the value of a home can be converted into a liquid asset (downsizing, moving to a cheaper area), but in the main to have "more" home, you need to inject some extra funding.

2
 neilh 23 May 2022
In reply to Tyler:

Because it’s ill informed ….but what does this matter…….

No worse or better than any other poorly researched populist article in the press. 

 NathanP 23 May 2022
In reply to tom_in_edinburgh:

I should say that my start point on this is that I think we have the good fortune to live in a rich and, relatively, equal and free society. We have a progressive tax system that funds social benefits, free healthcare and education. Whilst there are many obvious failings and needs for improvement, I'm a bit suspicious of the argument that it is crap and we need to throw it all up in the air because whatever untried system replaces it would be better. We don't have to look far to find countries that have different systems that worked out a lot worse - equally others that do better that we could learn from. Any fundamental changes to tax policy need to be very carefully thought through and implemented. 

Getting money to younger people is an interesting one. Linking back to earlier comments about people inheriting money when they are too old to benefit from it, one thing would be for people to skip a generation in their wills. Don't leave it to your kids, leave it to your grand children. Personally I'm against the idea of charging for higher education and making young people run up huge student debts (not an issue in Scotland, I know) but there is an argument of fairness against those who choose not to go to university before working, Maybe some scheme of a choice between free tuition or an annual payment into pension schemes for under 21s.

One radical change that I do think is worth looking at is the idea of a transaction charge for capital investments - a really small % but enough to nudge investors towards longer term investment rather than short term gambling.

 seankenny 23 May 2022
In reply to Michael Hood:

> That's a completely fallacious comparison, you can live with or without Google shares, most of us can't live without somewhere to live. Of course there are situations where the value of a home can be converted into a liquid asset (downsizing, moving to a cheaper area), but in the main to have "more" home, you need to inject some extra funding.

It really isn’t. There are two aspects to the value of a house: the provision of housing services and the ownership of an asset. Renters buy purely the first, landlords the second, owner occupiers buy both. (This is reflected in the way inflation is worked out.)

All you’re saying is that the value of the asset has increased, so therefore you’re not better off because you can’t buy more of that asset which is now more expensive. You definitely are better off if you own an asset which has appreciated… but you are simply considering the case in which you want more of the expensive asset! Or you want more housing services, which again can cost more. So you feel poorer. That you might not be able to realise the value of that asset for some time, eg when you downsize or move, is a bit irrelevant, because when you sell you’ll (probably) have more money than someone who has simply rented.

Post edited at 21:51
1
 seankenny 23 May 2022
In reply to LarahPars5:

> If they had been true conservatives they would have bailed out no one, preserved economic freedoms, let businesses fail during the pandemic. It would have been unpopular, and probably would have a led temporarily to a smaller economy.

> But we also wouldn’t have large number of people unable to afford food, and savings they have accumulated their entire life being reduced to nothing in a matter of years because of inflation.


I love how you think mass unemployment wouldn’t have led to people being unable to afford food. Also if you think quantitative easing was a problem, what the heck do you think would have happened to the economy without it? (Clue: a lot of people unable to afford to eat, and people reducing their savings to nothing because it was the only way to get by.)

1
 LarahPars5 23 May 2022
In reply to seankenny:

> I love how you think mass unemployment wouldn’t have led to people being unable to afford food. 

 

The pain of temporary higher unemployment is far better, and much easier to deal with, than runaway inflation.

Moreover, there was no real prospect of such a thing given pre-existing acute labour shortages.

Trading short term suffering for long term pain isn’t wise.

If anything, releasing a workforce stuck in unproductive endeavour could have brought badly needed fresh blood to the sectors that needed it.

Post edited at 22:23
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 seankenny 23 May 2022
In reply to LarahPars5:

> The pain of temporary higher unemployment is far better, and much easier to deal with, than runaway inflation.

> Moreover, there was no real prospect of such a thing given pre-existing acute labour shortages.

If you think we could have managed an effective lockdown without financial support for workers and not seen huge long term effects from that, you are out to lunch. The fact that other governments, including the left wing Democrats in the US, also supported workers suggests that this wasn’t just a U.K. Conservative policy. 

