This essay, to my mind, wanders round the key factor near the heart of today’s wealth gap, instead of stating it.
There has been a (far from fully conscious?) accretion of all forms of worldly power, over the past 30 years, which has effectually achieved a sort of Grand Coup d’Etat throughout the western world – the countries which are developed-economy democracies of the kind that we have in the United Kingdom.
The Political Left has reaped the harvest of spending the past 60 years marching through all institutions, taking them over and all but monopolising public discourse too; while Big Money (large, rather than middling or small, commercial enterprises; large inherited fortunes; large stolen ones [e.g. Russian oligarchs, Chinese nomenklatura]), has learned to kowtow to the Left so as to keep enhancing its fortunes.
Among other monopolies achieved, they twain have taken over most broadcasting and anything from half to all of the press in such lands as ours.
Practically anybody with any actual POWER now conspires, deliberately or otherwise, to maintain the status quo: one in which assets grow and grow in value, the working and middle classes are ever more pushed toward serf status (as in a feudal regime), and wealth is stripped out of each economy and relocated in the possession of the political and commercial and economic movers and shakers.
It is all a mad programme, which eventually will eat up its very proponents, as did the French and Russian Revolutions. But they do not see this because they spend their whole lives living from day to day and not thinking about what their own policies mean tomorrow: the very nature of Avarice as of all Sin.
Bob Honda
3 years ago
The fact of the matter is: when you are rich beyond a certain point, you do not have to work, because the return on your invested capital will cover both an increase in your wealth and your consumption and any measly “wealth tax”. That some wealthy people choose to work a lot is not really that relevant, and unless you are a corporate high-flyer, it’s not really your salaries that are growing your wealth, also these people are often compensated by stock options and bonuses, which is essentially not a “wage” in the classical sense and rather tied to the development of a financial instrument (the stock in the company). And besides, these jobs are usually quite rare, and are reserved for those who are essentially already “in” the boys club. Wealth grows itself once you have enough of it.
If you assume even a relatively “low” wealth of 10 million pounds, you could put this money into well diversified index-funds and still earn at least 5% or 500.000 pounds every year, without even lifting a finger. If you spend some of your money to have it managed, or get some of your rich buddies to give you some “investment advice” (AKA insider trading) you could probably do a lot better. You could invest in land, buidlings or whatever, you would have to almost try hard to lose wealth once aquired at a certain level.
Fact of the matter is, the real production of both intellectual and physical goods is done by wage slave average Joe’s around the world – it’s their labor that forms the basis of all the good fortune of companies and other ways of accumulating wealth.
Do a simple thought experiment: if the working classes (the bottom 90%) all disappeared tomorrow, what would the elite do? We’re not yet at a stage where work is fully automated. Everything would stop, literally nothing would be produced. Can’t “manage” your way to farm production. Or goods. Can’t “CEO” over nothing. The top 10% would starve to death or have to start doing some of the basic work themselves 🙂
Another thought experiment would be to put the richest 10% on one desert island and the poorest 10% on another. All else is equal, but nobody can take any money or other goods with them. Which island would be richer after 10 years? If that’s too obvious, I wonder how much more disadvantaged the richer group would need to be before the two groups, after ten years, had the same income?
Brilliantly well, and they wouldn’t even notice that they had no neurosurgeons or nuclear physicists.
Jeff Mason
3 years ago
The problem with taxing wealth is it can even more unfair than the current system. If a family owns a 1,000 acre farm, on paper they are millionaires yet farming is not a highly profitable enterprise and success from season to season is certainly NOT assured. To tax them on their ‘wealth’ would likely mean they would have to sell off some of their land every year to pay the taxman assuring them of ever shrinking ‘wealth’ and income. Likewise with homes. A retiree in New York City, London or San Francisco may own their home out right having bought it decades earlier. Due to speculation, inflation and other forces, it might be worth millions now – if they chose to sell it. Their retirement income could not possibly cover the wealth tax such a property would demand so they would be forced to sell. Kicking old people out of their home as punishment for the sin of buying in the right neighborhoods and paying their mortgage does not sound all that fair to me. I have another suggestion. Let government live within its means instead. Cut spending rather than make someone else make up the shortfall. After all, that is what the voters are expected to do.
‘Let government live within its means instead. Cut spending rather than make someone else make up the shortfall’
Yes, and i have said that many times. But it is the one option they will never consider. Thus they will keep printing and borrowing, further inflating the prices of assets and making the rich ever richer. What a sickening racket it all is.
