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Eat the rich

Written By: - Date published: 9:06 am, April 22nd, 2020 - 47 comments
Categories: class, class war, tax - Tags: ,

It appears that Richard Branson’s Virgin Airlines empire may be on the skids.

He is believed to be worth $8 billion but it seems that even the Atlasses of the business world are not beyond trying to become state beneficiaries from time to time.

He has written to staff saying that the airline needed Government support to survive.

From Radio New Zealand:

Sir Richard said in his letter to staff: “Many airlines around the world need government support and many have already received it.” The crisis facing airlines, and the staff they employ, was “unprecedented,” he said.

Despite his wealth, this did not mean he had “cash in a bank account ready to withdraw”. And he hit back at criticism that he was a tax exile who did not deserve help, saying he and his wife “did not leave Britain for tax reasons but for our love of the beautiful British Virgin Islands and in particular Necker Island”.

He said Necker would be offered as security for any loans. “As with other Virgin assets, our team will raise as much money against the island as possible to save as many jobs as possible around the group,” Sir Richard said.

It is interesting that he should be seeking Government support. He changed his tax status so that he would not have to put up with the drudgery of paying tax to one of the entities that he is now seeking help from.

Taylor Bell at Yahoo Finance last year had this description of what happened:

As the founder of Virgin Records and Virgin Atlantic airlines, Richard Branson is a business mogul sitting on a cool $5 billion fortune. Although he hails from the U.K., his primary residence is on Necker Island, an island in the Caribbean that he purchased for $180,000. Branson has repeatedly been accused of escaping to Necker Island as a way out of paying taxes due to the lack of income taxes there, but the Virgin mogul has denied this.

“I have not left Britain for tax reasons but for my love of the beautiful British Virgin Islands,” Branson wrote on the Virgin website in 2013, according to The Telegraph.

As a resident in the U.K., Branson would have to pay 50 percent of his income in taxes, compared to zero percent income taxes as a permanent resident on Necker Island.

The story is not clear but I presume that Branson could have spent time in Nectar Island but still have kept his UK tax status. Diddums that he did not do this.

Virgin Australia has collapsed. Branson’s response was to hit out at the failure of the Australian Government to stump up with a loan, saying:

In most countries federal governments have stepped in. Sadly, that has not happened in Australia.”

Pure dog eat dog capitalism, of which Branson has been a keen proponent, demands that the company’s assets be sold for whatever price they can get, for banks to strip its secured loans out and for shareholders to then take a bath. Survival of the fittest.

It shows incredible nerve to arrange your finances so that you do not pay tax on huge earnings, and then demand money from two different governments to keep your empire going.

And on the subject on the rich there have been recent suggestions that New Zealand should officially declare its position as a bolthole for foreign billionaires. Rod Drury reckons we should allow them to emigrate, own land, let them subdivide and let the wealth trickle down to the rest of us.

From Victoria Young at the Herald:

Drury reckoned if 1,000 sections were made available for foreign owners wanting to build luxury houses they could commit $5 million upfront each easily and straight away give architects and engineers work, with construction starting within 6 months.

“In my experience, these people are light on the consumption of roading, education and health, they pay GST and are very good at connecting to us to help businesses grow.”

“I’m not saying give them passports,” said Drury, who made headlines for supporting the citizenship of American tech entrepreneur and key Xero investor Peter Thiel.

Of course previous examples have worked out so well. Queenstown is awash with rich boltholers as well as doss houses where workers have shifts when they can use beds.

Maybe we should contemplate a scheme whereby billionaires could emigrate to New Zealand. As long as they agree to a one off capital gains tax of 90% of their acquired wealth.

47 comments on “Eat the rich ”

  1. pat 2

    "He is believed to be worth $8 billion but it seems that even the Atlasses of the business world are not beyond trying to become state beneficiaries from time to time."

    From time to time?….think you misunderstand the business model, they are permanent state beneficiaries.

    • Blazer 2.1

      Speaking of billionaires…ex Tiger Fund supremo…

      'American billionaire and philanthropist Julian Robertson's various entities received $1.2m to pay 180 staff at exclusive lodges and golf clubs in Queenstown, Cape Kidnappers and Kauri Cliffs. The Millbrook Country Club near Queenstown got $1.9m for 290 staff and Christchurch's plum golf club and resort Clearwater secured $140,503 for 20 staff.'-Stuff.

  2. Ad 3

    Tens of thousands of us are going to be doing this on a smaller scale.

    He's trying to save both his own wealth and thousands of Australian jobs at the same time. It's not to be sneezed at if you work for Virgin AU.

    What distinguishes us from Richard Branson is that we are citizens who contribute to our countries by paying tax.

    Which is why he lives on that island: a multi-decade-long tax dodge.

    So it would be quite appropriate for him to put the island up, and to lose it in a mortgagee sale to prop up the jobs of thousands of workers.

    • Andre 3.1

      Make it a condition that he move his residency back to a jurisdiction where he pays taxes and make him pay back taxes he's avoided before any bailout happens.

    • Barfly 3.2

      " He's trying to save both his own wealth and thousands of Australian jobs at the same time."

