The rich - poor gap

[porridge]

Rovinghawk said:

I'm still working my arse off; once you make a bit more money, the percentage taken by the silent business partner (HMRC) increases substantially.

I would like you to consider this:
If I can do it, so can many others. Many who dislike my BTL collection sneer during their evenings in the pub whilst I'm WMAO. If they really wanted to be higher up the tree they'd make at least a token effort to do so, but so many don't because envy is so much easier.

BTL has been lucrative for many, not by the work put in, but instead by the capital appreciation that has been allowed by the government's failure to build.

Many BTL 'property developer innit' brigade are nothing more than reckless gamblers who were saved by the 2008 bail outs, low interest rates and ongoing mass immigration.

You may have worked hard, but most have been due to being born at the right time and had capital appreciation in their own homes to use as security through little work of their own, which along with inheritance has been leveraged to build a portfolio that screws over the young.

Edited by porridge on Friday 18th April 13:11

[Willy Nilly]

Not read the whole thread.

No matter what systems are put in place there will always be clever people that find a way of making a pile of cash and there will always be people that let money fall through their fingers like water.

I often think that it would be better to have more profit sharing type schemes where by the employees get a percentage of the company's profit, it should make them motivated and interested in the company, that assumes that the management is any good.

A lot of the time the amount of money a person is worth is just "the score", having a pile of money doesn't make you a better person, it just gives the person with more money a few more options.

[whoami]

santona1937 said:

Tax wealth not income. Include pensioners.
Tax the profit on the sale of primary residences.
Raise the upper tax limit to 75% ( taxing wealth not income)
Raise inheritance tax
Put all schools under state control
Bring in a proper and working system of technical education ( I worked on the development of Modern Apprenticeships and for a lot of industries they are a joke)
Mandate a CEO/ Floor worker maximum spread in industries that do not manufacture, such as finance.
Raise the minimum wage to a regionally based living wage.
Require that companies that use zero hours contracts pay a 10% of amount earned annual bonus to staff on such contracts.
Tax cars on mileage per annum.
Reverse the conditions for new house builds, so new developments need to be 75% affordable housing and 25% at whatever the developer feels they can charge.
Disallow benefits to those who have not paid a certain amount of NI with exemptions for those who are physically unable to work
Ban transfer pricing in international companies
Lower Corporation tax but require that directors of any company doing business in the UK are annually personally liable for losses incurred without limitation
Remove all benefits from anyone working more than 16 hours a week.

[Siscar]

Willy Nilly said:

I often think that it would be better to have more profit sharing type schemes where by the employees get a percentage of the company's profit, it should make them motivated and interested in the company, that assumes that the management is any good.

My experience is that many people actually don't go for profit share. We tried it once by offering a choice of a pay rise of 5% or a profit share that would pay the equivalent of 10% at that time. Almost every one went for the 5% pay rise. Saved us a lot of money in the end.

[heppers75]

Is there a real explanation for the utter contempt that is shown for the wealth creators in the UK?

We are all but gone now and by the end of the year will be as I just can't stand it. I have spent a considerable amount of time effort and money properly structuring my exit from the UK as an individual.

I employ a fair number of folks in the UK and of course will continue to do so, I will personally not be in the UK come years end as I simply can't afford to be. So I will in many ways still "contribute", but why would I wilfully stay?

The politics of envy for all but those that are in power is a sad sad indictment of our once great nation IMO.

[Derek Smith]

Siscar said:

So what kind of person are you describing? The mother in a family unit with a husband employed, maybe in work herself? Or the other extreme, a single mother with kids on benefits?

In my opinion we need to build a society where working and contributing is rewarded whilst those in need due to circumstances outside their control are supported. What goes wrong is a society where working and contributing is not seen as the route to a better lifestyle for yourself. Unfortunately there is an element of that today where at the low income level the advantages of working are not that remarkable.

Penalising the rich is pointless and quite often counter productive. I started my business many years ago unashamedly because I wanted to be rich. If putting the work in and taking the risks didn't have the potential to make us rich why would we have bothered? We employ a lot of people today supporting customers around the world, why would we have created that if society would then penalise us for being rich?

Neither was employed as such, they were self-employed. You asked for a definition of struggle. I gave you an example, one that I knew full well existed.

You say: If putting the work in and taking the risks didn't have the potential to make us rich why would we have bothered?

