Knowing our limits

Jeff Bezos and Lauren Sanchez  at the Dolce & Gabbana autumn-winter 2024-25 men’s collection in...
Jeff Bezos and Lauren Sanchez at the Dolce & Gabbana autumn-winter 2024-25 men’s collection in Milan, Italy earlier this month. Jeff Bezos earns the average wage of one of his Amazon employees every nine seconds. REUTERS
We need an upper limit for wealth if we are to safely share this planet, "limitarian" advocate Prof Ingrid Robeyns tells Tim Adams.

Here’s a couple of good questions: while we may talk about minimum wages, why don’t we ever discuss maximum wages? And, while our politicians may argue about how little a family can survive on, why do they never address the other end of the inequality scale: just how much accumulated wealth might be too much?

January is always a good time for such questions. As the world’s billionaires private-jetted out to Davos to slap themselves on the back once again for their outrageous fortune, Oxfam produced its annual report about the growing gap between that happy few and the other eight billion from whom they profit and with whom they share the planet’s resources.

This year’s report, titled Inequality Inc, shows that while most people, locally, nationally, globally, try to survive on the same or less, the rich and the very rich become phenomenally more wealthy year by year. Since 2020, the report reveals, "60% of humanity has grown poorer, [while] billionaires are now $US3.3 trillion [$NZ5.4 trillion] or 34% richer than they were at the beginning of this decade of crisis ". The wealth of the world’s five richest men has more than doubled in that period, adding an unprecedented $US464 billion to their fortunes.

Are electorates and politicians across the world prepared just to shrug for ever about that widening wealth gap? At what point does the question arise: enough is enough?

For Ingrid Robeyns, a professor of philosophy and economics at the University of Utrecht in the Netherlands, the urgency of that question is long overdue.

Not only does Robeyns argue for a limit to wealth, she is prepared to put a number on it. Or actually two numbers: the first a political ambition, the second an appeal to ethical conscience.

The first is this: "In a country with a socioeconomic profile similar to the Netherlands, where I live, we should aim to create a society in which no-one has more than €10 million [$NZ17.8m]. There shouldn’t be any decamillionaires."

That aspiration, what Robeyns calls a realistic "political threshold", an outcome for policymakers to strive for, comes with a second figure attached, which is more an appeal to collective morality. "I contend," Robeyns argues, "that for people who live in a society with a solid pension system, the ethical limit [on wealth] will be around one million pounds, dollars or euros per person."

Those limits, she suggests, are not only the ones that would create the fairest and most effective kinds of society, but they represent the maximum levels that also would make individuals - including billionaires and decamillionaires - happiest (just rewatch Succession if you don’t agree).

Robeyns has a name for this philosophy, an argument that she hopes can become a movement. She calls it, in the title of a new book, Limitarianism.

Robeyns, 51, grew up in Belgium and gained her PhD at Cambridge under Amartya Sen, the guru of development economics. However, while most of her academic peers were committed to work on poverty reduction, Robeyns has always been focused on the flipside of inequality - the effects of grossly excessive private wealth on our precarious public sphere and our unravelling democracy and environment.

When I spoke to Robeyns about her book, I asked if she felt like a heretic for proposing these ideas. She laughed and said in political philosophy you just go wherever the arguments lead.

"Of course, the reactions have been polarised," she says. "A lot of people say: ‘I’ve been thinking this all my life’. And then there are those who just freak out and tell me: ‘This is crazy!’. And I can understand that if you have been raised in this neoliberal capitalist paradigm, which I think almost everybody now has, it is an essence of that ideology that there should be no limit to rewards."

Her book unpicks all aspects of that fallacy: the idea that any discussion of a limit to wealth must be born out of envy, for example; or that most seductive of all myths, that people somehow deserve the wealth (or poverty) of their lives - that multimillions are made mostly by hard work and talent, not by luck and vast inequalities of opportunity.

"Basically what I want to do with this book is to say, yes, we all accept that as a societal goal we want to try to eradicate poverty," Robeyns says. "Good. But actually, let’s also look at the other side. The fact is, we should and must minimise the number of super-rich people and the amount of wealth concentration because of all these bad effects ... "

Limitarianism explores the negative consequences not only on social cohesion and democracy, but on productivity, on mental and physical health and on climate change. Put bluntly, the concentration of wealth in a few hands "is setting the world on fire", and "there is so much more that we could do with the money".