> Trading short term suffering for long term pain isn’t wise.

> If anything, releasing a workforce stuck in unproductive endeavour could have brought badly needed fresh blood to the sectors that needed it.

There is no suggestion that most of the jobs that were supported by the furlough scheme were unproductive. They simply couldn’t be done under a lockdown.

I hasten to add that I think 12 years of Tory government have been a disaster for the U.K. and their economic policies are mostly junk.

 Xharlie 23 May 2022
In reply to jethro kiernan:

In the tech. industry, the venture capital coming in as funding from outside is premised on the fact that tech. ventures have an incredibly high failure rate but, upon a successful "liquidity event", they pay out at obsceen rates.

This explains a LOT, including why VCs aren't interested in anything like "reasonable" success and won't give the time of day to someone pitching an idea that pays less than 1000:1 and, conversely, are quite happy to put a bullet in anything that looks like it just might not -- even if it would be profitable to some lesser extent -- regardless of who's spent what effort working on it.

 FactorXXX 23 May 2022
In reply to LarahPars5: 

> The pain of temporary higher unemployment is far better, and much easier to deal with, than runaway inflation.
> Moreover, there was no real prospect of such a thing given pre-existing acute labour shortages.
> Trading short term suffering for long term pain isn’t wise.
> If anything, releasing a workforce stuck in unproductive endeavour could have brought badly needed fresh blood to the sectors that needed it.

Hmmm.
Why does this narrative seem somewhat familiar... 🙄

 redjerry 23 May 2022
In reply to FactorXXX:

I got a chuckle out of Laras reply as well. Kinda made my point for me.

Post edited at 23:48
 LarahPars5 24 May 2022
In reply to seankenny:

> If you think we could have managed an effective lockdown without financial support for workers and not seen huge long term effects from that, you are out to lunch.

I have not said it should have been done without financial support for workers.
We should definitely have supported people who are out of work with generous benefits.

This would have cost a fraction than what it costed to keep entire businesses artificially afloat. This wasn't done to protect workers. It was done to protect financial assets from collapse.

A lot of business should have failed during this crisis. I would argue that business failures are far preferable to stagflation that will punish an entire generation for the long term.

> The fact that other governments, including the left wing Democrats in the US, also supported workers suggests that this wasn’t just a U.K. Conservative policy. 

And they all face the same issues now.

> There is no suggestion that most of the jobs that were supported by the furlough scheme were unproductive. They simply couldn’t be done under a lockdown.

I am not sure how you don't see the glaring self contradiction in that comment. If the job couldn't be done by definition the productivity was zero.

Post edited at 11:43
4
 Andrew95 24 May 2022
In reply to LarahPars5:

> > There is no suggestion that most of the jobs that were supported by the furlough scheme were unproductive. They simply couldn’t be done under a lockdown.

> I am not sure how you don't see the glaring self contradiction in that comment. If the job couldn't be done by definition the productivity was zero.

I have not been keeping up fully with the debate, but just for reference construction / civil- engineering which is the sector I work in was split. 

Almost all of out 'site staff' i.e. geologist, drillers etc. were all put on furlough as they were unable to work. 

Meanwhile out 'office staff' i.e project managers, report writers etc were able to continue to work (be it in a limited capacity) to keep the place running, finish off what work we had been doing before lockdown and in some cases actually find new clients / jobs once we were all allowed back to work. 

Had it not been for the furlough scheme I think a lot of 'site staff' would have been laid off (at least short term) - we still had a fortune of assets / plant on hire which we were still paying for with no way to off hire. 

We were also quite lucky in that after a while construction was allowed to go back to work sooner than a lot of other industries. 

Deleted User 25 May 2022

The problem as I see it Ash is that your argument is very black or white a one-dimensional analysis of a multivariate problem. Recent research from LSE states the top one percent contribute 30% of the UK's tax revenues. A fair proportion of that one percent will also have established and built successful businesses that in turn employ thousands of people who also contribute to society through taxation. So lets say we make a money grab for all that billionaire cash and redistribute it on a means tested basis to the people. Would that make a difference? maybe for a few and for a very brief time but then what? The countries tax revenue will be down by nearly a third and without the capitalist incentive to build successful businesses such businesses would cease to exist further reducing the tax revenues. The outcome would be a nose dive in GDP widespread unemployment and poverty with a state that has no means to support even the most vulnerable. 

