Calls to tax the super rich increased in 2024 & G20 countries have noticed. Here in Australia, billionaires have increased their wealth by 70.5% since 2020

The world’s richest have truly never been richer and the gap between the rich and the poor in most countries has truly never been wider. In the first two years of the COVID-19 pandemic, the world’s ten richest men doubled their collective fortunes – from $700 billion to $1.5 trillion – at the same time that incomes for 99% of humanity fell. [Patriotic Millionaires, January 2023]

Wealth Of Australia’s 50 Richest On Forbes List Rises To $222 Billion [Forbes, 15 February 2024]

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Top 1 percent bags over $40 trillion in new wealth during past decade as taxes on the rich reach historic lows

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Oxfam Australia Media Release

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Thursday 25 July 2024

The richest 1 percent have amassed $42 trillion in new wealth over the past decade, nearly 34 times more than the entire bottom 50 percent of the world’s population, according to new analysis by Oxfam today ahead of the third meeting of G20 Finance Ministers and Central Bank Governors in Rio de Janeiro, Brazil.

Here in Australia, billionaires have increased their wealth by 70.5% or $120 billion since 2020. Australians are increasingly concerned about this growing inequality and support a wealth tax to address it. This is evidenced by newly released YouGov polling commissioned by Oxfam. The polling shows:

• 76% of Australians are concerned about the growing wealth gap between the ultra-rich and everyday people

• 74% Support a wealth tax of people with wealth of over $50 million

• 63% Support wealth tax proceeds being used to reduce inequality

The average wealth per person in the top 1 percent globally rose by nearly $400,000 in real terms over the last decade compared to just $335 – an equivalent increase of less than nine cents a day – for a person in the bottom half.

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Responding to the Rio de Janeiro G20 Ministerial Declaration on International Tax Cooperation published on 26 July 2024, Oxfam International’s Tax Policy Lead Susana Ruiz, said:

"This is serious global progress —for the first time in history, the world’s largest economies have agreed to cooperate to tax the ultra-rich. Finally, the richest people are being told they can't game the tax system or avoid paying their fair share.

"Governments have for too long been complicit in helping the ultra-rich pay little or zero tax. Massive fortunes afford the world’s ultra-rich outsized influence and power, which they wield to shield, stash and supersize their wealth, undercutting democracy and widening inequality.

"Now to the next step: at the G20 Summit in November this year, leaders need to go further than their finance ministers and back concrete coordination: agreeing on a new global standard that taxes the ultra-rich at a rate high enough to close the gap between them and the rest of us.

"Brazil has kickstarted a truly global approach to tax the ultra-rich. But the work is just beginning and international cooperation is crucial.

"We call on G20 leaders to align with the progress being made at the UN and establish a truly democratic process for setting global standards on taxing the ultra-rich. Entrusting this task to the OECD —the club of mostly rich countries— would simply not be good enough."

BACKGROUND

• Earlier this month, close to 20 former heads of state and government of G20 and higher-income countries called on current G20 leaders, including US President Joe Biden, German Chancellor Olaf Scholz and UK Prime Minister Keir Starmer, to support a “new global deal to tax the world’s ultra-rich individuals” in an open letter.

• Oxfam’s research found that the share of national income going to the top 1 percent of earners in G20 countries has increased by 45 percent over the last four decades. During the same period, the top tax rates on their incomes has fallen by roughly a third (from around 60 percent in 1980 to 40 percent in 2022).

• According to the EU Tax Observatory, global billionaires have very low personal effective tax rates, of between 0 percent and 0.5 percent of their wealth.

 

TOP 10 RICHEST AUSTRALIANS

according to Forbes, 14 February 2024

1. Gina Rinehart; US$30.2 billion

2. Andrew Forrest & Family; $21.5 billion

3. Harry Triguboff; $16.2 billion

4. Mike Cannon-Brookes; $13.7 billion

5. Scott Farquhar; $13.5 billion

6. Anthony Pratt; $10.3 billion

7. Cliff Obrecht and Melanie Perkins, $8.8 billion

8. Bianca Rinehart & Siblings, $8.5 billion

9. John, Alan & Bruce Wilson, $6.6 billion

10. Frank Lowy, $6.5 billion

Twitter continues to be plagued by its out-of-his-depth new owner

 

A forlorn tweet sent shortly after 2am, read & retrieved at 2:53am AEDST on 30 December 2022 in Australia.

