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Daily Maverick
2 days ago
- Politics
- Daily Maverick
‘Extreme wealth corrodes democracy' — making the case for a maximum wealth limit
'The challenge is not just that we're seeing large and increasing inequalities across the world. The challenge is that there is a well-connected group of people who are actively rigging the political rules in order to grow the capital they already have.' Think about these facts for a moment. There are slightly more than 3,000 billionaires in the world and it is expected that we are only a few years away from the world's first trillionaire. Between 1989 and 2018 this top 1% grew their wealth from $8.4-trillion to $29.5-trillion, while the bottom 50% incurred a net loss of wealth of $900-billion. On the other hand, according to new calculations from the World Bank, there are more than 808 million people worldwide living in extreme poverty – that is less than $3 per day. Thirty million people live in poverty in South Africa and of that number nearly 14 million live below the food poverty line of R796 per month. Is this just the natural order of things? According to Ingrid Robeyns, the author of Limitarianism: The Case Against Extreme Wealth (Penguin, 2024), most certainly not! In her quest to unpack the deleterious effects of extreme wealth Robeyns has produced a meticulously researched and referenced book. Drawing on her disciplines as an expert in economics and philosophy, and as a one-time student of Amatya Sen, in Limitarianism she unleashes reason in the case against wealth, through the splicing of economics, philosophy, history, morals and ethics. In addition, Robeyns bases her analysis in part on interviews with several billionaires, particularly those who are trying to limit their own wealth by calling for higher taxation and who have deep insights into the behaviours of their own class. In the US they have formed an organisation called Patriotic Millionaires. In an argument that is structured with the precision of a founding affidavit her chapters calmly deconstruct extreme wealth on the grounds that: 'It's Keeping the Poor in Poverty While Inequality Grows'; 'It's Dirty Money'; 'It's Undermining Democracy'; 'It's Setting the World on Fire'; and 'Nobody Deserves to Be a Multimillionaire.' Having set out the evidence, the core of Robeyn's argument is that there should be a limit (she suggests of 10 million) on individual wealth and that inheritance above a certain amount should be forbidden. Pointing to 'a massive intergenerational wealth transfer' – amounting to 'a staggering $84-trillion that will be transferred to the next generation by 2045' – she quotes philosopher DW Haslett: 'We abolished inheritance of political power; when, then, should we not abolish the inheritance of economic power, too?' The excess should be returned to the state which, among other options, could recycle it into a universal basic income grant, or savings account for young people, available as a leg-up when they reach adulthood. Robeyns finishes by making seven proposals for measures to limit wealth, including that there should be a 'balance of economic power': '[In liberal democracies] We all agree that we need a system of checks and balances; if we delegate political power to one institution, then we need countervailing power in others. Why then don't we have such a balance of economic power? That economics is a domain of power was first recognised by thinkers centuries ago.' And there's the crux of our modern dilemma. In the neoliberal era elected politicians have surrendered to the economic power of the wealthy and by doing so they have surrendered their ability to carry out the will of the people on the most basic human rights, such as access to healthcare services, education and meaningful employment. These might seem like a set of radical arguments. They are not. I think they are utopian, in the best sense of utopianism, that is, thinking the 'impossible' in order to make it possible. This was an approach advocated for by people like Rick Turner, the philosopher assassinated by apartheid state agents in January 1978. We only think it's a radical proposal because we have normalised extreme wealth, just as we have normalised extreme poverty and inequality. Yet, there are other ways to organise society and economy, and if you accept Robeyns's evidence, that is more a matter of necessity than choice. At the time I contemplated buying the book, I ummed and ahhed, struggling with a sense of déjà vu. 'I've read these books before. I've heard these arguments before. Is there anything new to be said about wealth and inequality? ' I asked myself. But I was wrong. Limitarianism is fresh. It's accessible. It's full of facts, analysis and dot-joining. I would particularly recommend it to those who might think that extreme wealth is okay, and I would plead that you read it with an open mind. We are 10 years after Thomas Piketty's magnum opus, Capital in the Twenty-First Century, and little has changed. In fact the opposite. Extreme wealth accumulation is now supercharged, what John Berger denigrated as the 'inalienable right to profit' now the driving political philosophy of the leader of the world's largest economy. Indeed, the irony is that it seems the more people have become acquainted with the facts the more numb and disempowered we seem to have become. As a social justice activist, I drew the following conclusions from reading it: It's time activists focused sustained attention on the case for wealth control, as much as we do on poverty elimination. While we may have debunked the neoliberal idea that wealth trickles down (or rather, it has debunked itself), the more important point is in fact the opposite: that unlimited wealth accumulation creates poverty. As Robeyns says: 'Extreme wealth concentration is, first and foremost, a structural problem. We should therefore focus above all else on the structural changes that are needed. We shouldn't become fixated on rich individuals per se, unless they are actively hampering the structural changes that are needed.' It's time for a measured, evidence-based campaign against extreme wealth that helps make people aware of how wealth is being abused in many ways that threaten democracy, human life and ultimately the planet itself. DM
The Guardian
10-07-2025
- Business
- The Guardian
Is it time for a wealth tax on the super-rich?
