Look at the above graph and you can see how wealth inequality has tumbled down. This is largely down to the huge growth in the middle class and to punishing death duties on hereditary wealth enforced by envious class warfare Labour governments. In Britain today there are more people who are self employed or who are business managers than there are members of trade unions. Our economy is now based on knowledge, not on manual labour. We are all middle class now.
It is very important for anyone concerned about these social issues to understand that there are two completely different types of equality. Firstly there is equality of opportunity. This is the only decent, moral way to organise a society and it benefits everyone because the best people rise to the top. Equality of outcome, which many lefties want, is pure evil. It says that society should reward the lazy, stupid and feckless the same as we reward the hard working, the intelligent and the enterprising. Which is utterly immoral.
It is a fact that inequality is excellent to have in society. It means that people strive to have more for themselves and their families. More holidays, better restaurants, nicer clothes. The whole of society benefits from the results of all this striving. Socialists want all the good stuff too, but instead of striving for it they expect the government to give it to them, paid for by punishing the strivers. Lefties really occupy the moral low ground.
This next graph, above, shows how wealth inequality increased when Gordon Brown was Chancellor and then Prime Minister, it could be argued that this was because he didn’t know what he was doing, and there is a lot of evidence for this. But it is a fact and when socialists harp on about equality just ask them why they reduced it.
Under George Osborne this has been reversed, he has sharply reduced inequality. Click here to see an FT article proving this. As you can see from the above graph only the rich actually pay any tax. In fact Osborne taxes the rich harder than any other Chancellor before. Click here to see a Spectator article about this. Click here to see an article from this blog about this. Osborne has massively reduced the tax that the poor pay, the personal tax allowance in 2009/10 was just £6,475 and by 2015/16 it is increased massively to £10,600. Not only that, the national minimum wage in 2009 was £5.80 an hour, Osborne’s National Living Wage, starts at £7.20 rising to £9 an hour by 2020. With minimal inflation and the prices of many essentials dropping this is a huge boost.
Gordon Brown used a number of methods to keep the poor people poor and to keep them under control. Firstly the National Minimum Wage, which he introduced in 1998, rapidly became the standard wage for great swathes of society which meant that very many people earned less and wage advancement became more difficult. Secondly Labour imported many hundreds of thousands of unskilled and poorly skilled workers from the 3rd world to compete for the available jobs, further deflating pay rates. Then, with socialist authoritarianism, Brown increased benefits to those he had made poorer, increasing his control over the population. Just more of the evil of socialism.
One thing the left continually complain about is “the rich”. This is just pure, undiluted, bitter envy, one of the seven deadly sins. Virtually all rich people are self made, they have achieved their wealth by hard work, enterprise, risk taking, investment and entrepreneurship. In making their wealth they have increased national economic activity which benefits everyone and, as we have seen already, they have paid lots of tax. If a person living down my street has a helicopter, a business jet, a swimming pool and a house in Barbados then good on him. He has all these things because he deserves them. And I have benefited from his achievements. It is a pity that the left are driven by class warfare, they want everyone to be poor, whereas the free market wants everyone to be rich. And inherited wealth is transient, 70% of wealthy families lose their wealth by the second generation, and a stunning 90% by the third.
One thing the left hate are the 1%. The people who have contributed so much to our lives that they have become super rich. We live in an age where this is possible to achieve within one person’s lifetime because we have global markets and information technology. An entrepreneur can reach 7 billion potential customers without moving from an attic in the Shetland Islands. And if you got all the worlds wealth and shared it equally it would be back in the hands of the super rich entrepreneurs within a few years. Let’s look at who some of these people are:
- Carlos Slim. Studied civil engineering and economics before becoming a stock trader, living modestly and continuously reinvesting for more than 20 years. Time after time he bought undervalued, underperforming companies and made them successful. Then reinvested the proceeds. He invested in creating Mexico’s mobile phone network and then reinvested the proceeds from this. Has given vast amounts of money to charity, including more than $3bn to his Carlos Slim foundation. He is worth $69bn.
- Bill Gates, son of a lawyer who dropped out of university to found Microsoft. Largely responsible for the home computer revolution with DOS, Windows, Office, Xbox and many other products, which have improved everyone’s lives. Made very many of his employees very rich. Giving away most of his wealth to charity. Worth $61bn.
- Warren Buffet, son of a politician. Made his fortune by investing other people’s money for them very successfully whilst at the same time making very many businesses very successful. He lives modestly and frugally and is giving away 99% of his wealth to charity. Worth $44bn.
- Bernard Arnault, son of the owner of a civil engineering company which he persuaded his father to liquidate. With the proceeds he invested in real estate and holiday accommodation. With the proceeds from this he bought into luxury goods manufacturers, into which he has reinvested and reinvested, turning many companies round and employing 90,000 people at LVMH, he is famous for his philanthropy and for collecting art. Worth $41bn.
- Amancio Ortega, son of a railway worker, became a shirt maker. By hard work and continuous reinvestment built this into Zara. Lives very simply and has made jobs for nearly 100,000 people. Worth $37.5bn.
- Larry Ellison, born to a single mother he was given up for adoption. Dropped out of university and in 1977 founded Software Development Laboratories (SDL) with two partners and an investment of $2,000, $1,200 of which was his. This became Oracle, which with hard work and continuous reinvestment grew to employ more than 135,000 people and provides the technology that much of the internet works on. He has given vast sums to charity since the early 1990s and has signed The Giving Pledge (as have more than 140 of the world’s richest people) to give 95% of his wealth to charity. He is worth $36bn.
- Eike Batista, son of a politician, worked as a door to door insurance salesman then, at 23 years old, he started a gold trading firm Autram Aurem. With continuous reinvestment, hard work and innovation he rode the world commodity boom with a cluster of huge companies. Then this wealth shrunk by more than 100% between March 2012 and January 2014, from a peak net worth of $32 billion to a negative net worth when one of his investments, OGX, went wrong. The other huge companies he built are still providing vast numbers of jobs and materials for the world economy.
As you can see virtually all the wealth of the world’s richest people is made by themselves. Anyone can do it. They have created huge numbers of jobs and brought goods and services, in the free market, to billions of people, improving the quality of their lives. Altruism, philanthropy and charity is the main way that these billionaires use the wealth that they have created. Yet the lefties hate them.
Further reading (click highlighted text to open article):