New York Times, 28 December 2022:

Twitter users in widespread locations said they were having problems with the service on Wednesday evening, days after Elon Musk said he had shut down one of the company’s data centers in Sacramento. The issues primarily hit users of the company’s site for desktop computer users, according to Down Detector, while some complained that its mobile app also experienced trouble.

The cause of the outages was not immediately clear. Some users reported that they had been logged out of Twitter, while others said they could not view replies to their tweets but had access to other parts of the service. Other users said they had encountered error messages while scrolling through their timelines, the primary feed of tweets that people see when they log in to Twitter.

The errors began around 7 p.m. Eastern time, according to Down Detector, a service that monitors web outages. The hashtag #TwitterDown trended on the platform as users reported their experiences with the outage.

“The problems with Twitter exhibit in multiple countries and are widespread,” said Isik Mater, the director of research at NetBlocks, an internet monitoring service. “The platform API is affected, which serves the mobile app as well as many aspects of the desktop site,” she added, referring to the interface on which Twitter operates.

Mr. Musk, who bought Twitter in late October for $44 billion, said on Saturday that Twitter continued to work smoothly, “even after I disconnected one of the more sensitive server racks.” The billionaire has been focused on reducing Twitter’s costs, eliminating contracts with vendors, laying off employees and reducing the company’s real estate footprint.

According to the Bloomberg Billionaire Index as of 30 December 2022 Elon Musk's wealth has fallen by $132 billion in 2022 and now stands at $138 billion. Yahoo! News stated on 30 December 2022: "Elon Musk has seen his net worth plummet by more than $200 billion over the last 13 months, marking the biggest loss of wealth in modern history." 

Top 10 Wealthy Federal Electorate and Bottom 10 Electorates - a very brief glimpse at the Australian experience of inequality

 

TOP 10 HOUSE OF REPRESENTATIVES ELECTORATES RANKED BY ORDER OF WEALTH IN 2020*

Wentworth (NSW) – Liberal – Dave Sharna since 2019 (general election) – No 1 electorate

Warringah (NSW) – Independent – Zali Steggall since 2019 (general election) – No 2 electorate

Bradfield (NSW) – Liberal – Paul Fletcher since 2009 (by-election) – No 3 electorate

North Sydney (NSW) – Liberal – Trent Zimmerman since 2015 (by-election) – No 4 electorate

Mackellar (NSW) – Liberal – Jason Falinski since 2016 (general election) – No 5

Cook (NSW) – Liberal – Scott Morrison since 2007 (general election) – No 6

Goldstein (Vic) – Liberal – Tim Wilson since 2016 (general election) – No 7

Higgins (Vic) – Liberal – Katie Allen since 2019 (general election) – No 8

Curtin (WA) – Liberal – Celia Hammond since 2019 (general election) – No 9

Kooyong (Vic) – Liberal – Josh Frydenberg since 2019 (general election) – No 10.

Four Liberal electorates in this group contain sitting members in the office of Prime Minister, Treasurer, Minister for Communications, Urban Infrastructure, Cities and the Arts and, Assistant Minister to the Minister for Industry, Energy and Emissions Reduction.

Within this group of wealthy electorates only est. 6.48% of all households were living below the poverty line. 

It should come as no surprise that in 10 electorates with the lowest wealth rankings:

5 were Labor electorates – Spence (SA), Brand (WA), Burt (WA), Blair (Qld), Chifley (NSW); and

5 were LNP/Nationals electorates – Herbert (Qld), Flynn (Qld), Forde (Qld), Longman (Qld), Capricornia (Qld).

Across these five Labor electorates est.13.38% of all households were living below the poverty line**, while across the other five LNP/Nationals electorates est.12.18% of all households were living below the poverty line.

