German 'Wise Men' push for wealth seizure to fund EMU bail-outs

Two top advisers to German Chancellor Angela Merkel have called for a tax on private wealth and property in eurozone debtor states to force the rich to fund rescue costs, marking a radical new departure for EMU crisis strategy.

Professors Lars Feld and Peter Bofinger said states in trouble must pay more for their own salvation, arguing that there is enough wealth in homes and private assets across the Mediterranean to cover bail-out costs. “The rich must give up part of their wealth over the next ten years,” said Prof Bofinger.

charlescawley: Here we go.  This is confiscation to pay for the political mismanagement of the EU.  It had to come.  They do not understand that confiscation of wealth does not create wealth.  By impoverishing wealthy people you do not make poor ones rich.  Instead, you destroy their ability or will to employ people. So, of course, the all powerful state will have to employ people instead.  In this way, we could see the resurrection of state controlled economies with all their corruption, inefficiency and injustice. The EU parades itself as a peace keeper and the great preventer of war in Europe.  It thinks itself the best form of government.  And what is proposed?  Massive confiscation of wealth under the pretext that it will create wealth and rescue the holy of holys being the Euro. But it is not.  The real scheme is to rescue the tin pot theory that justifies the EU and the comfortable unaccountable lives of the rich supreme beings that rule over us. Meanwhile, Cameron, Clegg and Milliband heartily approve of the EU and back all this obscene and injust activity.  They believe that the EU and its unaccountable leaders have every right to do as they wish.  How long will it take for UK politicians to realise that they have pinned their colours to a sinking ship? We must not let these child politicians take us down with them.  If they persist we must hurl them into obscurity and, if need be, confiscate their wealth to focus their minds on the injustice they proposed for others.

fla56: dear   i'm not sure if you think you will become one of the so-called uber-rich or if you are one already there is a clear issue now visible in the UK -even highly capable young professionals like myself struggle to secure a home for their family whilst at the top-end the asset-owning and exploiting classes get endlessly richer taxing wealth (rather than earnings) is mostly about reducing inequality it seems like you expect the rest of us to quietly starve on the streets so you can enjoy your BTL empire and second home on the Costa-Del-Sol i would reiterate the author's comment -the rich have massively benefitted from the endless money-printing from the ECB and BoE et al, the rest of us are sick of it

denc: oh you struggle to secure a home do you? poor thing you mean no one comes round and gives you one like they did to all the previous generations? the entitlement generation writ large pass the puke bag major

fla56:  i mean that the BoE and politicans print money in order to keep house prices at unheard-of multiples to earnings we just want free market house prices do you get it numpty?

Smell Da Quoffee: fla56 I've spoken to you before.  Last time I gave up because I made absolutely no progress, you were determined your version of the truth was the only one. You still want harm to come to older generations because of what has happened. Seems to be a lot of hate and blame rather than full understanding and solutions and yet common sense would dictate that older generations have daughters and sons and grandsons and grand daughters. Your world simply does not make sense. Understanding of history and the education of previous generations would help. You are expecting too much of the people that have come before you. Now instead of blaming please look forward at the future.  the first problem that we have is that most people have little education about money, assets, pensions and politics. If people are fully educated they will demand common sense decisions. Getting them educated is an an unenviable task but you don't eat an elephant at one sitting. The only other ways are to continue * spreading hateful blame * resign yourself and get out of the game, emigrate like someone suggested or forget about it and have a few beers down at  the local pub.

charlescawley: Smell Da Quoffee I think you are a bit tough on him.  When you have absolutely nothing things can be pretty difficult.  There is no doubt that anyone with a bit of luck and half a brain could have done very well from just owning houses over the last 40 years.  They got something for nothing and someone had to pay for it.  Perhaps the rich should be made to be more responsible: if you are wealthy and waste the opportunity to make others happy and richer you should have it taken away or taxed heavily. Property should only be held under such a contract of responsibility otherwise society is out of pocket protecting property for no return. This is no leftie proposal.  Indeed the likes of Gates and many others already try to do this now.  Great wealth is an enormous privilege; it deserves respect not only from the society that enables and protects it but from the wealthy themselves.