After cuts in Labour's proposed welfare reform bill caused uproar, many of the party's supporters insist it's time for a different approach. Rather than cutting the benefits bill or public spending, why not tax the wealthiest more? It's a question Keir Starmer was asked in PMQs, and he replied by saying it wasn't possible to 'tax our way to growth'. The millionaire Dale Vince disagrees. A former new-age traveller who made his money in green energy and has donated to Just Stop Oil, he is part of the Patriotic Millionaires organisation who think it is high time people like them are asked to increase their contributions. 'There's a whole bunch of us. We're all saying the same thing, that we can afford to pay more tax. Rich people should pay more tax, and we can use that money to reduce inequality in our country.' The tax expert and economics professor Arun Advani explains how a wealth tax could work and what the dangers could be. Would it send millionaires fleeing from the UK – and would that matter? And what other levers are at the government's disposal?
Telegraph
02-07-2025
- Business
- Telegraph
Benefits rebels are eyeing their next target: the rich
Having forced Sir Keir Starmer to climb down on benefits cuts, Left-wing Labour MPs scent blood in the water. The question is what will the rebels demand next from the Prime Minister? And can Downing Street regroup to take back control? Wealth taxes The most obvious crunch point is the autumn Budget, when – on its current trajectory – the Government must choose between a series of unpalatable options. Rachel Reeves has staked her credibility on being the 'Iron Chancellor', who will not budge her fiscal rules to get borrowing under control. But worsening economic forecasts, rising debt interest rates and costly about-turns have left another promise of hers at risk: no more large tax increases before the next general election. It is here where rebels will press their advantage, with some now calling for a raid on wealth to balance the books. Andy McDonald, one the 49 Labour MPs who voted to throw out the welfare Bill even after ministers made significant concessions, is among them. He singled out two ideas for new wealth taxes to The Telegraph on Wednesday. The first is a 2 per cent tax on assets of more than £10 million, which is an idea being pushed by the Patriotic Millionaires UK campaign group, and the second is increasing capital gains tax in line with income tax. 'It is the broadest shoulders argument. 'Distributed to each according to his need.' That's not Marx, it's the Bible,' Mr McDonald said. 'I've made the case for the last six months for wealth taxes. I'll continue to do so in the next six months because it's right.' Another rebel had a similar message on welfare taxes: 'I think it is inevitable. I don't think the Chancellor [Rachel Reeves] has got any options left. 'I think they're also going to have a conversation about income tax. I don't know if they have the strength or authority to do that, but it's going to come about.' The calls echo one of the suggestions made by Angela Rayner in a memo she sent to Ms Reeves that was revealed by The Telegraph in May, proposing measures to raise money without making spending cuts. However, the rebels will not be without their opponents. Liz Lloyd, the new Downing Street policy chief, 'scandalised' colleagues at a recent meeting by asking about existing wealth taxes and raising concerns about their impact on the mission to boost economic growth, according to the Financial Times. This raises the possibility that – far from introducing new wealth taxes – some in Sir Keir's inner circle may be mulling over diluting their non-dom crackdown. The rebels not being a homogenous group will present another challenge. The strength of the uprising against the welfare Bill was that it was not comprised of just the 'usual faces' on the Left, with moderate heads of Commons committees leading the charge. While some push for more taxes, other rebels are attempting to water down the inheritance tax hike on farmers. Immigration and Donald Trump Sir Keir may have rowed back his tough rhetoric on immigration, saying he 'deeply' regrets using the phrase 'island of strangers' after it led to accusations that he had echoed language from Enoch Powell's 'rivers of blood' speech. But policies tightening up the visa system remain – could this become a rallying point for the Left? Another potential clash is over Sir Keir's willingness to ingratiate himself with Donald Trump, who will briefly visit the UK this month before enjoying a full state visit in September. British public opinion is firmly disapproving of the US President, according to the polls. Labour MPs in private are just as vociferous, with some uneasy of Sir Keir's buttering up of his counterpart. Could a reshuffle save Starmer? Downing Street's options for a reset are numerous. There is speculation that a ministerial reshuffle of some form is being planned for either this month – before the parliamentary summer recess – or upon its return in the autumn, with mutterings about those at risk. Liz Kendall, the Work and Pensions Secretary, oversaw the specifics of the welfare package that had to be shredded to avoid defeat. Peter Kyle, the Science Secretary, has walked back his support for artificial intelligence proposals after a campaign backed by celebrities such as Sir Elton John that demanded stronger copyright protections. Lord Hermer, the Attorney General, has rubbed some colleagues up the wrong way with his championing of international law, though he could be salvaged by a friendship with Sir Keir that long predates politics. Should Sir Keir choose to rearrange his Cabinet, which is by no means a certainty, any moves risk creating new headaches. Thrusting newbies who are not promoted on to the Government benches could become disillusioned. One Labour aide noted that none of the Downing Street sycophants looking for promotions spoke out about welfare, and not rewarding them could have consequences. Those demoted in any reshuffle will also have their noses out of joint. A sacked minister can create more political problems than an underperforming one. And then there is the Number 10 team itself. Sir Keir notably swung a supportive arm around Morgan McSweeney, his under-fire chief of staff, at the Cabinet gathering on Tuesday morning. 