The principal reason that so little attention is paid to the potential benefits of the kind of limits to wealth that Robeyns argues for is, she says, precisely because the beneficiaries of this system continue to be "extremely smart in framing that set of policies as non-ideological" - not least through the media organisations they buy.

A sky’s-the-limit philosophy of wealth - for oligarchs and sheikhs and footballers and tech bros and hedge funders and the lawyers and bankers who support them - has come to be thought of as a "normal" consequence of free markets.

Despite the fact that "trickle down" economics has long been discredited as an idea, we apparently remain in thrall to the mythology of "wealth creators" and all their zeroes. But of course, as Robeyns argues, those cascading riches are just a political choice like any other; we regulate markets in different ways all the time. "I think," she says, "if citizens were to understand that better - that we really can choose between many different options of economic system - then we can start a proper debate."

Critics of Robeyn’s ideas tend to fall into two camps; she is either naive or a communist (or both). She insists she is neither and counters these arguments by making the case that placing an upper limit on earnings and wealth is not only ethical but also rational.

In this argument she can not only cite the likes of Thomas Piketty, author of the bestselling Capital in the Twenty-First Century, as a fellow traveller, but also philosophers of democracy going back to Plato (the latter argued that no cohesive society could ever be created if the richest citizens earned more than four times the wages of the poorest; last year, Jeff Bezos earned the average wage of one of his Amazon employees every nine seconds).

For society to pursue these aims - as it eventually must - Robeyns argues that a radical reform of taxation to concentrate on wealth rather than income is clearly necessary. She makes the case that inheritance is the ultimate non-meritocratic advantage, and has to be largely a collective, not a familial benefit.

"There is real value to everybody having some wealth," she says. "The problem is, as it happens now, it’s so hugely unequal. The vast majority of people get almost nothing [from the previous generation]. And then there are people who just perpetuate these dynasties of multimillionaires and billionaires."

The plutocrats at Davos have been, no doubt, full of ideas about how we must think differently to solve some of the crises that we face - political and economic and environmental. Robeyns is very sharp on the ways that this habit of "blue sky thinking" always tends to stop short of addressing the fundamental connection between those crises and the delegates’ own "tax efficient" accumulation of riches and selective private philanthropy.

"They believe they can solve these huge problems by using a so-called ‘entrepreneurial’ approach," she says. "Or by using technology. It’s all about trying to take the politics out of it."

Her book offers some case studies of fabulously wealthy individuals who have understood the effects of their fortunes not only on the economy and the planet, but also on their own wellbeing.

Some, such as the Irish-American billionaire Chuck Feeney, who made his money from a monopoly of duty-free shops at airports, have enjoyed nothing so much as giving all their money away.

Mackenzie Scott, ex-wife of Jeff Bezos, has been shedding billions of her divorce settlement a year, on the basis that "she is giving it back to [society] where it came from".

Others, such as the entertainment heiress Abigail Disney, or the British-based group "Patriotic Millionaires", are sympathetic to the fundamentals of Robeyns’ ideas, recognising that "policies that favour the richest are unsustainable".

At Davos, 250 millionaires and billionaires sympathetic to those groups signed a letter to world leaders demanding a wealth tax: "This will not fundamentally alter our standard of living, nor deprive our children, nor harm our nations’ economic growth. But it will turn extreme and unproductive private wealth into an investment for our common democratic future."

In other billionaire minds, such private reckonings are born out of realism or fear. Nick Hanauer sold his internet advertising company to Microsoft for $6.4 billion in 2007. In 2019 he wrote an open memo to his "fellow zillionaires" about the lessons of history: "If we don’t do something to fix the glaring inequities in this economy, the pitchforks are going to come for us ..."

"It’s probably true that in the past, there would have been a burning of castles by now," Robeyns says. She hopes instead that an "ecosystem of academics and books and films" as well as a popular groundswell with similar ambitions to the Occupy movement - "we are the 99%" - might supersede that prospect.

"It may actually be that climate breakdown is going to be the kind of thing that will do the trick," she says, by which she means the work of revolution. "I mean, of course, we have all the people who try in different ways to deny that, but at some point, you know, it will become clear we cannot just continue like this."

I ask if, as she was writing the book, there was a voice in her head chiding, "come on, this is never going to happen", the voice that defenders of the status quo want people to hear.

"Of course," she says. "Many people who read my book will ask, what can I do? It can feel like, how on earth can we ever fix this? But my answer is, it is the duty of those of us who are in relatively secure positions to take on their responsibility as citizens, make the arguments."

- The Observer