The Sunday Times (London) Rich List 2014 published last week, profiled the top 1000 wealthiest men and women in the UK. It revealed an incredible 15% increase in assets over 2013. The author, Philip Beresford, who has produced the list since 1989 said "I've never seen such a phenomenal rise in personal wealth.....the richest have had an astonishing year, and while some may criticize them, many of these people are at the heart of the economy and their success brings more jobs and more wealth for the entire country.".
Supporters of wealth redistribution like President Obama would have us believe that the top 1% have too much of the economic pie - the rich should be taxed more, they must pay their fair share. Economists like Thomas Piketty claim "wealth begets wealth", the rich get richer while the rest of us stagnate in the economic doldrums, oppressed pawns of a ruling elite. But closer examination of the Rich List explodes this myth - most of the top 1000 did not make it through inherited wealth, most are self-made entrepreneurs who increased the size of the economic pie for the benefit of all. Many are newcomers from the online world; most have overcome educational disadvantages, poverty, loss of a parent or personal setback. And all of them share 3 common characteristics - the determination to succeed, the ability to take risks and the insight to learn from their failures.
A recent report from the Centre for Policy Studies on these "super-entrepreneurs" examined their personal histories and found that virtually all of them tried various business ventures, failed, learned from their mistakes and eventually discovered the winning formula. The report concluded that during this process "the prerequisites for success are to be very very clever and very, very driven".
Of course, external factors are also essential for entrepreneurs to create wealth. Low but reasonable taxes, political stability, access to venture capital, government regulatory bodies that provide a level playing field for fair competition, an impartial judiciary, an education system that promotes hard work and recognition for achievement, and many others.
Wealth is not finite, there are no limits to the potential size of the economic pie; personal fortunes don't have to be "redistributed". We need to free the human spirit, let the brightest and best rise to the top, promote competition and innovation. When society accepts these concepts as the norm - everyone benefits. The rich can only get richer if we the people have the disposable income to spend on their products and services. Their success lies in the success of all of us.
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