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Title: The Richest 1% Will Own Two-Thirds Of Global Wealth By 2030, Report Finds
Source:
Zero Hedge
URL Source: https://www.zerohedge.com/news/2018 ... lobal-wealth-2030-report-finds
Published: Apr 9, 2018
Author: Tyler Durden
Post Date: 2018-04-11 09:43:51 by Deckard
Keywords: None
Views: 4287
Comments: 41
Back in November, Credit Suisse highlighted an alarming - yet altogether unsurprising - milestone in the increasing concentration of global wealth that has been perhaps the most influential force behind the populist revolts that rocked the US in 2016 and have continued to unfurl across Europe. According to the Swiss bank's annual "global wealth pyramid," for the first time, the wealthiest 1% of the world's population had accumulated more than half of its aggregate household wealth. Credit Suisse's researchers describe in stark terms how global wealth inequality had actually improved somewhat in the years between the start of the new millennium and the financial crisis - but in the years after, the gap between the world's richest and poorest individuals widened dramatically, one of the most pernicious aspects of the Fed and the global cabal of central banks pumping easy money into the global financial system. The researchers said that "our calculations show that the top 1% of global wealth holders started the millennium with 45.5% of all household wealth. This share was about the same until 2006, then fell to 42.5% two years later. The downward trend reversed after 2008 and the share of the top one percent has been on an upward path ever since, passing the 2000 level in 2013 and achieving new peaks every year thereafter. According to our latest estimates, the top one percent own 50.1 percent of all household wealth in the world.” But while CS's report was unequivocally dire, a recent report published by the UK Parliament is even more harrowing. According to the Guardian, projections produced by the House of Commons library suggest that the top 1% of the world's wealthiest individuals will own roughly 64% of the planet's wealth by 2030. An alarming projection produced by the House of Commons library suggests that if trends seen since the 2008 financial crash were to continue, then the top 1% will hold 64% of the world’s wealth by 2030. Even taking the financial crash into account, and measuring their assets over a longer period, they would still hold more than half of all wealth. Since 2008, the wealth of the richest 1% has been growing at an average of 6% a year – much faster than the 3% growth in wealth of the remaining 99% of the world’s population. Should that continue, the top 1% would hold wealth equating to $305tn (£216.5tn) – up from $140tn today. Analysts suggest wealth has become concentrated at the top because of recent income inequality, higher rates of saving among the wealthy, and the accumulation of assets. The wealthy also invested a large amount of equity in businesses, stocks and other financial assets, which have handed them disproportionate benefits. The study was the brainchild of Liam Byrne, a former Labour cabinet minister, who hopes it will factor into the discussion when the financial chiefs of the world's largest countries meet in Buenos Aires late this year for a G-20 summit. "If we don’t take steps to rewrite the rules of how our economies work, then we condemn ourselves to a future that remains unequal for good," he said. "That’s morally bad, and economically disastrous, risking a new explosion in instability, corruption and poverty." Unfortunately, the public is extremely sensitive to growing wealth disparity, and polls show most people in the UK are growing increasingly cynical about the prospects for change. Already a plurality of Britons believe the superrich have more influence and power than national governments. New polling by Opinium suggests that voters perceive a major problem with the influence exerted by the very wealthy. Asked to select a group that would have the most power in 2030, most (34%) said the super-rich, while 28% opted for national governments. In a sign of falling levels of trust, those surveyed said they feared the consequences of wealth inequality would be rising levels of corruption (41%) or the “super-rich enjoying unfair influence on government policy” (43%). Indeed, even if the incomes of the wealthiest individuals were frozen at 2017 levels, their share of the world's wealth would still expand thanks to returns on their investments, according to Danny Dorling, a professor at Oxford. "Even if the income of the wealthiest people in the world stops rising dramatically in the future, their wealth will still grow for some time," he said. "The last peak of income inequality was in 1913. We are near that again, but even if we reduce inequality now it will continue to grow for one to two more decades." One Tory MP quoted by the Guardian pointed out that while wealth inequality remains a problem, liberal capitalism has lifted more people out of poverty than any other system of government. Though this overlooks the fact that, while this holds true in most of the biggest developing countries, in the developed world, the working and middle class are at risk of seeing their standard of living decline vs. that of their parents' generation. George Freeman, the Tory MP and former head of the prime minister’s policy board, said: “While mankind has never seen such income inequality, it is also true that mankind has never experienced such rapid increases in living standards. Around the world billions of people are being lifted out of poverty at a pace never seen before. But the extraordinary concentration of global wealth today – fuelled by the pace of technological innovation and globalisation – poses serious challenges. "If the system of capitalist liberal democracy which has triumphed in the west is to pass the big test of globalisation – and the assault from radical Islam as well as its own internal pressures from post-crash austerity – we need some new thinking on ways to widen opportunity, share ownership and philanthropy. Fast." Demands for action from the group include improving productivity to ensure wages rise and reform of capital markets to promote greater equality. While this sounds like a plausible plan, the obstacles to it being put into practice are myriad - including opposition from corporations and the wealthy, who might prove reluctant to part with what they've gained. And even once central banks retract their stimulus and securities valuations inevitably fall, it remains unclear whether this trend can ever be reversed. One thing's for sure: While pundits have been eager to call the end of the populist wave, as long as the wealth divide continues to widen, anger toward the status quo will continue to metastasize. 
