A billion dollars is hard to visualize. And that’s a major understatement. Major. Understatement. Yet, billionaires are increasing their influence, increasing their numbers, and accumulating more of the world’s wealth. And then, there are taxes. And a fun idea to imagine, even if it can’t be implemented.
A billionaire, as measured in US dollars, is a relatively new identity. The United States Constitution was written in 1789. It wasn’t until 1916 when John D. Rockefeller became the first US billionaire. Now, there are over 2,000 billionaires, and growing. Whether they are US citizens may be moot considering their tendency to have multiple residences, and their tendency to have even more residences for their assets.
If only everyone else’s wealth was growing as quickly. At the start of this year;
“Billionaire fortunes increased by 12 percent last year – or $2.5 billion a day – while the 3.8 billion people who make up the poorest half of humanity saw their wealth decline by 11 percent,” – Oxfam
In 2000, it took 388 billionaires to equal the wealth of the poorest half of the world. By 2016, that was down to 62. According to CNN/Oxfam;
“The top 26 billionaires own $1.4 trillion — as much as 3.8 billion other people” – CNN
Well, maybe that’s okay as long as they continue to pay their fair share of taxes. But what’s fair? The Panama Papers proved that billionaires and millionaires have sophisticated mechanisms to launder money and hide from taxes. Those havens aren’t enough, evidently. Tax cuts now mean that;
From The Guardian;
“Economists calculate richest 400 families in US paid an average tax rate of 23% while the bottom half of households paid a rate of 24.2%“
From my blog Pretending Not To Panic;
“In 1960, the richest paid 56% in taxes. The richest are now paying less than half of what they did during the golden years of the Baby Boom.“
Over five years ago someone posted a video trying to provide some perspective on what a billion looks like. Even visualizing a billion as a thousand millions or a million thousands is difficult because it can be difficult to visualize a million. Their video inspired several of my friends to find a truly visual way to display a billion. After a lot of creativity and resourcefulness produced some ideas (Concentration Dissipation, Extreme Displays Of Wealth Inequality), we realized the task was so difficult that;
“The very fact that this is beyond some of our technological limits is a message.“
A tweet went by recently that found another perspective. People have an easier time envisioning $50,000. For some, that’s a salary. It’s also the price of a nice car. It’s a large down payment on a small house.
To earn a billion dollars at $50,000 per year would take – well – let’s walk through it. Ten years would get to a half a million dollars. A hundred years would make that five million dollars, two hundred years is ten million, – really? Does 2,000 years times $50,000 only get to $100,000,000? Well, a billion is a thousand million. Make a million dollars for a thousand years and make a billion dollars.
Repeating what was said above; “Now, there are over 2,000 billionaires, and growing.”
That’s not 2,000 people worth $1,000,000,000. That’s >2,000 people worth >$1,000,000,000. The “poorest” of the top twenty billionaires is worth >$37.7 billion. Make a million dollars a year for 37,700 years and you, too can be worth that much – at least in terms of financial assets.
And yet, many wonder why wealth and income inequality continue to rise – or debate the existence of inequality.
Even billionaires are starting to say billionaires may have too much of a good thing.
There are reasoned plans for reversing tax codes to earlier, more sustainable levels. Tax cuts to the wealthy have been proven to not inspire broad improvements in the economy. Instead of encouraging investment in advances, there are incentives to hoard rather than distribute. Stagnation rather than progress.
And here’s where I returned to having some creative fun. I’m only one voter, and plan to vote accordingly. But, I can imagine and play with ideas.
Currently, the incentives to continually increase wealth far exceed the disincentives, and the disincentives are diminishing. Not sustainable. Negotiating tax structures is realistic but dull. How about this. Once a year, the wealthiest person is determined, and that one person gives up everything except one billion dollars. Jeff Bezos would be taxed about $110,000,000,000 – and still have more money than most people can make in hundreds or thousands of years. Unfair? Debatable. Yet, being left with a billion dollars would have only a very small cadre of people feeling sorry for them. Instead of casually accumulating wealth, there’d be an active attempt to come in second. The ‘sacrifice’ of someone becoming worth ‘only’ a billion dollars isn’t much of a sacrifice considering the billions of people who have no hope of accumulating such excess.
While $110,000,000,000 (left off three zeroes the first time I typed that), is a lot of money; it isn’t a panacea when compared to the US federal budget of ~$4.4 trillion (of which ~$1T is borrowed, debt, spending more than we make as a country. Also not sustainable.)
I’ll repeat the graphic from above. Oxfam produced this, which looks like it hasn’t been updated since 2016. Billionaires who own half the world’s wealth:
- 2000 – 388
- 2014 – 80
- 2016 – 62
- 2018 – 26 (from the above news report)
- and about in 2021 – 1
One person with half the world’s wealth. For several reasons that chart will flatten as the wealth concentrates into just a few; but within a few years we have the potential to reduce this discussion to a conversation between a few billion people and a group small enough to fit around a kitchen table. Billions facing billions, people facing dollars. Who should come in first?