Annette Kralendijk
3 years ago
“The logic is that wealth is idle while (earned) income is the reward for effort.”
Wealth is never idle. If it were, it would soon cease to be wealth.
“It’s certainly true that younger people today are less likely to own their homes than their parents’ generation were at the same age.”
Not so sure about that, if you are 25 or 30 today, your parents were that age in the 1980s. Do you remember what mortgage interest rates were then? Like 18%.
No, I think you’re missing something. When interest rates were high, inflation was also high. Meaning that you took out a crippling mortgage and after about 5 years it wasn’t crippling any more. Wages grew steadily every year and the government tried to put a cap on salary rises – which is when the idea of company cars came in.
It is more difficult to buy a house today, if not only because you can’t expect to get a job for life to guarantee that your mortgage would be repaid. Teachers being the exception of course.
No one has a job for life guaranteed. No one had that in the 1980s either. That’s why you have to buy mortgage insurance unless you have a 20% down payment.
It’s not more difficult to buy a house today, you just can’t buy the same house you grew up in, you have to start small. Plenty of young people buy homes, even people in their 20s.
Young people were not buying huge houses in the city in the 80s but today they expect to and are disappointed if they can’t. Well, guess what, your parents didn’t do that either. They bought a two bedroom house, usually with one bathroom.
Moreover, in addition to the good point made by Chris Wheatley, sky-high interest rates in a sense helped to keep overall property prices low. (Of course, the people who benefited most of all from this setup were people who could afford to buy outright).
Anyway, it’s odd to write “not so sure about that” when the statistics exist to back up the claim.
On the contrary, real estate prices soared in the 1980s and 90s. If you bought a house in 1980 and you still own it, you’re likely sitting on a gold mine.
Well, I guess I’m not sure about it because young people are buying houses. They just aren’t buying houses like the ones they grew up in. But then their parents didn’t do that either.
In addition, you seem to be assuming that cost is the only reason a millennial would not own a home today. It isn’t. Millennials are delaying marriage and having children. How many people in their 60s today would have wanted to live with their parents at 25 or 30? Most boomers were married by then and had two incomes and maybe a kid or two. Today, lots of well paid 30 year olds are single and live with mom and dad. Wouldn’t be for me, nor would my parents have expected me to do that or liked it if I did, but millennials seem to like the amenities at home. We were expected to clear out after college. Not so today.
Another reason, millennials may not buy a house is that they are more mobile than previous generations. Unmarried and childless they pick up and move at the drop of a hat. And they like to live in big cities where prices are higher. They could move to the suburbs and buy but they want to live in the city. I have a niece who lives in NYC in what looks like a large closet to me but hey, she likes living there. She could afford a house, but not in NYC. Neither could most boomers.
My point is that the assumption that it is real estate prices primarily that keep younger people from buying homes is not accurate.
You think young people choose to live with their parents throughout their 20s and 30s? None of the ones I’ve ever met seem to value getting their laundry done over their sexual and emotional independence. Property prices are clearly the driver in preventing young people from achieving what previous generations saw as a consequence of full-time work: property ownership.
Wealth isn’t income though. You can have one and not the other, both ways actually.
Mark H
3 years ago
A fair chunk of the excess wealth ends up funding government debts, when it is invested in government bonds. The sheer amount of money available to be invested in bonds means governments can currently pay very little interest on the money they borrow.
Michael Dawson
3 years ago
I’m not in favour of high government spending, but there are things the state must fund, so taxation is unavoidable. I suspect, though, that a lot of people who complain about how the rich don’t pay enough tax do not appreciate how redistributive the tax system actually is. It’s also obvious that the UK tax code is far too complex – something accelerated under the baleful gaze of Gordon Brown, but which none of his successors seems to have done anything to stop, let alone reverse. The upshot is a perception that a lot of businesses and individuals ‘exploit’ the system and do not pay the tax they should. So I’d favour an open system where anyone who completes a self-assessment form will have their income, ‘tax paid’ and various exemptions published online, for anyone to see. This will show how much most higher earners do pay and apply some social pressure on the rest not to look for loopholes that they cannot justify when they are made public – yes, you Jimmy Carr. It should go without saying that the whole system should be hugely simplified over 2-3 years as well.
stephen f.
3 years ago
The “Robber Baron” industrialists were not idle-their children were-give the silicon valley zillionare children a little time…
nic.ekomi
3 years ago
Just a question – that I am hoping a genuine statistician / mathematician, can answer? If all the wealth of every adult – land, property, savings, investments, income, all revenue streams – within the UK, were to be divided up purely on mathematical grounds – what would that figure be per head of adult population? Has anyone ever put in the resource to accurately assess and calculate such an equation?
