Wealth is draining out of the UK

[Ifmenhadperiods]

I was at an event with business people the other week. One of the high net worths said to me that no wealthy foreigner he knows will stay in the UK long term. He is local but says anyone with foreign connections and wealth is fleeing abroad - and taking their businesses with them. That is the chat around his dinner table in Holland Park.

One indisputable piece of evidence I guess is the massive slump in companies that list in the UK. We also have so few pension funds investing in UK business. Personally I don’t blame them: my own shares ISA is invested in the US and has grown by 30% in the last year, a figure UK shares just can’t compete with. Most of our FTSE top companies are in legacy industries like fossil fuels while elsewhere they’re in tech and innovation as well
as traditional companies.

Several friends have left here and gone to the US in the last decade and they say the lifestyle is excellent (and they earn far more, working in tech).

I have also spoken to friend’s older DC (6th formers) and some who have had offers from Oxford and Cambridge are rejecting them in favour of Ivy League schools.

Apparently Ivy leagues are FAR better at getting students to think about their careers from day one. Oxbridge is amazing at teaching you the subject in an academically rigorous way, but Ivy leagues pair you up with business investors if you do a degree such as economics. They have fees assistance for households earning up to 400k US dollars. Here you can’t get student loans if you have more than about £50k in household income.
I know the fees are higher there but they also have more scholarships in the US.

We are about to tax private schools. A popular policy with the public. But again, apparently the wealthy foreigners who can afford this tax are worried it will shake out the middle class Brits they want their kids to go to school with! They don’t just want their kids to go to school with foreign and British super elites. They’re quite fond of the eccentric Brits.

It seems every way you turn, there’s little incentive to make money especially with the cliff edge in income taxation. And the worst thing is it’s understandable because of the massive levels of wage stagnation we have to subsidise through working tax credits (no real wage growth for 20 years!).

We don’t want immigrants but we have no one to pay for our massive welfare bill which is made up mostly of a triple locked state pension and grossly inefficient health system.

If you’re lucky enough to have a bit of spare cash, forget moving up the property ladder, owning a holiday home or a rental (tax hell lies in all those paths).

Can anyone shake me out of this pessimism? Of course I know we are lucky not to be in Syria or Afghanistan or Gaza. But this is about the decline of the UK rather than where we are compared to truly volatile or oppressive countries. I genuinely don’t want to emigrate but fear we - along with anyone who was once comfortable but never wealthy - are going to have a very uncomfortable retirement - if I make it that far - and our DCs will face a future in a country that will continue to get poorer, with the entrepreneurial class deserting us.

Actually social security (us equivalent of state pension) is more generous than uk state pension. Also while they expect to pay medical bills, they get much better medical treatment and Medicare does cover a lot for elderly people.

Read the thread @wombat15 . I have said this is on the back of 14 years of Tory govt!

I am pro immigration as I’m a pragmatist. I am
pro investing as it’s essential. How is it right wing to worry about money? Everyone should worry about and have some basic knowledge about money and investing - especially the poor. I should know, my parents were poor.

I am very open to persuasion about solutions. Agree that something has gone badly wrong and it’s the middle classes and next generation who have massively missed out. The system is broken.

Yes I work with and know some wealthy people but that doesn’t make me right wing. I have actually found elements of the Labour Party too right wing - and am worried about their anti-immigrant rhetoric.

As for my motivation, I’m genuinely fascinated and horrified by what appears to be happening to this country BUT am very open to evidence that I’m falling for bad news stories and that there is going to be a demographic or economic shift that will turn things around.

My inner pessimist worries that we still have further shocks to come from AI!

Some aspects of that post are correct - but one of the real biggies is indeed Brexit. I wouldn't invest here if I was in that position. Those investing really only have easy access to UK - which is ok if you are Amazon for a distro centre , useless if you are a multi national pharma company say - you want easy access to a vast range of markets without constant red tape - your average Jo who just has a local job with say a building company really didn't think about those things but it's a biggie in terms of logistics and wealth creation and job creation too. We have. Basically handed lots of our best business to our European neighbours on a plate- places like Netherlands, Eire, Germany etc - I think Labour can improve on some aspects of life but I think it will become (is becoming) a very expensive country - a bit like Australia- but without the weather

Well you’re probably not wrong about AI but it may help solve your immigration worries

@Polishedshoesalways Someone accused me of being a right wing Tory above so at the risk of pandering to that view… Isn’t it Labour that have also enabled the super rich? Yes the Tories let their mates asset strip but Labour borrowed the 2% inflation mandate and then imposed it on the Bank of England.

