The rich are different but we should still love them
It’s hard to keep getting excited about the New Zealand Rich List put out each year by the National Business Review. However, since the rich will always be with us, I guess it’s important to know who they are and how we can soak them.
The list should really be called the Very Very Rich List as members have to be worth at least $50 million to qualify.
These are not people who have a high-paying job or a lucrative little business. They have either inherited big or created large corporations from smaller businesses or from scratch. They are outliers and in some ways irrelevant.
It doesn’t take much to be rich in New Zealand. You can have a couple of houses, a holiday home, enough money in the bank not to have to work, a number of expensive vehicles and the ability to afford trips overseas and not make it anywhere near the rich list. You won’t be a rich-lister but will still be universes apart from someone living on a benefit in a state house in Timaru.
The rich are much easier to spot these days. We used to be a nation where ostentatious wealth was regarded as vulgar showingoff but, judging just by the holiday homes in Wanaka and the nicer beaches up north, this virtue has long gone.
The rich and the comfortable are generally boring. Only the billionaires interest us. But it’s the former group that should get more of our attention.
They are the folk who supply the bulk of the New Zealand tax take and, regrettably, they are thin on the ground. Only 108,000 Kiwi taxpayers earn more than $150,000 a year but they pay about 25 per cent of all tax. According to this year’s Budget, only 11 per cent of taxpayers in New Zealand earn over $90,000 a year. But that 11 per cent contributes nearly 50 per cent of the tax take.
The tragedy for New Zealand is that we don’t have enough billionaires, probably because we are just too small. Those we do have, have not made their fortunes in New Zealand and don’t do much for the local economy.
Often they are like packaging tycoon Graeme Hart, who does most of his business overseas, or they are foreigners who have secured a bolthole in New Zealand, like Russian Alexander Abramov or American Peter Thiel.
You will hear that billionaires are bad for an economy and society because they show too much wealth is aggregated at the top.
In the same breath you will hear that Scandinavian countries even out their wealth much better so they don’t have really rich people lording it over everyone else with their squillions.
A surprise then to find Sweden does in fact have billionaires. At 14 of them for a population of about 9.5 million, that is more per capita than the United States.
Sweden seems to show that you can have very, very rich people and still have a well-functioning, egalitarian society. It has high taxes but they seem to be directed at ensuring people stay in the workforce, especially by subsidising things like childcare, elder care and transport.
Sweden’s company tax rate, by the way, is lower than in the United States.
The Swedes seem to be OK with wealth, although some comments I read about the New Zealand Rich List from our own academics suggest something is very wrong with our interest in the very rich.
University of Auckland senior lecturer in sociology Ronald Kramer called the list unhealthy because it encouraged people to value wealth at the expense of social considerations.
The appeal of the lists reflected how ingrained the ideals of capitalism were, he said.
‘‘They don’t discuss the problematic nature of where it comes from. They are put on the list as if they are doing society a favour. It’s disturbing.’’
Sommer Kapitan, a senior marketing lecturer at AUT University, agreed the lists were a sign of a culture obsessed with capitalism.
‘‘It has to be tied to the Protestant work ethic of our forefathers, ‘‘ she said.
‘‘I think ... it’s buried in our psyche to seek for more and to ‘pull ourselves up by the bootstraps’.’’
Give me strength. It’s almost as though they think the very rich should be charged with something. Those attitudes are certainly not going to help build businesses which will create the wealth to support services like universities and hospitals.
Many academics will frown on people with real jobs looking up to billionaires in the way rural strugglers in America seem to support Donald Trump.
Joan C Williams, in her book White Working Class, says the people in her book tend to feel more resentment towards professionals with all their fancy diplomas than the very rich.
‘‘The dream is not to become upper middle class with its different food, family and friendship patterns. The dream is to live in your own class milieu where you feel comfortable just with more money,’’ she says.
While we may wonder how the very rich reconcile their gilded lifestyles with the hardship of others, we on the ‘‘comfortable list’’ are not exactly blameless.
We could all be giving a lot more to the poor without too much pain.
The saddest thing about the rich list is we know nothing about how its members spend their money or how much tax they pay.
That’s why we need to take the bold step of making all tax returns open and transparent and guarantee we get our share.