Super-rich ravaged by recession

Here’s an interesting story I think we’re going to see more of:

Britain’s richest people lost 155 billion pounds in the past year because of a deep recession and the global financial crisis, a survey showed on Sunday.
The Sunday Times newspaper’s 2009 Rich List, featuring the thousand wealthiest people based in Britain, also found the number of billionaires sank from 75 to 43 people in the last 12 months as the credit crunch took its toll.
The country’s 1,000 richest people have a collective fortune of 258 billion pounds, according to the weekly newspaper. That compared with a record 413 billion pounds in last year’s survey.
“I am beyond being surprised, except by the scale of the devastation,” said Philip Beresford, who has compiled the annual list since 1989.
“It is extraordinary how people have seen their fortunes being whittled away. It is devastation all round.”

Not all recessions are the same. Each has a particular slant to it and I think our current unpleasantness can be described as a Depression for the Ultra-Rich.
One of the fall outs for this will be on government finances. Our tax code has followed income inequality. As a result, millions of Americans have been removed from the tax rolls while lower marginal rates have been offset growth the rising income of the very wealthy.
Now we’re at a reckoning because it’s those upper incomes that are feeling the heat and the rest of the country no longer faces much of a tax burden. I believe that half of NYC’s taxes are paid by just 40,000 households. Well, they’re not going to have a good year this year. Just as the tech bust lead to the California recall, I wonder if the implosion of Wall Street will lead to similar political actions.
Today we learn:

New York City’s net personal income tax revenues plunged 51 percent in the first 24 days of April, compared with the same period a year ago, the city comptroller’s office said on Monday.

Posted by on April 28th, 2009 at 10:51 am

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