Concentrated Wealth in the Age of Austerity

rockmonkey1973

Well-known Member
Ok long post and this reads as a little essay and may even take about ten minutes to read so you may want to go elsewhere if this bothers you but if it doesnt then... i have been doing a fair bit of reading this last week about society and politics and what not and it has started the old cogs turning again. I keep hearing in the media about austerity and how we all have to tighten our belts and you know that we are all in it together. Yet i had recently read about these huge profits Microsoft and Apple were posting for the last financial year and i thought well they seem to be doing alright despite these lean and mean times. So i pondered this and came to the conclusion (common sense really) that if these multi nationals are earning huge profits in this era of skintness then someone is not feeling the pinch. So this got me thinking where is all the money going? Anyway i finally, yesterday got around to having a look. Not for the first time i might add, but certainly a little bit deeper than i normally would.

Now while i was researching i read somewhere this really insane, outlandish claim that the top x per cent of people had more combined wealth than a hell of a lot of countries based on their GDP. Well i didnt quite believe it so i thought now would be as good a time as any to test this idea.

Now i actually struggled with this. Not because the data was hard to find, in fact it was all rather easy, thanks to the Forbes lists and Wikipedia which have all the information one could ever wish for. No the reason i struggled was because the figures are that big that i actually had difficulty working out billions in my mind. It starts getting like infinity and space, it all becomes that enormous it can be totally overwhelming (at least for my grey matter anyway). I can only hope i have the trillion mark worked out correctly because too be honest at that point my head started to hurt! If i havent, can you please let me know and i will then have to either edit the post, or delete the post entirely, accept the humiliation of being a maths dummy, and start again!

I personally think there are many interesting points raised, when you start reading through the information below and most dont even require any real thought at all, they simply jump out at you. I will however leave you to make your own conclusions about the way the figures play out. The list i keep referring to is a list from Wikipedia that shows each country ranked numerically by GDP and the figures are all in dollars. The data i got regarding the people and the companies are from Forbes online which annually publishes its rich list as well as the top 2000 global companies. The links for everything are below if you want to take a look yourself.

So i want you to think about the number one billion... it looks like this 1,000,000,000 and reads like one thousand million. It is also the net worth of Charles Dunstone who founded Carphone Warehouse and who stands at 1153 on the worlds rich list. Then consider the retailer Nexts profits for 2012 which stand at 600,000,000 and reads as six hundred million. Please bear these figures in mind because they gave me and maybe you a reference point.

Lets start with the UK which we all know and love and that is a very, very, very rich country and is well embedded into the top ten of the Wiki GDP list. We are also, as the media keep telling us, skint. If we are as they claim i ask again where is all the money going?

The top 50 UK companies in 2012 made a profit (all the figures i use are pure profit not sales) of 163 billion rounded down, in just that one year alone.

The top 10 companies made 89.5 billion.

The top 5 UK companies made 72.7 billion and combined these five companies would stand at 71 on the Wiki list (of countries) and therefore these five UK based companies yearly profits are higher than even Omans Gross Domestic Product.

At the very top of the UK list and obviously ranked number one is BP which made 25.7 billion or to put it another way that looks really cool 25,700,000,000 or one that sounds even better... twenty five thousand seven hundred million and places it 95 on the list higher than the GDP of Cyprus.

The worlds top earning company Exxon Mobil earned 41.1 billion and so it gets ranked at 82 and in 2012 its profit alone was higher than the GDP of Costa Rica. I think the silly, paltry looking .1 is 100 million dollars!

The top 5 companies in the world when combined earned 163.6 billion dollars and these five companies would find themselves at 55 on the country list and earn more than New Zealand. They also have a yearly income that is greater than the combined GDP of the bottom 72 countries or in other words the poorest nations on earth (although it does include some of the low population nations who are relatively wealthy... i mention some of them below).

The worlds top 10 companies earn 283 billion dollars a year in profit which is more than the combined income of the 82 poorest countries and would place them at 36 on the list higher than Malaysia.

Now we move onto the individuals, but bear in mind this is only net worth and not income. However i do think the figures are interesting, just because. At the very top, worth 69 billion or sixty nine thousand million, is a dude from Mexico and this one bod is worth more than the 52 poorest countries in the world earn every year. Based on his worth, he would find himself placed at 64 (higher than Ecuador) on the list. We are meant to believe, he earned his coin from Telecoms and considering the region and the deadly battle raging in that country, just Telecoms, nothing more and certainly nothing er, you know, illegal.

The top ten people have a combined wealth of 395 billion rounded down to the nearest thousandth of a billion, and is more than the bottom 94 poorest/ smallest countries earn every year, based on GDP. This includes some of the smaller wealthy nations i was talking about including Iceland, Zimbabwe, Malta, West Bank and Gaza, Monaco, Jersey, Guernsey, Isle of Man, Maldvies and the Falkland Islands to name but a few. Combined these top ten people have a net worth that is higher than what the United Arab Emitrates earns in a year and would mean if they were a country they would be at number 31.

I stopped comparing it here but i did work out that the top 25 people are worth 731.1 which is seven hundred and thirty one thousand million dollars

I did however carry on adding the coin up for the top rich lot because i wanted to see when we would hit through the trillion mark. Eventually we did thanks to Michael Dell who stood at number 41 on the list (quite ironic i thought considering most will know who he is and i am even typing away from one of his laptops). So 41 people have a combined wealth of 1 million million... i think i am actually slightly confused myself at this figure. It is so big i cant properly wrap my head around it. I was trying to compare my yearly salary to it and i got a little lost. I think it looks like this... 1,000,000,000,000 although i am sure someone will correct me if any of this is wrong...