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Begin Trace Mode for Comment # 34.
#2. To: Deckard (#0)
And what does the 1% do with that wealth? Sit on it? Look at it? Roll around in it? Or do they invest it? How much money does the other 99% invest in new projects? What's your solution? Tax the wealthy and give it to the government to spend? I thought you didn't like the government. But maybe you only like the government when it steals money from the wealthy and gives it to you? Is that it?
Tax the wealthy at the same rate of their gross wealth than everybody else is taxed. The middle classes primarily hold their wealth in cars and houses, which are hit with property taxes, sales taxes, registration taxes, etc. Such liquid reserves they have are in bank accounts - where the interest is taxed. Most of the income of most people is spent on living, and all that expenditure goes under the sales tax. The lives of the bulk of people have been carefully scrutinized by government everywhere, and each transaction and wealth concentration is taxed. In particular, the PROPERTY of the average person is taxed: housing is where most of the wealth of the non-rich is stored, and that is taxed every year, on its value. Property tax is a WEALTH TAX on everybody but the upper class. Sure, the upper class pay property taxes on their homes. But THEIR wealth is mostly held as securities. And unlike bank interest, capital gain is NOT taxed until the owner of the securities CHOOSES to be taxed, by CHOOSING to sell the securities. Savvy ones simply borrow (at favorable rates that the public can never tough), pledging the securities as collateral. So they never pay taxes at all on either the gain or the cash flow. Houses, cars, boats - all taxed. Securities? THAT is the form of property that is NOT taxed with a property tax. Sales of houses, cars, boats, clothes, everything people need to live except some food in some states: taxed. But sales of SECURITIES, the way that the wealthy exchange wealth? Not taxed. The tax system is skewed such that the very wealthiest, as a portion of their wealth, pay lower taxes than anybody else. The welfare poor pay more of their wealth as sales taxes than the super rich do of theirs. What this means is that the wealthy accumulate more wealth at a greatly accelerated rate that the common man cannot catch, because the common man hands over substantial portions of his wealth as property taxes on what he already has, while the wealthy are NOT taxed on most of what they have accumulated. My solution? Replace the whole tax system with a simple, single flat tax, on gross wealth. Make it the same level as property taxes on houses currently are. That levels the playing field and captures the same percentage of wealth from everybody. Right now, with federal and state income taxes, social security, and sales taxes, you're paying 50% of your gross wealth (income is part of your gross wealth) every year in taxes. The super-rich are paying in the single digits. THAT is where the unfairness lies. And THAT is where you level the playing field. Everybody pays the same tax on every dollar of value he owns, whether it's wages or stocks or boats or houses. THAT is fair, and it eliminates the huge advantage in wealth accumulation that the rich have, without simply seizing what they have and redistributing it. Everybody is taxed THE SAME PERCENTAGE on what the have, so the more you have, the more you pay, but only in the same percentage. THAT is fair. And THAT would end the advantage the rich have over everybody else under the current rigged system. Needless to say the rich will fight any such thing to the death. I don't think that "progressive" taxation is nearly as fair as a flat gross wealth tax.
