The ridiculously rich are more analogous to the Gray Goo, a science-fiction concept where a self-replicating organism subsumes all around it until the entire universe is gray goo.

When you reach a certain level of wealth, in general, you cannot stop.

Someone with $2M in the bank might get an income of $100K from it (at 5% interest if that ever returns). They probably own their own home, so that would enable a comfortable life without working. They might save a little, or they might spend it all.  

Someone with $10M in the bank has more options:

• Outrageous lifestyle – spending $10K per week is hard otherwise
• Saving it for no real need
• Reinvesting and getting richer

The latter is the choice of many – they use money to make money.  With that level of wealth, their life changes from one of leisure to one of greed. Whether they use a “family office” to make “investments” or if they actively choose where they store their wealth, their life is now different. They have a purpose of becoming needlessly richer. 

They can still have an outrageous lifestyle, but there will be money left over, nagging them… If it cannot be spent, it needs to be put somewhere.

Just as I have proposed determining a new minimum income by which anyone can live with dignity (albeit poor), I am suggesting that an upper limit should be determined, where an average person might consider that they have more wealth than they could possibly need.  Such a limit could then be used to decide  taxes of constraint, rather than arbitrary numbers like $100M or the 1%.

It can be determined like this:

Make a list of the most expensive year-round travel costs, the most expensive mortgage repayments, the most expensive food and clothes.  And for each, remove the top 1% (cost-wise) that is available as being obviously ridiculous.  A $100M apartment is not twice as good as a $50M apartment.

That income can be a point at which extreme taxation kicks in, and quite likely it won’t deter the greed, but simply spread the wealth. We can also have a wealth tax (to cover any trickery) where the wealth limit is the income limit times whatever a typical investment return is for the middle class.

It is a brutal idea but it can be softened a little, towards the insanely rich using their money for good. Seed investment (like, really, really, seed), charity (not museums and the hospitals/universities of the rich), and infrastructure (get a road named after you because you built it all).

Once a set amount is determined – it can be debated, different models can be used, but there will still be a range – we can ask the maniacally rich, why do you need more?

The post When Wealth Feeds Upon Itself appeared first on Unism.

Jack Dorsey, billionaire founder of Twitter and Square, gave away $1 billion in shares (28% of his net worth) to his charitable foundation. This isn’t a foundation that donates to colleges and hospitals reserved for the wealthy. The money doesn’t go to pushing a political agenda that helps him stay rich.

No, the money is going towards genuinely helping the poor. Take a look at the public spreadsheet of the donations. And you will see donations regarding COVID-19, and in general feeding the poor. And of particular interest, supporting pilot UBI programs.

Hopefully the media highlights his giving as much as possible, so other billionaires can consider following suit.

The post Jack Dorsey – Good Billionaire appeared first on Unism.

Of the two pieces of information I found worth using, the second could have been great. However being in the second-to-last paragraph of the book, you would think more effort could have been made:

“America is the wealthiest nation in the history of the world. Over the course of the twentieth century alone, real income per capita (adjusted for inflation) increased roughly sevenfold in the United States. As we have seen, so wealthy is our nation that were income divided equally today, all families of four would receive almost $200,000. (Alternatively, of course, the workweek could be cut in half, with family income reduced on average to $100,000–roughly two times current median family income.”

What is a family of four? If it is two adults and two children, then the assumption is that half of the population are children. That’s nothing like reality. Surely just counting the number of adults is easier?

But more importantly, he has made the simplistic assumption that if the nation works half as much, they earn half as much.

Here’s the real statistic, and it is an important one to use alongside the popular The richest 0.1% earn more than the… stats that abound.

If the national GDP was split evenly, it would equate to $95K per adult before tax.

That’s what income equality looks like – the average American earns double the income from the same amount of work. People can easily imagine what that looks like to them.

Or to put it more crudely, half of your income is currently being stolen by rich people, compared with equality.

• The median income in the US is $31K per full-time worker, or $63K per household
• Average per capita income (after income tax) is $45K
• Labor share of income is 45%
• GDP is $20 trillion
• Adults (18+) in the US is 210 million

The post Brilliant Stat, Screwed Up by Gar Alperovitz appeared first on Unism.

Five former city employees and a former Trump Organization employee say the company used middlemen to pay New York City tax assessors to lower building assessments and pay less taxes in the 1980s and 1990s.
https://www.propublica.org/article/trumps-company-paid-bribes-to-reduce-property-taxes-assessors-say

This also isn’t the place to discuss if Donald Trump was involved. Perhaps he told someone, “if you can lower my taxes, I’ll be very grateful”. Nothing illegal in that.

The point is simply this, regular employees, often working 60 hours a week to make ends meet, can’t cheat. Yes, perhaps they could steal or cheat in some minor way, and risk losing their job, but that is rare.

The rich and privileged, throughout history and to this day, are regular cheats. At the most basic level, they cheat (legally) cheat on their taxes. 

Here in Australia, as an employee, I cannot cheat on my taxes. Income tax is removed from my pay each fortnight, and GST is added to the purchase price in stores. I can’t cheat on taxes.

The richer you get, the more you can afford accountants to minimise tax. In Australia, one of the ways is to set up a family trust to split income. Income splitting is not available to families who are paid wages. It is a legal form of tax avoidance available to rich people. 

The richer you get, the more separation you can have between yourself and your finances. Your business can go bankrupt without you going bankrupt. Your business can receive a fine for something an individual could go to prison for. 

Rich people know people in power.

Here’s another real world example. At the marketing agency where I work, we have had several clients who have so much cash they could buy our listed company and not blink an eyelid. Some of these clients have broken contracts with us. The option of suing them is not available – they are too big to sue. 

Likewise on a Google Ads forum that I frequent, where disgruntled advertisers come to complain. We often hear them say, I’m so angry,  I’m going to sue Google! Yeah, good luck with that.

The richer you get, the more you can cheat, in ways that are unavailable to the poor. The playing field becomes less even as time goes by.

The post The Wealthy Can Cheat appeared first on Unism.