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Billionaires amass more through inheritance than wealth creation, says UBS

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Re: Billionaires amass more through inheritance than wealth creation, says UBS

#291

Post by uoaei »

pydry wrote: post #146
uoaei wrote: post #138

Earlier quoted context omitted.

Distribution implies few to many, concentration implies many to few. We could call it semantics or we could call it using words correctly.

It might imply few to many to you, but to other people it implies not earned. Implication is often a highly personal thing.

https://en.m.wiktionary.org/wiki/distribute

Roughly, literally, "to give apart", i.e., to break up a resource from fewer to more owners.

I'm a big fan of poststructuralism but social spaces generally require that people understand each other. We can't just go redefining words on personal whims unless the people you're communicating with have consented to be a part of that metatextual process. This isn't that kind of space.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#292

Post by AnimalMuppet »

pmorici wrote: post #270
AnimalMuppet wrote: post #255

Earlier quoted context omitted.

You think $5 million a year only gets up upper middle class lifestyle? I don't think we share definitions...

That’s 5 million in assets from which you can derive a yearly income of $150k per year adjusted for inflation as time goes on. Yes I consider 150k per year upper middle class.

Ah, I see. I misread your previous comment.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#293

Post by kelseyfrog »

blacksmith_tb wrote: post #274
zozbot234 wrote: post #208

Earlier quoted context omitted.

We are pretty much there already. The average person in a developed Western country is pretty much a billionaire when compared to the living conditions of even the wealthiest people in ancient history. It's only the impulse of greed and envy towards others that leads us to believe otherwise.

Traditional responses see that as either good (which I think is your implication) or terrible, a la "bread and circuses" where people are too complacent to demand any real changes. I would say that the "average person" is a tricky model, here in the US there are people sleeping on the sidewalk, but they have smartphones in their pockets. Are they better off than a Roman emperor? I would say no.

Thanks for pointing this out. It helped me contextualize the argument.

It is a combination of "Other People Have It Worse Than You Do" but uses the past as a point of reference.

We could just as easy compare ourselves to our presumably better off future and say that we have it worse off than them so we deserve to improve things now.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#294

Post by rufus_foreman »

godelski wrote: post #241
chrischattin wrote: post #130

Earlier quoted context omitted.

Hardly empirical. The data shows the opposite. ~80% of current billionaires in the U.S. are self-made first generation.

> ~80% of current billionaires in the U.S. are self-made first generation. I see conflicting evidence to the claim[0,1,2] I'd argue that you also got to be really careful with these studies. Defining "self-made" is not a straight forward issue. In some sense, no person is self made as we're all products of our environments and the opportunities presented to us. If it were consistent you wouldn't see these numbers swi…

>> Defining "self-made" is not a straight forward issue

Forbes has an interesting (to me at least) self-made score that assigns ten categories from "Inherited fortune but not working to increase it" to "Self-made who not only grew up poor but also overcame significant obstacles", https://www.forbes.com/sites/gigizamora/2023/10/03/the-2023-....

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#295

Post by abeppu »

NovemberWhiskey wrote: post #273
abeppu wrote: post #266

Earlier quoted context omitted.

Of the criticisms to Piketty, not having done the math isn't really one of them. I don't have Capital and Ideology close at hand, so I can't check how he worked it out, but consulting some other sources: - the top 1% in the US apparently have around $45.7T in wealth [1] - there are around 22M people in the 20-24 age bracket and 23 in the 25-29 age bracket [2] So suppose there are 5.5M people turning 21 every year. Gi…

The top 1% of households in the US starts around $10M. That sounds like a lot, but consider it includes retirement accounts, value of a home etc. For a couple in that bracket at about retirement age (and who might own their home and be expecting to retire on their savings), those people might be looking at a household income of $300-400K per year. I don't know, but it seems pretty unreasonable to start hitting them w…

Would the crudest flat rate scheme be unappealing to people just above the threshold to which it applies? Sure. I don't think anyone's seriously advocating for Bezos and the successful small business owner to be paying the same rate.

AnthonyMouse created a strawman to fight; getting from "very wealthy" to "only the top 100 billionaires" is kinda crazy. To use that to assert that the math just doesn't work on using a wealth tax to fund universal inheritance is kinda untenable.

I think "wealthier than 99% of people in a rich country" is fair to call "very wealthy" but I can see how others would differ. I also hope you can see how the person with >10M in net worth would not be happy to pay 1.2% but can likely swing it (and under this crude hypothetical, stops paying it if they fall to merely being richer than 98.9% of their peers), but that the 100k would be life-changing and transformative for young people.