This led to massive surges in asset prices - their growth quickly outstripping wages. That in turn had meant house prices have soared. People spend waaaaaay too much of their income now on property which leaves little for investing in other bits of the economy. But it has worked well for those who were in a position to leverage.

I also seem to remember there was a time when CGT on second homes was really low, I think under Alistair Darling.

It was Osborne who buggered about with stamp duty levels, making it stupidly expensive to move house in the south east.

It is the Tories who removed the tax free allowance for high earners.

It was the Tories who removed tax relief for
landlords, thereby exacerbating the rental crisis (because institutional property companies lobbied them to demonise mom and pop landlords so that they’d be forced to sell up).

It was the Tories who brought on the Brexit referendum which will ensure my DC have fewer opportunities to travel, work and study abroad.

• If someone can explain the bond market to me please do as it may or may not be part of the link here.

It's basic economics - increase the tax on the rich beyond a certain point, and overall tax revenue will decrease. Everyone knows this.

I was a bit 😳 when I discovered that one of our local water companies, and I think one of our bus companies are French owned now (South Coast). I mean, what's that about?

I think personally that basic infrastructure providers should be "in country" owned or preferably nationalised.

In the case of rail services, privatisation didn't appear to improve services despite prices going up on that promise. And all the different companies had me tearing my hair out last time I tried to travel by train which admittedly was pre-Covid.

In the case of the NHS some services have been cut entirely and passed to opticians, pharmacies etc at a cost direct to consumer. Great for the companies in question, and no doubt saves the NHS money but it can contribute to lack of continuity of care. My Dad has been referred for a lung function test at the end of the month, and will be going to a private clinic passed on by the NHS presumably as it's urgent and it's a work around waiting times, but it may well cost the NHS more. Don't get me wrong, we're grateful he's getting seen "so soon" but it's all a bit bonkers.

Also (sorry, I'm on a roll) all the green initiatives to protect the environment which is absolutely necessary seem to overlooks the fact that the widget based economy via online sales means a heavier burden on the environment through increased supply chain traffic. We're encouraged to shop sustainably on one hand, yet bombarded with new widgets every day, especially on the tech front because "built in obsolescence" .

Every now and then thinking about this my brain kind of freezes at the weight of cognitive dissonance to be honest.

The OP's suggestion that in 20 years the UK will have an 'ideal' climate is just laughable. 2.7C warming, as predicted by many IPCC scientists, means conditions this planet hasn't experienced for 5 million years. Johan Rockstrom, one of the world's most respected experts on planetary boundaries, has said "there is no evidence that we can support humanity on a 2.7C planet". Yes, the UK may fare better than many countries where billions will suffer horribly. But we will still face extreme weather that we currently can't even contemplate. It will make the recent flooding in many parts of the country look tame. And that's before even considering what heatwaves and droughts followed by torrential rain will do to food security.

I know several people who have gone down to four days a week because of the loss of personal allowance / childcare support removal threshold.

Top 1% earners.

It’s absolutely crazy that the government is incentivising this behaviour.

Child benefit should be universal & so should the 30 hours.

@Ifmenhadperiods I'm a bit like you in many ways - and I'm centre left- I am not pro immigration for the sake of it- the thing with the EU was it worked both ways- and the people coming here on the whole in last 12 years were young, single (or couples) and well. They were not on the whole bringing whole families and granny. Many were in shared houses and not creating massive pressure on housing and health- it's our own indigenous population doing that due to longer living , house prices, insecure private renting , social housing sell off etc. for a long time people didn't care because plenty were doing nicely from it- now their kids can't get housed and have huge student loans, itstwigged that maybe it wasn't such a great idea- especially in southern half of uk and more desirable areas in midlands and north. There is a really logical reason Labour won't rush back into anything or make a special arrangement for young people- the country would undoubtedly get a brain drain given the state of it- many in a position to bugger off would and these are often people they need the tax revenue from- the Tory's really have shafted the middle classes and lower end of higher tax brackets . Itsall very well for those struggling on lower incomes to say 'tough shit' but it's those people who are paying significant tax to enable UC top ups etc. it doesn't come off a magic money tree. I'm not in this bracket - but I do see totally that this is the case