Yet, we do the math and we hear of Amazon paying 11.4m in tax, versus a 5.3billion profit. We hear of its owner, who’s personal fortune rose by 74billion in 2020, as effectively his ‘shop’ became the only one open. 2020, a year where in one single day, Jeff made personally, 13.4billiion. Let that figure sink in, 13.4b in-a-day!
is it time to tax, or put another way, physically take savings, assets back – directly by central govt and redistribute? Or, is that figure I asked to be calculated, so low, why bother?
I think it highlights that we need the facts first – at least the math, and not some fabricated £350m payment to the EU a week propaganda math either – but, an accurate calculation from our finest mathematicians in whatever academic institution they reside. Notice, no Oxbridge bias.
Life is unfair and heavily weighted towards the ‘advantaged’- so why not just ‘take back’ – directly / indirectly – no matter how unfair? Working forty hours a week for £8 plus change is grossly insulting and unfair, not being able to feed your children is unfair; so why not strip, reset and redistribute?
Volvo announce today all car sales to go online only. Ubers defeat in the Supreme Court will only accelerate their ambitions to flood the UK with autonomous vehicles. Soon many will be paid ‘not-to-work’ rather than work. The poor will be paid to stand idle, while the rich play in that dreadful stereotypical dystopian world of – work hard; play hard – and all that misery to society and personal relationships it ultimately brings? Or are the dispossessed, inadequate and poor simply jealous? Whatever, it feels as though the status-quo in this small island of ours, is about to shaken, and profusely shaken at that.
Basil Chamberlain
3 years ago
“It’s certainly true that younger people today are less likely to own their homes than their parents’ generation were at the same age. Furthermore, their employment opportunities are more concentrated in fewer, pricier locations. Thus, every month, they lose what’s left of their salaries (after tax and loan repayments) to their landlords.”
How about the government establishes a provisional tax rebate for renters? A certain proportion of the tax take from renting households could be set aside in a specific, separate fund. Renters would be able to reclaim their contribution for the purpose of putting a deposit down on a mortgage. If they don’t do so, the money could eventually be released for other uses – perhaps most logically to support the building of council houses.
I kind of thought it was in the spirit of Thatcher’s policy of selling off council houses – i.e., encouraging home ownership (and indirectly encouraging people to hold down a job, since that’s a precondition of mortgage approval) – it is a policy that would encourage responsibility and give currently frustrated and disaffected people a stake in society. It is a thoroughly conservative policy!
Actually I think my generation (early forties) had it much better than the youth of today; and probably those twenty years older than me had it better than I do.
I was a great supporter of Lady T’s “Right to buy” initiative, proper ‘blue sky thinking’, and even now one can feel the political tsunami it caused.
However eventually the Electorate forgot, and invited the Blair creature to wreck the country, which he and his toadies duly did.
The problem was and still is that 93% of our children are State Educated, which means they are subjected to a relentless torrent of pseudo marxist drivel from almost the moment they draw breath, thus negating much of Lady T’s ideological message. How often do hear people ejaculate the expression “that woman!”.
So please forgive my cynicism but I see no solution to the housing famine until there is a massive revaluation of property and land prices generally.
You maybe right about your halcyon youth, although I would contend that the 50’s with the ‘Atlantic Coast Express’, Enid Blyton, the opening of the MI, the Comet 4B, and countless other goodies, such as complete, semi feral, childhood, was an epic time to be alive.
Ah yes, the death of Crassus! Could a contemporary audience watch that on film? I think not. Epic in every way, so apposite as be untrue perhaps? However Cassius Dio, Plutarch and Floras paint such a convincing picture it must be true. What great days those must have been, and sadly we will not see them again.
So “what tale shall serve me, here among, mine angry and defrauded young?”
Oh Christ that sexually neurotic Semitic Censor is at work again! I shall try to a amend the text and expunge the ‘offensive word’. God’s teeth this is so tedious!
