Susan Edmonds writes on how the super wealthy got wealthy:
. . .While you can earn your way into the top 1 per cent – former Fonterra boss Theo Spierings earnt $43m in his time in the job – most people who are very wealthy have become that way through their investments.
An Inland Revenue report on high wealth individuals found that “in close to all cases” the wealthiest among us had got their capital base from the non-taxable sale of a business or other capital asset. . .
But how did they get those businesses or capital assets, the ones they sold that gave them the capital to invest?
A very, very few might have won or inherited it.
All the rest worked and worked hard, took big risks, almost always lost large amounts when at least some of the risk didn’t pay off, worked and risked again, invested and reinvested what they earned in their business, and forwent spending on almost anything else but the business.
The column is yet another attempt to argue for capital gains or wealth taxes, as if riches fall from the sky upon a few lucky people without any effort from them.
It’s another complaint about inequality, even though dragging the rich down reduces inequality without improving the lot of the poor; even though Lindsay Mitchell points out, inequality is about average for the OECD and isn’t worsening.
There might be an element of luck in the success of the super wealthy, but its a very small element in comparison to the risks, sacrifices and work required to get where they’ve got.