Elon Musk only marginally less wealthy than all New Zealanders combined

11:45 am today

Elon Musk is now worth US$1.11 trillion

Photo: Gonzalo Fuentes/Reuters via CNN Newsource

Elon Musk is now worth only marginally less than all New Zealand households combined.

According to Stats NZ, New Zealand households have net worth - assets minus debts - of $2.5 trillion. That is roughly US$1.45 trillion.

Musk is now worth US$1.11 trillion (NZ$1.9 trillion). One trillion is one thousand billion.

NBR's updated rich list this week put the total wealth of New Zealand's richest people at a combined $129b, or US$75.5b, or 14 times lower than Musk's.

Edward Miller, researcher at The Centre for International Corporate Tax and Accountability Research, said Musk becoming the world's first trillion was a sign of how unequal wealth distribution had become.

"When you have such extreme or maldistributions of wealth, extremely poor distributions of wealth, you start to get quite bad social problems that eventuate from it, those social problems tend to start to threaten the entire social order. It's not a healthy phenomenon… we haven't reached this level of inequality before because it is so unhealthy on a societal level."

He said there were examples of unequal distribution in New Zealand, too. "The top 1 percent of New Zealanders own more than twice the net wealth of the bottom 50 percent. We have similar levels of wealth disparity, they haven't moved radically over time but as the pie has grown the scale of increase for those people at the very top has been a much larger proportional increase than those in the bottom 50 percent, let alone the bottom 20 percent or bottom 10 percent."

Shamubeel Eaqub, chief economist at Simplicity, said people often hoped they might be able to get a slice of billionaires' growing wealth.

"I think there's been a cultural shift where we've become very obsessed about valorising individualised individual performance.

"That hoarding is what's celebrated. It hasn't always been the case. If you look back through history, for example, even in our own Business Hall of Fame, you'll find our previous extraordinarily wealthy people were also the mayors and civic leaders and the donors and people who did charity ... But that has become less common. Elon does a lot of things, but giving is not a thing that he enjoys."

He said some people would also argue that if outliers like Musk did not exist then there might not be as many people willing to take big risks and create things. "Would you only invent little things or do little things? I think there's something to that."

But billionaires had often been supported by the state in their business endeavours or other investments, he said, so there was a transfer from the public.

"It's not always obvious that the reason why it happened is because these people are so amazing. Perhaps there are other reasons why that was the case too."

He pointed to the work of French economist Thomas Piketty. "His whole thing is when you see these kinds of concentrations of wealth... they are more likely to lead to the erosion of trust in society and corruption....because that wealth bends everything to its centre of gravity."

But he said the Musk situation was complex. "Some of the things he's done are incredible. But not everything he's done is incredible. Both those things can be true and I think our inability to kind of hold those two ideas together makes it quite difficult because it's kind of all good or all bad - there is this tendency to go oh because he's rich he's better than everybody else. Well, not really. You know, so much of it is luck and privilege and all those other bits and pieces. And it's okay to admit that's the case."

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