I was a great supporter of Lady T’s “Right to buy” initiative, proper ‘blue sky thinking’, and even now one can feel the political tsunami it caused. However eventually the Electorate forgot, and invited the Blair creature to wreck the country, which he and his toadies duly did. The problem was and still is that 93% of our children are State Educated, which means they are subjected to a relentless torrent of pseudo marxist drivel from almost the moment they draw breath, thus negating much of Lady T’s ideological message. How often do hear people ej*culat* the expression “that woman!”. So please forgive my cynicism but I see no solution to the housing famine until there is a massive revaluation of property and land prices generally. You maybe right about your halcyon youth, although I would contend that the 50’s with the ‘Atlantic Coast Express’, Enid Blyton, the opening of the MI, the Comet 4B, and countless other goodies, such as complete, semi feral, childhood, was an epic time to be alive. Ah yes, the death of Crassus! Could a contemporary audience watch that on film? I think not. Epic in every way, so apposite as to be untrue perhaps? However Cassius Dio, Plutarch and Floras paint such a convincing picture it must be true. What great days those must have been, and sadly we will not see them again.
So “what tale shall serve me, here among, mine angry and defrauded young?
You just described my childhood! And with parents who had absolutely no desire to play with us or, worse, oversee our every move. And, as children, we would have been horrified if they did.
Well, I think my take on this is that the selling off of council houses was that relatively rare thing under the Thatcherite dispensation: a policy designed to stabilise. On the other hand, the lady abandoned what had been a central concern of governments right and left since 1945: pursuing policies conducive to full employment – and that, surely, was dangerously destabilising.
In a sense, wasn’t Blair the inevitable result of her success? She appeared to have won the economic argument so conclusively that electoral democracy necessarily shifted towards social concerns.
The 1990s didn’t seem like an amazing time to be young as I was living through it, but in retrospect it glows, and not just, I think, with a nostalgic light. But I confess I envy you your 1950s youth!
40% of Right to Buy properties are now owned by private landlords. Thatcher’s RTB policy was an excellent mechanism for transferring state wealth into the hands of property speculators.
How about the government establishes a provisional tax rebate for renters? How about no. Govt has done quite enough social engineering as it is, well beyond its purview.
Cathy Carron
3 years ago
Taxing wealth is unconstitutional is the USA, not to mention it’s just obviously impracticable.
G Harris
3 years ago
It might seem like a quibble but it is more of an aside.
I can see why the myth persists, not least because governments the world over have an active interest in propagating it, but our taxes don’t actually ‘pay’ for anything, much as most of us are led and choose to believe.
This is because it ‘makes sense’ to us, or most of us anyway, that the state is undertaking the act of effectively making us poorer through taxation for the greater good ie using ‘our’ hard earned money to pay for stuff.
The fact of the matter is is that the money we pay in taxes to our government revenue services essentially ceases to exist once paid. It is no more. Fin.
Its function, very basically, is to create the space for further money creation by the state as without it countries that fail to diligently tax and continue to create more and more of their own money regardless essentially become Weimar Germany, Venezuela, Zimbabwe or the like.
Fred Atkinstalk
3 years ago
The basic premise of the article is that the “wealthy” work harder than ordinary folks, and are therefore not just more successful, but by implication more virtuous and all-round better people. This is just not true.
The wealthy need work to keep them engaged and entertained (who would really want their life to be an endless round of parties in Monaco?) but work for them is both qualitatively and quantatively different from what most of us do, not least because they do it because they don’t need to. They could give up and not be on the breadline.
They often have several projects on the go : I once worked for (definitely ‘for’ not ‘with’) someone who combined several directorships with running an estate of several thousand acres. Did he spend a lot of time on his various activities (and his high-level social life)? Yes, he did. But was it actually work? No, I don’t think so. All he actually did was point his minions in the direction to go, and they did the work. We worked : he led a fulfilling life.
The royals are a good example. We are fed the myth that the queen works really hard, and never has a holiday. What would she do if she did not have ‘royal duties?’ Scrub the steps at Sandringham and spend the afternoons reading the “People’s Friend’? And as for holidays, what about the months off at Balmoral (not to mention the private holidays on friends’ estates?)
The myth is that our betters earn their privileges by good old-fashioned graft. What they do is less onerous and much more fulfilling than having a job, or working for a living. They probably achieve more, but then they have ‘people’ to do things for them.
Spot on. But the wealthy love to maintain the myth that have accrued their lucre through their own innate brilliance, rather than acknowledge that the system is rigged in their favour. Points to a fairly common human need to establish oneself in one’s own mind as superior to the hoi polloi.
Terence Fitch
3 years ago
Some of the poor think others should pay for them but some of the rich forget that their wealth depends on public roads etc. Don’t forget the vast public investment in the US via WW2 and NASA and defence which practically bankrolled fundamental technology advances entrepreneurs used.
This essay, to my mind, wanders round the key factor near the heart of today’s wealth gap, instead of stating it.