Piketty's proposals for a wealth tax have varied over the years, but have at points in the past included 1% above 1M euros, 2% above 5M euros, 5-10% above 1B euros. He's trying to re-imagine a more equal society; the redistribution can't be small.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#296

Post by beaeglebeach »

wewtyflakes wrote: post #284
beaeglebeach wrote: post #236

Earlier quoted context omitted.

[flagged]

Better to be robbed by the rich than by the poor? If you're convinced the world is out to get you, what difference does it make?

[flagged]

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#297

Post by DennisP »

lapcat wrote: post #229
DennisP wrote: post #204

Earlier quoted context omitted.

I wasn't the one who called it clickbait but I do think it's misleading. The one year could easily be an outlier. It might be by accident, or it could be that the writer was more interested in pushing a political view than getting clicks.

> it could be that the writer was more interested in pushing a political view than getting clicks. The report comes from the Union Bank of Switzerland. https://www.ubs.com/global/en/media/display-page-ndp/en-2023... "UBS manages the largest amount of private wealth in the world, counting approximately half of the world's billionaires among its clients." https://en.wikipedia.org/wiki/UBS Also keep in mind that some of…

I don't dispute the content of the report, but the report doesn't have the misleading title we were talking about; in fact, the first line says "For the first time in nine editions of the report..." My only complaint is that the title at FT makes it sound like it's always this way.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#298

Post by NovemberWhiskey »

Epa095 wrote: post #285
NovemberWhiskey wrote: post #273

Earlier quoted context omitted.

The top 1% of households in the US starts around $10M. That sounds like a lot, but consider it includes retirement accounts, value of a home etc. For a couple in that bracket at about retirement age (and who might own their home and be expecting to retire on their savings), those people might be looking at a household income of $300-400K per year. I don't know, but it seems pretty unreasonable to start hitting them w…

$10M sounds like a lot, because it is a lot. It's so much that if you make the median US income, you have to make it for ~300 years -tax free- to save up $10M. It's 50 years, tax free, on a good developer salary. It's so much that with 5% interest rate you can pay those $120k in tax and still get $380k a year, placing you among the top 5% wage earners in the US, while doing nothing more than own. Is so much, that whe…

I mean, sure if you completely ignore investment returns; otherwise your numbers are bogus.

The “safe” rate of retirement drawdown is generally accepted as 4% because inflation, bad years in the markets etc.

In case it isn’t obvious, taxing wealth is basically taxing the older people in society, because they had more of a chance to accumulate wealth.

Hitting people at retirement with a 25% marginal tax increase is just wrong and an unworkable policy proposal.

Piketty’s proposal may work in countries with functional pension schemes, but not in the U.S. where personal wealth accumulation is necessary to extent a solid middle class lifestyle into retirement.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#299

Post by DennisP »

lapcat wrote: post #264
rufus_foreman wrote: post #261

Earlier quoted context omitted.

Buffet has said he is giving most of his money away. Same with Gates, Ellison and Bloomberg. Carlos Slim has also been donating huge amounts to philanthropies.

We'll see what happens when they actually die. In any case, they're giving their money "away" to "foundations" controlled by billionaire families. The money is still inherited, and these foundations can be seen as tax shelters.

I've spent some time googling how foundations work and while there are various structures, a common theme is that it's not that cushy. The bulk of the money has to actually go to charity, otherwise you pay the normal taxes. And they keep an eye out for tricks like having the foundation pay absurd salaries to your relatives.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#300

Post by onlyrealcuzzo »

wing-_-nuts wrote: post #177
onlyrealcuzzo wrote: post #128

Earlier quoted context omitted.

> Due to the historical averages of the rate of return on capital, he concluded empirically that wealth will continue to concentrate to the point to inheritors, to the extent that individuals become increasingly unable through labor to achieve parity to the inheritors. You're obviously incredibly unlikely to become a billionaire. If someone inherits billions - you're not going to out-labor them to become richer. Only…

>I'm in favor of inheritance taxes. But this doesn't seem like the main driver of inequality.... I mean, Piketty's work shows that it is... I'd like to see a scandi style tax system and social safety net. Inheritance taxes at the point where 90% of small business and farms won't be affected. Progressive carbon taxes. Massively increased social safety net that includes paid education, healthcare, and unemployment gene…

> I mean, Piketty's work shows that it is...

He shows that - currently - R > G. I'm not convinced this "proves" inheritance is the main problem.

It shows that you can't work your way to the top - only invest and get lucky (of which inheritance is one of many ways to get lucky).

And by the way - it shows that this was true for all of human history except a brief window after WW2.

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