Smell Da Quoffee: charlescawley Gates has been unbelievable, he deserves to go down in history and undoubtedly he will. Love or hate windows his software has made a huge difference to the world and now his philanthropy is doing similar and inspiring other wealthy individuals to do the same.  . However the problems that we face I believe exist because of lack of Education. I think we (humans) think that because we can put a man into space we believe we can progress similarly in the worlds of finance and politics. The difference is that finance and politics has been around a lot longer than space travel, there is already a creaking infrastructure to circumvent, the opportunity is that there is already a huge knowledgebase to tap into.   The gap is education. We need a  inspired individuals to address this gap.  I think you expressed this when you said above  "There is a vacuum which must be filled" I think you have the crux of what will happen there. Maybe I was tough on fla56 but maybe more of a difference could be made if hate and protest were transformed into love and solutions. Certainly the later would get more buy in from older generations, parents, grandparents. In addition his contemporaries would be able to operate, inspire and make sense of the world we have while still loving and respecting their families.

charlescawley: fla56 You can pay to go around Berrington Hall.  My Father used to own it.  I left the family and they certainly made it plain that I was not one of them.  As I drove lorries, it was a lonely world… the other drivers were excellent, but the junior and middle managers loathed me. (Since the death of my parents things have improved). No, I am not rich by I do own my house so I am wealthy compared to most people in Somalia.  Indeed, you are wealthy compared to them.  I would not mind being rich but that is another matter.  I have lived in a palace and believe that no one should live in such a place.  It is good that those whose forbears built the place can now enjoy it. Equality does not exist.  Some of us are more able than others.  Of course all should have the necessities for co-operation.  Health, freedom from fear, education and that they be listened to.  These are the prerequisites for democracy and the maximum information flow to the executive ensuring minimum ignorance for legislation and government. There is a choice, either own your own business, permit others to employ you or permit the state to employ you.  Which one do you want?  I am heartily sick of low productivity and the waste of peoples' lives. Good management be it self management/employment or managed by others is the best route to happiness and wealth for all.  State employers are known to be politically driven and can be as unkind and brutal as any private employer. (Mid Staffs and the victimisation of whistle blowers and murder of patients, for instance). You do not make wealth by confiscating it.  The matter is political.  Equality is a mathematical expression which does not move to human beings very well.  We are not all the same… but society and each person must have certain absolute basics so both society and that individual can prosper. I am sick of mismanagement.  If the super rich are mismanaging that does not mean that the state will improve things by confiscation.  It is more likely to make things worse.  Perhaps more subtle moves could improve things. How about radically reducing corporation tax for unlimited liability companies whilst increasing it for limited liability companies?  This would force the super rich to spend more time and care managing and put pressure on the incompetent exposing them to the results of their incompetence. We need similarly imaginative solutions to find our way out of this mess.  Simple confiscation will do nothing but make things worse. Edit. I thought to add that what people like you face is utterly appalling. Whatever difficulties I faced breaking out of the mental cage of my upbringing and then making my way in the world pale compared to what you are up against.

fla56:  thanks for your reply in some ways i believe we see eye to eye i wholly agree that tax on medium/small business should be cut to create a vibrant real economy nonetheless there has been a huge theft of wealth from upcoming generations by money printing, especially to the benefit of the asset-holder class this is the antithesis of the Darwinian economy you espouse to support ultimately these people are parasites who do not add value to UK PLC and need to be taxed to within an inch of their BTL landlord-lives and so long as Sir Philip Green et al are paying less tax than their cleaners(!) never mind the average UK professional then we have a problem

