How rich is too rich?

🌈 Abstract

The article discusses the concept of "limitarianism" - the idea that governments should set limits on the amount of wealth individuals can accumulate. It explores the historical precedents for such wealth limits, the author's research on public perceptions of wealth thresholds, and the arguments for why limiting extreme wealth concentration can benefit society as a whole.

🙋 Q&A

[01] Limitarianism: The Case Against Extreme Wealth

1. What are some historical precedents for limiting wealth inequality?

• The Hebrew Bible and Torah recognized years for cancelling debts, freeing slaves, and redistributing property from rich to poor.
• In classical Greece, Aristotle praised cities that kept wealth inequality in check to enhance political stability.
• In 1942, US President Franklin D. Roosevelt argued that annual incomes should be capped at the current equivalent of $480,000.

2. What is the author's proposed wealth limit, and why did they choose that figure?

• The author proposes a wealth limit of around 10 million euros or dollars per person.
• This figure is based on the author's research across Europe, which suggests this level or an even lower "riches line" would be broadly accepted by the population.
• For example, 9 out of 10 respondents in a survey of Dutch people agreed that having wealth exceeding €4 million for a family of four qualifies as being "super-rich".

3. How does the author argue that extreme wealth is often tied to unethical practices?

• The author notes the massive use of tax evasion among ultra-wealthy people and their firms, which she labels as unethical even if legal.
• She also reminds us that current wealth inequalities have roots in historical practices such as slavery or military conquests.

[02] Why the world cannot afford the rich

1. What are the author's key arguments for why limiting wealth accumulation would benefit society?

• Wealth concentration at the top often means fewer resources to lift people at the bottom, contrary to trickle-down economics.
• Extreme wealth concentration can undermine democracy by giving the ultra-wealthy disproportionate political power.
• Wealth inequality can limit governments' abilities to invest in public goods like education, healthcare, and climate change mitigation.
• Meritocratic promises are endangered when extreme wealth inequality is passed down across generations.

2. What policy proposals does the author discuss as part of a "limitarian" agenda?

• Giving workers more rights over firms' strategic decision-making
• Restoring governments' fiscal agency by changing tax rules to limit tax evasion
• Introducing steep taxes on inheritance, with a limit of €200,000 that can be inherited by an individual

3. How does the author address the ecological crisis in the context of limitarianism?

• The author argues that it would be easier to limit assets than to impose individual quotas on the appropriation of finite resources like water or energy.
• However, the author acknowledges that the implementation of such limits in polarized political systems remains a challenging open question.