There has been a (far from fully conscious?) accretion of all forms of worldly power, over the past 30 years, which has effectually achieved a sort of Grand Coup d’Etat throughout the western world – the countries which are developed-economy democracies of the kind that we have in the United Kingdom.
The Political Left has reaped the harvest of spending the past 60 years marching through all institutions, taking them over and all but monopolising public discourse too; while Big Money (large, rather than middling or small, commercial enterprises; large inherited fortunes; large stolen ones [e.g. Russian oligarchs, Chinese nomenklatura]), has learned to kowtow to the Left so as to keep enhancing its fortunes.
Among other monopolies achieved, they twain have taken over most broadcasting and anything from half to all of the press in such lands as ours.
Practically anybody with any actual POWER now conspires, deliberately or otherwise, to maintain the status quo: one in which assets grow and grow in value, the working and middle classes are ever more pushed toward serf status (as in a feudal regime), and wealth is stripped out of each economy and relocated in the possession of the political and commercial and economic movers and shakers.
It is all a mad programme, which eventually will eat up its very proponents, as did the French and Russian Revolutions. But they do not see this because they spend their whole lives living from day to day and not thinking about what their own policies mean tomorrow: the very nature of Avarice as of all Sin.
The fact of the matter is: when you are rich beyond a certain point, you do not have to work, because the return on your invested capital will cover both an increase in your wealth and your consumption and any measly “wealth tax”. That some wealthy people choose to work a lot is not really that relevant, and unless you are a corporate high-flyer, it’s not really your salaries that are growing your wealth, also these people are often compensated by stock options and bonuses, which is essentially not a “wage” in the classical sense and rather tied to the development of a financial instrument (the stock in the company). And besides, these jobs are usually quite rare, and are reserved for those who are essentially already “in” the boys club. Wealth grows itself once you have enough of it.
If you assume even a relatively “low” wealth of 10 million pounds, you could put this money into well diversified index-funds and still earn at least 5% or 500.000 pounds every year, without even lifting a finger. If you spend some of your money to have it managed, or get some of your rich buddies to give you some “investment advice” (AKA insider trading) you could probably do a lot better. You could invest in land, buidlings or whatever, you would have to almost try hard to lose wealth once aquired at a certain level.
Fact of the matter is, the real production of both intellectual and physical goods is done by wage slave average Joe’s around the world – it’s their labor that forms the basis of all the good fortune of companies and other ways of accumulating wealth.
Do a simple thought experiment: if the working classes (the bottom 90%) all disappeared tomorrow, what would the elite do? We’re not yet at a stage where work is fully automated. Everything would stop, literally nothing would be produced. Can’t “manage” your way to farm production. Or goods. Can’t “CEO” over nothing. The top 10% would starve to death or have to start doing some of the basic work themselves 🙂
Another thought experiment would be to put the richest 10% on one desert island and the poorest 10% on another. All else is equal, but nobody can take any money or other goods with them. Which island would be richer after 10 years? If that’s too obvious, I wonder how much more disadvantaged the richer group would need to be before the two groups, after ten years, had the same income?
How would a third island populated by artisans, mechanics, fishermen and farmers work out?
Brilliantly well, and they wouldn’t even notice that they had no neurosurgeons or nuclear physicists.
The problem with taxing wealth is it can even more unfair than the current system. If a family owns a 1,000 acre farm, on paper they are millionaires yet farming is not a highly profitable enterprise and success from season to season is certainly NOT assured. To tax them on their ‘wealth’ would likely mean they would have to sell off some of their land every year to pay the taxman assuring them of ever shrinking ‘wealth’ and income. Likewise with homes. A retiree in New York City, London or San Francisco may own their home out right having bought it decades earlier. Due to speculation, inflation and other forces, it might be worth millions now – if they chose to sell it. Their retirement income could not possibly cover the wealth tax such a property would demand so they would be forced to sell. Kicking old people out of their home as punishment for the sin of buying in the right neighborhoods and paying their mortgage does not sound all that fair to me. I have another suggestion. Let government live within its means instead. Cut spending rather than make someone else make up the shortfall. After all, that is what the voters are expected to do.
‘Let government live within its means instead. Cut spending rather than make someone else make up the shortfall’
Yes, and i have said that many times. But it is the one option they will never consider. Thus they will keep printing and borrowing, further inflating the prices of assets and making the rich ever richer. What a sickening racket it all is.
“The logic is that wealth is idle while (earned) income is the reward for effort.”
Wealth is never idle. If it were, it would soon cease to be wealth.
“It’s certainly true that younger people today are less likely to own their homes than their parents’ generation were at the same age.”
