What if the world’s richest paid for government spending?
Brussels/New York: How many days could the government keep running if the richest person of each country was paying for it? We created the 2018 Robin Hood Index to delve into the subject.
We took 49 countries with various political regimes and expenditure types and the richest individuals of each of these nations. We then compared their net worth as of end-December 2017 to the daily cost of running each government. By the way, only four out of the 49 on the list are women: in Angola, Australia, Chile and the Netherlands.
The index compares the net worth of each country’s wealthiest person to his/her government’s spending. If, hypothetically, each government were to run out of resources imminently and the assets of the richest citizen were liquidated and donated to the government, the index estimates how long can this “funding” prevent the respective government from shutting down offices and agencies. The Bloomberg Billionaires Index and the International Monetary Fund’s estimates of government spending were our building blocks.
Cyprus’s richest man, John Fredriksen, could keep his government running for 441 days. With projected 2018 expenditures of $23.6 million, a small population and therefore smaller costs on social security and welfare, advantageous tax policies and an economy centered around tourism and services, Cyprus would benefit the longest from Fredriksen’s $10 billion fortune.
In comparison, the most expensive governments to run are Japan, Poland, the US and China, where Jack Ma, the world’s 16th richest person with $47.8 billion, could save the Communist Party for four days. Jeff Bezos wouldn’t fare much better, even with $99 billion. With the highest government spending on the Robin Hood Index, the world’s richest man would only help the US government for five days, as much as Hugh Grosvenor in the UK and Dieter Schwarz in Germany.
Quantifying government costs for each nation and what they would do with free money is hard because there are plenty of other considerations to take into account. Some of them may not even have a cost per se — bureaucracy — or may depend more or less on policy and which ones each government will choose to pursue, spending more on transport and less on defence etc. However, one can see from the Robin Hood Index that most Western nations could not hold the fort very long, even with the help of the richest citizens.
Still, as an intellectual exercise, one can only imagine what the most affluent in 49 countries, with an estimated wealth of $911 billion, or 1% of the world’s 2018 gross domestic product, can do with their money that government can’t resolve on their own. Bloomberg
- Cash crunch: Bank unions threaten agitation, blame RBI, govt for shortage
- News in Numbers: Domestic air passenger traffic rises 28% in March
- IndusInd Bank Q4 net profit jumps 27% to Rs953 crore
- Time not ripe for large scale privatisation of PSBs: SBI chief Rajnish Kumar
- India stares at water crisis, urgent steps needed: experts