The two NSW Northern Rivers federal electorates ranked 25th (Richmond –  Labor since 2004) and 112th (Page – Nationals since 2013 general election) for average wealth per capita. With Richmond having 14% of all households living below the poverty line and Page having 16.4% of households.

NOTE: 

* Order of wealth is calculated by average per capita wealth in an electorate as set out in Roy Morgan Wealth Report, 1 May 2020.

** RMIT ABC Fact Check, "Federal electorates ranked by percentage of households below the poverty line", 24 October 2019.

Individual wealth in the NSW Northern Rivers region

Richmond and Page federal electorates in the Northern Rivers region ranked 24th and 112th respectively when it come to net wealth per capita and median net wealth by the end of 2019.

In Richmond half the individual interviewees had net wealth of $325k or less and in Page half had $175k or less.

The highest indivdual average net wealth was unsurprisingly found in the electorates of Wentworth (Liberal MP Dave Sharma), Warringah (Independent MP Zali Steggall), Bradfield (Liberal MP & Minister Paul Fletcher), North Sydney (Liberal MP Trent Zimmerman), Mackellar (Liberal MP Jason Falinski) and Cook (Liberal MP & Prime Minister Scott Morrison).

The current COVID-19 pandemic is likely to significantly change net wealth across many electorates in this table.

Roy Morgan, 1 May 2020

24 months to December 2019, average 12-month sample, n = 50,431

Personal Net Wealth is calculated by subtracting debt from assets, predominantly equity in owner-occupied homes, plus superannuation.

It appears that in a Morrison-led economy not all of his aspirational folk "who have a go" are actually managing to "get a go"

Credit Suisse Research Institute, Global wealth report 2019, excerpt:

For the past decade, global wealth creation has centered around China and the United States. This year, the United States extended its unbroken spell of wealth gains, which began after the global financial crisis in 2008. The United States also accounts for 40% of dollar millionaires worldwide and for 40% of those in the top 1% of global wealth distribution. Wealth in China started the century from a lower base, but grew at a much faster pace during the early years. It was one of the few countries to avoid the impact of the global financial crisis. China’s progress has enabled it to replace Europe as the principal source of global wealth growth and to replace Japan as the country with the second-largest number of millionaires. More tellingly, China overtook the United States this year to become the country with most people in the top 10% of global wealth distribution. 

The rest of the world has not stood still. Other emerging markets – India in particular – have made a steady contribution, which we expect to continue over the next five years. However, overall worldwide growth was modest in the 12 months up to mid-2019. Aggregate global wealth rose by USD 9.1 trillion to USD 360.6 trillion, representing a growth rate of 2.6%. Wealth per adult grew by just 1.2% to USD 70,850 per adult in mid-2019. The number of new millionaires was also relatively modest, up 1.1 million to 46.8 million. The United States added 675,000 newcomers, more than half of the global total. Japan and China each contributed more than 150,000, but Australia lost 124,000 millionaires following a fall in average wealth.....

Comparing total wealth gains and losses across the most important countries....The main losses occurred in Australia (down USD 443 billion), Turkey (down USD 257 billion) and Pakistan (down USD 141 billion).

During the past year, the total number of UHNW  [Ultra High Net Worth] adults has risen by 6,870 (4%), with every region except Africa recording a net increase. The regions adding most members were North America (4,570), Latin America (870) and Europe (710). China (up 370) and India (up 54) had a relatively quiet year. The individual countries gaining the most members were the United States (4,200) and – more surprisingly – Brazil (860) and Russia (400). Losses occurred in Korea (down 140), Turkey (down 230), Italy (down 270) and Australia (down 280)......

According to our estimates, the number of global millionaires could exceed 62 million in 2024, a rise of almost 16 million from today, and 49 million from the beginning of the century......Among developed economies, millionaire numbers in Germany, France, Italy and Sweden are expected to rise roughly in line with the global average. Canada and Spain should perform a little better, and Japan and Portugal much better. However, growth of millionaire numbers in the United Kingdom after Brexit is unlikely to match the rest of the world and we think this will also be the case with Australia and Norway. 

Also according to Credit Suisse:

• only 29 of the current crop of wannabe millionaires will make it into the winners circle by 2024; and

• Australia's wealth to GDP ratio has fallen since its 2015 level.