I make the assumption this is a serious question. Given the preceding sentences I would object to a whoosh parrot.

In my smallish circle of friends, I know a number for whom the desire to be rich is not a motivator to work hard. I know two men who gave up a 'rich', at least materially, lifestyle and dedicated themselves to the welfare of others, both without any religious motivation I should add, and both working much harder, dedicating their lives. I would assume that there are one or two within your acquaintance who are similar.

I've met a considerable number of people in my working life who have dedicated themselves to the welfare of others and 'suffered' financially as a result.

I would say that even I am not motivated to get as much money as I can, certainly if at the expense of others.

I know a chap, with an antique shop local to me, who was asked to value and buy an item which many of us, including the owners, would not know the true value of. He could have walked away with the object having paid less that a few % of the actual value, but he didn't. He made a fair offer. Money was not a motivator for him, or them actually. Can you not see the driver for that? They worked hard.

I would guess that becoming rich is not the main motivation for most people.

And, I've just realised, I left a fairly well-paid job to join one where the pay was quite low in order to do something 'useful'.

I'm not ever going to be rich. I've worked hard (at times) in my life and I currently do voluntary work, i.e. without pay. Indeed, I've been doing a fair bit of that today. I've just received an email which means that I will have to do a bit more. I will have to contact others, also not rich, who do voluntary work for them to help someone else.

[DanL]

900T-R said:

But why is the person who manages value creation 'higher' up the scale than the person who creates value? ... The function of a manager is the same either way - making sure the professional can apply their skills to the best effect.

Nope - the purpose of management is to set the goals, vision and direction for the company (if only that could be written with less management speak!) as well as deciding what it is that the engineers or whoever create - the person creating the widget, or whatever, is just one piece. Market analysis, marketing, sales, etc. all feed into this as well, but the overall direction is driven by the company's senior execs.

If you're thinking lower down the chain (line managers, etc.) then they're paid more due to the extra responsibility they shoulder.

[wolves_wanderer]

heppers75 said:

Is there a real explanation for the utter contempt that is shown for the wealth creators in the UK?

We are all but gone now and by the end of the year will be as I just can't stand it. I have spent a considerable amount of time effort and money properly structuring my exit from the UK as an individual.

I employ a fair number of folks in the UK and of course will continue to do so, I will personally not be in the UK come years end as I simply can't afford to be. So I will in many ways still "contribute", but why would I wilfully stay?

The politics of envy for all but those that are in power is a sad sad indictment of our once great nation IMO.

You employ people and can't afford to live here?!

[avinalarf]

ClaphamGT3 said:

"Poor" is always a relative term. The definition that is widely accepted by economists is a financial status that excludes, to an unreasonable degree, an individual from participation in the normal activities and conduct of society. On this basis, next to no one in the UK is 'poor' albeit, their participation may be subsidised by the public purse. I am therefore unsure as to what problem any sort of Government mandated re-distribution of wealth would solve

I am not comfortable with excessive Government intervention in the minutiae of how we live our lives.
However the purpose of Government should be to devise a set of laws, by which we all live, that are transparent and treat all parts of that society in the same manner,regardless of wealth or social position.
It is in this environment ,allowing for a "safety net"for the mentally and physically disadvantaged , that we can feel that we are all equal.
Obviously we do not all have the ability to attain great wealth,and to many that will not be of prime importance.
What is important is that we are all seen as equals before the Law,with the opportunity of work and that work is rewarded to sustain a "fair" standard of living.
This has been especially shown not to be the case in the past 8 years and I example the "banking crisis"and the behaviour of many MP's.
In these examples the Laws to protect society have either been non existent or framed so loosely that they are unenforceable and although some efforts have been made to correct this it stll not good enough.

Edited by avinalarf on Friday 18th April 17:29

[900T-R]

DanL said:

Nope - the purpose of management is to set the goals, vision and direction for the company (if only that could be written with less management speak!) as well as deciding what it is that the engineers or whoever create - the person creating the widget, or whatever, is just one piece.

Um, that's not 'management' in a strict sense. Goals, vision and strategy are the remit of the entrepreneur, the CEO, the board - management is by definition executive. Although I've known more than a few managers with delusions of grandeur...

[Siscar]

Derek Smith said:

More stuff

But the people I am talking about are not the norm, I am talking about those that go out to start companies that become successful and employ people. A very specific group.

