by Peter Franklin
Tuesday, 17
November 2020
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The real problem with Marcus Rashford’s property portfolio

The footballer is hardly alone in owning multiple houses
by Peter Franklin
What’s so newsworthy about someone investing the proceeds of their own talent in bricks-and-mortar?

The Mail on Sunday “can reveal” that “campaigning football star Marcus Rashford has bought five luxury homes worth more than £2million.”

There was no direct allegation of hypocrisy in the article, but it has annoyed a lot of people — not least Mr Rashford himself:

It’s easy to see why he and his many fans are upset. For a start, why pick on someone who’s done so much to help others lately? Why attach the label “luxury” to a portfolio of obviously non-palatial properties? And what’s so newsworthy about someone investing the proceeds of their own talent in bricks-and-mortar? As Chris Cook tweeted, a fairer title for the piece might have been “man with proven track record for being quite responsible invests in reliable asset class.”

The UK has more than 2.5 million landlords, of which about 150,000 own multiple properties. Something like a fifth of MPs have invested in buy-to-let. Therefore Marcus Rashford is hardly alone.

That, however, is the problem. When homes become a mass investment product, money floods into the property market pushing up prices and rents. That’s good for those who already own their homes and even better for those who also own other people’s homes, but it’s a disaster for those who can’t get onto the housing ladder.

It also pushes up the price of land on which new social housing could be built.

In his 2013 book Capital in the Twenty-First Century, Thomas Piketty argues that we can expect ever greater levels of inequality because, over time, the rate of return to capital (which, by definition, is owned by the wealthy) is greater than overall economic growth. Thus if an ever increasing share of national income is going to capital, that means an ever decreasing share for everything else, including wages. Inevitably the rich will get richer and the poor poorer. However, as another economist, Matthew Rognlie, points out, the increase in the share going to capital is mostly or entirely accounted for by one kind of wealth — property.

Therefore, while measures like free school meals help people in need, they don’t tackle the underlying causes of inequality. For that we must de-privilege the position of the rentier class in the tax and planning systems.

Economists and other wonkish types have been making this argument for years — in fact, decades. Unfortunately, though, we’ve made little headway. To achieve a breakthrough, what we need a truly gifted campaigner.

Anyone come to mind?

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Andrew Harvey
Andrew Harvey
2 years ago

Grandstanding about poverty and using a multi-million pound PR campaign to force the government into bad policy decisions is not “helping others”.

David X
David X
2 years ago
Reply to  Andrew Harvey

Getting issues raised as a result of your personality status does not equate to a multi-million pound PR campaign. Rashford has become wealthy as a result of his particular sporting ability but the success of his campaign – and why it is not grandstanding – is because he lived that life of poverty on free school meals while growing up. It might be instructive for you to learn more about him before making similar crass comments in future – whatever your view might be of the government response to the isssue

Andrew Harvey
Andrew Harvey
2 years ago
Reply to  David X

I grew up with free school meals, thanks.

When you hire a PR firm, it’s a PR campaign.

Alex Lekas
Alex Lekas
2 years ago
Reply to  Andrew Harvey

Sports is full of players who made millions and lost it all. But, sure; let’s take shots at a 23 year old who gets that football is not a permanent vocation, and who chooses to invest in appreciable assets rather than hookers and blow.

Derek M
Derek M
2 years ago
Reply to  Alex Lekas

If he was just doing that no one would be taking ‘shots’ at him. It’s the juxtaposition of his own wealth while he is using it and his fame as a platform to spend other peoples’ money on his pet causes

Terry Mushroom
Terry Mushroom
2 years ago
Reply to  Alex Lekas

Professional soccer is a vocation?

It’s ruthless big business misusing a great game for greed and ego. It rips off supporters without conscience or morality.

Terry Mushroom
Terry Mushroom
2 years ago
Reply to  David X

Rashford kicks a ball about for a living. Nothing wrong with that. But he earns more in a week than many do in years in their work of caring for others.

He doesn’t need all that money. I’d be impressed if he invested a great deal of it for the direct benefit of the youngsters he says he cares about.