I'm not rich, so I suppose I don't have much of a dog in this hunt, but I'll just point out a few issues. The rich pay the vast, vast majority of all federal taxes. Property taxes and sales taxes are local issues, They support local programs. They don't support the nation. Money given to heirs has already been taxed. Should it be taxed again? Rich people don't just put their money in mattresses or swim around in it like Scrooge McDuck. It is invested in the economy.
No, they do not. Not at all. What percentage do you think that is? Do not conflate the federal income tax with "all federal taxes". Truth is, the federal income tax is less than half of all federal taxes. 47% of federal tax revenues come from the federal income tax. High income earners paid 55% of federal INCOME tax, which is to say, they paid 25.85% of federal TAXES. Now let's look at the rest of the sources of federal taxation. 34% of federal taxes, nearly as much tax revenue as the income tax, is paid as Social Security and Medicare tax. Now, thing is, Social Security tax is only applied to a CAPPED amount of income. The rich are NOT PAYING SOCIAL SECURITY TAX on any of their income above the cap of about $120,000. Social Security tax IS paid by the very poorest worker on his first dollar. So, 34% of Federal taxes are paid by middle class and low income workers, because the Social Security tax barely touches the rich. Next comes Excise taxes - taxes on gasoline, on tobacco, on alcohol, and the like. These taxes skew heavily to the middle, working and lower classes, who make up the bulk of the population. Add another 4% of taxation paid by other than the rich. So far, the total of Federal taxes paid by working and middle class people is 38%, versus 25.85% by the very rich. This is offset by about 4.5% of taxes that come in the form of the Estate tax. That is paid by the rich. So, that brings the rich up to 29.85% of federal taxes, versus 38% paid by everybody else. The remaining 10% of tax falls on corporations, most of whose wealth is in publicly-owned and heavily skewed towards pension funds and mutual funds. That's another 9%. So, the oft-asserted claim that the rich pay the vast, vast majority of all federal taxes is simply a lie, told over and over again as propaganda by the mouthpieces of the super-rich on the right. It is not true. Truth is, the common people pay much more in federal taxes than the very rich - and that is precisely how the rich have designed the system. They have managed to tell the Big Lie, by repeating over and over again that the rich pay the overwhelming amount of federal tax, by pretending that the Federal Income tax is most federal taxes, but actually, it isn't even half of the taxes owed to the federal government's revenue. One of the reasons I am not a Republican conservative or a Democrat liberal is that I focus on the facts and the truth, while partisans and ideologues of both sides repeat and believe the lies they have been taught by those who have successfully ensnared them. Look at the truth, which is what I posted, and realized that you have been had, for years, and that you're still being had. These people lie to you to divide you and keep their own taxes low.
https://www.cnbc.com/2013/12/11/the-rich-do-not-pay-the-most-taxes-they-pay-all-the-taxes.html
And once again the play-pretend that federal income taxes are ALL the taxes. Federal income taxes are less than half of the taxes collected by the federal government. Boy is that article deceptive.
80% of all Federal income comes from income and payroll taxes. Now, yes 35% of that comes from SS, and there is a cap on that the rich don't have to pay. It really shouldn't even be included in Federal income. It's like saying "well I'll use some of my retirement funds to pay my mortgage, but I'll put a note that I will put more in later." SS is not supposed to be a charity. However it is. The government could just say SS is a charity, and tax everybody on all their income and make a means test on what you can receive.
