Striking leader in this week's The Economist.
TONS of more wealth around
People in advanced economies stand to inherit around $6trn this year—about 10% of GDP, up from around 5% on average in a selection of rich countries during the middle of the 20th century. More wealth means more inheritance for baby-boomers to pass on. And because wealth is far more unequally distributed than income, a new inheritocracy is being born.
"The typical heir is someone inheriting a normal house, or the proceeds from its sale, not a superyacht or a country pile."
And housing wealth has rocketed in recent decades, especially in apex cities like London, New York and Paris. Those who were fortunate enough to buy property before the long boom have made lots of money, passing on a windfall to their heirs.
This bit was particularly revealing: "As housing has become ever more unaffordable in places like New York and London, so a 90th-percentile income has become too small to pay for a 90th-percentile life."
Wealth, especially the inherited kind, just matters too much.
One solution (well, "solution") is to wield government even more—more cowbell to fix problems of different, previous cowbells:
Levying sufficient annual property taxes, especially those that target underlying land values, would also help, because the tax would be capitalised as a fall in house prices, bringing down house-price-to-income ratios. And anything that boosts economic growth, so desperately needed in Europe, would bring down wealth-to-GDP ratios
Tragic to see the development; love to see the coverage. Maybe whoever wrote and researched this can stay on staff after the @Undisciplined very-disciplined takeover? (#898722)
non-paywalled: https://archive.md/kAVoo