Obviously, the world is about to get its primary multimillionaire.
A statement from the business intelligence firm Informa Connect says, at his present level of wealth accumulation, it businessman Elon Musk is on record to be the nation’s first multimillionaire, three years from now.
At the moment Musk is said to be worth US$ 195 billion ( A$ 293 billion ), but if his wealth continues growing at the recent rate of 110 % per year, he will hit US$ 1.195 trillion in 2027.
Indian mining tycoon Gautam Adani, followed by Nvidia’s CEO Jensen Huang and Indonesian mining tycoon Prajogo Pangestu, who are all on track to reach the breakthrough in 2028, should be the next multimillionaire after Musk.
As the tech henchmen and mining bosses battle it out for the top 13 digits, nearly 1 billion people who do n’t yet have electricity to their homes will undoubtedly be watching closely.
Before examining how possible it is for someone to actually make a trillion dollars and what it might mean for the earth for so much of the country’s wealth to be held in the fingers of one individual, it is important to first try to comprehend how large a trillion really is.
One trillion seconds last 31, 000 years
A million is a big number: it is 1, 000 thousands. If you managed to retire with that many dollars in superannuation, you would have saved up more than 90 % of your fellow retirees.
One billion is 1, 000 millions. A million seconds pass in 12 days, but 31 years wait for a billion seconds to pass. That means a trillion seconds would equal 31, 000 years.
You would receive$ 40 billion in interest if you only had$ 1 trillion and did nothing more than stick it in the bank to earn 4 % interest annually.
No one needs$ 1 trillion, and it’s difficult to imagine how anyone would use it as quickly as it grew, which raises crucial questions about how societies, economies, and democracies will function if and when trillionaires are allowed to emerge.
A trillion is hard to justify
France’s King Louis XIV spent today’s equivalent of US$ 200 , billion-300 , billion building his palace at Versailles, and it was by no means his only palace.
Pyramids and sphinxes were n’t cheap either, but these kinds of expenses were viewed as necessary for beings chosen by gods and not entirely mortal.
Some believe that the entire population benefits when a small minority controls most of the resources on the grounds that it creates incentives.
In modern economies, we are told that wealth and prosperity will eventually trickle down to us if we keep working hard, just as peasants spent millennia awaiting their reward in the afterlife while their rulers enjoyed heaven on earth.
Unfortunately for most of us, despite the wealth of the richest 200 Australians growing from A$ 40.6 , billion to$ 625 , billion over the past 20 years, neither the Australian economy nor the wages of ordinary Australians are soaring.
High profits are meant to be temporary
Incentives can and do play a significant role in our economy.
If everyone wants a silicon chip or new farming technique because they are so good, it is only fair that I receive an initial reward, as suggested by 18th-century economist Adam Smith.
However, after a while, everyone else will be free to compete with me by selling comparable goods, which will prevent me from receiving an extraordinary ongoing reward.
The problem is that some markets are n’t free and do n’t work properly. It is not a coincidence that those who own monopoly rights to sell natural resources or technologies that are protected by patents or systems that lock in users own the majority of the world’s riches.
That’s bad news for those who are patiently waiting for wealth to trickle down or be distributed more evenly.
Technofeudalism keeps profits growing
Former Greek finance minister Yannis Varoufakis describes the current state of the world as one of technofeudalism in which online platforms continue to be able to exploit workers, consumers, and producers in ways Smith could not have imagined.
Modern tech titans have developed digital platforms where the price of entry is the transfer of your personal information and preferences, and they have developed new forms of alchemy to make this knowledge available to them so they can use them to keep you on their platforms and exploit you, your advertisers, or your suppliers in the belief that you wo n’t leave.
There are physical limitations on how big a fast-food chain like a car factory can grow, but there are hardly any physical limitations on how much money tech platforms can make selling ads for goods they know almost nothing about.
Restraining profits is pro-market
It is n’t anti-capitalist to want those profits competed away, it’s pro-market.
When the United States broke up J D , Rockerfeller’s oil monopoly in the early 20th century, the oil industry prospered rather than vanished. Both the economy as a whole and the businesses that dealt with Rockerfeller were in better shape.
For the moment, democracies have the authority to redistribute the enormous profits that the new class of billionaires ( and soon trillionaires ) receive from the sale of limited resources and the development of platforms that keep us trapped.
Whether and how we use that power is up to us, but we might n’t have it for long. The more the new class of billionaires and trillionaires becomes established, the more it will be able to use the political system to advance their own interests rather than those of ordinary people.
Richard Denniss is adjunct professor, Crawford School of Public Policy, Australian National University
This article was republished from The Conversation under a Creative Commons license. Read the original article.