But do note that this is a case of one rentier feeding off three renters (or one and a half if you average it over their whole lifetime). So clearly this isn't something everyone can do. It depends on some people never being permitted to do it.
Now, if the lifetime average had been less than or equal to one half of a renter pr. rentier, then it would be possible for everyone to retire as a rentier (although there remains a question of distribution between different age groups). But that's not the case in this example.
- Jake If you only spend 20 minutes of the rest of your life on economics, go spend them here.
If anyone can do so or not, it depends on luck, I guess, personal talents also, besides inheriting or other parasitic way (even though I don't find passing along my wealth necessarily immoral) and so on... we also need to define the word permitting, and assess the way the blocking happens, in order to think of a solution. Free at last! Free at last! Thank God Almighty, we are free at last! (Martin Luther King)
Huge areas of central London are owned by a relatively small number of aristo Landlords.
And even in a small example, there's always a cost of entry. Right now it would be very difficult for anyone without a good block of starting capital to set themselves up with a buy to let scheme.
But generally rentiers are people who are inherently parasitic - they do no productive work themselves (which even a landlord has to do at least some of to keep a house maintained.) Instead they work at arms length, moving money around in the hope that it will catch a market trend, or - more straightforwardly - betting against other rentiers.
As long as money markets are fed with Ponzi-like cash flows and rent is paid as tribute, they can live like that quite comfortably.
But this process isn't just detached from the real economy, it actually starves it, because both wages and committed investment capital become more scarce.
But you won't ask people to justify their wealth, or what they do with it - and they may work through intermediaries anyway. That's why I was saying that today the democratic regimes and the rule of law provide perfect cover for "elites" (in the broadest sense, I find it nicer a word than fatcats :) ) and there's not much to do about it. How do you punish greed, other than through its most obvious consequences (like force them to repair electrical wiring in the rented house) Free at last! Free at last! Thank God Almighty, we are free at last! (Martin Luther King)
The problem is, how do you draw the line, how make the difference.
When they can buy seats in Parliament, they are a problem. That seems to happen somewhere between 100 million € and 1 billion €. So let's play it safe and say confiscatory taxation on any fortune above 50 million €. Surely fifty million should be enough for anybody? That's something like fifteen apartments - thirty if you're a couple.
I don't actually have a problem with rentiers per se - sure, they're inefficient and a burden on the rest of us, but they're not that much of an imposition, as long as they stick to their fancy boats and expensive golfing shoes. Or nice vacations in Bretagne. No (or very little, at least) skin off my nose.
But I have a problem with people who can buy and sell political parties wholesale.
And I have a problem with inherited wealth, for much the same reason that I'm opposed to hereditary nobility. Oh, sure, by all means pass along the chandelier and the silver candlesticks Greataunt Martie hid from the Germans during the War. And keep the yacht, if you want to. But hand over the factory and the copper mine and the TV station. Those are not your personal fiefdoms, to rule as you please and pass on to your heirs.
Rentiers a burden?... Those two guys earned their own money, paid building companies to build apartments (so they indirectly gave work to -- algerian illegals, well there might be something there), rented to people at fair price, maintained the property. I think your problem is with greedy, dishonest rentiers. I have that problem with all greedy dishonest, btw :)
The issue is not if they can buy seats or not, for we need to know who does, when and what it costs. It's illegal to buy seats. Inherited health may still have sane basis, right. My Breton landlords had a daughter too if I remember well, imagine her luck. I would tax inheritance - up to a point though, for I don't see any moral problem, except a risk of corrupting the offspring. If we raise the scale and speak about factories -- give them back to the -- State, then?... To political fiefdoms ? Hmm.
I would rather have a problem with hereditary fiefs, rather than the nobility per se. And you should count the number of former nobility working in finance and who are now buying back their old castles and some new ones. Free at last! Free at last! Thank God Almighty, we are free at last! (Martin Luther King)
Rentiers a burden?... Those two guys earned their own money, paid building companies to build apartments (so they indirectly gave work to -- algerian illegals, well there might be something there), rented to people at fair price, maintained the property.
I should re-phrase. Rentiering is a burden. The actual people involved may or may not be, overall, depending on whether they have previously contributed something of value to justify their current status.
I don't begrudge people who worked honest jobs for decades that they retire as rentiers. Although I would prefer if they could retire on adequate public pensions instead. But you work with the political economy you have, not with the one you'd like.
What I do begrudge somewhat is the people who buy at the bottom of the market and then, purely because rental values soar for a decade, can rent out and use the rent to pay interest on the mortgage and amortise the mortgage. Although that's still mostly small fry, and irritates me more because of what it says about the lack of counter-cyclical real estate policy than for the actual rentiering involved.
If we raise the scale and speak about factories -- give them back to the -- State, then?
The state can always auction them off, if you think that it's undesirable to have the government run factories.
Cultures which share too much stagnate through lack of incentive and reward.
Cultures which share too little stagnate through lack of majority opportunity and systemic top-down corruption.
The reality probably isn't as one-dimensional as that, but a Goldilocks economy which is designed with the explicit aim of balancing opportunity against opportunism could be an interesting thing.