Not so sure about that, if you are 25 or 30 today, your parents were that age in the 1980s. Do you remember what mortgage interest rates were then? Like 18%.
No, I think you’re missing something. When interest rates were high, inflation was also high. Meaning that you took out a crippling mortgage and after about 5 years it wasn’t crippling any more. Wages grew steadily every year and the government tried to put a cap on salary rises – which is when the idea of company cars came in.
It is more difficult to buy a house today, if not only because you can’t expect to get a job for life to guarantee that your mortgage would be repaid. Teachers being the exception of course.
No one has a job for life guaranteed. No one had that in the 1980s either. That’s why you have to buy mortgage insurance unless you have a 20% down payment.
It’s not more difficult to buy a house today, you just can’t buy the same house you grew up in, you have to start small. Plenty of young people buy homes, even people in their 20s.
Young people were not buying huge houses in the city in the 80s but today they expect to and are disappointed if they can’t. Well, guess what, your parents didn’t do that either. They bought a two bedroom house, usually with one bathroom.
Jobs for life disappeared in the 1970s….
Moreover, in addition to the good point made by Chris Wheatley, sky-high interest rates in a sense helped to keep overall property prices low. (Of course, the people who benefited most of all from this setup were people who could afford to buy outright).
Anyway, it’s odd to write “not so sure about that” when the statistics exist to back up the claim.
On the contrary, real estate prices soared in the 1980s and 90s. If you bought a house in 1980 and you still own it, you’re likely sitting on a gold mine.
Well, I guess I’m not sure about it because young people are buying houses. They just aren’t buying houses like the ones they grew up in. But then their parents didn’t do that either.
In addition, you seem to be assuming that cost is the only reason a millennial would not own a home today. It isn’t. Millennials are delaying marriage and having children. How many people in their 60s today would have wanted to live with their parents at 25 or 30? Most boomers were married by then and had two incomes and maybe a kid or two. Today, lots of well paid 30 year olds are single and live with mom and dad. Wouldn’t be for me, nor would my parents have expected me to do that or liked it if I did, but millennials seem to like the amenities at home. We were expected to clear out after college. Not so today.
Another reason, millennials may not buy a house is that they are more mobile than previous generations. Unmarried and childless they pick up and move at the drop of a hat. And they like to live in big cities where prices are higher. They could move to the suburbs and buy but they want to live in the city. I have a niece who lives in NYC in what looks like a large closet to me but hey, she likes living there. She could afford a house, but not in NYC. Neither could most boomers.
My point is that the assumption that it is real estate prices primarily that keep younger people from buying homes is not accurate.
You think young people choose to live with their parents throughout their 20s and 30s? None of the ones I’ve ever met seem to value getting their laundry done over their sexual and emotional independence. Property prices are clearly the driver in preventing young people from achieving what previous generations saw as a consequence of full-time work: property ownership.
Wealth is never idle perhaps a better way to look at it is the concept of “horizontal income” ie income you derive even when horizontal ie sleeping.
Wealth isn’t income though. You can have one and not the other, both ways actually.
A fair chunk of the excess wealth ends up funding government debts, when it is invested in government bonds. The sheer amount of money available to be invested in bonds means governments can currently pay very little interest on the money they borrow.
I’m not in favour of high government spending, but there are things the state must fund, so taxation is unavoidable. I suspect, though, that a lot of people who complain about how the rich don’t pay enough tax do not appreciate how redistributive the tax system actually is. It’s also obvious that the UK tax code is far too complex – something accelerated under the baleful gaze of Gordon Brown, but which none of his successors seems to have done anything to stop, let alone reverse. The upshot is a perception that a lot of businesses and individuals ‘exploit’ the system and do not pay the tax they should. So I’d favour an open system where anyone who completes a self-assessment form will have their income, ‘tax paid’ and various exemptions published online, for anyone to see. This will show how much most higher earners do pay and apply some social pressure on the rest not to look for loopholes that they cannot justify when they are made public – yes, you Jimmy Carr. It should go without saying that the whole system should be hugely simplified over 2-3 years as well.
The “Robber Baron” industrialists were not idle-their children were-give the silicon valley zillionare children a little time…
Just a question – that I am hoping a genuine statistician / mathematician, can answer? If all the wealth of every adult – land, property, savings, investments, income, all revenue streams – within the UK, were to be divided up purely on mathematical grounds – what would that figure be per head of adult population? Has anyone ever put in the resource to accurately assess and calculate such an equation?