If we don't include SS in Federal income, nor should we then include SS payments as federal expenditures. SS taxes pay SS benefits. In 2017, the federal government collected $996 billion in Social Security taxes, and spent only $873 billion in benefits. Further, those benefit payments were themselves taxed AGAIN, by the income tax, and brought $38 billion back to the government (so, the net cost of Social Security was a positive 161 billion into the federal coffers. Furthermore, Social Security surpluses are invested in interest-bearing government bonds, and have accumulated over the decades to the point where the interest paid to the Social Security program by the bonds is another 85 billion per year. So, when you hear people tell you how "expensive" Social Security is, that it's one of the biggest parts of the budget, you can counter them with the truth. Truth is, Social Security not only does not COST the government ANYTHING, it actually adds $245 billion to the federal coffers every year. In other words, the complaint that Social Security is "bankrupting us" or that it is "bankrupt" is utter bullshit. It runs a surplus, it pays interest, the benefits it pays are THEMSELVES taxed, which brings money right back to the government. People who hate Social Security because "we can't afford it" actually do not know what they are talking about. Literally, they're ignorant. You made a good point by saying that it should not be counted in Federal Income. It ALSO should not be counted in federal expenditures either, because the program ADDS $260 billion dollars a year to the federal coffers, and does not cost the federal government a penny. Real expenditures (as opposed to simply cycling money through Social Security), the way you've defined it, are a billion less than the official numbers. In other words, one quarter of the federal budget is a mirage. You say we should not count Social Security taxes - that's fine. We also should not count Social Security expenditures either. What we do about the $240 billion surplus? Medicare taxes bring in a lot of money too, though Medicare taxes. There's also the premiums indivduals pay, and interest on certain bonds held by Medicare. All told Medicare revenues pay for 55% of Medicare's total costs. So Medicare IS an expense on the Federal budget (the way you propose to count things): 45% of it is funded by regular government funds. That amounts to $324 billion. The rest of Medicare spending should not be counted, as it is offset by taxes and contributions. Of course, the rich also get Medicare and Social Security, so these are not welfare programs.
Or rather they feel that supporting the old and sick is wasteful. It is enough that noble Job Creators had to provide means of existence for parasitic Job Eaters for years. No need to let them linger and wander aimlessly after work is done. Who can calculate the exact profit or expense of a slave one year with another, if I furnish my negro with every necessary of life, without the least care on his part - if I support him in sickness, however long it may be, and pay all his expenses, though he does nothing - if I maintain him in his old age, when he is incapable of rendering either himself or myself any service, am I not entitled to an exclusive right to his time good feelings, No negro shall leave the place at any time without my permission ... Whatever, that they are always liable to my call without questioning for a moment the propriety, of it, I adhere to this on the grounds of expediency and right. The very security of the plantation requires that a general and uniform control over the people of it should be exercised. Who are to protect the plantation from the intrusions of ill designed persons When everybody is abroad? Who can tell the moment When a plantation might be threatened with destruction from Fire - could the flames be arrested if the negroes are scattered throughout the neighborhood, seeking their amusement. Are these not duties of great importance, and in which every negro himself is deeply interested to render this part of the rule justly applicable, however, it would be necessary that such a settled arrangement should exist on the plantation as to make it unnecessary for a negro to leave it - or to have a good plea for doing so - You must, therefore make him as comfortable at Home as possible, affording him What is essentially necessary for his happiness - you must provide for him your self and by that means create in him a habit of perfect dependence on you ...
#35. To: A Pole (#34)
Well, that's pretty dark. Fortunately, We the People put Social Security and Medicare in place, which removes that sort of private power.
You see, that's acknowledging it as a welfare program. It was never meant to be that. Maybe it's time to admit that's what it has become. Why do you care anyway? Don't you live in Poland?
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#4. To: misterwhite (#2)
What's your solution? Tax the wealthy and give it to the government to spend?
#14. To: Vicomte13 (#4)
#15. To: no gnu taxes (#14)
The rich pay the vast, vast majority of all federal taxes.
#21. To: Vicomte13 (#15)
The rich do not pay the most taxes, they pay ALL the taxes
#24. To: no gnu taxes (#21)
The rich do not pay the most taxes, they pay ALL the taxes
#32. To: Vicomte13 (#24)
#33. To: no gnu taxes (#32)
It really shouldn't even be included in Federal income.
#34. To: Vicomte13, no gnu taxes, VxH, Tooconservative, sneakypete (#33)
People who hate Social Security because "we can't afford it" actually do not know what they are talking about. Literally, they're ignorant.
Replies to Comment # 34.
#36. To: A Pole (#34)
Or rather they feel that supporting the old and sick is wasteful.
End Trace Mode for Comment # 34.
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