We all know the rich are thieves, hiding their wealth and their income in complicated corporate structures and offshore havens to dodge the taxman and avoid paying their fair share. But how big is the problem? 21 Trillion US dollars, according to a report seen by the Guardian. That's as much as the US and Japanese GDPs combined.
If this wealth returned a mere 5% - a level which would have fund managers calling for heads on spikes - it would generate over a trillion US dollars in income a year. Which means around US$400 billion a year in dodged taxes. If it returns 10%, then we're looking at the thick end of a trillion dollars a year in theft.
This is bad enough in the rich world. But its effects on poorer countries have been absolutely crippling:
The detailed analysis in the report, compiled using data from a range of sources, including the Bank of International Settlements and the International Monetary Fund, suggests that for many developing countries the cumulative value of the capital that has flowed out of their economies since the 1970s would be more than enough to pay off their debts to the rest of the world.Its not the whole story, but theft by the rich is a significant factor in keeping the developing world poor.
Oil-rich states with an internationally mobile elite have been especially prone to watching their wealth disappear into offshore bank accounts instead of being invested at home, the research suggests. Once the returns on investing the hidden assets is included, almost £500bn has left Russia since the early 1990s when its economy was opened up. Saudi Arabia has seen £197bn flood out since the mid-1970s, and Nigeria £196bn.
What can be done? Pretty obviously, we need to close the loopholes which let the rich get away with this theft. And we need to jail the people who do it and the people who enable them - the accountants, bankers, and other parasites who have made a business out of helping rich people steal from their fellow citizens. These people's job is essentially to conspire to rip us all off. And they need to pay for it.
Meanwhile, I'm curious: how much are New Zealand's overclass stealing from us? How much is John Key hiding? Its a fundamental question of moral decency here, and we deserve some answers.