h2g2 The Hitchhiker's Guide to the Galaxy: Earth Edition

The 2007 Rich list is about to be published and it contains a few surprises for those who complain of capitalism's evils.

In 1989, 78% of those on the list inherited their wealth. Now 75% on the list are self-made millionaires. In addition, only one in four have a university qualification. It gets harder and harder to be named on the list too. Last year, the requirement was to have at least £60m - this year it's £70m.

Capitalism works, especially for those prepared to get off their backsides and work. Which may account for why there are so few Britons on the list. Only one in five on the list were born in Britain.

Of course, much of this is due to the generous tax schemes available to foreigners brought in under a Labour Government, but there is no getting away from the fact that hard work beats university.

Ah. So by "works" you mean "can make some people acquire a lot of money".

Funny, I always thought there was more to life than that.

I was wondering about the definition of "works" as well. The list seems to tell me that the rich are getting richer.

And are you implying that university isn't hard work? I certainly expect it to be. In my experience you have to be greedy and ready to screw every man, woman and child you come across the acquire that kind of wealth. I suppose you might work hard doing that, but...

Sorry, but you've proved nothing here and simply drawn your own conclusions from some statistics.

First of all:

"it contains a few surprises for those who complain of capitalism's evils."

What "evils" are you referring to? And what surprises?

"In 1989, 78% of those on the list inherited their wealth. Now 75% on the list are self-made millionaires. In addition, only one in four have a university qualification. It gets harder and harder to be named on the list too. Last year, the requirement was to have at least £60m - this year it's £70m."

Unfortunately "self-made" doesn't necessarily mean "from non-inherited wealth". Strictly-speaking, it should be someone who started with little or nothing and, with no help from government nor nepotism, built themselves and a business up from the ground. It's the idealistic view of an entreprenuer and it's not the majority. The majority of people join a business (sometimes with help from people they know, sometimes not) and work their way up by networking and contacts. They don't create anything, they simply join an existing structure and work their way up it through creating a good impression, nepotism (this is what "networking" is largely about) and claiming credit for others' work. Hard work cerainly helps and many people rise through that but the notion that hard work and hard work alone = success is simply balderdash. The truth is so much less idealistic.

"Of course, much of this is due to the generous tax schemes available to foreigners brought in under a Labour Government, but there is no getting away from the fact that hard work beats university."

Hard work alone means nothing. Most people in manual labour work hard and are paid a pittance. I've been paid well for easier work and paid poorly for difficult work. A lot of what determines your career is about nepotism, personality, self-confidence, dishonesty (not necessarily in an unpleasant way but few people would turn down a superior's praise for a piece of work they knew their underlings had worked harder on), luck and hard work. Interestingly, people who work in business are perfectly honest (I've been told several times about people who've been promoted based not on hard work but on being lucky or knowing the right people) about this and some even joke about how ridiculous the road to success can be but are grateful for it if it's benefitted them. Hard work is part of what makes people successful in everything from art to business but the notion that successful people are hard-working and unsuccessful people aren't is simply tripe.

SWL, I'm afraid this simply confirms to me that you're an ideologue. I personally think Capitalism is, on balance, a good thing but I'm aware from experience that the rich are not necessarily deserving and the poor are not necessarily to blame for their condition. There is no black and white in anything. I err on the side of business being a good thing that needs to have a good eye kept on it. For every Richard Branson there's a Leopold II. You can think the profit-motive is a good thing and still recognise that the Congo Free State was a human tragedy that should never happen again or that Enron's crookedness was excerbated by the starry-eyed "business knows best" ideology. Businesses are run by people, not gods, and people are far from perfect.

"Unfortunately "self-made" doesn't necessarily mean "from non-inherited wealth""

That second quote should read "without any help". This place needs an edit function.

Idealogue? I've been called worse. If that means a belief that hard work brings it's own rewards, guilty as charged. I guess I'm posting as a reaction to the benefit junky society espoused by some around here. Darn tootin' if Labour were actually a socialist party, there's no way we'd be looking at figures like the above.

Networking = nepotism There's twisting to an agenda for you.

I'll bring it up again. Just what is you think you mean by 'Capitalism Works'? Eh?

As someone with the good fortune to have inherited an opportunity to work hard in a family business for half my life and then retire well off ridiculously early I have to ask:


Does anyone seriously think that it is possible for *everybody in the world* to be monetarily wealthy by Western standards even in the hypothetical situation of everyone being both a devoted capitalist and a capitalist genius? Doesn't the idea of unlimited growth at some point meet up with, I don't know, the Second Law of Thermodynamics? If everybody is making a mess of money, who's spending a mess of money?

As I see it, capitalism's continued functioning depends on there being Haves and Have-nots. If everybody is a Have, then (thank you Incredibles) no one is. Or, to put it another way, it's communism.