Yet, we do the math and we hear of Amazon paying 11.4m in tax, versus a 5.3billion profit. We hear of its owner, who’s personal fortune rose by 74billion in 2020, as effectively his ‘shop’ became the only one open. 2020, a year where in one single day, Jeff made personally, 13.4billiion. Let that figure sink in, 13.4b in-a-day!
is it time to tax, or put another way, physically take savings, assets back – directly by central govt and redistribute? Or, is that figure I asked to be calculated, so low, why bother?
I think it highlights that we need the facts first – at least the math, and not some fabricated £350m payment to the EU a week propaganda math either – but, an accurate calculation from our finest mathematicians in whatever academic institution they reside. Notice, no Oxbridge bias.
Life is unfair and heavily weighted towards the ‘advantaged’- so why not just ‘take back’ – directly / indirectly – no matter how unfair? Working forty hours a week for £8 plus change is grossly insulting and unfair, not being able to feed your children is unfair; so why not strip, reset and redistribute?
Volvo announce today all car sales to go online only. Ubers defeat in the Supreme Court will only accelerate their ambitions to flood the UK with autonomous vehicles. Soon many will be paid ‘not-to-work’ rather than work. The poor will be paid to stand idle, while the rich play in that dreadful stereotypical dystopian world of – work hard; play hard – and all that misery to society and personal relationships it ultimately brings? Or are the dispossessed, inadequate and poor simply jealous? Whatever, it feels as though the status-quo in this small island of ours, is about to shaken, and profusely shaken at that.
“It’s certainly true that younger people today are less likely to own their homes than their parents’ generation were at the same age. Furthermore, their employment opportunities are more concentrated in fewer, pricier locations. Thus, every month, they lose what’s left of their salaries (after tax and loan repayments) to their landlords.”
How about the government establishes a provisional tax rebate for renters? A certain proportion of the tax take from renting households could be set aside in a specific, separate fund. Renters would be able to reclaim their contribution for the purpose of putting a deposit down on a mortgage. If they don’t do so, the money could eventually be released for other uses – perhaps most logically to support the building of council houses.
Subsidising the unfortunate/hopeless?
That’s hardly in the spirit of that noble Roman, Marcus Licinius Crassus is it?
Frankly, to plagiarise ‘Mad Mac’ the young “have never had it so good”!
Paradoxically their obsession with supporting the current draconian Lockdown Progrom of Obersturmbannführer Hancock will be the ruin of many of them.
“Much learning does not teach understanding.” Heraclitus.
Well done, the road to recovery beckons.
I kind of thought it was in the spirit of Thatcher’s policy of selling off council houses – i.e., encouraging home ownership (and indirectly encouraging people to hold down a job, since that’s a precondition of mortgage approval) – it is a policy that would encourage responsibility and give currently frustrated and disaffected people a stake in society. It is a thoroughly conservative policy!
Actually I think my generation (early forties) had it much better than the youth of today; and probably those twenty years older than me had it better than I do.
We know what happened to Crassus in the end!
I was a great supporter of Lady T’s “Right to buy” initiative, proper ‘blue sky thinking’, and even now one can feel the political tsunami it caused.
However eventually the Electorate forgot, and invited the Blair creature to wreck the country, which he and his toadies duly did.
The problem was and still is that 93% of our children are State Educated, which means they are subjected to a relentless torrent of pseudo marxist drivel from almost the moment they draw breath, thus negating much of Lady T’s ideological message. How often do hear people ejaculate the expression “that woman!”.
So please forgive my cynicism but I see no solution to the housing famine until there is a massive revaluation of property and land prices generally.
You maybe right about your halcyon youth, although I would contend that the 50’s with the ‘Atlantic Coast Express’, Enid Blyton, the opening of the MI, the Comet 4B, and countless other goodies, such as complete, semi feral, childhood, was an epic time to be alive.
Ah yes, the death of Crassus! Could a contemporary audience watch that on film? I think not. Epic in every way, so apposite as be untrue perhaps?
However Cassius Dio, Plutarch and Floras paint such a convincing picture it must be true. What great days those must have been, and sadly we will not see them again.
So “what tale shall serve me, here among, mine angry and defrauded young?”
Oh Christ that sexually neurotic Semitic Censor is at work again! I shall try to a amend the text and expunge the ‘offensive word’. God’s teeth this is so tedious!
I was a great supporter of Lady T’s “Right to buy” initiative, proper ‘blue sky thinking’, and even now one can feel the political tsunami it caused.
However eventually the Electorate forgot, and invited the Blair creature to wreck the country, which he and his toadies duly did.