I think things need a complete reset- when we lived in Copenhagen for 2 years it was absolutely eye opening how differently some stuff operated. Cheap childcare meant both parents in 2 parent families worked- not always full time but at least 20 to 25 hours- I saw very few SAHMs - tax was very high but wages were higher too ,balanced off by cheap childcare, no council tax, cheaper utilities, cheaper transport and lots of social housing of all kinds (and not just for the very poor) - people ended up with similar levels of take home pay to UK but more was already covered off and instead of say a £900 nursery bill, it was £268 etc. groceries were higher, but I would say only just- only thing that was noticeably more expensive was drinking out and eating out- but that's not an 'essential' and people still did it. Many Well off pensioners here wouldn't like it as they would pay more in tax without benefits of cheaper childcare or more social housing etc- and hence all the right wing press geared up to them would say 'outrage' - might mean 2 fewer cruises a year- sorry but that's the case with some.

The problem with your point, is taxes have not been invested in the infrastructure of the country for ages because the government is corrupt and full of cronyism.
Noones got any money to pay their energy bills, so forgive us if we dont start panicking that some rich cunts who are looking to abandon the country and go to fckn Dubai for their luxury goods businesses. 🙄

Many Well off pensioners here wouldn't like it as they would pay more in tax without benefits of cheaper childcare or more social housing etc- and hence all the right wing press geared up to them would say 'outrage' - might mean 2 fewer cruises a year- sorry but that's the case with some.

we do have a lot of inter generational inequality but I’m not sure how you fix that.

Agree with you about paying for those who choose not to work, but how much more tax do you think the wealthy should pay without leading to them too leaving and subsequently paying nothing?

The top centiles do cover most of the tax burden

I agree with you btw, tax people but so they stay for maximum tax receipts

This. Some guy was bitching via The Guardian recently how he had 10 properties in London but was leaving. he has given the Tories £300k etc. These people have global wealth and the idea that they own stuff is laughable. Off shore companies they own own the houses, they are non-dom, etc.

Another victim of crime to add to the problem. A 66 year old knifed to death for her purse in Edgware. This is the third world now. But is ok we have Sadiq Khan for a third term. Oh wait!

I was not born in uk and did not live here until 32. Never thought would stay in this country. I even sold my very good UK house and did not own property here for a few years. I have been to and lived in several countries but in the end decided uk was best and returned - although at the moment things are not look great!

The non dom rule has to go. Not sure how much that would raise but it's a joke. We have a v wealthy self made non dom friend who lives here. How can that be justified that when my dh lives here too and pays 55% tax?

It's already going, as announced in the last Budget.

https://www.google.com/amp/s/www.bbc.co.uk/news/uk-politics-68488721.amp

And here I was hoping you’d be able to get back to me with a genuine reason as to why you do this. I don’t know why I’d expect that from you when you clearly don’t have common sense

@Ifmenhadperiods
I get the whole resentment of the upper classes thing and the super rich elites, but those who say ‘oh the wealthy can just F off, they make no difference to my life’ may want to think hard about who is going to fund tax credits or state pensions in future. It will mean even less assistance for those struggling which is not a good thing.

It's not the super rich Holland Park owners that fund tax credits and state pensions. It's the people who are earning probably above 40k and those who have large salaries but not anywhere near the super rich. The super rich are few and have a variety of vehicles to minimise their tax.

Some of us are fixing it by passing the money we’re fortunate enough not to need on to our children. But I personally would be happy to be taxed more by a government committed to providing high quality public services.

Some of us are fixing it by passing the money we’re fortunate enough not to need on to our children.

And what about those who have parents who can’t or won’t help? I think it just sows more division.

I think for many of todays young whether your parents owned a home or not & can help you is more important than job/salary. Not particularly progressive.