Wealth inequality is a global crisis

keepingquiet Mon 22-Sept-25 09:23:36

Exactly.

You have just explained that while money isn't strictly finite in a technical sense, it has practical limits—like inflation, currency stability, and economic growth an that, in the real world, governments must respect this. Relying solely on printing money ignores these constraints and can lead to serious economic problems. There is no instant answer and politics will sway the answer whichever flavour the party in power is. The fact that money isn't finite, while true, means very little on its own.

I'm not sure why you have gone through this again when I have already, as you say, pointed out the practical limits to the government issue of money. I have frequently said this. I have also pointed out that the frequently cited examples of hyperinflation have been the result of governments not observing those practical limits.

I think it's time that we lost the expression 'printing money' because it's become a dog whistle phrase which immediately elicits the 'but hyperinflation' response from people who don't appear to understand that hyperinflation only happened in specific circumstances, circumstances which don't necessarily apply to their own country. Also, that ''printing money' is rally an obsolete term as there is no physical process involved in a government issuing money apart from the entry of numbers on a keyboard.

The exception being the issuance of notes and coins, which are still needed because people still use physical money tokens, though the practice is rapidly declining. When the government produces these tokens they are sold to the commercial banks at a massive profit to the government. So physical cash can actually be taken out of the 'inflation' loop altogether. And physical cash is only a tiny component in the nation's 'wealth'

Once you ('you' being people in general, not you personally) recognise that most monetary transactions, starting from its issuance by the state and by commercial banks under licence from the state, are done electronically it becomes more obvious that the monetary system is just double entry book keeping. A record of debits and credits. It always has been.

The question of 'value' is, of course, completely different.

Higher taxation and investment in public services whilst not the complete answer, is certainly part of the solution.

Higher taxation of who, keeping quiet?.

As far as controlling global wealth is concerned there is no particular point in investing more in public services. Our current economic system will ensure that more of the invested money will end up in the hands of the wealthy, either directly by profits of the private sector companies which supply all the goods and services which the public sector needs. As an example, government has several contracts with Palantir, a US based IT company owned by billionaire right wing Trump supporter Peter Thiel. His company will make a great deal of money from the contracts, much of which will end up in the hands of its shareholders and its owner. This is how neoliberal free market economics works. Not only will profits leave the UK, but the company will do its best to avoid as much tax as it possibly can in the UK. British based suppliers may contribute a bit more to UK taxation, but the larger the company, the greater the profits, the less it seems to pay

While I see state investment in public services as a good thing for growth and the welfare of our citizens it doesn't help to control global wealth.

The national borrowing/creation of money in relation to GDP is the yardstick buy which others judge the health of the economy. the UK is close to to 100% of GDP which any higher will triggers more negative pressure on sterling. Starmer does not it to go higher and I agree with that position.

Personal income tax is high enough although some changes mid range are needed, its Company taxation that needs to contribute more, the way that celebrities and consultants use it to avoid tax certainly needs to be changed.

Currently Shares and Property are only taxed on sale, in many cases held for decades there needs to be an interim tax on that wealth, personally I think IHT exemption of 1 million for a couple is too high but I accept there are too many with vested interest to get any agreement on this site

MaizieD

^Higher taxation and investment in public services whilst not the complete answer, is certainly part of the solution.^

Higher taxation of who, keeping quiet?.

As far as controlling global wealth is concerned there is no particular point in investing more in public services. Our current economic system will ensure that more of the invested money will end up in the hands of the wealthy, either directly by profits of the private sector companies which supply all the goods and services which the public sector needs. As an example, government has several contracts with Palantir, a US based IT company owned by billionaire right wing Trump supporter Peter Thiel. His company will make a great deal of money from the contracts, much of which will end up in the hands of its shareholders and its owner. This is how neoliberal free market economics works. Not only will profits leave the UK, but the company will do its best to avoid as much tax as it possibly can in the UK. British based suppliers may contribute a bit more to UK taxation, but the larger the company, the greater the profits, the less it seems to pay

While I see state investment in public services as a good thing for growth and the welfare of our citizens it doesn't help to control global wealth.

Taxation in any country should be a matter of proportion to fund public services which everyone benefits from.