The problem was and still is that 93% of our children are State Educated, which means they are subjected to a relentless torrent of pseudo marxist drivel from almost the moment they draw breath, thus negating much of Lady T’s ideological message. How often do hear people ej*culat* the expression “that woman!”.
So please forgive my cynicism but I see no solution to the housing famine until there is a massive revaluation of property and land prices generally.
You maybe right about your halcyon youth, although I would contend that the 50’s with the ‘Atlantic Coast Express’, Enid Blyton, the opening of the MI, the Comet 4B, and countless other goodies, such as complete, semi feral, childhood, was an epic time to be alive.
Ah yes, the death of Crassus! Could a contemporary audience watch that on film? I think not. Epic in every way, so apposite as to be untrue perhaps?
However Cassius Dio, Plutarch and Floras paint such a convincing picture it must be true. What great days those must have been, and sadly we will not see them again.
So “what tale shall serve me, here among, mine angry and defrauded young?
You just described my childhood! And with parents who had absolutely no desire to play with us or, worse, oversee our every move. And, as children, we would have been horrified if they did.
Well, I think my take on this is that the selling off of council houses was that relatively rare thing under the Thatcherite dispensation: a policy designed to stabilise. On the other hand, the lady abandoned what had been a central concern of governments right and left since 1945: pursuing policies conducive to full employment – and that, surely, was dangerously destabilising.
In a sense, wasn’t Blair the inevitable result of her success? She appeared to have won the economic argument so conclusively that electoral democracy necessarily shifted towards social concerns.
The 1990s didn’t seem like an amazing time to be young as I was living through it, but in retrospect it glows, and not just, I think, with a nostalgic light. But I confess I envy you your 1950s youth!
40% of Right to Buy properties are now owned by private landlords. Thatcher’s RTB policy was an excellent mechanism for transferring state wealth into the hands of property speculators.
How about the government establishes a provisional tax rebate for renters?
How about no. Govt has done quite enough social engineering as it is, well beyond its purview.
Taxing wealth is unconstitutional is the USA, not to mention it’s just obviously impracticable.
It might seem like a quibble but it is more of an aside.
I can see why the myth persists, not least because governments the world over have an active interest in propagating it, but our taxes don’t actually ‘pay’ for anything, much as most of us are led and choose to believe.
This is because it ‘makes sense’ to us, or most of us anyway, that the state is undertaking the act of effectively making us poorer through taxation for the greater good ie using ‘our’ hard earned money to pay for stuff.
The fact of the matter is is that the money we pay in taxes to our government revenue services essentially ceases to exist once paid. It is no more. Fin.
Its function, very basically, is to create the space for further money creation by the state as without it countries that fail to diligently tax and continue to create more and more of their own money regardless essentially become Weimar Germany, Venezuela, Zimbabwe or the like.
The basic premise of the article is that the “wealthy” work harder than ordinary folks, and are therefore not just more successful, but by implication more virtuous and all-round better people. This is just not true.
The wealthy need work to keep them engaged and entertained (who would really want their life to be an endless round of parties in Monaco?) but work for them is both qualitatively and quantatively different from what most of us do, not least because they do it because they don’t need to. They could give up and not be on the breadline.
They often have several projects on the go : I once worked for (definitely ‘for’ not ‘with’) someone who combined several directorships with running an estate of several thousand acres. Did he spend a lot of time on his various activities (and his high-level social life)? Yes, he did. But was it actually work? No, I don’t think so. All he actually did was point his minions in the direction to go, and they did the work. We worked : he led a fulfilling life.
The royals are a good example. We are fed the myth that the queen works really hard, and never has a holiday. What would she do if she did not have ‘royal duties?’ Scrub the steps at Sandringham and spend the afternoons reading the “People’s Friend’? And as for holidays, what about the months off at Balmoral (not to mention the private holidays on friends’ estates?)
The myth is that our betters earn their privileges by good old-fashioned graft. What they do is less onerous and much more fulfilling than having a job, or working for a living. They probably achieve more, but then they have ‘people’ to do things for them.
Spot on. But the wealthy love to maintain the myth that have accrued their lucre through their own innate brilliance, rather than acknowledge that the system is rigged in their favour. Points to a fairly common human need to establish oneself in one’s own mind as superior to the hoi polloi.
Some of the poor think others should pay for them but some of the rich forget that their wealth depends on public roads etc. Don’t forget the vast public investment in the US via WW2 and NASA and defence which practically bankrolled fundamental technology advances entrepreneurs used.