I see what SWL is saying. If 75% of the worlds richest inherited the money, it would seem capitalism just keeps poor people poor, and rich people rich. But if 75% of them are selfmade, and might not even have had the opportunity for higher education then that would indicate poor people can rise in a capitalist system.

Oh, so it still point out of ignorance and oversimplification.

Of course there's simplification when dealing with sweeping terms. Pure capitalism is a rare beast and is more akin to anarchy. The curbs put on capitalism are the very measures that sustain it long term. I wouldn't particularly want to be reliant upon the largesse of the privileged as was the case in the past, but when put beside the alternative, IMO capitalism wins hands down because it does at least recognise the individual.

In practice, reality brings a balance between the two. When our society swings towards socialism we have stagnation and strife (the 70s). Under Thatcher it swung the other way. Millions were empowered but millions were also stripped of their "blankies". Winners and losers, yes, but a growing economy.

So, as long as we constantly modify the system, capitalism works.

With those rules, communism is still working in Russia.

"In practice, reality brings a balance between the two. When our society swings towards socialism we have stagnation and strife (the 70s). Under Thatcher it swung the other way. Millions were empowered but millions were also stripped of their "blankies". Winners and losers, yes, but a growing economy."

A lot of the people who lost-out under Thatcher had already been working, she just closed the businesses down because they weren't sustainable. People who had been living off the dole kept living off the dole. Since the Conservatives in the '80s knew they were getting high unemployment and not creating jobs fast enough to replace the ones they were disestablishing they actually created more welfare-junkies.

"Pure capitalism is a rare beast and is more akin to anarchy"

Apparently, "anarcho-capitalists" have cited Mogadishu in Somalia as an example of their theory in action. Nuff said.

" I wouldn't particularly want to be reliant upon the largesse of the privileged as was the case in the past, but when put beside the alternative, IMO capitalism wins hands down because it does at least recognise the individual."

But most capitalism is based around corporations which are an uneasy mix of corporate co-operativism, bureaucracy and individuals trying to rise within the structure. The idealistic view of the capitalism as everyone working on their own to better themselves no more exists, nor can exist, than the idealistic version of socialism. There is strength in numbers and the individual alone can't compete. That's true of nations, corporations, business, everything.

And all systems "recognise" the individual: talented and ambitious (and sometimes ruthless) people rise in any system. Stalin didn't become the head of the USSR by being "first among equals" he got where he did by ambition. Given different circumstances, he might have made an excellent CEO.

It's a human factor that makes people individuals, not any sort of ideology.

If I were going to say a nice thing about capitalism, I'd point out that it means the system does change every so often. Its not quite the same as "we can change it" - it does the changing by itself - but the flexibility is there.

Does a change in the composition of the rich list show that capitalism is a success? No, its far too small a slice of society. Judged by democratic standards, for the economic system to be a success, it has to be an overall benefit to everyone, not merely allow a chance for some people to climb to the very top.

I should point out that Communism too more or less completely replaced inherited wealth in society - with the the party apparatchik.

Moreover, despite Thatcher's rhetoric, tax rates at the end of her rule were not that significantly lower than when she started, nor was the division of public spending all that different. We have now what was built after the second world war: a large and expensive state sector within a market economy. Thatcher's innovation was labour flexibility.

I suspect that this is more about post-industrial society than politics though. It is likely that these nouvelle riche belong to relatively new and growing sectors of the economy that have benefited from this.

Interesting couple of posts. I don't know owt about Mogadishu and I take the point about Communism eliminating inherited wealth, though in rather a different way

Food for thought.

I've just been chewing on this food for thought:

I must say that I do agree that capitalism over the course of its run has generally led to an increase in individual well-being. But this general increase has been roughly similar to the general increase in complexity, beauty and general niftyness that Darwinian Evolution has brought to the natural world. Now, Natural Selection is a really cool way to run a planetary ecosystem, but is it really the way we want to run a global economy?

and,

as I mentioned before, and at the risk of joining an in/famous Club in Rome, there are, in fact, Limits to Growth. If we, and capitalism, are to survive, there needs to be very careful management of local and global economies, conducted *with the active participation of all people*. Then, of course, we must ask the question, 'will that still be capitalism?'

and, on a more personal note:

lately I find I've been agreeing quite happily and sometimes strongly with posts by Zagreb and Arnie. What happened? Have they become more enlightened, internationalist and socialist or has the unthinkable happened to me?

Oh. I'm sorry SWL: I've been agreeing with your posts lately, too. Except, of course, the first one of this thread.

It's called making a provocative opening statement to elicit a response Strangely for around here, the usual suspects haven't come charging in and we've seen more thoughtful, intelligent posts.

Good stuff.

How about making a thoughtful, intelligent opening statement? That might elicit some thoughtful, intelligent posts. Just a thought.

And I have a question, which has kind of been mentioned before. If hard work = 'success' ie. huge wealth why are there no manual labourers on the list? Where are the workers in an day-and-night Asian sweatshop?