The well-off must re-engage with politics to defend against onslaughts from professional politicians, says private asset management expert James Anderson, founder of thewealthnet
Bereft of leadership, governments of the so-called “developed” world look bankrupt from every angle – morally, financially, politically and intellectually. Despite their protestations to the contrary, professional politicians have suffocated once vibrant economies with increasingly complex and onerous bureaucracy.
This is extremely relevant to wealth management. The professional political elite are unjustly targeting successful multinational businesses, and the rich investors who own them, to pay for broken political promises and economic mismanagement. It is where the money is – and professional policymakers are desperate.
The average proportion of gross domestic product (GDP) spent on government and public services in Europe has ballooned, from around 15 per cent 100 years ago to more than 50 per cent today. UK government spending currently stands at around 47 per cent of GDP or, to put it another way, around half the UK population isn’t producing anything.
Independent thought is suffocated by centralised selection of MPs who will toe the party line. All mainstream political parties believe in the same formula: labyrinthine regulation, high and complex taxation, big centralised government machinery and the perpetuation of a bloated welfare state. Put simply, this is all unaffordable and leaves voters with no real choice.
Politicians are now blaming their current indebtedness on the rich and the companies they run and own, casting both as immoral social outcasts, who don’t pay their fair share to society.
But it is not just the rich who are at risk. The sequestration of assets from banks in Cyprus was a warning to even those with modest savings or small businesses. Just €100,000 (£83,000) in a business or personal account made you a target for blatant, legalised government theft.
The professional political elite are unjustly targeting successful multinational businesses to pay for economic mismanagement
Accumulation of wealth through honest endeavour and prudent financial planning used to be admired and respected. Now it appears that it is sneered upon by both policymakers and media alike.
But there is another way. The rich need to re-engage with politics, directly and soon. The UK electorate desperately needs people who can make things happen, people who can inspire and lead others, people who have experience of creating wealth, of building and running successful businesses that create opportunities for others, as well as securing and passing on assets to the next generation of managers.
The fact is that the rich have more in common with the rest of the population, even the poor, than either politicians or media. The poor and helpless are of little interest to professional politicians and publishers – they have little spending power, do not have advertising budgets and don’t contribute much to the tax system, as they are often net beneficiaries. It is the middle classes that politicians of every creed need to seduce, but it is the middle classes who are also paying the largest share of their income to the Exchequer.
Ironically, the rich are increasingly the main source of funding for the main political parties. But why donate money to self-interested professional politicians, instead of directly standing on a platform based on independent thinking, common values and mutual interest?
The dangers of doing nothing are far greater than acting. Giving time to society to help cut through the Gordian Knot would be a far greater contribution to the nation than merely paying a fairer share of tax (though the latter is important). The very fact that the rich don’t need to enter the political arena is precisely why they should.
They say that people get the politicians they deserve. If decent, successful people want to hold on to the money they have worked hard to accumulate, then perhaps it is time for them to put professional politics to the proverbial sword.
James Anderson is founder and editor-in-chief of thewealthnet and eprivateclient.