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Friday, January 30, 2015
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The (Very) Rich Get (Much) Richer

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How do we define the term “obscenely wealthy”? We start with people who already have more wealth than any humans in the history of our species. We then watch these people getting much wealthier, much faster than anyone else on the planet. And then we listen to them lusting for even more wealth.

No one does a better job of illustrating obscene wealth than the lovers-of-Big-Money at Bloomberg. It’s recent headline summarizes this attitude perfectly:

Billionaires Worth $1.9 Trillion Seek Advantage in 2013

We have a handful of Oligarchs sitting on a mountain of wealth large enough to completely eliminate global poverty – with enough left over for they and their entire family clans to live lives of perpetual luxury. However this is not the truly “obscene” aspect of this paradigm. The true obscenity lies in the fact that these Oligarchs remain obsessed with getting much richer, much faster – and at the expense (literally) of everyone else.

Again, Bloomberg illustrates this for us with perfect clarity. It notes that these billionaires who were worth roughly $1.65 trillion at the beginning of 2012 are now worth $1.9 trillion at the end of 2012. That’s approximately a 15% increase in their total wealth, in one year, after paying(?) their taxes, and after all the lavish spending which characterizes the life of the average billionaire.

How many of the Working Poor got 15% wealthier last year – after paying their taxes and all their living expenses? Zero? Indeed, only the most entrepreneurial (or crooked) millionaires would have been able to increase their wealth at the obscene rate of these billionaires. Yet what do we hear out of the mouths of Billionaires like Warren Buffett? “Tax the millionaires.”

Specifically, tax the income of the millionaires (much harder). Note that the billionaires also have large incomes. However, once one acquires this obscene level of wealth, “income” becomes a trivial element of their total wealth.

Few billionaires have annual (taxable) “incomes” above $50 million/year. Yet for even a ‘bare’ billionaire this amounts to only 5% of their total wealth. So how did all of these billionaires get wealthier by an average of 15% last year alone? The untaxed appreciation of their vast assets.

Even if all the incomes of all the billionaires were taxed at 100%, these billionaires would still be getting wealthier much faster than anyone else in society.  This is why I continue to regularly point out in my commentaries that it is never possible to construct a fair tax system based on income taxation. Inevitably, income taxation makes those on the bottom much poorer, while allowing the Top-1% to accumulate (and hoard) wealth at a rate which would have made the kings and queens of the Middle Ages envious.

The only possible fair form of taxation is wealth taxation, specifically a flat wealth tax. Everyone pays the same rate, and no one (including the billionaires) is able to hide the vast majority of their wealth from the Tax Man. Thus when Warren Buffett says “tax the (incomes of the) millionaires”, he doesn’t say this because he wants to start paying his “fair share” of taxes. He says this so that he (and his Oligarch buddies) can continue to avoid paying their fair share.

Note that Bloomberg makes it clear that the Oligarchs aren’t satisfied with getting only 15% wealthier in one year. In 2013 they want an “advantage” for themselves. This presents two, obvious questions for readers.

How much richer do these Oligarchs think they are entitled to become in 2013? How much richer do the Oligarchs think the Little People are entitled to become in 2013?


What makes the second question even more pertinent than the first is that the Little People (the Working Poor) didn’t get 15% wealthier in 2012. In fact (on average), they all got significantly poorer. For example, the U.S. standard of living (for the Little People) has fallen by more than 50% over the past 40 years.

Indeed, the precise reason why all of the debt-saturated economies of the West are on the verge of implosion is because these Vampire Billionaires have blood-sucked us dry. And in referring to our massive debts this brings us to the fiction in the Bloomberg article.

Bloomberg refers to its list of Oligarchs as “the richest people in the world”, yet even its own research indicates this is a farcical classification. In its sub-title, “Hidden Billionaires”, Bloomberg discloses that 54 of these Oligarchs were “discovered” in 2012 alone. They didn’t become billionaires last year, but rather their vast wealth-hoards were only identified for the first time last year.

What about the Trillionaires?

There is somewhere in the vicinity of $200 trillion in total debt floating around the global economy; comprising total sovereign, corporate, and personal debt. Who holds the IOU’s?