'We will not turn on our staff, including our chief of staff, without whom none of us would be sitting around this cabinet table,' Sir Keir remarked, according to The Times. But are others safe? Claire Reynolds, who was appointed Sir Keir's political director, oversees relations between MPs, the party and Downing Street – links that broke down over welfare. Supporters of Sir Alan Campbell, the veteran Labour MP who is in charge of delivering the votes to pass laws as Chief Whip, are firmly defending his handling of the benefits reforms. He is said to have repeatedly warned those in Downing Street about the scale and severity of opposition for months. If so, did those in the centre not respond accordingly? And to what consequences? One area Number 10 is already looking to beef up is its economics brief, with the hiring process for a senior economist to keep an eye on Ms Reeves's policy agenda being in train. It is nothing new for governments to face tussles on policy and pressure for personnel shake-ups. But what gives this welfare rebellion its political bite is its size and how early it has come for this Prime Minister. Sir Keir, a politician who talked about the need for a decade of renewal in opposition, is only just approaching his one-year mark in office and yet, is being bounced by backbenchers into billion-pound changes. Rebellions past are not always an accurate predictor of those yet to come.
Yahoo
13-06-2025
- Business
- Yahoo
The Patriotic Rich
DONALD TRUMP HAS HUGGED A FLAG more than once, and he's now adding flagpoles on the north and south White House lawns. He addressed uniformed troops at Fort Bragg (at least the fit ones who love him and don't look fat) and he's ordered up a $45 million military parade on June 14 that could wreck D.C. streets to the tune of $16 million. He probably thinks of himself as a patriotic billionaire. Imagine, if you would, a different kind of wealthy role model for our nation's youth—and its grownups, too, for that matter. A millionaire or billionaire who does not waste taxpayer money, destroy government services, attack science, undermine public health, pave the Rose Garden, and decorate the Oval Office with so much gilt that you halfway expect Marie Antoinette to show up anytime. How about a millionaire or billionaire who obeys the law and isn't constantly, voraciously on the hunt for more power and more money? Who would prefer a more equitable society and would pay more taxes to make it so? These people do exist. Some are philanthropists. Some put money into political activism. And some create policy advocacy groups, like the nonpartisan Patriotic Millionaires. The group's members are self-described 'proud traitors to their class,' offering a platform of foundational economic changes to coincide with the nation's 250th birthday next year: AMERICA 250: The Money Agenda. 'Over the long term, the unfair tax system is a cause of the oligarchy being able to do what it does. The proposals that even the progressives are making are not sufficient to actually change the course of history,' Patriotic Millionaires Chair Morris Pearl, former managing director at BlackRock, told me in an interview. The group's four-part proposal, released in April, aims to do just that. It starts with exempting people below a certain income from federal taxes and making up the revenue by imposing a 3 percent surtax on income above $1 million, rising to 8 percent above $10 million. Other elements include raising the minimum wage to the cost of living for a single adult, and indexing it; equalizing the tax rate for capital gains and ordinary income over $1 million; and significantly taxing the intergenerational transfer of wealth. Forget false modesty. 'The solutions to the problem are not complicated, and the Patriotic Millionaires have them all,' the group says on its home page. Their plan, they say, would 'ensure prosperity and stability for America's next 250 years.' Join now Although the Patriotic Millionaires' agenda is forward-looking, in the immediate moment their focus is on the depredations of the Republican budget bill that would simultaneously explode the national debt, damage the safety net, and exacerbate inequality. The nonpartisan Congressional Budget Office reported this week that the House GOP bill would reduce annual household resources by roughly $1,600 for the lowest-income 10 percent, and increase them by about $12,000 for the top 10 percent. Americans really don't like this budget plan. Registered voters opposed it 53 percent to 27 percent in a new Quinnipiac poll, and a full 87 percent said federal funding for Medicaid—which the bill cuts bigly—should either increase or stay the same. The backdrop to the legislative activity and public opinion is a massive and persistent wealth gap. The top 10 percent of households by wealth held over two-thirds of the nation's wealth in the third quarter of 2024, the Federal Reserve said in a March report, while the bottom 50 percent held just 2.4 percent. Join now ANYONE CAN CLAIM to be a patriot. Trump praised the January 6th Capitol insurrectionists as patriots and even paid out $5 million in taxpayer dollars to the family of Ashli Babbitt, who was fatally shot trying to climb through a broken window into an area where lawmakers, staff, and journalists were trying to escape the House chamber and 'patriots' were beating up police to reach them. These millionaires have a different definition of patriotism that tracks more with the common good, or, as the Constitution put it, the general welfare. 