And called for football’s profiteers to do likewise. Not the clubs doing it as as PR exercise. I mean spending from their personal fortunes.

Gary Lineker is paid a great deal for talking about others doing it. For reasons I don’t understand, some think that this gives him a privileged platform for his politics. He certainly has huge self importance.

I’m not envious of his or Rashford’s wealth. I just don’t get the importance attached to these people for, in the scale of things, doing so very little.

People rightly get enormous pleasure from watching football. But more people go fishing.

I support the right to private property. But the owners have a duty to others. And a starving man taking bread from a rich man isn’t stealing. He’s taking what is his by right.

(Edited)

Arnold Grutt
Arnold Grutt
2 years ago
Reply to  Terry Mushroom

No, he is stealing, but most realms recognize that exceptional circumstances deserve exceptional treatment. However there is a danger in this: that others take advantage of a pretended exceptional circumstance to institute a norm. A positive right to steal could never be allowed. This can be summed up as the exercise of ‘mercy’.

Maggi Wilson
Maggi Wilson
2 years ago

Owning a second property does not make one ‘wealthy’. Many people are 2nd home owners cos they can’t sell a property, so rent it out. I do have one property which provides me with a pension. I have spent over 5K this year upgrding and maintaining to keep house at level I would want to live in. Lets stop this assumption that all landlords bad and ripping off tenants.

Aaron Kevali
Aaron Kevali
2 years ago
Reply to  Maggi Wilson

Get her comrades! An oppressor and enemy of the people 😉

But seriously you are correct.

Nick Whitehouse
Nick Whitehouse
2 years ago

In other words, you think that a rich man managing to spend other peoples money (AKA the taxpayer) on other people makes a rich man good.
If he had spent his own money that would indeed be worthy.

Richard Slack
Richard Slack
2 years ago

your words were as I predicted above!

Derek M
Derek M
2 years ago
Reply to  Richard Slack

That doesn’t make them any less correct

Ethniciodo Rodenydo
Ethniciodo Rodenydo
2 years ago

Because of his celebrity Mr Rashford’s view carry far more weight and get far more coverage than they merit, and a weak government is seen to bend and grovel not because of the strength of the argument but out of fear of another round of adverse publicity.

It is all to easy for wealthy celebrities to gather plaudits for taking on soft targets and they understand this. I doubt that any of those who have applauded Mr Rashford would have been nearly so keen if he had taken a more controversial public stance, say, against the lockdown or gay marriage. In fact, I imagine the response would have been that footballers should be seen and not heard.

Warren Alexander
Warren Alexander
2 years ago

As bitter a pill it might be to swallow, rich people make rather good philanthropists.

Andrew Harvey
Andrew Harvey
2 years ago

Can we just be clear — HE’S NOT A PHILANTHROPIST. A philanthropist gives away his own money. Marcus Rashfordâ„¢ is perfectly entitled to give away his own money, and that would be an admirable thing to do, but he’s actually calling for higher taxes on people making far less money than he does to fund his pet projects and boost his highly profitable PR profile.

David X
David X
2 years ago

A more accurate comment might be that “SOME rich people make rather good anthropologists”. I would suggest that philanthropy doesn’t enter the mind of most of the rich – one reason why Rashford’s actions stand out. And of course it completely misses the point that philanthropy is somewhat more of a challenge for the poor. Your comment is nevertheless very revealing.

Stephen Crossley
Stephen Crossley
2 years ago
Reply to  David X

Hi David

I have had the good fortune to know a large number of wealthy people in my life. I cannot think of a single one who did not give generously to charity. Some of them in eye-watering amounts and even then known only to their family and friends.

It is an unfortunate characteristic of human nature that we tend to believe what we would prefer to be true.

Derek M
Derek M
2 years ago

A philanthropist usually uses their own money not other peoples’

Stephen Crossley
Stephen Crossley
2 years ago

The British commentariat hate Capitalism despite being the beneficiaries of it for many decades, however I can’t let this article slide without correcting some fundamental errors and language bias.

