Last week the Forbes list was released.
The list is an unabashed celebration of wealth accumulation,
listing the richest individuals in the world. The list accounted for 1,826
dollar billionaires with an aggregate networth of $7.1 trillion or about twice
the total economic output of Africa, population 800 million.
Africa was well represented with Nigerian industrialist
Aliko Dangote on top of the heap with other Nigerians, Egyptians and South
Africans accounting for most of the continent's Forbes listers.
I suspect that for the members of the Forbes list it does
not change very much, if anything at all, in the quality of their lives. But as
journalistic project, now in its 29th year, it is a winner. People
like lists. They simplify information and what best way to
provide context than by presenting from best to worst?
"What is interesting is to go down the list and notice that while the richest man in the world Bill Gates and few other billionaires have made their money in the ICT sector, the old economy industries of manufacturing, finance, real estate and even agriculture dominate...
Among other things this means that to make outlandish fortunes
one still has to build capital over years, decades even generations before you
can even be on the list.
Also interesting is that more than half the people on the
list were from the USA and Europe, while resource rich Africa only accounted
for 106 or less than a tenth of the total list occupants.
This points to the fact that it is not the abundance of
natural resources that produces the wealth of nations. The individual
entrepreneurs are key but more importantly is the economic and legal framework
they operate in.
The US is a single $17trillion dollar market, Europe is not
very far behind with an economy of about $14 trillion. On the whole the number
of billionaires depends on the size of the economy they are playing with.
The love of money is the source of all evil and it
interesting to see how when interviewed most of the billionaires are not in it
for the money. Even at their most extravagant they cannot consume their
accumulated dollars.
Two things come out. That the bigger they get the more
people they employ and the more people they serve. Secondly, that the growth of
their companies is a real survival mechanism. There is no such thing as staying
in the same place you are either growing or shrinking.
"The poor convince themselves that such accumulation of wealth is evidence of the supersized greed of the superegos that own it. This thinking probably helps them sleep better at night...
Interestingly billionaires Bill Gates and Warren Buffett
have between themselves pledged to give away all their wealth to charity by the
time they die. Buffett last year gave away $2.5b. Ironically however his net
worth as an individual during the same period grew by $14.5b.
Of course the argument is that the rich are getting richer
and the poor, poorer, a situation that is unsustainable and bound to cause
instability in the future. They are right and they are wrong.
Inequality is inevitable. What is not, is the growing chasm
between either side of the wealth divide.
This growing inequality is actually an indictment on
governments. Either through poor policies that do not allow businesses to
create wealth, jobs and taxes or by failing to spread the tax of the surpluses
businesses make for the benefit of the rest in terms of security, social
services and infrastructure.
"Despite our poor mentalities we need more wealthy people in our midst, businesses create wealth not governments. So the more wealthy people you have the better chance your society has of uplifting the general population, especially if government is doing its job well...
Which comes around to how government should aid businessmen.
Giving them handouts does not work.
Last week the Economist had an article “Brazil’s business
Belindia”, wondering why Brazil while it has a handful of world class companies
it has hundreds more mediocre to bad businesses.
As it turns out the winners such as aeronautical company,
Embraer or JBS a meat processor (they slaughter 100,000 cows a day) are private
companies benefitting from investments in education and progressive policies
that allow them to compete on the world stage. State owned oil company
PetroBras on the other hand has been brought to its by mismanagement and
scandal that have come to light with the fall of global world prices.
So we have to stop looking at the Forbes list as a vanity project, but as a tool, for both individuals and governments, that can point us in the right direction in our efforts to raising te living standards of our people.
