“There’s been class warfare going on for the last twenty years, and my class has won. We’re the ones that have gotten our tex rates reduced”. Warren Buffett
Last Sunday saw the publication of the Sunday Times Rich (April 26th 2015). It showed that the wealth of Britain’s richest people has more than doubled in the last ten years. The wealthiest 1,000 individuals and families now have a combined fortune of £547.126 BILLION up from £249.615 billion recorded in 2005.
Here is a list of Britain’s wealthiest 25 people, according to The Sunday Times Rich List.
1 Len Blavatnik £13.17 billion 2 Sri and Gopi Hinduja £13 billion 3 Galen and George Weston and family £11 billion 4 Alisher Usmanov £9.8 billion 5 David and Simon Reuben £9.7 billion 6 Ernesto and Kirsty Bertarelli £9.45 billion 7 Lakshmi Mittal and family £9.2 billion 8 Kirsten and Jorn Rausing £8.7 billion 9 The Duke of Westminster £8.56 billion 10 Roman Abramovich £7.29 billion 11 John Fredriksen and family £7.24 billion 12 Charlene de Carvalho-Heineken and Michel de Carvalho £7.145 billion 13 Sir David and Sir Frederick Barclay £6.5 billion 14 Hans Rausing and family £6.4 billion 15 Mohamed Bin Issa Al Jaber and family £5.935 billion 16 Carrie and Francois Perrodo and family £5.8 billion 17 Nathan Kirsh £5.06 billion 18 Earl Cadogan and family £4.8 billion 19 Nicky Oppenheimer and family £4.55 billion 20 Sir Richard Branson and family £4.1 billion 21 Bruno Schroder and family £3.76 billion 22= Mike Ashley £3.5 billion 22= Sir James Dyson and family £3.5 billion 22= Sir Philip and Lady Green £3.5 billion 25 Sir Henry Keswick and family £3.275 billion
The Sunday Times simply documents the ‘facts’ of this ‘rich’ elite. Oxfam’s analysis published earlier in the year (January 2015: Wealth: Having it all and Wanting More’) puts it in a world perspective:
“Global wealth is increasingly concentrated in the hands of a small wealthy elite. ..85 billionaires have the same wealth as the bottom half of the world’s population… In 2014, the richest 1% of people in the world owned 48% of global wealth, leaving just 52% to be shared between the other 99% of adults on the planet.1 Almost all of that 52% is owned by those included in the richest 20%, leaving just 5.5% for the remaining 80% of people in the world. If this trend continues of an increasing wealth share to the richest, the top 1% will have more wealth than the remaining 99% of people in just two years, … with the wealth share of the top 1% exceeding 50% by 2016”
What is shocking about all this is that the world has been gripped by a period of recession and austerity. The rich are undoubtedly getting richer! So how is it possible that the rich – who caused the international banking crisis in the first place – have done so well out of it? Andrew Sayer’s brilliant recent book Why We Can’t Afford the Rich ( 2015, Policy Press) details this world trend, shows how it has happened, and why we should be working to stop it. He shows how the accelerating wealth of the rich is not gained by wealth creation but through what he calls wealth extraction. This is wealth that is unearned , not worked for – but gained through mechanisms like playing the finance market, investment games, playing the renting market. As he says:
“Unearned income is not only unjust, a form of parasitism, but dysfunctional, because it diverts resources away from the productive economy. We need either to block or tax it: in fact I suggest we tax earned income less and unearned income more”.
“No-one ever got rich or poor outside of social relations between people—between buyers and sellers, employers and employees, landlords and tenants, lenders and borrowers. We need to think about whether those relations are fair and contribute to the good of society. Talking about the ethics of unearned income is a good place to start”.
Sayer shows that the increased opportunities for wealth extraction by the rich has allowed them to dominate politics too. We see in effect a world-wide rise of the Plutocracy- government by the rich. (As an aside it is even worse than this: Sayer also shows that the concentration of wealth at the top produces wasteful consumption, weakens economies, and draws from the wide population – reducing their ability to meet basic needs.Ultimately the financial interests of the rich in continued growth and in the extraction of fossil fuels threatens the planet).
Andrew Sayer’s book is one of a significantly growing number of books that are putting inequality and the rich at the centre of their analysis. Take a look.
On The Current Crisis in Inequality: The World Problem and Danger of the Rich
(Be warned: many of these books could make you very angry indeed- they did me!).
Oxfam International (2014) Even It Up: Time to End Extreme Inequality
(2015) Wealth: Having it all and wanting more https://www.oxfam.org/en/research/wealth-having-it-all-and-wanting-more
Danny Dorling (2014) Inequality and the 1% (Verso, 2014) A University of Oxford social geographer has written widely on the horrors of austerity – on poverty, inequality and the housing crisis. He explains why we cannot afford the rich.
Stewart Lansley and Joanna Mack (2015) Breadline Britain: The Rise of Mass Poverty One World. Poverty in Britain is now at crisis levels and the current government stigmatizes, excludes and blames the poor whilst protecting the rich.
Anette Hsatings et al (2015) The Costs of the Cuts: The Impact on Local Givernments and Poorer Communities London: Rowntree see: http://www.jrf.org.uk/sites/files/jrf/Summary-Final.pdf
Thomas Piketty (2014) Capital in the Twenty-First Century (Harvard University Press, 2014) Widely discussed, and already a classic, a French economist explores not just how unequal we have become but also shows how even more unequal we are rapidly becoming.
Goran Therborn (2013) The Killing Fields of Inequality. Cambridge: Polity
James Meek (2015 rev ed) Treasure Island: Why Britain Now Belongs to Some one Else. Verso Critical examination of the ways in which Britain’s public services have been sold off – so the rich benefit and the poor pay.
Kerry-Anne Mendoza (2015) Austerity: The Demolition of the Welfare State and the Rise of the Zombie Economy. Oxford: New Internationalist
Andrew Sayer (2015) Why we can’t afford the rich/ Bristol: Policy Press
A startling book by a well-known and respected sociologist. He shows how the new economy – and austerity– works to make the rich richer and the poor poorer; how this is now done on a massive scale as the rich live lives cut off from the 99% of the world. Full of quite shocking detail that leads one to ask : just how are they getting away with making our world such a terrible place?
Joseph Stiglitz (2012) The Price of Inequality: How Today’s Divided Society Endangers Our Future (W.W. Norton) A Nobel Prize-winning economist paints a vivid picture.
Polly Toynbee & David Walker (2015) Cameron’s Coup: How The Tories took Britain to the Brink. Guardian Books. A journalist and obviously partisan book that shows just how much havoc the Coalition has hurled at Britain over the past five years.
John Urry (2014) Offshoring . Cambridge: Polity. One of the world’s leading sociologists examines the hidden (secretive) worlds of offshoring, demonstrating a truly the dark side of globalization. He shows how the rich are involved in concealing income, wealth and profits in tax havens; and how secretive activities offshore also involve relations of work, finance, pleasure, waste, energy and security. Ke whosw how new patterns of power reduces the responsibilities of the powerful ‘offshore class’, and limit the conditions for democratic governance.
Richard Wilkinson and Kate Pickett (2009) The Spirit Level: Why Greater Equality Makes Societies Stronger (Bloomsbury Press, 2009) Became an instant classic as it showed that by every measure that matters, from social trust to how long we live, relatively equal nations outperform nations where income concentrates at the top.