'It's not that I'm altruistic. I want my children and grandchildren to grow up in the kind of country where I grew up,' Pearl says. 'I'm trying to get what I want.' Elon Musk, who spent $277 million last year helping elect Trump and Republicans, is trying to do the same, Pearl says. He adds: 'I'm hoping that I'll be more successful in the long run.' People like Pearl will never convince Trump that he's a bad role model, or an unpatriotic billionaire. This is after all the president who portrayed himself as a king on social media. When he went to see Les Misérables on opening night at the Kennedy Center—the institution he now leads after executing an unprecedented takeover—he evinced no sense of awareness of what the musical is about. 'I love the songs, I love the play,' he told Fox News Digital. He loves 'Do You Hear the People Sing?,' the show's anthem sung by oppressed people rising up against their despot-king. ('I hereby retire from satire,' Andy Borowitz wrote on Facebook.) For all we know, Trump may interpret the show as a sympathetic story about downtrodden MAGA and white South African peoples straining for freedom from a tyrannical leader, like, maybe, the last guy in the White House. Best case, in this case, is that the politics didn't break through. But he loved the songs. Share
Forbes
06-06-2025
- Business
- Forbes
Majority Of Millionaires Supports Wealth Tax
NEW YORK, NEW YORK - APRIL 15: People protest on tax day calling for billionaires to pay more tax on ... More April 15, 2025 in New York City. Activists suggested a 90% wealth tax to guarantee universal healthcare, free college education and to eliminate hunger and homelessness. (Photo by) A recent survey by Patriotic Millionaires UK shows that a majority of millionaires in G20 countries supports a 2% tax on wealth. When asked if any millionaires with a wealth of more than $10 million should pay the tax, 58% of the more than 2,000 millionaire survey participants said yes. As part of the same survey, 75% agreed that billionaires should pay the tax. Between 66% and 69% said that those with a household wealth of more than $50 million and more than $100 million, respectively, should pay up. On the other hand, there is still a considerable share of respondents with household investable assets of more than $1 million who think otherwise. Almost a third opposed or was torn about the tax concerning those with a wealth of $50 million or more, while this number was 40% concerning those with assets of $10 million or more. Only 11% of surveyed millionaires definitely opposed a tax on billionaires, however. This chart shows the share of surveyed G20 millionaires who said they supported additional wealth ... More taxes (in percent). Patriotic Millionaires UK is an organization of more than 60 British billionaires that advocate for the higher taxation of wealth and its fairer distribution. The first advocacy group by the name was founded in 2010 in the United States to lobby for the expiration of Bush-era tax cuts, which were extended under President Barack Obama, however. At the World Economic Forum in Davos in 2024, 250 millionaires and billionaires actually demanded that global leaders take action to tax very rich individuals but change has not come. According to a 2023 report by Oxfam, only 4 cents of every tax dollar raised globally came from wealth taxes, while half the world's billionaires lived in countries with no inheretance tax. Meanwhile, support among the public for wealth taxes mirrors that of the millionaire survey. According to Ipsos, Global Commons Alliance and Earth4All, 68% to 70% percent in G20 countries said they were in support of a tax on wealth, on high incomes and on large business profits. Many polls across time and different countries have shown the same results. The report by Patriotic Millionaires UK refutes the often-made claim that wealth taxes would led to capital flight and in turn, economic decline. It claims that many rich individuals would not change their residence and in fact welcome the change that they think strengthens democracy, fights global issues like climate change and not least prevents an eventual outbreak of violence over the unequal distribution of wealth. Three quarters of surveyed millionaires said that they thought well-funded public services and a functioning infrastructure were vital for entrepreneurs and a strong economy. 54 percent said that extreme wealth was a threat to democracy while 72 percent agreed that wealthy individuals were paying for their political influence. According to the latest figures by the World Inequality Database, the top 10% of the wealthiest individuals in the United States held more than 70% of the country's wealth in 2023, surpassed only by several African, Latin American and Arabian Gulf countries. In the United Kingdom, this figure stood at 57% most recently, comparable to the European Union level of 59%. Few countries achieved better result, with the most equal distributions found outside the EU in Norway at a still-high 52.6% and in Iceland at 56.7%. Within the EU, the lowest figures were 45.4% in the Netherlands and 49.4% in Slovakia. Charted by Statista