Both the lists (the top billionaires and top 2000 global companies) make for interesting reading especially when you start to break down the countries they come from and the industries they are in. I think i counted 51 countries that have a company in the top 2000. The rest of the world doesnt exist as far as Forbes is concerned. I didnt check the actual number but i would imagine the same sort of figure for the individuals will be true. The USA is by far and away the most dominate force in each list especially in the all important top ten. In the top ten alone they make up around about a third in one and slightly more than that in the other or 3 out 10 and 4 out of 10.

Finally i will throw this out there because it is an interesting comparison. The UK pays annually 44,000,000,000 in interest payments for our national debt and is double what we pay in all out of work benefits (ESA, JSA and IS). EDIT: These figures are in pounds not dollars and edit: the benefit figures are taken from the 2010 budget so may be slightly out of date but i wouldnt imagine by much. Sure it would be easy to check if one was so inclined.

Thankfully we can get back to more easy to understand numbers.

15 million children who die every year from starvation and this equates to a rate of one person (adult/ child) every 3.6 seconds.

World Hunger Statistics | Statistic Brain

The World's Billionaires - Forbes

The World's Biggest Public Companies

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)

It is also very interesting when you start looking at the NYSE and see what has happened to the DJIA since both 1970 or there abouts and in the last four years since 2008. It tells another story which is glaringly obvious even if one (like me) doesnt know much about the why... the numbers themselves highlight the what. I only know that since the 1970s (which is when i think the financial markets were deregulated) the figure has been getting higher and higher at a far faster rate than ever before. If i understand it correctly it is more or less what the top companies and shares of these companies are worth as an average.

That is another can of worms for another day though and only mention because i think it is relevant to why the rich are getting not just richer but astronomically so... although i havent looked at all the details. One doesnt need to know everything though because even an idiot can see it has been climbing at a faster and faster rate ever since the seventies and thus companies have been getting larger and certain people have benefited enormously. Plus in this age of austerity the fact that the DJIA has recovered and is considerably higher than it was when it crashed in 2008 and thus the companies it loosely represents are doing even better than before paints a picture that is far different to the one bandied about in the media. The fact that HSBC was also second only to BP with profits of 16 billion (i think remembering now) also highlights the facts that the banking sector is also missing out on the great party that is austerity.

Stock Market History

DJIA - Dow Jones Industrial Average - CNNMoney

Funny thing is none of this, from the huge concentration of wealth to the massive number of children dying, surprised me at all. Like i say you can draw your own conclusions to all the things i have mentioned and all the things i havent found the time to as yet, such as how i bet my last dollar that the poorer nations where everyone is doing the starving are old colonial nations. I will leave you to compare rich folks income and the rate at which it has increased, it would be quite easy to do. If you do, to give you a leg up, i did check before a few weeks/ months back and compared during the last ten years, how much inflation had risen (about 150 per cent) and and average (hate that word) salary (about 2 thousand pounds or 9 per cent). In fact thinking about it i wouldnt be at all surprised if the wealth of the top x per cent hasnt increased at a rate closer to the rise of inflation... which would leave me to conclude we really are paying for the top lot to get rich.

Anyway this was mainly an information providing post, one in which i could simply share what i had discovered, not just in general but in real factual detail. I decided to post it just in case you werent aware of these figures because i personally feel everyone should be. Now i accept the narrow range of the data doesnt tell the whole story far from it in fact but i do think it shows quite clearly the question i asked namely where is all the money going. The reasons why i think this happens and why it is so wrong are far more complex than i can explain here and so i wont even bother to try (even if i actually could which i doubt). I do however think it shows quite clearly that something is obviously broken... unless you actually believe profit before people is ok.
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200p

Well-known Member
Combined these top ten people have a net worth that is higher than what the United Arab Emitrates earns in a year and would mean if they were a country they would be at number 31
Though you're comparing the net worth of those 10 people to what countries make in a year. Surely they'd only be at number 31 if their earnings in a year was the 31st.
 
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rockmonkey1973

Well-known Member
Though you're comparing the net worth of those 10 people to what countries make in a year. Surely they'd only be at number 31 if their earnings in a year was the 31st.

Sorry mate you have lost me. edit or maybe you havent... i think i did say exactly what you did in the original post... unless i really am lost.
 
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200p

Well-known Member
Okay maybe I had it wrong, but I still think 2 different things are being compared that aren't really equivalent.
 

rockmonkey1973

Well-known Member
Okay maybe I had it wrong, but I still think 2 different things are being compared that aren't really equivalent.

I think i already said that didnt i. Just interesting comparisons thats all. like i said i read it and wanted to find out if it was true.
 

Peridot

Well-known Member
Them's the facts, but the vast majority of folk are happy to believe that the Latvian mother looking for a bigger council house or [insert any similar Daily Mail headline here], are their enemy.

We live in a depressing cesspit of a world, but anyone reading or contributing to this thread is part of a small minority that has avoided the worst deprivations of it.

Enjoy the good bits and die :smashin:
 

kav

Distinguished Member
The UK is a rich country? It's flat broke. Successive governments have seen to that.
 

Rasczak

Distinguished Member
Why not post politics topics in the politics section of the forum? That little sub-forum could do with some fresh blood and it would keep General Chat a restbite from it all.
 

rockmonkey1973

Well-known Member
If you think it best there then I don't mind if it gets moved. I only posted it here because I really wanted as many people as possible to get a chance to read it.
 

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