The author states that capital is “by definition, owned by the wealthy”.

As I write in 2020 a young couple on separate salaries in the low £20k’s with joint savings of between £10-20k can afford to buy a first property worth around £200k. This evil capitalist couple are apparently now “wealthy” by the author’s definition.

The phrase “the rentier class” has been slipped into common usage as a pejorative by those who think they know what is best for the common man in order to keep him or her in their place as in when the author states:

“we must de-privilege the position of the rentier class”

Notice how this phrase turns the mere act of owning an asset such as a house or a business into a class struggle designed to reignite the divisions of the past.

The main pathway to upward social mobility for many is via breaking free of the strait jacket of an hourly wage by making their hard-earned savings work for them, whether by investing in a property, business or other appreciating asset. The end game suggested in this article will result in all property being owned by financial institutions and for the man in the street renting will be the only option available.

Thank you for keeping the proles in their place. I’m sure they will appreciate it once the Great Socialist Re-education of the British public is complete.

D Ward
D Ward
2 years ago

I always thought Rentiers were those that did no work, and lived off the rents they charged their tenants? I do disagree with that.

Jeffrey Chongsathien
Jeffrey Chongsathien
2 years ago

To summarise this post “The status quo is great because everyone has strong chance to become a debt slave”

Richard Slack
Richard Slack
2 years ago

I think this article is being more generous to Rashford’s critics than they deserve. I do think that the one passage in the Bible that conservatives love is the one where the rich man is told that in order to enter the kingdom of heaven he must sell all his goods and give the money to the poor. It is also coupled with the fact that the biggest sin you can commit it seems is hypocrisy (and, as Orwell once said, being nosey). If you are very wealthy and care not one jot for poverty or injustice then that it would seem, is morally better that being fairly wealthy and being concerned about such things. There was much effort put into proving that Jeremy Corbyn was a millionaire; in fact he probably is in that anyone owning a house in that part of London and having a Final Salary pension scheme almost certainly has assets of over £1million, I may well do myself. But let us not be under any illusion, Rashford has embarassed the Government and as the role of most of the press in the UK is to criticise the Labour Party when either in opposition or Government the Mail’s offensive is sadly predictable.

However there is an intersting point made in the article, to whit that in the 1970s we were told that Taxes needed to be cut, and we were promised that if that happened 1) High earners would reduce their salary demands 2) They would pay their taxes in full and 3) a whole new world of investment and philanthropy would blossom. In fact, strikingly, none of these thngs have happened and parts of the West have seen the greatest accumulations of private wealth since the days of high colonialism and slavery with, it seems little tug of the conscience with Victorian mega-earners seemed to have.

Static capital is possibly the greatest financial risk the world faces; in 1954 President Eisenhower in the US told companies that if the didn’t invest their earnings he would tax it at 94 cents in the dollar and do it for them. He was right

Steve Gwynne
Steve Gwynne
2 years ago

End Child Poverty by driving up local house prices and rents.

I’m still waiting for this social justice campaigner to lobby for a higher wealth tax or higher capital gains taxes.

How else does he intend to end child poverty. Lobby for an increase in the minimum wage and a decrease in his own.

The fact of the matter was that his campaign was orchestrated with the full knowledge that a second lockdown was inevitable and therefore, typical of Labour these days, they preempt what is about to happen anyway and then start lobbying for it in advance.

The government simply extended support to local councils along with the programme of holiday clubs and a free meal along with all the other financial support packages but then Labour and the Woke Left hails this routine government policy as a big win for social justice.

Manufactured consent now sits alongside manufactured social justice spectacle. It was hollow before and it is hollow now.

Jeffrey Chongsathien
Jeffrey Chongsathien
2 years ago

Correct… and there’s not a single political entity willing to (let alone are capable of) make the required changes, which are 1) rationing of residences to one per household, 2) no foreign/corporate ownership of residences and 3) building of tall, high-density housing like Singapore/Tokyo/Hong Kong/Vancouver.