The fact the international companies operate on a global scale should not make any difference to the gact that the employ people who pay income tax, and pay VAT on the goods they buy, and put local taxes too to maintain their communities.

I agree this is difficult to regulate because the companies act with impunity often in the countries where they operate.

However, trading nations can come together to decide of how their individual countries can cooperate togethe rparticularly regarding licensing rights and including environment impacts.

Yes I am familiar with Peter Thiel and his ilk- but just giving up and thinking there is nothing to be done is a terrible attitude to take.

As for controlling global wealth- without public services the communites where these companies seek to operate rely on settled and reasonably healthy workers, living in places where there are good transport links etc because without them they would make no profits.

Taxation doesn't fund services. The country is not a household or a business, it doesn't need to earn money by any means before it can fund state spending.

Funding public services is the method by which government issued money gets into to economy. Funding public services is an important contribution to economic activity and growth. While the state will never get back all the money it 'invests, through taxation of all the economic activity generated, it will get back the greater part of it. It would get back even more if the wealthy who suck up a great deal of it weren't able to minimise their tax obligations in a way that is not possible for the less well off and so pay a smaller percentage of tax than most of the population.

It would make life less worrying for everyone if this nonsense about taxation funding spending was knocked on the head.

TBH, if anyone thinks I'm 'giving up' I'm clearly not communicating very well. I'm trying to identify areas where we could restrain the wealth of those who are 'the global wealthy'. If one doesn't understand how they accumulate how can one identify the most effective way to cut down the amount they can accumulate?

P.S My point about it not being worth investing in public services was that all that investment would do under our current economic regime is increase the wealth of the already wealthy. The wealth we want to cut down.

I'm not saying don't invest. I'm saying it's not a solution to reducing the global wealth of individuals.

MaizieD

Taxation doesn't fund services. The country is not a household or a business, it doesn't need to earn money by any means before it can fund state spending.

Funding public services is the method by which government issued money gets into to economy. Funding public services is an important contribution to economic activity and growth. While the state will never get back all the money it 'invests, through taxation of all the economic activity generated, it will get back the greater part of it. It would get back even more if the wealthy who suck up a great deal of it weren't able to minimise their tax obligations in a way that is not possible for the less well off and so pay a smaller percentage of tax than most of the population.

It would make life less worrying for everyone if this nonsense about taxation funding spending was knocked on the head.

TBH, if anyone thinks I'm 'giving up' I'm clearly not communicating very well. I'm trying to identify areas where we could restrain the wealth of those who are 'the global wealthy'. If one doesn't understand how they accumulate how can one identify the most effective way to cut down the amount they can accumulate?

Maisie you are railing against the governments expression of spending and taxation

Technically you are correct taxation doesnt fund services, just like any business the government spends money on services then recoups it from taxation ( hopefully). if taxation plus sale of any assets falls short borrowing increases, only twice in the last 25 yrs has there been a surplus.

Taxing the globally wealthy will require all states to agree a unified taxation policy, because the wealthy can choose where they are resident and pay taxes, currently even in Europe there are major differences in tax policy.

My council tax does fund local services.

Maybe not a model for government services but it is a tax just the same.

NI is also a form of taxation which pays for the NHS

Maybe it isn't related to the global economy or the super rich but I think that is a completely separate argument and I haven't heard any suggestion yet as to what to do about it.

I'm neither an economist nor a business owner, neither am I very wealthy but I have been a tax payer all my life...I can also choose not to patronise some mega bucks company with my hard earner money- does the consumer of these services/goods not have power to boycott them? Or has that ship long sailed?

.”I can also choose not to patronise some mega bucks company with my hard earner money- “

I dont buy from Amazon (Bezos) or Tesla (Musk)

As for Council Tax it would be easy to collect more from the wealthy add more bands at the top based on house value, that would be a very useful addition money the council spends.

Council tax does have to fund services because councils can't create any money for themselves, they have to work with what is allocated to them. But the government, as the issuer of our money, can fund services before it has the tax revenue in.

I'm not altogether confident about David's statement that 'borrowing' is 100% of GDP.

According to the Office for National Statistics UK government borrowing (public sector net borrowing) in the financial year ending March 2025 was about 5.1% of GDP.

