Some People Have All the Luck
...and an outrageously large share of the wealth the rest of us have created
Wealth Concentration
New Stats, Old Story: Our Rich Are Raking It In
From Swiss bank researchers, an alarming update on our global maldistribution of wealth.
Five-star hotels. So yesterday. Today’s super rich, the Wall Street Journal reports, are picking palatial luxury villas over swanky suites when they need a quick pick-me-up.
Italy, France, and Greece currently offer the widest array of villa options, but Portugal seems to be catching up fast. So many options!
How can our deepest pockets find the right one? A “high-end travel consultant,” the Robb Report on luxury living points out, can identify just the perfect villa vacation. The cost for joining the circle that can access one top consultant’s advice: $25,000 in annual fees on top of a $150,000 joining fee.
The cost of actually renting a high-end villa? The realtor agency Oliver’s Travels was offering at one point this summer three dozen villas renting for over $130,000 a week.
How many people on our Earth today can afford to put down — without batting an eye — that sort of cash? Some of our best annual stats on our global super rich have been coming out, over recent years, from the Swiss banking giant Credit Suisse. But this fabled 167-year-old institution stumbled royally during the pandemic and, earlier this year, ended up the property of its Swiss rival UBS.
UBS, fortunately, has opted to continue Credit Suisse’s annual Global Wealth Report tradition, and the 2023 edition — covering data through 2022 — has just appeared. As usual, this annual report’s release has enjoyed substantial media coverage worldwide, especially in the business press.
Most all the latest coverage has generally emphasized the news in the 2023 report’s opening lines. As one typical headline, from Bloomberg, reads: “Global Wealth Fell Last Year for First Time Since 2008.”
Wealth per global adult, the new Global Wealth Report does indeed show, fell by 3.6 percent in 2022. But most of that decline, the report goes on to add, “came from the appreciation of the US dollar against many other currencies.” Hold those exchange rates constant and the story changes. Wealth per adult increases by 2.2 percent.
This year’s Global Wealth Report actually has a much more important story to tell than the global wealth per adult, and the global media coverage has by and large missed it. That story: The world’s distribution of wealth remains remarkably top-heavy. Individuals with less than $10,000 to their name — 52.5 percent of the world’s adult population — hold just 1.2 percent of the world’s assets.
Those numbers almost exactly reverse at the other end of the Credit Suisse Research Institute’s “global wealth pyramid.” The 1.1 percent of the global adult population worth over $1 million individually holds 45.8 percent of the world’s wealth.
One nation — the United States — is driving this incredibly top-heavy statistical picture. Some 38 percent of the world’s millionaires call the USA home. China, the next largest contributor to the global millionaire population, claims just 11 percent. Japan and France, the next two highest millionaire manufacturers, each claim only 5 percent of our globe’s at least seven-digit set.
Worldwide, about a quarter-million individuals — 243,060, to be exact — qualify for Credit Suisse’s more exclusive “ultra-high-net-worth” status. These ultras each hold at least $50 million in personal wealth, and over half of them, 51 percent, hail from the United States. That U.S. ultra-rich share nearly quadruples China’s ultra-rich population, the world’s second largest.
America’s richest of the rich, in short, dominate the ranks of our global deep-pockets. But the rest of us Americans, cheerleaders for our rich love to assure us, have no cause for unease about that domination. The more wealth that America’s wealthy accumulate, their reasoning goes, the more our rich can invest in creating better futures for ordinary working Americans.
The latest Credit Suisse numbers totally undercut that claim. In other developed nations — societies with the rich holding significantly smaller shares of their national wealth than in the United States — typical people have seen substantially greater growth rates in their personal wealth.
Back in the year 2000, the typical American had a net worth of $46,479. The typical net worth of French adults that year: $51,360. By the end of 2022, the typical French adult held $145,591 in personal wealth. The typical — median — U.S. adult wealth last year: just $107.739. Over that same two-decade-plus span, the typical Dutch median net worth jumped from $44,513 to $120,270, the typical Canadian from $37,295 to $143,862.
The spectacular wealth of America’s wealthy, in other words, is paying no great dividends for average Americans. Those dividends are funneling instead to the top of the U.S. economic ladder.
Just one final illustrative example of that dynamic from the new 2023 Global Wealth Report: Japan’s top 1 percenters hold 18.8 percent of their nation’s wealth. The U.S. top 1 percent wealth share? Almost twice as much: 34.2 percent.
Japan’s most typical adults, meanwhile, hold personal net worths of $124,258, some 15 percent higher than the $107,739 U.S. wealth median.
How much more unequal can the United States get? The researchers behind the annual Global Wealth Report can’t answer that question. Only we Americans can.
Sam Pizzigati co-edits Inequality.org. His latest books include The Case for a Maximum Wage and The Rich Don’t Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class, 1900-1970.