Exploring an extreme wealth line

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It has long been accepted that there is a line beneath which people have too little to thrive or survive. In a period defined by rapidly growing wealth inequities, there is increasing discussion about whether we should also be asking how much is too much. At what point does wealth accumulation become excessive, unjust, or harmful?

The concepts of a poverty line and an extreme wealth line (EWL) are not the same. One focuses on the minimum income, or the level of resources, required to access life’s essentials such as food, shelter, and clothing. The other considers whether there is a point beyond which the concentration of global wealth, such as income-generating land, properties, and financial assets, in the hands of relatively few people, is harmful – to individuals, to society, and to the environment. Drawing a line in either case has the potential to be highly contested, but also hugely impactful: it enables us as a society to discuss and reassess our tolerance for inequities and ultimately design better policies to tackle them.

There is much evidence to suggest that we should. Wealth concentration has reached alarming levels. In the last decade, the richest 1% of humanity captured over 50% of all new global wealth. The top ten wealthiest people in the world now own more than the poorest three billion combined, and the average billionaire’s carbon footprint is one million times that of the average person. Meanwhile, growing wealth disparities are outpacing poverty reduction; if current trends continue, the world could witness its first trillionaire within this decade, while poverty won’t be eradicated for another 229 years. These figures point to a major policy gap in tackling wealth inequities, but the issue of extreme wealth has yet to receive the visibility and political attention it deserves.

Society needs novel approaches to bring this complex topic to life, including narratives and practical tools more apt to address the vast cultural, moral, economic, and social barriers to tackling extreme wealth

This research, developed by the New Economics Foundation in partnership with Patriotic Millionaires International, raises the flag for an EWL: the point at which excessive wealth causes unjustifiable harm. It builds on Ingrid Robeyns’s concept of limitarianism and work by Thomas Piketty, Emmanuel Saez and Gabriel Zucman, studies by the London School of Economics, Utrecht University, and the Excessive Wealth Disorder Institute, as well as broader work by the Fairness Foundation, Oxfam, and the Joseph Rowntree Foundation, among others. The report draws on interviews with politicians, policy experts, and millionaires from Brazil, France, Italy, South Africa, the UK, and the USA, to provide insights into the potential impact, challenges, and opportunities that an EWL brings and critically, how and where it might be set.

Overall, we found widespread support for an EWL as a tool capable of shifting public and political thinking and narratives, fostering meaningful discussions about the origin, accumulation, and distribution of extreme wealth and any harm it may cause. In our interviews, extreme wealth was often regarded as a systemic failure, rather than an anomaly; extreme wealth concentration was linked to significant negative outcomes, including damage to the social contract and community cohesion, disproportionate political influence, and environmental deterioration.

Of the 25 interviewees, nearly half (48%) suggested an absolute value for the EWL ranging from $10m to $1bn. One-third of millionaires set it at $10m. Politicians and policy experts overwhelmingly preferred a relative measure, such as the extent of the wealth gap or a ratio between individual wealth and the size of the national economy.

When considering how, and where, to draw the line, participants discussed various factors including whether the wealth was spendable, reasonable, and fair, as well as the type and level of harm it caused. While participants expressed the importance of accounting for local contexts, there was broad support for a global benchmark for clarity and coordination, and to help address policy challenges such as tax evasion and capital flight risks. Rather than imposing absolute restrictions on wealth accumulation, the majority favoured using the line to implement redistributive measures, such as taxation. However, our analysis of findings indicates that the EWL might provide a more powerful foundation for challenging the current primacy of economic growth in global economics by engaging in a more cohesive discussion about how much growth, at what cost, and for whom.

There are many anticipated hurdles to implementing an EWL, including achieving consensus on where it should be set, enforcing any associated policies, and overcoming backlash. This research points towards the next steps, including more robust research on the causal links between extreme wealth and societal and environmental harms; broader societal engagement, including through deliberative and participatory processes such as citizens’ assemblies; and direct work with international institutions such as those in the UN system and policymakers.