If You’ve £10 And No Debt You’re Richer Than 10% Of Britons – Added Together

The Equality Trust treats us to a feast of economic nonsense today in their whinges about wealth inequality. They manage to entirely forget that anyone with a £10 note and no debt is richer than 10% of Britons. That’s 10% of Britons put together. This though is only the least of their economic sins:

New analysis by The Equality Trust, using the wealth estimates of Forbes and Credit
Suisse, reveals a shocking level of wealth inequality in the UK, and shows how this
inequality has increased since 2010

Scary, eh?

According to the Credit Suisse Global Wealth databook, https://www.creditsuisse.com/media/assets/corporate/docs/about-us/research/publications/global-wealthdatabook- 2019.pdf, the wealth of the bottom 20% of the UK population is 13.28. The
bottom 10% has negative wealth of $109 billion and the second decile has a positive
net wealth of $21 billion. This gives a total figure of $-88 billion.

Quite, people can have negative wealth. Thus someone who has only £10 of actual cash, but no debts, is richer than that bottom 10% put together. In fact, than that entire bottom 20% put together.

We can and should go further than this though. Who are that 10% without significant net assets? Well, among them will be just about anyone who has graduated from university in the past few years. They will have student debt and absent any inheritance they’re most unlikely to have any positive assets. Except, of course, their human capital, that sheepskin which will increase their earning power throughout their lives. It’s just that we’re not counting human capital in our definition of wealth.

But the Equality Trust is using that Cambridge graduate, just about to join Goldman Sachs on squidillions a year, as an example of the wealth inequality – on the downside note, not the up – that must be abolished.

There’s also this:

In the UK, the five richest families own more wealth than 13.2 million
people.
• Over the last ten years the number of billionaires in the UK has almost
doubled and the wealth of the UK’s billionaires has more than doubled.
• The richest 1% of people in the UK owns the same wealth as 80% of the
population, or 53 million people.
• 14 million people, a fifth of the population, live in poverty. Four million of
these are more than 50% below the poverty line, and 1.5 million are
destitute, unable to afford basic essentials.

Switching, as they do, between a discussion of wealth and one of income is a certain sign – that is, not a certain one of many, but one involving certainty – of economic illiteracy.

But the really grand mistake here?

What’s the value of the welfare state? We do have it because we think it makes us all generally richer. And while we can have the most lovely arguments about whether it should be exactly as it is the base idea that a general insurance system does make us richer is going to hold for everyone but Ayn Rand’s ghost.

Think on it. You’ve no assets at all, no cash, no house, no stocks, bonds, shares nor even bank account. You also get free education for all your children, free medical care for yourself and everyone else, the government knocks on your door and proffers free cash – heck, they’ll even pay for your door and the building it’s attached to.

Do you actually have no assets? Or do you have that substantial wealth that comes from living in a welfare state? Quite, and no estimation of wealth inequality that doesn’t take this into account is going to be worth it, is it?

Think on it again. In, say, Zimbabwe there is no welfare state. In the UK there is. Someone who lives in the UK is richer – not has a higher income but has greater wealth – than someone in Zimbabwe or not? And asking the same question along a different axis, someone living now in the UK is richer or not that someone pre-1909 when the welfare state first started to be built?

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[…] treats us to his analysis of the problems with taxation and wealth in the UK. He refers to the Equality Trust’s report on that wealth inequality. He notes that 6 people control as much wealth as the bottom 13 […]

Spike
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Spike

Why should there be wealth equality? (Why should there be income equality? Why should there be equal representation of races, sexes, and cultures? Why should there be sustainability?)

Transferring the charity functions to government does not make us richer. It enables unlimited theft, justifies taking from one and gifting it to another, validates excuse-making, and deprecates self-improvement.

Leo Savantt
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Leo Savantt

To quote the siren that is Joni Mitchel “you don’t know what you’ve got till it’s gone”. Even poorer Brits are amongst the wealthiest people ever to have lived in all of human history. Furthermore they live more equally amongst their contemporaries than ever before. The gap between aristocrat and farm labourer in the middle ages, in real terms, was far greater than the gap between a benefit recipient and the millionaire today; now both get their children educated, both have access to healthcare, both have a warm(ish) home, both generally have TV(except for the wise) and both have enough/too… Read more »

Quentin Vole
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Quentin Vole

1.5 million are destitute, unable to afford basic essentials.

Rilly? Where are they and why have their benefits been stopped?

Jihn Olm
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Jihn Olm

For a webpage that has the motto “realist, not comformist” in their header. You and your acolytes sure seem to promote conformism quite a lot.

jgh
Guest
jgh

That looks like Sham Shui Po MTR station, so even Mr Kwan there has positive wealth, as he has access to community-provided senior citizen support; if he can put up with associating with a dozen other oldsters for a couple of hours and ignore the prayers, he can get one hot square a day.

Esteban
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Esteban

Note also that they claim that a fifth of the population “live in poverty”. N0, a fifth of the population would live in poverty if it weren’t for all the things that British society (charities and government) does to make sure they’re taken care of. Not to mention that numerous studies have shown that a lot of supposedly poor people have income and assets that aren’t counted for a variety of reasons (income from illegal activities, income that is hidden to qualify for benefits, the option to live with their parents, etc.).