It seems that no week goes by without someone, politician or not, decrying the outlandish amounts of money the super-rich make every year, be they individual investors, hedge fund managers, or serial entrepreneurs. Even Warren Buffett, who not so long ago said his secretary was in a higher tax bracket than he, has come in for criticism for not always practicing what he preaches.
Some have argued that this elite group of people are the cause of the rise of home values in parts of Canada and elsewhere in the world, as a low interest environment cannot come close to generating the type of returns someone who owns a house in, say, Vancouver can.
But, even if we agree these people are filthy rich, and can’t possibly spend all the money they earn, what can one do to rein them in?
If one looks at either of the presidential candidates south of the border, their love of money, notwithstanding denials to the contrary, would preclude any significant moves on their part, for example, on the matter of “carried interest”.
Chrystia Freeland, who has enjoyed success as a journalist and now as a politician, has written a fascinating book on the people she often rubbed shoulders with, in Davos and elsewhere, so there is a certain amount of empathy, even envy, though less so for oligarchs in Eastern Europe (the author is of Ukrainian descent).
Two of her more interesting theses have to do with income inequality leading to less social mobility, and globalization leading to a less inclusive society, as Western businesses are less dependent on a prosperous domestic middle class because they can now sell to the rising middle class of the emerging markets.
Chrystia Freeland, Plutocrats, Doubleday
Recent Comments