Are billionaires a policy failure?
Anne-Marie Elias
Co Founder PrimeLife Partners ??Building Australia's longevity economy ecosystem to transform the way we age, live, care and retire | 2x Tedx speaker
I bought the t-shirt and wear it often "Billionaires are a policy failure". I love it, its a great conversation starter but I also wanted to explore its origins for its creator, Alan Jones the nice one, and its significance for me and Beckon Capital .
Some may think its biting the hand that feeds you, but in truth its a reality check of the world in which we live. There is no doubt the world is misaligned, growing inequity despite increase in wealth, governments are not the answer and have been outsourcing responsibility to not for profits and consultants for decades with little impact. Governments have consistently failed to redistribute income, and they have failed at providing the safety net for the vulnerable in our communities.
In Australia we are looking down a barrel of growing inequity affecting low income families and those reliant on social security (ACOSS, 2020 ). In its 2020 report, ?Poverty in Australia 2020: Part 1, Overview , ACOSS?found that there are 3.24 million people living below the poverty line – including 774,000 children and 424,800 young people. In dollar figures, this poverty line works out to $457 a week for a single adult living alone; or $960 a week for a couple with 2 children."
We are at a point now where one in eight adults and one in six children are living below the poverty line, in Australia, let that sink in.
The tax system is designed to redistribute wealth and provide a safety net for the most vulnerable, yet we have the working poor unable to purchase a home so even in retirement remain below the poverty line. We also have a growing crisis of over 440,000 women over 45 at risk homeless. In a country like Australia it is disappointing we can't get it right and ensue that no child, woman or man are without a home.
In Australia the ten wealthiest billionaires in increased their wealth during the COVID pandemic by $68.4 Billion. The current total wealth of Australia’s 122 billionaires is $417 billion, an increase of $90 billion. While a part of me says power to you, I cant help but wonder why our tax system is failing to redistribute wealth?
My conflict is that in 2019 I held the fist large tech roundtable for the federal government, at the end of the discussion Richard White , billionaire, founder and CEO of Wisetech Global said "We should all be paying more taxes." I was absolutely blown away and there began a friendship that taught me a lot. Richard is very kind and generous, his business is registered in Australia and pays his taxes here. He loves music and guitars and lives away from the maddening crowds. I don't begrudge his wealth at all, I know he loves his country and is eager to help when asked.
So I bought him the t-shirt and when we get together next he promised me he would wear it, even if he doesn't, I will, because ultimately, the fact that we have billionaires at the same time as poverty is the disconnect I cannot reconcile in my mind or my heart.
Chris Selth , founder and CIO of Beckon Capital shares my point of view and told me that in 2019 at Davos, historian Rutger Bregman said “I hear people talking the language of participation, justice, equality and transparency but almost no one raises the real issue of tax avoidance, right? And of the rich just not paying their fair share,”?Bregman tells the Time magazine panel on inequality. It feels like I’m at a firefighters conference and no one’s allowed to speak about water.” Chris wanted a t-shirt made "Philanthropy is a policy failure" and Alan Jones and Communitees obliged.
When I asked Alan Jones why he made the t-shirt, he was quick to reply and said:
"The story is pretty simple: at the beginning of the pandemic, at the start of April, some numbers came out that showed the top ten billionaires on the planet had increased their wealth by an incredible amount in the first quarter. As the world tipped into what was thought might be a depression as big as the Great Depression, these already stupendously wealthy people became even more wealthy, faster than they’d ever done so before. Not only that, but the world created more new billionaires in that quarter than ever before.
And that got me thinking: that’s not what a well governed world should be doing. That’s not a constructive way to respond to an economic shock. The capital should have been flowing in the opposite direction, to people made unemployed as a result of the pandemic, to people too unwell to work, to families who’d lost a breadwinner to COVID, to communities with insufficient hospital beds, ambulances, home schooling resources and mental health services.
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And I thought to myself, I can’t blame billionaires, for the most part - I’m sure some are rapaciously greedy, but some just happened to be in the right place, at the right time, and good things happened to them. I mean, I know Mike Cannon-Brookes a bit. He’s a billionaire. He’s not evil. He’s a good bloke. It’s not his fault. So what’s to blame if it’s not the billionaires? It’s got to be the economic and social policy.
Right now there are misaligned economic incentives that mean we think it’s more important to give us all maximum opportunity to become wealthy, and we’re prepared to sacrifice the right of the underprivileged to the life we all take for granted in return.
We’re all so in love with the idea of being wealthy one day, we keep voting in people who support the rights of the already wealthy, who design economic and social policy to maximise the opportunity to be wealthy. Someone once said, “America is full of temporarily financially embarrassed millionaires” and it’s true of most of the western world now.
And problems like Australia’s affordable housing crisis are a direct result of focusing on the right to become wealthy at the expense of creating a “common wealth” that we all share. We all know how to fix the house price problem in Australia - take away the financial incentives to invest in (rather than live in) real estate. But we’re not prepared to do it because it makes too many voters feel like we’re taking away their chance to become wealthy.
So that’s why I made the tee: at the beginning of the greatest economic crisis in living history our global economic policies were sucking wealth away from the commons and into the bank accounts of people who didn’t even need more money. The tee slogan was inspired by Dan Riffle, an advisor to AOC who made the case for abolishing billionaires ."
I agree with Alan whole heartedly and I wear that t-shirt with pride knowing the inspiration behind it and knowing it is right! I cannot rest easy while we have a massive disconnect in a country like Australia where we have so much great wealth, yet increasing inequality - that is the failure.
I am proud to be at Beckon Capital where our aim is to direct capital and capability to the SMEs, and projects that are making a difference in communities. In that way we are doing our bit to educate investors about being more focused on impact.
So do yourself and ASRC a favor and head over to Communitees and get a t-shirt or two that makes you smile.
Anne-Marie Elias is the CEO of Beckon Capital , she spent three decades as a senior policy adviser to federal and state government ministers, government and NFPs. Follow her journey on twitter ?@ChiefDisrupter ?
Tech investor, founder coach, radio host, t-shirt designer.
2 年Thank you so much ??
We assist companies to go global, find relevant business partners & manage new global business opportunities.
2 年Hi?Anne-Marie, It's very interesting! I will be happy to connect.
Business Development As A Service | Helping business owners create and capture value!
3 年Rather than looking at policy failure as something that fails at distributing wealth, look at it as something that fails at empowering individuals to create personal wealth.
C-Suite Executive | Board & Founder Advisor | Business & Innovation Strategy | Skills & Workforce Development
3 年Hi Anne-Marie Elias. I really think there is a multitude of issues here that really don’t align to billionaires being a policy failure. Some entrepreneurs do well because the gap in the market they focussed on was bigger than other gaps in the market that others focussed on, and they executed better. That’s irrespective of the number of others that tried to address that same gap without the same success. That’s the market and that’s the economy. Purchased vote with their feet. Taxation and tax avoidance are a separate issue that needs to be addressed. Affordable housing is again a separate issue - Governments of all persuasions have had every chance to address this issue, and it is not tied to billionaires or taxation. It is time for public policy to step up. Taxation for pork barrelling has to stop.