      Air passenger transport is not going to return to what used to be normal for a hell of a long time – if ever. The vast majority of those jobs are just gone – period.

      So that leaves us with saving his own wealth – stuff him.

    • clare 3.3

      sure, but if he bouht the island for $180,000 how much is it going to raise either as security for a loan or in a mortgagee sale?

  3. Obtrectator 4

    "Rod Drury reckons we should allow them to emigrate, own land, let them subdivide and let the wealth trickle down to the rest of us."

    Memo to RD: the wealth doesn't $%&*ing well trickle down. All this time as an economist, and he hasn't realised that YET?

    • RedLogix 4.1

      let the wealth trickle down to the rest of us.

      Indeed economists are often not very good mathematicians. Wealth is not additive, it is multiplicative.

    • pat 4.2

      Drury well aware of the direction of flow….hes betting on others not having the same knowledge…suspect he may lose that bet.

      • Wensleydale 4.2.1

        I guess advocating (I was going to use the word 'shilling' but I have no idea if Drury is paid for his efforts) for the ultra-wealthy is a profitable enterprise. I'm sure Rod has the best interests of all of New Zealand at heart and just wants everyone to prosper. Bless him. After the Peter Thiel episode, you'd think he'd perhaps take a moment to contemplate the optics… apparently not.

        • pat 4.2.1.1

          I guess he really has nothing at stake…or perceives nothing at risk, a no loss position.

          He may, as you note want to reconsider that as what he is likely to succeed in doing is further drawing attention to the issue…but then the elites famously feel invincible.

          Until they're not

  4. Tiger Mountain 5

    Wealth, including technological advance and other necessary features of society, is created by the physical and intellectual labour of the world’s workers. Parasites like Mr Branson are surplus to requirements–even more obvious now in a global crisis.

    Many that keep a service based economy ticking along in NZ are currently parked up in suburban lairs, farmlets, and less salubrious accomodation, across the land; while carers, drivers, power technicians, retail staff, logistics, dairy industry staff, Police, Civil Defence and Military etc. are still hard at it, working in the face of significant risk.

    “Shareholder value”, property booms, Stock buy backs, leveraged buyouts, Investment funds, the workings of Finance Capital are freshly exposed largely as the vampiric ponzi schemes they always were.

    It is up to the NZ people now to take the fork in the road that says to US 1%ers like Thiel–“sod off…don’t even think about it”

  5. More 1% percenters coming here and sticking their ugly mansions where they can be seen in our outstanding natural landscape, thus wrecking it. Perfect.

    Rod Drury showing his true colours.

  6. RedLogix 7

    Branson's problem (and remember he's only a minority shareholder in Virgin Australia) is that Australia is really not quite big enough to sustain two full domestic carriers even in good times. Virgin's threat is not the immediate crisis, it's the $5.3b of debt they were carrying when the crisis hit.

    • Muttonbird 7.1

      Also, governments tend to bail out their own flag carriers as strategic assets, not private sector cowboys.

  7. halfcrown 8

    Hang on a minute.

    Didn't this parasitical prat sue the NHS over something and got a payout from them?

  8. Dawn Trenberth 9

    Love the idea of the one off capital gains tax. After that we really need a much higher top tax rate which they along with others would have to pay. It would help us find the money we need to spend on our health system including state of the art contact tracing.

    • Descendant Of Smith 9.1

      Capital gains is too complicated. Just bring back stamp duty on the sale. Extend stamp duty to things like art after the initial artist sale as well.

  9. Jum 10

    Billionaires can only wear one outfit at a time. 'Five' million New Zealanders can wear 'five' million outfits at a time. Spot the retail value difference here?

    These bill's have already flown in to bunkers here. They're really not egalitarians; over the last month or so, we've had a revival of true egalitarianism in our people here. Let's not lose that; let's not 'eat the rich'. Let's eject them. They can't be too clever practically for our no 8 wire philosophy. One of them didn't even know how to get into his bunker!

    Fran can just take a hike with her advocating for the rich and useless. Unless these bill's are going to donate half their fortune to be shared amongst every New Zealander and pay full taxes they should be refused entry or shipped back out of here.

    I bet the greedy percentage of our homegrown bill's are either living overseas or their billions are. Their worth is like trying to eat sweetcorn on the cob with no teeth! Zilch, zero, nada.

    The 'billionaires' of value to me are the ones that produce product not money-movements. We can't even charge the money movers a transaction tax on that useless activity to everyone but their own ever-increasing wealth. That's a crime in itself.
    They have never made all that money themselves; it has always required government input or asset sales.

    I'd rather have quality like: 'Neil Oliver is a British television presenter, freelance archaeologist, conservationist and author. He is best known as a presenter of several BBC historical and archaeological documentary series ' Coast included.

    Yes I'm still a dreamer, but better days are ahead of us. I just know it.

    • Jum 10.1

      Oh dear, Peter Beck doesn't like my ' no 8 wire philosophy ' phrase. He wants it to be called 'ingenuity'.

  10. bill 11

    Y'all know that liberalism is based on notions of innate superiority, aye?

