I first heard about this book on The News Agents podcast, and then saw the author being interviewed by Gary Stevenson on YouTube. I’d read Gary’s book, The Trading Game, last year and have watched his videos occasionally since.
Gabriel Zucman is a French economist who has also spent years researching inequality in modern economies. He has come to the same conclusion that wealth must be taxed to counteract the effect that ordinary people are being priced out of living a comfortable life.
The book itself is very short, only around 100 pages. In it, he details the context behind growing inequality, the history of previous wealth taxes and why they failed, and his plan for a new one. This law has actually been passed by the French government, although it is currently blocked by the senate. In fact, he details how the UK went through a similar thing with Lloyd George’s budget in the early 20th century to set up a more progressive income tax. His proposal is that there should be a tax:
- For people with wealth of over £100 million.
- Where they pay a minimum tax rate of 2%.
- There are no exclusions, no exemptions.
- Which still applies after they have left the country for several years.
The final point is the most interesting to me, in that the usual argument against wealth taxes is that these people will just leave. The US imposes taxes on all its citizens no matter where they live, so there is a precedent for this. It’s actually a middle ground between that and Europe, which drops tax burdens as soon as you leave. Also he argues against the claims that the extremely wealthy have no cash liquidity by saying that the 2% is below the average growth in the stock market, and once you get to the level he is talking about the vast majority are held in shares.
Something along these lines clearly needs to happen. Things cannot carry on in this direction. Or, I guess, they can. It’s just that this always leads to absolute destitution for most people or war.