Which is rather a different figure...

It's slightly above the figure that the EU pulled out of a hat when it decreed that a nation's deficit shouldn't be more than 3% pf GDP, but there is no evidence at all that it is a meaningful figure and countries exceed it.

I don't buy from Amazon, either, David. Haven't done for years.

Funnily enough, I can function without it...😁 though suggest it to other GNetters and I get the impression they would die if they couldn't buy from Amazon...

The problem isn't that you believe the MMT theories but that you don't seem to accept that others, who may think differently (as many/most governments do) may be right or at least have the right to hold a different view.

The mainstream counter-argument emphasises that while sovereign governments can create money, they still need to manage fiscal policy carefully, using taxation and borrowing as tools to ensure sustainable economic growth and stability. This seems very reasonable, obviously to governments but also to many citizens of those governments. You tell us what to believe but not the reason for doing so. What is the advantage? Which countries have tested it? Why should we believe those preaching this view. I can't see where there is general discussion of the evidence of this "print first, pay later" view? To me, and I get that this is just a personal view, this seems to have just the same quick fixes and over simplification to complex problems that the populist extremes offer.

Please believe I don't expect anyone to agree with me but I will stand up for my, and anyone else's right to hold there own views.

Sorry! Missed saying that was to Maisie.

“According to the Office for National Statistics UK government borrowing (public sector net borrowing) in the financial year ending March 2025 was about 5.1% of GDP.”

LOL
The ONS also states the National Debt is £2.5 trillion whih is 100.5% of GDP

Last year to msrch the UK did spend 105% of GDP if thats true it added a trivial £125 billion to the national debt.

The EU may well have targets but in common with the UK have been consistently missed

MaizieD

I don't buy from Amazon, either, David. Haven't done for years.

Funnily enough, I can function without it...😁 though suggest it to other GNetters and I get the impression they would die if they couldn't buy from Amazon...

Haha I quite agree with this one!

Oh you entitled people. What about the home-bound, those with little disposable income? There seem to be competing "churches" on GN one will tell you the sins of the asylum seekers (and those who want to help them), another will tell you that anyone not agreeing with the principles of their childhood is a "sinner" and, it appears, it is now a sin to shop, perfectly legally, on Amazon.

Hell is obviously waiting. We're all doomed!

DaisyAnneReturns

Oh you entitled people. What about the home-bound, those with little disposable income? There seem to be competing "churches" on GN one will tell you the sins of the asylum seekers (and those who want to help them), another will tell you that anyone not agreeing with the principles of their childhood is a "sinner" and, it appears, it is now a sin to shop, perfectly legally, on Amazon.

Hell is obviously waiting. We're all doomed!

So you disagree that Bezos and Musk have enough and would encourage us all to give them even more.
That’s fine I prefer to use smaller local suppliers when I can.

I agree with the opening post.

Yes, I watched the video[well half iof it, which is very good for me!].

Most of the posts on here are going above my head.

Nope. I dislike holier than thought comments David49.

thought

Should have been thou.

DaisyAnneReturns

Nope. I dislike holier than thought comments David49.

So you have no principles you would deal with the devil.

There is nothing wrong with wealth. It is how money is distributed that matters. If companies pay good wages and provide good living conditions, who can complain about that? If people are not valued for their skills and paid a wage which reflects that, of course there will be resentment.
Lifestyle comes into it too. We have become used to a certain standard of living and, for some reason, many think that people in other countries should live as we do. However, we should not try to force the Western lifestyle on others.

David49

DaisyAnneReturns

Oh you entitled people. What about the home-bound, those with little disposable income? There seem to be competing "churches" on GN one will tell you the sins of the asylum seekers (and those who want to help them), another will tell you that anyone not agreeing with the principles of their childhood is a "sinner" and, it appears, it is now a sin to shop, perfectly legally, on Amazon.

Hell is obviously waiting. We're all doomed!

So you disagree that Bezos and Musk have enough and would encourage us all to give them even more.
That’s fine I prefer to use smaller local suppliers when I can.

But remember that the small businesses who supply the goods through Amazon need the profits too.
My life would certainly be harder without Amazon deliveries.