When you start and build a business you would be a very fortunate person to do it without taking financial risks. When you first employ people it's one hell of a responsibility, you have to come up with the money to pay people on time so they feed their families and pay their mortgage. Has anyone who hasn't done that got any idea what that responsibility is like?

For me and for most it was hardest early on. I had months where I took no money because paying everyone else took priority. I had periods where I had no idea where the business was coming from to occupy people in a few weeks or even days time. I certainly had periods when I took far less out of the business, I earned less than anyone we employed.

I did it, and the other people I know who have done the same did it for a mix of reasons. But we have no shame in having become rich through it. I'm not perfect, I'm not some superman but I've made a good life for myself and my family whilst also making a great contribution to society. I've created work for a lot of people and I've created an entity that has generated god knows how many tens, possibly even hundreds of millions in tax revenue as well over the years.

Now OK, I'm not a social worker, I haven't been out on the coalface of society's problems, but I'll not take a backseat to many people when it comes to having contributed to the good of society and the prosperity of a lot of people I know even if it did make me fairly wealthy at the same time.

[avinalarf]

Siscar said:

But the people I am talking about are not the norm, I am talking about those that go out to start companies that become successful and employ people. A very specific group.

When you start and build a business you would be a very fortunate person to do it without taking financial risks. When you first employ people it's one hell of a responsibility, you have to come up with the money to pay people on time so they feed their families and pay their mortgage. Has anyone who hasn't done that got any idea what that responsibility is like?

For me and for most it was hardest early on. I had months where I took no money because paying everyone else took priority. I had periods where I had no idea where the business was coming from to occupy people in a few weeks or even days time. I certainly had periods when I took far less out of the business, I earned less than anyone we employed.

I did it, and the other people I know who have done the same did it for a mix of reasons. But we have no shame in having become rich through it. I'm not perfect, I'm not some superman but I've made a good life for myself and my family whilst also making a great contribution to society. I've created work for a lot of people and I've created an entity that has generated god knows how many tens, possibly even hundreds of millions in tax revenue as well over the years.

Now OK, I'm not a social worker, I haven't been out on the coalface of society's problems, but I'll not take a backseat to many people when it comes to having contributed to the good of society and the prosperity of a lot of people I know even if it did make me fairly wealthy at the same time.

I have been down a similar route to you and I applaud your success.
Through your hard work and skills you have created jobs and opportunity for many,good on you.
It might not be you there is a "problem" with.
If however you had said that all your staff were on minimum wage,no contract, then there might become a "moral" problem.

[turbobloke]

Siscar said:

Derek Smith said:

More stuff

But the people I am talking about are not the norm, I am talking about those that go out to start companies that become successful and employ people. A very specific group.

This and the rest of what you say makes perfect sense but with respect (to you) in terms of the wider target audience of PH's very own Polly Toynbees and Johann Haris you might as well be talking double dutch coded in cyrillic script.

avinalarf said:

If however you had said that all your staff were on minimum wage, no contract, then there might become a "moral" problem.

If.

How about pulling legs off insects and boiling babies in the boardroom?

[V8 Fettler]

turbobloke said:

How about pulling legs off insects and boiling babies in the boardroom?

Don't be ridiculous.

That sort of thing doesn't happen in boardrooms, it's saved for the team-bonding days.

[Siscar]

avinalarf said:

I have been down a similar route to you and I applaud your success.
Through your hard work and skills you have created jobs and opportunity for many,good on you.
It might not be you there is a "problem" with.
If however you had said that all your staff were on minimum wage,no contract, then there might become a "moral" problem.

We pay what we need to pay to get good people. We have a part of the business that is minimum wage because it's data entry, but we fill those roles at that level perhaps partly because the hours can be quite flexible.

To some extent you can tell how well you are doing it by how long people stay around. Most people we've ever employed work for us now, we've just had our third hit 20 years with us.

It is good business to develop people, it's good business to be nice. The employee whose father was needing care towards the end of his life, flexible hours, work when you can. The employee whose got kids and wants to start a little late to fit in with school hours. The employee who gets ill, needs more time off. Whatever.

Treat people well and most will treat you well in return, although not some unfortunately. There are those who sit on their 'rights', who run out of the door on the dot of finishing time, who are full of themselves. Those are the ones to avoid, the ones you want to part company with.

