Britain’s 1,000 richest persons made gains of £155bn in last 3 years

The Sunday Times Rich List, published today and compulsory reading for anybody who wants to understand Britain’s power structure today, holds three extremely significant conclusions.   One is that the 1,000 richest persons in the UK have increased their wealth by so much in the last 3 years – £155bn – that they themselves alone could pay off the entire UK budget deficit and still leave themselves with £30bn to spare which should be enough to keep the wolf from the door.   The second, even more staggering, is that whilst the rest of the country is being crippled by the biggest public expenditure and benefits squeeze for a century, these 1,000 persons, containing many of the bankers and hedge fund and private equity operators who caused the financial crash in the first place, have not been made subject to any tax payback whatever commensurate to their gains.   This is truly a government of the rich, by the rich, and for the rich.

The third is that despite the biggest slump for nearly a century, the slowest and most anaemic recovery, and prolonged austerity stretching to a decade or more, this ultra-rich clique are now sitting on wealth even greater than what they had amassed at the height of the boom just before the crash.   Their combined wealth is now estimated at more than £414bn, equivalent to more than a third of Britain’s entire GDP.    They include 77 billionaires and 23 others whose wealth exceeds £750m.  

Despite these massive repositories of wealth, these are some of the very people to whom Osborne gifted £3bn in his recent budget by cutting the 50p tax rate.   That measure alone gave 40,000 UK millionaires an extra average £14,000 a week, at the same time as those on very low incomes in receipt of working tax credits who couldn’t find an employer to increase their hours of work from 16 to 24 a week were being deprived in the same budget of £77 a week, around a third of their income, through their tax credits being withdrawn.

In 1997 the wealth of the richest 1,000 amounted to £99bn.   The increase in their wealth over the last 15 years has therefore been £315bn.   If this increase in wealth were subject to capital gains tax at the current 28% rate, it would yield £88bn, and that alone would pay off more than 70% of the total budget deficit.   However Osborne seems to share the notorious view of the New York heiress, Leonora Helmsley: “taxes are only for the little people”.

 

39 thoughts on “Britain’s 1,000 richest persons made gains of £155bn in last 3 years

  1. its funny old world this is
    for it always seems the same
    for it seems its the rich that get richer
    and the poor that get the blame

  2. Most of this ultra rich clique made their wealth under Labour’s time in office. Gordon Brown slashed capital gains tax in one of his first budgets and never looked back. The Tory coalition is playing copycat.

    It’s a bit too easy to complain now when you could have fixed things.

  3. And when was that song written Jim .. 1870s? It fits so perfectedly now because we have been ‘groomed’ and conned into a ‘back to the future’ neofeudalism. The gap in wealth, which narrowed in the post war period, has been restored to its pre 1920s level and still continues to widen.

  4. So Osborne is to blame for this incredible growth of wealth for the mega-rich and the widening divide of rich and poor that has developed over the last fifteen years is he?

    Who exactly ran the country for most of this period?

  5. @ Mark. But the Tories are in power now, so it is they who have the power to address this problem, but for them this is the natural order of things. I do not think that it was Labour policy to make poor people poorer at the expense of the rich. They wanted everyone to be better off. The tories, however, DO want rich people to be richer and poor people poorer. How much money would the, lower Labour rate, of capital gains tax raise if applied? Lots.

  6. Mark – and before Mr Brown there was Mrs Thatcher, who gave Banks Carte-Blance to syphon off as much cash as they want from pensions and mortgages, and freed up ‘futures+securities’, the biggest fraud system ever. It’s nothing to do with Parties or specific MP’s, this has been a developing situation for at least 25 years, as the rich have perfected Tax-avoidance techniques, and gradually pocketed more politicians in return for payoffs and favours. How many politicians even mention or acknowledge this situation? Not many, as they are making a tidy ‘Retirement Package’ for themselves if they keep shtum and don’t expose the applecart. Trying to put down one MP is missing the whole point, and doesn’t expose the shoddy business for what it is. I dont mind people being rich, buit whatever happened to good old Philanthropy? How many ‘OLD’ Universities, Libraries and Hospitals are named after people who gave their own cash to build them? And now – they buy an island, dig a hole and stash it away. Michael Meacher for PM!

  7. Great to hear this very article plugged on natonal BBC radio this morning – MM for PM.
    But weasel brain Nicky Campbell cut the caller off in mid-flow to go to, gusee what, someone who wasn’t there. Classic BBC censorship and reminds me of the fact that BBC founder Lord Reith was a fascist, even a Nazi, a big supporter of Hitler’s invasion of Czechoslovakia.
    And Michael, you even appeared in the pre-Victor Rothschild coup BBC series: The Edge Of Darkness too.
    You are the tops man.
    God bless you and heal your every ailment!
    BTW why was this article not in The Guardian. Have they been ‘got at’ too?

  8. You would tax the wealthiest an additional 28% for 15 years so that you can pay 70% of a single year’s deficit (that’s 8.4 months)? Is that right?