Alex Lekas
Alex Lekas
2 years ago

Rationing. How authoritarian of you. And building in Singapore and Hong Kong might have something to do with available land, no? Where would we be without the central planners and control freaks among us?

Alex Lekas
Alex Lekas
2 years ago

Real estate has always been an investment. Is this somehow news? Of course, the real “problem” is that there might be less social housing. By all means, let’s more of the most poorly-maintained, least cared for housing, the type of housing no one gives two cents about because no tenant has any stake in the property’s value.

Therefore, while measures like free school meals help people in need, they don’t tackle the underlying causes of inequality.
Well, no, because inequality is most often the result of individual decision making which govt is powerless to effect. You can lecture people all day long about the need to finish school, to get married before having kids, and to not run afoul of the law, but they do it anyway. To then turn around and blame their poor choices on the rest of us is offensive.

Last Jacobin
Last Jacobin
2 years ago
Reply to  Alex Lekas

So if everyone made the ‘right’ decisions then we’d eliminate most inequality? That sounds like socialism!

Though if there was no inequality what would motivate wealthy people to get wealthy? I thought that maintaining inequality was necessary in order to motivate capitalists to make money – and that’s why we shouldn’t tax them too much in case they all leave the country or give up capitalism and take a job in a bar.

Alex Lekas
Alex Lekas
2 years ago
Reply to  Last Jacobin

So if everyone made the ‘right’ decisions then we’d eliminate most inequality?
Not what I said, so why make things up? Making good choices reduces one’s chances of being in poverty which, by definition, reduces inequality. But that aside, it’s not the role of govt to produce equality of outcomes. That’s an impossibility.

I thought that maintaining inequality was necessary in order to motivate capitalists to make money
Find a new hobby; there are plenty of straw man builders as is it.

Last Jacobin
Last Jacobin
2 years ago
Reply to  Alex Lekas

‘inequality is most often the result of individual decision making’

‘if everyone made the ‘right’ decisions then we’d eliminate most inequality’

I didn’t misrepresent you.

Anakei greencloudnz
Anakei greencloudnz
2 years ago
Reply to  Last Jacobin

No. Socialism is when others make the “right” decision for you

Derek M
Derek M
2 years ago

I don’t care how many homes he has, my objection is to this individual having undue influence on government policy and how taxpayer money is spent just because he is rich and famous. I’m also getting a bit bored with his self righteous virtue signalling

Christopher Barclay
Christopher Barclay
2 years ago

Does Marcus Rashford use tax avoidance schemes to reduce the taxes he pays the Government? If not, then he is no hypocrite. If he does, then he is hypocrite.

Wulvis Perveravsson
Wulvis Perveravsson
2 years ago

The problem with highly-paid sports people is that their financial decisions are generally either (a) made by others who in turn make money out of said sports person’s wealth, or (b) made personally and heavily influenced by whatever their peers are doing or have done. The problem, really, is that they can’t just be content with their already substantial wages, get on with doing what they do best, and instruct the ‘representatives’ clamouring to make a killing from them to b****r off. It’s not like top-flight footballers have to buy a pub to make ends meet when they retire from the game anymore.

A classic example is the recently concluded legal battle between Lewis Hamilton and the Swiss watch maker Hamilton over the rights to use that name, which thankfully the F1 driver lost. I cannot for the life of me fathom how anyone, however over-inflated their ego, would think it their right to copyright their exceedingly common surname merely by virtue of being famous. No doubt it was LH’s ‘business associates’ pushing for this, and not the man himself.

shinybeast1
shinybeast1
2 years ago

If you are rich they won’t let you get away with speaking up for the poor. They’ll call you a Champaign socialist or whatever. If you are poor, they’ll say you are just lazy and jealous . That is the set narrative and they use it as a battering ram every single time.

Aaron Kevali
Aaron Kevali
2 years ago
Reply to  shinybeast1

Perhaps the answer is to actually preach from a postion of genuine saintliness? To actually give up one’s wealth in a miracle of grace and work in a soup kitchen and follow the Lord utterly… But that sounds hard and we don’t really believe in God that much anyways.