Read the full report here.

While for all those other Australians who are not even close to becoming millionaires, the Australian Bureau of Statistics reveals in System of National Accounts 2018-19:

• households have $46.42 billion less in total savings than they had four years ago;

• net household savings are the lowest they have been since the Global Financial Crisis years;

• these households spend less on daily needs to offset almost stagnant wages growth and a collective income tax payable bill which is $56.15 billion higher than it was in June 2015;

• regardless of any reduction in spending on daily needs, households owed a total of $95.8 billion more in loans, placements & accounts payable than they did in June 2018; and

• although employee compensation (wages) has grown modestly in the last financial year, as a share of gross national income employee wages have dropped to 48.44 per cent of the total.

Quotes of the Week

"All billionaires want the same thing – a world that works for them. For many, this means a world in which they are scarcely taxed and scarcely regulated; where labour is cheap and the planet can be used as a dustbin; where they can flit between tax havens and secrecy regimes, using the Earth’s surface as a speculative gaming board, extracting profits and dumping costs. The world that works for them works against us.” [Journalist George Monbiot writing in The Guardian on 3 July 2019]

"Scott Morrison loves “quiet Australians”. The Abbott/Turnbull/Morrison government especially loves quiet charities, quiet scientists, quiet environmentalists, quiet journalists, quiet human rights commissioners, quiet workers in quiet unions and a quiet public broadcaster. It will burn for anyone who stays quiet – and threaten to burn down anyone who raises their voice.” [Pastor Brad Chilcott writing in , 8 July 2019]

Australian society in 2019

It seems when it comes to personal wealth only the poor admit the truth of their financial situation.

Those who are financially well-off in Australia apparently refuse to recognise their good fortune.

This rather strange state of affairs was very obvious during the 2019 federal election campaign.

Last month the national public broadcaster asked its online readers to guess where they stood on the income scale and this was the result.....

ABC News, 2 July 2019:

The interactive divided people into 13 income bands, corresponding to the bands in the Australian Bureau of Statistics' data.

People were asked to estimate which bracket they sat in, and were then asked to enter their weekly take-home pay.

After removing certain outliers with outlandish responses (we're looking at you, Mr or Ms $1 trillion a week) there was a marked difference between those in the top and bottom halves of the income distribution when it came to estimating their place.

Respondents in the top seven brackets (earning more than $800 per week) fared far worse at guessing their place than those in the bottom six brackets. In fact, our lower-earning respondents were 2.6 times better at estimating their place than their higher-earning counterparts…….

But it was those in the third-highest bracket — earning between $1,750 and $2,000 per week — who fared the worst at estimating their position.

Only 2.85 per cent of respondents in this bracket correctly identified their place and the average guess was 3.2 brackets lower than reality.

Quotes of the Week

“If you want to know what caused those conditions, I’ll give you an answer – it’s called climate change,” the Queensland premier told reporters. “It is only the LNP who could watch Queensland burn and then blame the trees.”  [Queensland Premier Anna Palaszczuk quoted in The Guardian, 7 December 2018]

“Last year, more Australians bought their seventh home than those who bought their first”  [Journalist Timothy Swanston quoting an incorrect statment by Queensland Minister for Housing and Public Works Mick de Brenni, ABC News, 8 December 2018]

 “Most people just consider Assange a spoilt-brat egomaniac with murky motives, a limelight habit and some profoundly questionable political affiliations.”  [Journalist Elizabeth Farrelly writing in The Sydney Morning Herald, 8 December 2018]

“Both Brandis and Turnbull were regularly labelled, and probably were what passes for, ‘moderates’ in the neoliberal alt-right nativist populist Trumpist tribal world, or whatever white patriarchy is called these days.”  [Academic and blogger Ingrid Matthews writing in oecomuse, 27 November 2018]

“Scott Morrison reminds me of a belligerent & angry Sunday School teacher. Protected by his Christian reputation but in reality just a nasty, angry, vengeful man”  [Elizabeth Marr on Twitter, 9 December 2018]

An ethics question for corporations large and small

Monash University, The Death of Corporate Greed? – Episode 9: A Different Lens

https://youtu.be/Jm12vdkPR4c

So that champion of silvertails Malcolm Bligh Turnbull thinks mentioning his wealth in public is a form of class warfare?