Post edited at 10:24
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 Harry Jarvis 25 May 2022
In reply to David Cannon:

> The problem as I see it Ash is that your argument is very black or white a one-dimensional analysis of a multivariate problem. Recent research from LSE states the top one percent contribute 30% of the UK's tax revenues. A fair proportion of that one percent will also have established and built successful businesses that in turn employ thousands of people who also contribute to society through taxation. So lets say we make a money grab for all that billionaire cash and redistribute it on a means tested basis to the people. 

Is anybody suggesting we make a money grab for all that billionaire cash, or is the suggestion that they might pay a bit more? Given that some of the world's wealthiest people think they should pay more tax, I'm not sure the picture is quite as black-and-white as you suggest. 

https://www.forbes.com/sites/cartercoudriet/2019/10/15/billionaires-more-ta...

Post edited at 10:45
 jethro kiernan 25 May 2022
In reply to David Cannon:

One of the things that is overlooked is that higher corporate tax with no loopholes can result in more investment and development,

research, wages, capex are all tax deductible  so it would make more sense for companies to invest in research, infrastructure and a happy well paid workforce rather than give it to the taxman. Higher taxes  can help drive investment not suppress  it as long as all the financial rat runs are blocked.

 RobAJones 25 May 2022
In reply to David Cannon:

> Recent research from LSE states the top one percent contribute 30% of the UK's tax revenues.

Just to be clear that was about earners and income tax rather than wealth.

The top one per cent pay 30 per cent of all income tax revenues: a higher share than at any time in past twenty years. In other words, three in every ten pounds that the government receives in income tax is paid by just over 300,000 individuals. Not surprisingly, this statistic is often quoted by those who argue that the rich cannot be asked to pay more. But it doesn’t tell the whole story.

https://www.lse.ac.uk/research/research-for-the-world/economics/how-much-ta....

>and the conclusion of that LSE report was that the wealthy should pay more

We published the final Wealth Tax Commission report in December 2020, with the recommendation that, if the government chooses to raise taxes as part of its response to the COVID-19 crisis, it should implement a one-off wealth tax in preference to increasing taxes on work or spending. A one-off wealth tax on millionaire couples paid at one per cent a year for five years, we found, would raise £260 billion.

>A fair proportion of that one percent will also have established and built successful businesses that in turn employ thousands of people who also contribute to society through taxation. So lets say we make a money grab for all that billionaire cash

does that imply there is also a fair proportion who have inherited that wealth and aren't doing anything particularly useful with it?

Post edited at 11:16
OP Tyler 25 May 2022
In reply to David Cannon:

> The problem as I see it Ash is that your argument is very black or white a one-dimensional analysis of a multivariate problem.

Have we met? I never use my real name on here and very rarely does anyone else so curious why you chose a semi-doxxing when leaving "In reply to" in your post would have made it clearer what argument you are replying to. Apologies if we have met IRL

> Recent research from LSE states the top one percent contribute 30% of the UK's tax revenues. A fair proportion of that one percent will also have established and built successful businesses that in turn employ thousands of people who also contribute to society through taxation. So lets say we make a money grab for all that billionaire cash

1. You seem to be using the top 1% and billionaire interchangably when billionaires make up 0.0000026% of the UK population not 1%.

2. The1% in the study (https://www.lse.ac.uk/research/research-for-the-world/economics/how-much-ta...) is based on income not wealth

3. The study you refer to states that the 1% do not all pay the same rates of tax on their income, it is quite likely that that the billionaire contribution is not as much as you assume.

4. The 30% figure is 30% of tax paid by individuals on income (salary, investment income), it does not include corp tax, VAT, cpatial gains, import tariffs or myriad of other taxes that make up total UK tax take.

> and redistribute it on a means tested basis to the people. Would that make a difference? maybe for a few and for a very brief time but then what?

