rich

IMF: Tax the Rich to Improve the Economy

- Adam Clare

The International Monetary Fund has just completed a study that compiled data across time and space to conclude that taxation isn’t harmful for economies. Indeed, taxing the rich is actually very beneficial for any national economy because it stops inequality – which is an awful thing for both people and economic progress.

Labelled as the first study to incorporate recently compiled figures comparing pre- and post-tax data from a large number of countries, the authors say there is convincing evidence that lower net inequality is good economics, boosting growth and leading to longer-lasting periods of expansion.

In the most controversial finding, the study concludes that redistributing wealth, largely through taxation, does not significantly impact growth unless the intervention is extreme.

Read more.

Why Poorer People Are Kind to One Another

- Adam Clare

For some reason there are stereotypes out there that imply that if you’re not part of the middle class then you are a jerk. Well, it looks like that maybe half true. New research has come out that started with the question why statistically do poorer people give a higher portion of their income to charity compared to the rich has now concluded with the idea that rich people are not as empathetic as the poor.

It would be nice if people who were better off gave more of their income to charities and to other worthy causes. I hope this inspires all of you to give.

Michael W Kraus, of the University of California, San Francisco, is one of a number of social psychologists who have recently been busy demonstrating that lower socioeconomic status (SES) is intricately linked to all sorts of prosocial behaviours. Everything else equal, the less wealth, education and employment status we have, the more charitable, generous, trusting and helpful we appear to become. In interactions with strangers, poorer people are more likely to use polite, attentive, respectful gestures. Most recently, in a paper just published in the prestigious journal Psychological Science, Kraus et al report that lower SES subjects show significantly greater empathy than their richer, better educated counterparts. He argues that this tendency to empathise may at least partly explain the other observations of prosocial behaviour.

Read the rest at the Guardian.

German Millionaires Support Democracy

- Adam Clare 1 Comment

Remember those super rich folk from the USA who decided to donate half their money? Well, that’s not the German way – and for good reason!

In an interview with Der Spiegel, a German millionaire explains why he thinks it’s best for the state to decide where money should be spent in a democracy.

SPIEGEL: Forty super wealthy Americans have just announced that they would donate half of their assets, at the very latest after their deaths. As a person who often likes to say that rich people should be asked to contribute more to society, what were your first thoughts?

Krämer: I find the US initiative highly problematic. You can write donations off in your taxes to a large degree in the USA. So the rich make a choice: Would I rather donate or pay taxes? The donors are taking the place of the state. That’s unacceptable.

SPIEGEL: But doesn’t the money that is donated serve the common good?

Krämer: It is all just a bad transfer of power from the state to billionaires. So it’s not the state that determines what is good for the people, but rather the rich want to decide. That’s a development that I find really bad. What legitimacy do these people have to decide where massive sums of money will flow?

SPIEGEL: It is their money at the end of the day.

Krämer: In this case, 40 superwealthy people want to decide what their money will be used for. That runs counter to the democratically legitimate state. In the end the billionaires are indulging in hobbies that might be in the common good, but are very personal.

Read the rest on Spiegel Online.

The Super Rich Have a Super Nice Pledge

- Adam Clare 3 Comments

Thirty-eight US billionaires have pledged to give at least half of their total wealth to charity during their life or after their death. Warren Buffet and Bill Gates (who have previously donated very large sums of money) have made an impression on other extremely wealth individuals in the USA with their new organization The Giving Pledge.

The campaign was started in June to convince US billionaires to give away at least half of their fortunes either during their lifetimes or after their deaths.

“We’ve really just started but already we’ve had a terrific response,” Mr Buffett said in a statement.

He added: “The Giving Pledge is about asking wealthy families to have important conversations about their wealth and how it will be used.”

Those who pledge their money to “philanthropic causes and charitable organisations” must publicly state their intention through a letter of explanation.

Read more at the BBC.

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