damicol:  fla56  if you are smart you will leave the UK and Europe and get to some place that has the economic chance to survive whats coming. two million have already left, the best and brightest and ten percent of fresh grads are on a plane before the ink on their diploma is dry. Two million more are in active search mode or in planning and in process of leaving the UK.  These are not the got herder socialist class.  They are brightest and the best and they take with them a huge multiple of the future prospects for the UK, (compared to the underachieving goat herder class of socialist misfits left behind) True, its a wrench, its a major departure from you hoped for, but its the reality.  Face reality and act swiftly and you become the vanguard, just as the pioneers that went to the US so long ago. They won in the end and built the greatest nation on earth.  Sadly that too, now that the goat-herder class are in charge is going down the same toilet especially with the head corrupter in chief and evil commie being handed 8 years to accomplish his demolition of the country. Take the chance, emigrate, you wont regret it. Unless of course you are basically a goat herder at heart.

fla56: thanks   , sadly your description of the UK is correct i am first to finish my world-class British training (~18 months) but then it remains to be seen where the opportunities are

beejeebers: £1 today buys what I could buy for 6p as a boy and my father could buy in 1900 for 1p.  In short inflation is always with each and every generation, and nothing will change this. The importance of owning a home in the past is that when the age comes to retire at say 70 while other peoples salaries are rising those who are retired see savings  and pensions fast deteriorating from inflation on basics such as food. But at least they have a roof over their head they could not otherwise rent. Right now with stagflation the retired see home prices falling, no interest on their savings above inflation rates, and no chance of working even if they want to. So those in a job are better off.  You need count your blessings and  keep your job.

fla56:  errr sorry but you are dreaming if you think house prices have fallen i don't need to count my blessings -my hard work is being stolen by QE to stop house prices correcting the 50%+ they would have done in a free market

beejeebers: I am sympathetic with your cause, but there are many people in different circumstances afffected  by this banking debacle, and as regard house prices it is only in and around London they have risen.

charlescawley: fla56 I suppose what I believe is that those who are wealthy have an absolute responsibility to manage it well to create employment, productivity and happiness.  If they fail to do this then the parable of the talents applies.  (From an atheist, this is a bit odd).  Ie: if you are wealthy and waste the opportunity to make others happy and richer you should have it taken away.  Property should only be held under such a contract of responsibility otherwise society is out of pocket protecting property for no return.  Something for nothing makes for a bad society.  The rich should not / cannot expect protection of their wealth solely through possession.  If you waste the chance to be productive that chance should be offered to others.

fla56:  i cannot agree more with what you are saying sadly though this country is precisely what you condemn -all about inherited wealth and not about promoting creativity and productivity so i give it a short time to begin change or else it will be time to leave

dalai guevara: charles I appreciate your great personal response, but we must not conflate equality of opportunity with the equality of outcome - I am sure you aren't. We also must not believe that whilst 'we cannot make wealth by confiscating it', we could make wealth by 'trickling it down'.

dinosaurpete: Charles, I've been likening euroland with the Titanic for months but still they seem determined to drag us all down with the wreck. Typical arrogant youngsters, think they know it all while they're still too young to wipe behind their ears ! 

charlescawley: dinosaurpete The only way to deal with these people is to start generating ideas.  When things get very serious ideas suddenly find a focused and radical potency. There is a vacuum which must be filled.

ricoos:  It is like the Titanic, but instead of helping people into the lifeboats, they seem determined to try and use the lifeboats to try and stop the ship sinking. Despite it being blindly obvious that it won't work…

davyclam:  It's going to get worse before it gets better. We're on the edge of a precipice, and we can't trust our governments. Those American Survivalist Loonies don't seem so loony now.

Antiehypocrite:  Zero Hedge - the wikileaks of finance news.  Anyone with more than day to day cash in a bank account right now is NUTS

annoyinglyrightallthetime: 'Those American Survivalist Loonies don't seem so loony now.' Quite. That's why I have bought 5,000 tins of baked beans. Provides central heating as well.