  9. Wonderful words. Why hasn’t this been on EVERY news channel? As it is we have Nick and David cuddling up saying – “it’s difficult!” to make the poor give more to the rich. That’s not news – that’s the status quo. The difficult thing would be to pry the money from the super rich. Surely it can’t be that hard.

  10. I can only assume Mr Meacher understands the distinction between the deficit (the difference between public revenue and expenditure) and the debt (the net amount the UK is in the red). However, the way he presents his numbers comes across as intentionally misleading.

    By his reasoning, the total increase in the net assets of these top 1,000 over a three year period (£155b) is enough to plug the deficit for a single year (circa £150b). Or, if you forced the UK’s 1,000 richest to liquidate their total assets it would plug the deficit for two and a half years.

    None of that would get rid of the debt (or the underlying reasons for the debt). And, after those two and a half years, you’d be back to square one (minus said 1,000 richest, presumably). Doesn’t strike me as a sustainable economic strategy.

    I tried to get into the 100 Richest List in order to further critically examine his numbers, but it’s behind a firewall. I assume if they’re that rich their assets mainly consist of the ownership of businesses. So liquidating said assets would presumably involve the commandeering of those companies and selling them back to the market? This is all very Chairman Mao.

    It’s depressing that ‘The Guardian’ have published the letter without a basic critical examination of Mr Meacher’s peculiar comparison of one year’s deficit with three years asset accumulation, and that so many people have seized upon them with the apparent misunderstanding that he’s talking about income.

    This does not bode well for the British public’s ability to hold it’s elected leaders to account, or to encourage them to be financially responsible for the long-term good of the country.

    Mr Meacher published a similar article in the News Statesman on 27 January 2012, albeit with slightly different figures. I took the time to post a comment at the time, pointing out the apparent elementary confusion, but for some reason it’s not there.

    Kind regards

    Peter Baker

  11. I agree with the general tenor, but the deficit (£185bn or so) is not the debt (£1.3-1.4 trillion)and is not “paid off”. It looks like you’re confusing the two.

  12. This is an excellent article. I have every sympathy though, with critics of the previous Government. It’s hardly a ringing endorsement to argue that Labour are a lesser evil. What value ‘democracy’ when Tweedledee and Tweedledum yield the same outcome? Voting Green!

  13. Doesn’t need to be on every news channel. Seems to be going viral on Facebook. That’s how I saw it.

  14. I thought Mr Meacher might like to know, that someone has carefully cut this article, from whatever newspaper it appeared in, photographed it and shared it on Facebook! It is still doing the rounds this morning.

  15. What was Mr Meacher doing when Blair, Mandy, Byers, Milburn, Hoon et al were sucking up to Murdoch, Ecclestone and the rest of their acolytes? Why did he do and say so little whilst they pursued their neo-thatcherite agenda and were worshipping at the alter of “Trickle-down” ?! Where in that golden 1997-2008 era were the 60%(and higher) top rates of tax that Thatcher’s governments made the rich endure …? We may not like the coalition but to blame them for the follies of the previous “Labour” government is completely absurd and reprehensible. Furthermore using infantile mathematics(thank you Peter Baker) to temporarily plug the holes in the books does not re-balance the economy does it? It would be far better if Meacher and his allies were attacking the corrupt system of fractional reserve banking directly rather than going back to 1970s style rhetoric and …

  16. Peter Baker:

    Thank you for your helpful comment. I do of course well understand the difference between the budget deficit (the difference between tax revenues and expenditure, currently about £125bn) and the national debt (the stock of liabilities that has accumulated over time, currently around £1tn, but expected to rise to about £1.4tn by 2014-5), but I agree that the way I made the point on my website on 29 April could be read as misleading. My point was that the gains made by the richest 1,000 persons in the UK, just 0.003% of the population, in the last 3 years – £155bn – were so stupendous that it was enough, and more, to pay down the entire UK budget deficit. Nobody could seriously take it that it would happen in this way, and of course I was not suggesting that. It was simply a way of illustrating the sheer magnitude of the gains of the ultra-rich in an economic context when everybody else was being subject to unprecedented cutbacks, yet they themselves were hardly being taxed at all on these colossal gains.

    In terms of practical politics, I would make three points. First, it is clearly practicable, and desirable, to require the very rich to make a fair and proportionate contribution to resolving the country’s current financial crisis, and as I stated, they could be charged capital gains tax or an annual wealth tax on their net wealth or their gains over a certain period. For example, as I stated, charging 28% capital gains tax on their gains over for illustrative purposes the last 15 years (£315bn) would raise about £88bn, equal to 70% of the current UK budget deficit.

    Second, if this general policy were being pursued, it would not of course be confined to just the 1,000 richest persons, though they themselves alone have total wealth of £1tn. The richest 1% in the population (those with incomes over £3,000 a week) number 307,000, and they own some 22% of total wealth. A graduated wealth tax could therefore raise serious amounts of revenue for the Exchequer.