It’s not governments. They’re all debtors. It’s not the corporations. They’re (almost) all leveraged-to-the-hilt with debt, because in the Age of the Oligopoly all their time, energy and financial resources are going into buying up other corporations. It’s certainly not the Little People. Even in (supposedly) “wealthy” Western economies, personal debt-levels have never been higher, meaning net wealth has never been lower.

We know from Bloomberg’s own numbers that the total wealth of the (supposed) “richest people” is a mere $1.9 trillion – and that is all of their wealth combined. Who is holding the IOU’s on the other 99% of this $200 trillion in debt? The Trillionaires.

These are the people who are so wealthy that their wealth hasn’t even been “discovered” yet by the sleuths at Bloomberg – and likely never will. Even at currently artificially low interest rates, these Vampire Trillionaires blood-suck the global economy for $trillions every year in interest payments alone.

This is why (real) economic growth is now impossible for all but the most-robust (or least-indebted) economies. In a $70 trillion global economy, we have the Trillionaires skimming roughly 10% per year off the top, for themselves. What readers must understand is that this “taxation” of the entire global economy by the Trillionaires – in the form of interest payments – is essentially nothing less than the proceeds of crime.

We start with income taxation, a form of taxation which (as a matter of arithmetic) must impoverish the bottom-80% over time, turning them into debtors. Most of the rest of the top-20% prosper moderately under this extremely corrupt form of taxation, while (as we have seen) the Oligarchs get a complete ‘free ride.’

With the bottom-80% turned into impoverished debtors, this starves our consumption-based economies of revenues. This “revenue crisis”, in turn, turns our governments into massive debtors; as even modest levels of public/social services can no longer be maintained by the trickle of tax revenues flowing in.

These $trillions per year which the Trillionaires are siphoning-out of the global economy (and into their own wealth-hoards) are being extorted out of the global economy via an entirely corrupt economic system. The very, very rich are not simply getting much, much richer. They are doing so by stealing from everyone else.


Comments (2)Add Comment
Jeff Nielson
written by Jeff Nielson, January 04, 2013
The oligarchs are not just attempting to be wealthy but actively impoverishing the despised masses. It`s more than mere greed, they seem to be attempting some kind of global social engineering so that the world reflects their despotic, neo-feudal vision.

What astounds me Jeff, is that the KEY people in both governmental and private institutions that turn a "blind eye" to all this and allow all this wealth to be stolen, MUST be in on the heist, otherwise it could not occur, in the same way that the narco trade would collapse overnight without their support.

These people are in the public domain,yet they know the next link in the chain and they can be held accountable. They PRETEND that is out of their jurisdiction...

Dylan, this is precisely why I have been referring to Western regimes as "Traitor Governments" in my writing.

As you say, with the magnitude of betrayal here it is simply impossible to dismiss this as 'mere' incompetence or ignorance. Admittedly most of the rank-and-file politicians ARE just incompetent dupes. However, our (so-called) "political leaders" are nothing more than foot soldiers for the Oligarchs.
written by Dylan, January 03, 2013
The oligarchs are not just attempting to be wealthy but actively impoverishing the despised masses. It`s more than mere greed, they seem to be attempting some kind of global social engineering so that the world reflects their despotic, neo-feudal vision.

What astounds me Jeff, is that the KEY people in both governmental and private institutions that turn a "blind eye" to all this and allow all this wealth to be stolen, MUST be in on the heist, otherwise it could not occur, in the same way that the narco trade would collapse overnight without their support.

These people are in the public domain,yet they know the next link in the chain and they can be held accountable. They PRETEND that is out of their jurisdiction.

Good article here that expands upon this topic, particularly the stashing away of wealth in shadowy tax havens.

Libor, Tax Havens and the Filthy Rich


"This is the real story – the scandal of tax havens and dirty, fugitive money, concealed by those who have profited from this system for far too long. These individuals continue to plunder not only the wealth of the world, but more importantly the ecological account upon which we all depend for our very survival.

Exactly what was this shocking revelation which should have far broader exposure? It was the publication of a set of figures by a little known organisation which tracks this data - as much as it is possible to do so - calculating the amount of wealth squirreled away in tax havens around the world"

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