“They want to attack me having a quid…They want to attack me and Lucy for working hard, investing, having a go, making money, paying plenty of tax, giving back to the community." [Malcolm Bligh Turnbull, The Guardian, 25 June 2018]

“The honourable member has asked about my investments, which are set out in the members' interests disclosure….. If honourable members opposite want to start a politics-of-envy campaign about it, I don't think they'll be telling people anything they don't know.”  
[Malcolm Bligh Turnbull, Hansard, 25 June 2018]

“It has embraced the politics of envy and class war”;
[Malcolm Bligh Turnbull speaking about the parliamentary Labor Party, Hansard, 25 June 2018]

“He says I'm a snob." [Malcolm Bligh Turnbull speaking about Labor leader Bill Shorten, Hansard, 19 June 2018]

I can’t speak for anybody else. However I would gladly “attack” the vainglorious Malcolm Bligh Turnbull - not for being wealthy but on the basis that:

(i) during his time practising law he was allegedly not above abusing the legal process, a judge stating in 1984 that he “managed effectively to poison the fountain of justice”;

(ii) he reportedly made millions from the logging industry in the Solomon Islands in the early 1990s – when Hong Kong-listed Axiom Forest Resources of which he was chair virtually clear-felled its holdings and, whose logging practises were considered "amongst the worst in the world";

(iii) he was at the centre of Australia’s biggest corporate failure to date in 2001, as chairman of investment bank Goldman Sachs Australia, and many ordinary working class people lost everything while he walked away virtually unscathed;

(iv) as Water Minister in the Howard Government in 2007 he wanted to wreck water sustainability in the Clarence River catchment area on the NSW Far North Coast in order to satisfy Liberal-Nationals supporters in the Murray-Darling Basin;

(v) as an independently wealthy federal minister in 2007 Malcolm Turnbull was submitting claims to the Dept. of Finance for $175 accommodation costs per night while in Canberra even though he was staying at an ACT residence owned by his wife and, until he was caught out in 2014 also submitted claims of $10 per night if his wife came to stay at his ACT penthouse;

(vi) as chair and managing director of Goldman Sachs Australia and partner in New York-based Gold Sachs and Co. from 1998 to 2001, he helped lay some of the early building blocks for the Global Financial Crisis;

(vii) his political judgement was so poor that, after meeting then public servant and Liberal Party supporter Godwin Grech in private on or about 12 June 2009, he asserted to parliament on 22 June that a forged email was a true document in an effort to bring down the government of the day; 

(viii) he and his government opposed any real wage increase for workers on the minimum wage in a submission to the Fair Work Commission and went on to actively support a cut to penalty rates – safe in the knowledge that their own parliamentary salaries would increase at fairly regular intervals;

(ix) he resisted the creation of the Banking and Finance Royal Commission and set up terms of reference which sought to nobble that commission;

(x) as Communication’s Minister and then Prime Minister he deliberately wrecked Australia’s hope of having world-class Internet connections;

(xi) he continues to move forward with imposing a punitive cashless welfare payment system on the majority of welfare recipients while also continuing the reduction of funding to vital social services; and

(xii) his first response to any challenge to his world view is to sneer at both the questioner and the content of the question.

An more authentic telling of Malcolm Turnbull’s own ‘poor boy made good’ story

Malcolm Bligh Turnbull went to a public primary school at Vaucluse in Sydney’s affluent Eastern Suburbs for about three years. During this period the family income was in the vicinity of £8,700 to £9,700 a year – with his mother earning four times the average female wage as a successful screenwriter.

Then from the age of eight he went to Sydney Grammar School as a border during and after his parent’s divorce proceedings. He received a scholarship for at least part of that time.

When Malcolm was in Year 10, his father bought a luxurious three-bedroom apartment in Point Piper. The apartment had extensive water views and cost Bruce Turnbull est. $36,000. Before that both he and his father had lived in a flat belonging to his mother.