    But my third and main point is that, as my regular blogs on my website have repeatedly demonstrated, I have never suggested that taxing the super-rich should simply be used to fill the gap between tax receipts and expenditure. I have always proposed that the way to cut the deficit was not by prolonged austerity, but by public capital investment to generate jobs and growth, and that this should be funded either by quantitative easing (channelled through a new National Infrastructure Bank, not the current Big Five) and/or proper and fair taxation of the super-rich. That is the real way to deal with the deficit.

  17. >One is that the 1,000 richest persons in the UK have increased their wealth by so much in the last 3 years – £155bn – that they themselves alone could pay off the entire UK budget deficit and still leave themselves with £30bn to spare which should be enough to keep the wolf from the door.

    You also forgot to mention that the £155bn was only a recovery from the wealth lost in a single year 4 years ago.

  18. Thank you Mr Meacher but you have not responded to my points above…. Clearly you are an accomplished politician but you conveniently attack the coalition(presumably because they are mostly Tory party). As you elucidate “the stock of liabilities that has accumulated over time” is burdensome to all of us, however it was politicians of all colours who promoted the horrendous debt! The National Infrastructure Bank is an exciting concept but who ultimately would be responsible for it and it’s governance? How do we encourage these kleptocrat billionaires to remain in the UK and pay back all this tax?

  19. It is astounding that there are people who find arguments against what Mr Meacher has outlined here. I also find it astounding that they believe the British people should have to struggle to encourage billionaires and millionaires to stay here. Britain is an amazing country, and it is a priviledge to live here, a priviledge which it is deemed should be paid for in taxes. These taxes should rightly be in proportion to your wealth and earnings, whether you are rich or poor. The argument that we should allow the disgustingly rich a cheap ride in order that they will kindly allow their wealth, gained from the sweat of the workers, to ‘trickle down’, is an absolute disgrace to anyone who voices such an argument. If the wealthy in question had a shred of decency and honesty they would gladly part with a little more of their enormous pile to help make for a better country. The fact that they believe we are indebted to them shows their blatant disregard for the ‘little people’, and I believe we should let them leave, or even encourage them to do so if that is their attitude to our country. Britain was not made great by pieces of paper with the queen’s head on, or imaginary numbers in computers.

  20. You can lay much of this at the feet of Tory Blair and his New Labour and his vile policies of PFI and courting the rich and powerful.He and his cohort Peter Mandelson tore the heart out of Labour and trampled it underfoot,what little socialism that was left over from Attlee and Bevan was throw into the dustbin of antiquity..The rich have prospered at the expense of the poor under New Labour and this fascist leaning right wing coalition party who are in power now and the mood music on the streets is one of mass revolt and a English Spring..very soon, cos the balance has got to be redressed..

  21. just wanted to say this if you look further at the figures he provides this crops up – “The increase in their wealth over the last 15 years has therefore been £315bn”… that means that the gains of the past 3 years accounts for just under 50% of the gains of the overall past 15 years

  22. … with what I just typed, do people still think “we’re all in it together”? Still believe in the trickle down theory, and this notion of wealth creators (that has been picked up from the American Republican party and is now doing the rounds under this government)?

  23. The main problem with the arguments above (and the reality of the actual situation) is that, right or wrong, they are quite complicated to present convincingly to the general public. What Gideon has successfully done is to present a very simple message for the general public (including the national press and broadcasting media) that “It’s all their fault” either by commission or omission.
    It is the case that many factors contributed to the current mess, including the actions of those (the poor, the ill, the old, the unemployed, the unhoused etc.) who are now likely to be the most seriously harmed by austerity politics.
    However I agree with Meacher when he says that the way to deal with the deficit is not by prolonged austerity, but by public capital investment to generate jobs and growth, and that this should be funded either by quantitative easing (what we used to call ‘open market operations) and fair taxation of everyone, including the super-rich.

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  26. This is total populist nonsense. Do you expect these people to give their money for your overspending or do you propose stealing it? You seem to have no concept of what caused the financial crash & it’s impact on the taxpayer (Gordon Brown bailing out banks – a wrong move). If you were interested in sorting out the deficit you’d have turned your pay rise down & have objected to HS2. Our tax money should go on better representatives than you

  27. Is humanity not capable of harnessing fairness and harmony for all? Do we not all want food in our systems, a safe roof over our heads & enough wherewithal to go about business interactions that give rise to quality outcomes not vast profiteering? Human nature can both be explained and modified. A debate on financial austerity & wealth is insipid when it is stacked against the future needs of humanity on this increasingly delicate ecosystem. We absolutely need to make paradigm shifts in our thoughts, behaviours and values especially around personal wealth before any of this will actually change. Not many persons on their deathbeds are going to look back in all honesty and say that their wealth accumulation was their gift to humanity and indeed will encounter a certain all too late pang of conscience. Let’s change the debate from numbers, accusations and fear to another frequency of debate that unites us.

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