    Not saying there haven't been subtle shifts over time, but the basic idea that white and male and property owner sits next to godliness, while "the rest of us" are fallen in various ways and to be 'let go' if beyond 'saving' … that idea persists.

    You can see it all around you when inter-generational trauma is dismissed as bad personal choice or lack of moral fibre – the poor person/the drug taker/the gambler and the drinker…etc.

    – sigh – cue protestations of "my liberalism is benign" from some commenters, aye?

    Bottom line. If you're a liberal and not a hypocrite, then you ought to be urging your peers to cater to the needs of 'betters' like Branson.

    • Peter ChCh 11.1

      Virgin is majority owned by a mix of Arab (20%), Singapoean (20%) and Chinese owners (40%). Not a lot of whites amongst that lot. Racist and foolish comment Bill.

      [Hey, bell end! That reply an urge to demonstrate what a fantastic dick you are? Here’s what’s going to happen now. You are going to read the comment again (particularly the bit about “subtle shifts”) and then you are going to demonstrate a degree of humility by retracting that accusation of racism – or you’re going to explain in very clear terms, and with reference to all relevant historical and cultural contexts, how my comment can reasonably be construed as racist. Option three is to do neither and wait til I come back to the site and ban your arse. Your choice.] – B.

  11. thebiggestfish 12

    Thoroughly enjoy the standard community but god there is some dribble on here sometimes. Not a huge Branson fan but he has a minor stake in virgin Australia. Virgin group of which Branson is the majority shareholder owns just 10% of Virgin Australia. Branson’s ownership in the company is tiny. I for one have no issue with him using his brand/status to try and get an Aussie government bailout or assistance for Virgin Australia of it will protect some of those jobs. Of course that bailout in my opinion should either be a loan with commercial interest rates repayable before any shareholder distributions via dividends or share buy backs. Or alternatively a slice of the equity in Virgin Australia that the government can dispose of in the future should it so choose too. Just my two cents. Click bait post (rolls eyes).

  12. Peter ChCh 13

    Virgin Australia is owned 20% by the Nanshan Group and 20% by he HNA Group, which are effectively owned by the China government.

    I really would hope that Australia does not slide money to Virgin that will ultimately benefit the Chinese government that let the virus out of the bag in the first place and then has lied non stop about it ever since. In any case, the post virus world will not need all these low grade airlines for the next decade or so.

    • left_forward 13.1

      Privately owned according to Wikipedia.

      • RedLogix 13.1.1

        Virtually all major Chinese enterprises have major CCP shareholdings or controlling covenants with state owned banks. Senior CCP cadres own vast swathes of their economy.

        A few years back Xi Xinping reacted most viciously to investigative reports that revealed just how wealthy him and his family were. That's a data point they're very keen to keep quiet.

        Yet around here it's apparent that it's only appropriate to 'eat the rich' when they're also white.

  13. florabunda 14

    Queenstown is like a once beautiful woman who has become an ugly drug addict – thanks to the likes of Drury, off-shore investors and local greed.

    Tourism is a cancer destroying the economy and the environment of of NZ.

  14. tony 15

    Nah, let's just eat them ..

    • RedLogix 15.1

      No … lets eat the poor. There are many more of them and ‘they will always be with us’. /sarc

      • Alice Tectonite 15.1.1

        A more modest proposal would be to start with the babies.

        • RedLogix 15.1.1.1

          lol … very good. I know when I've been gazumped well and truly. yes

        • Descendant Of Smith 15.1.1.2

          Well it wouldn't be the first time. Remember reading about this years ago in a text book.

          http://www.heretical.com/cannibal/egypt.html

          "It was not unusual to find people [selling] little children, roasted or boiled. The commandant of the city guard ordered that those who committed this crime should be burned alive, as should those who ate such meats."

          • Descendant Of Smith 15.1.1.2.1

            Actually I need to find a better internet source for this. Not because it's not true but because that particular site seems shall we say "odd".

    • Adrian 15.2

      But they will taste bloody awful tony.

  15. tony 16

    Adrian, so true, oh well lets feed them to the other pigs ..

  16. Herodotus 17

    Maybe nöt tö everyönes liking, but thöse whö appreciate Lemmy, filthy Phil and öthers

    https://www.youtube.com/watch?v=Wh3t49NsWBA

  17. UncookedSelachimorpha 18

    If the employees of Virgin need public assistance – then give it directly to them, not to a private for-profit business.

    Bailouts of for-profit business by the state should never be a donation – instead the government should offer to purchase equity (ownership) in the company. Then the general public would benefit very directly from the ongoing survival of the company, rather than much of the benefit going to private investors.

    Don't repeat the mistakes of the GFC bailouts – where investors socialised the losses and privatised the profits.

  18. There is a lot of confusion here. The rich are not getting bailed out to shore up their position, but to protect jobs. To keep businesses afloat. Basically, they are going to close these businesses, and the govt can't allow that to happen. Why? Because the constituency of the politicians will not carry responsibility for the malfeasant political system, and the politicians won't either, so they are obliged to do the only thing they can – pay the people to stay in jobs, where the sustenance of the business employing people is more important than 'the people employed' in most cases, because its an employer's market, and they can always get another worker. In this market, even skilled workers.

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