He graduated from university during the years when undergraduate and post-graduate tertiary education was free of course fees in Australia. All this is on the public record.

Malcom Turnbull purchased his first house while still a university undergraduate.

At age 23 he bought a semi-detached house in inner-Sydney Newtown for almost $50,000 and at age 25 he bought a Redfern terrace for $40,000. He bought his own first home as a married man, for an undisclosed sum in Potts Point, after returning from his stint as a Rhodes schlor at Oxford University.

Malcolm Turnbull inherited assets worth an est. $2 million from his hotel-broker father before he turned 29 years of age according to one of his biographers, Paddy Manning.

He went into  a cleaning business with former NSW premier Neville Wran. After the sale of his co-founding interest in IT company Oze Email Ltd for a reported $60 million, he also founded a merchant bank with Nicholas Whitlam, son of the former prime minister (both Packer and Larry Adler gave their financial backing for a short time). 

In 2008 BRW reportedly estimated Malcolm and Lucy's joint wealth as $133 million and, in 2010 he was included in the BRW Rich 200 list for the second year running for having a personal fortune of $186 million. He and his wife Lucy went on to greater wealth which was last jointly estimated to be in the vicinity of $200 million.

His last Statement of Registrable Interests lists a veritable slew of financial investments and an expensive property portfolio shared between he and his wife. 

Malcolm Turnbull’s annual salary as Australia Prime Minister places him in the Top 10 for world leaders and even the most conservative estimation of his total annual income places him in the top 5 per cent in this country.

In the second half of 2016 Malcolm and Lucy Turnbull made a political donation towards the Liberal Party federal election campaign of $1.75 million.

It has been reported that Malcolm Turnbull and his wife give $550,000 annually to charity via the Turnbull Foundation - their "private ancillary fund" which apparently has a family corporation/s as trustee/s and appears to act as a tax minimisation scheme as the entire $550,000 is potentially 100 per cent tax deductible.

The personal income tax ‘cuts’ recently pass by the Australian Parliament will potentially benefit the Prime Minister, as will the proposed company tax cuts as he owns or co-owns a number of active corporations.

I say potentially, because during the Panama Papers exposé it was revealed that Malcolm Turnbull is not adverse to availing himself of the advantages of international tax havens and likely already pays little tax on much of his financial interests.

US President Donald Trump's businesses lost $100 million over the past year

In 2005 Donald J. Trump unsuccessfully sued an author who stated that he was not as rich as he claimed to be.

The author had written that Trump was only worth between $150-$250 million.

Over a decade later and his 2016 claim of a fortune in excess of $10 billion is looking a lot like delusional thinking.

The latest assessment is that Trump's net worth is around $2.8 billion, down from $2.9 billion in 2017.

If he continues to lose money at this rate he will probaly leave office a lot poorer than when he came in.

The New York Post, 31 May 2018:

President Donald Trump’s businesses lost $100 million over the past year, with revenues sinking at Trump Tower and his golf courses — though he’s still a billionaire with a net worth of roughly $2.8 billion.

The drop, his second in two years, was based on figures compiled by the Bloomberg Billionaires Index from lenders, property records, annual reports, market data and a May 16 financial disclosure, the news service reported.

During the same period, his once-hugely marketable brand has also taken a hit as assorted scandals and controversies prompted the owners of buildings from Manhattan to Toronto and Panama stripped his name from their buildings.

The most recent estimate, down from $2.9 billion last June, is the lowest since Bloomberg began tracking Trump’s wealth in 2015.

The biggest declines, totaling $220 million, came from adjacent buildings in midtown Manhattan — 6 E. 57th St., which had housed a Niketown store, and Trump Tower, where lower occupancy resulted in less income.

The Trump Organization’s 16 golf and resort properties also dropped in value, by $70 million, as revenue fell at some courses and gained at others.

Losers included Trump’s Doral, Palm Beach and Mar-a-Lago clubs in Florida, while his courses in Scotland and Ireland posted revenue gains. Annual reports for those overseas properties, which have historically lost money, are expected later this year and will show whether they were profitable.

Overall, the clubs are now worth about $650 million, based on lower valuations across the industry……