If you give a poor person money they will spend it on goods and services the multiplier effect will be benficial to the economy, creating jobs etc. If you give a billionaire money they will 'invest' it inflating asset prices which is not really good for the economy, it does not create wealth or increase GDP

> The countries tax revenue will be down by nearly a third and without the capitalist incentive to build successful businesses such businesses would cease to exist further reducing the tax revenues.

1. See above as to why the "nealy a third" is an embarssing figure to put into a serious debate, I mean, even if it were true, you're saying revenue from this cohort would drop from what it is now to zero!!!

2. Business investment for existing businesses is driven by things other than tax on indivduals, e.g. buisness confidence, buoyant economy, corp tax

3. People starting businesses will not expect to be immediately catapulted into the top 1% of income earners never mind expect to billionaires so I doubt thye will pay any heed to how much billionaires get taxed

> The outcome would be a nose dive in GDP widespread unemployment and poverty with a state that has no means to support even the most vulnerable. 

Strangely the study you bastardised in your post comes to a different conclusion:

"We published the final Wealth Tax Commission report in December 2020, with the recommendation that, if the government chooses to raise taxes as part of its response to the COVID-19 crisis, it should implement a one-off wealth tax in preference to increasing taxes on work or spending."

EDIT: what RobAJones said!

Post edited at 12:51
 RobAJones 25 May 2022
In reply to Tyler:

I found this part of the report surprising

Using anonymised data from personal tax returns, we show that in 2015-16 the average rate of tax paid by people who received one million pounds in taxable income and gains was just 35 per cent: the same as someone earning £100,000. But one in four of these paid 45 per cent – close to the top rate – whilst another quarter paid less than 30 per cent overall. One in ten paid just 11 per cent—the same as someone earning £15,000. The rich, it seems, are not all in it together.

and there seems little downside to this suggestion, although I'd prefer to see it set at more like 40%

One option for a government looking to raise tax revenues would be to implement a new "alternative minimum tax". This would put a floor on the lowest tax rates. If set at 35 per cent on taxable income and gains for all those with over £100,000 per year, our research indicates that this tax could raise £11 billion per year. That’s equivalent to raising both the higher and additional rates of income tax by five pence, but instead of everyone on high incomes paying more, it would be targeted at those currently paying the lowest shares.

Post edited at 13:08
OP Tyler 25 May 2022
In reply to RobAJones:

Could not agree more

 LarahPars5 25 May 2022
In reply to David Cannon:

I don't believe we have a huge taxation problem. Sure we could always improve things - other posters have pointed out what could be improved - but broadly speaking, looking at the aggregate, the rich are heavily taxed, and as you say, they bear (rightly so) a large chunk of the tax burden.

What we have though is a lack of skin in the game problem.
When rich people or their businesses fail they are often bailed out by everybody else - directly or indirectly. Usually there is some excuse along the lines of "if we don't do it it's going to be very bad for everybody", or "it's to protect the workers". It fails to understand that workers are far more resilient entities than the businesses they work for.

I suspect that for an economy to function well, letting things that don't work fail is as important, if not more important, than helping things that work succeed. If we don't let things that should fail fail, then we accumulate fragilities, which leaves us very vulnerable to any shock. That's pretty much the situation we are in now.

Post edited at 13:45
1
 mutt 25 May 2022
In reply to dsh:

> In reply to neilh:

> They can shape government policy, and the legal system to meet their ends using their money. We can, and should vote but the voting system is set up to support the status quo. UK FPTP means that you can take all with a minority of votes, and makes it harder for minor parties to gain representation. Look in the US where the republican controlled state legislature are actively introducing laws all over the country to gerrymander even more, and actively make it harder to vote in democratic areas.

Your whole post is bang on but I just thought it worthwhile to note that the masses will never get equality in a democratic system. Once you have an inequitable society there will be, as you say, more power invested in those with more capital. If they feel that the labour party for instance may seriously tax or otherwise threaten their position they will definately band together and wield their collective might to prevent that party being in power. The only real way to wrest wealth from those who have it is violence. But as is so often shown even civil war can be turned to the advantage of those families with power and wealth. Those who took power in 1066 were still in positions of power after the English civil war and by all accounts they still hold power now.

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