[avinalarf]

turbobloke said:

Siscar said:

Derek Smith said:

More stuff

But the people I am talking about are not the norm, I am talking about those that go out to start companies that become successful and employ people. A very specific group.

This and the rest of what you say makes perfect sense but with respect (to you) in terms of the wider target audience of PH's very own Polly Toynbees and Johann Haris you might as well be talking double dutch coded in cyrillic script.

avinalarf said:

If however you had said that all your staff were on minimum wage, no contract, then there might become a "moral" problem.

If.

How about pulling legs off insects and boiling babies in the boardroom?

There is a company that does just that ,the managers are on big bonus schemes whilst the 95% rest of the employees are on minimum wages , no contract.
I do not understand your antipathy toward the notion that employees of a company be given a fair share of reward when that company is successful .
John Lewis seems to do quite well with such a system in place.
I have no problem with "sustainable wealth creators"receiving commensurate salaries,it seems that you have a problem with anybody, apart from that tiny percentage of entrepreneurs that have your financial acumen and focus ,from having a reasonable lifestyle.

[avinalarf]

Siscar said:

avinalarf said:

I have been down a similar route to you and I applaud your success.
Through your hard work and skills you have created jobs and opportunity for many,good on you.
It might not be you there is a "problem" with.
If however you had said that all your staff were on minimum wage,no contract, then there might become a "moral" problem.

We pay what we need to pay to get good people. We have a part of the business that is minimum wage because it's data entry, but we fill those roles at that level perhaps partly because the hours can be quite flexible.

To some extent you can tell how well you are doing it by how long people stay around. Most people we've ever employed work for us now, we've just had our third hit 20 years with us.

It is good business to develop people, it's good business to be nice. The employee whose father was needing care towards the end of his life, flexible hours, work when you can. The employee whose got kids and wants to start a little late to fit in with school hours. The employee who gets ill, needs more time off. Whatever.

Treat people well and most will treat you well in return, although not some unfortunately. There are those who sit on their 'rights', who run out of the door on the dot of finishing time, who are full of themselves. Those are the ones to avoid, the ones you want to part company with.

So there we have it.
You deserve your rewards,you have created employment and paid a fair wage.
You are not the problem.
The problem is the lax or nonexistent regulation that allowed financial institutions to make a massive cock up.

[turbobloke]

avinalarf said:

So there we have it.
You (Siscar) deserve your rewards,you have created employment and paid a fair wage.
You are not the problem.
The problem is the lax or nonexistent regulation that allowed financial institutions to make a massive cock up.

How gracious of you to pat Siscar on the head. And you're sitting in judgement why exactly?

As to the crunch and recession there are several PH threads to have a look at. Lax regulation in terms of Brown's inadequate tripartite system was one element and another at the very core of the problem was political egalitarian delusion. The threads should be easy to find.

[nightflight]

Why is it that in this country, people who work hard and make a few quid for themselves are demonised. In America, success is celebrated. I remember back in the seventies when my Father had been successful in business and bought himself a Mercedes 450 SLC, which at the time was a very desirable car. It got very badly vandalised one day, and I remember asking him why someone would do such a thing. He said to me that he had committed the ultimate crime in the UK. He had worked hard, and been successful. This was a man who had left the navy after the war with nothing, and through sheer hard graft had made a nice life for himself.
I had a conversation with someone a few years ago who was earning £300 per week, and we were discussing the possibility of him earning more than that. He told me he didn't want to earn more than that, and when I asked why, he said "because if I do, people will think I'm rich like you, and I don't want people to think I'm rich". There really is no answer to that. Pathetic.

[Siscar]

avinalarf said:

There is a company that does just that ,the managers are on big bonus schemes whilst the 95% rest of the employees are on minimum wages , no contract.
I do not understand your antipathy toward the notion that employees of a company be given a fair share of reward when that company is successful .
John Lewis seems to do quite well with such a system in place.
I have no problem with "sustainable wealth creators"receiving commensurate salaries,it seems that you have a problem with anybody, apart from that tiny percentage of entrepreneurs that have your financial acumen and focus ,from having a reasonable lifestyle.

So let me get this right. Last year I spent over a fortnight flying to and from Australia, NZ and USA. Together with a Director we brought in a lot of business that is allowing us to employ some more people and, yes, make more profit.

Because of that my receptionist deserves to be paid more? Why?