The Super-Rich Crave to Live Longer – Are You Rich Enough?

Contemplating money - photograph

How Much Is Enough – Rich, Richer, Super-Rich?

Multi-Billionaires crave to live longer. Larry Ellison, Jeff Bezos or Peter Thiel, to name just a few, invest billions in the business of living longer. Individual life expectancy far beyond the level even the most sophisticated medical skills currently can provide is the aim. That’s costly, so you better be among the super-rich.

Larry Ellison’s (Oracle Corporation) net worth amounts to 128.2 billion US$. Jeff Bezos’s (Amazon) net worth is even 210.7 billion US$. But Peter Thiel (PayPal, Palantir Technologies, Founders Fund), the poor wretch, only owns 3.5 billion US$. (2021 Figures from Forbes Trending)

Most South African High-Net-Worth-Individuals Are Too Poor By Far

Each of the 5 super-rich people residing in South Africa have at least net assets of US$1billion (14.6billion Rand) at their disposal. Maybe one or two of them could get in on an investment drive financing a life extension program. Google’s parent company Alphabet and the drug company AbbVie*, for example, finance the secret research centre “Calico” (California Life Company).

Latest research shows that South Africa boasts 86 centi-millionaires, each with net assets of US$100 million or more (down from 92 previously). In addition, approximately 1,800 multi-millionaires live in South Africa, each with net assets of US$10 million or more (down from 2,030 previously).** None of them would be rich enough to get in on the multi-billion dollar business of living longer. Initially, each company wanting to join in was requested to invest $350 million. And they enjoyed an option for each to add an extra $500 million later on.

In 2018 the average net worth of the 3540 richest individuals in South Africa was “only” 486,200,000 ZAR, equivalent to US$33.3 million. That amounts not even to 1% of the wealth poor German/American entrepreneur Peter Thiel has been assessed at. Nonetheless they belong to the category of people for whom banks spread out the red carpet: High-Net-Worth-Individuals. HNWIs in bank speech: People who possess at least US$1million aside from the real estate where they live.

South Africa’s Losing Millionaires

And their numbers are dwindling! Between 2017 and 2020 South Africa lost 8,600 millionaires, including 4 centi-millionaires and 230 multi-millionaires. This shows a trend of money leaving South Africa, either through emigration, or destruction of wealth through the weak economy.***

No doubt, even most of the richest South Africans are lamentably poor, compared to their peers notably in the USA. Somehow this is a mirror of the horrendous wealth and income inequality within South Africa. Busi Mavuso, (chief executive officer of Business Leadership South Africa), revealed at a webinar organized by the University of Cape Town’s (UCT) African Centre of Excellence for Inequality Research (ACEIR) in partnership with the Embassy of France in South Africa:

‘Only 10% of South Africans live in “opulence”, while 35% are ranked as middle class, and more than 50% live in abject poverty’.

Poorest South Africa

Indeed, wealth distribution in South Africa seems to be more unequal than in all other developed and developing countries for which comparable data is available. The top 1% wealth share stands at 55% in South Africa, as compared to about 40% in the United States and Russia, 30% in China and India, and less than 25% in France and the UK.

And there is not so much as a trace of decreasing wealth inequality since the end of apartheid, and these levels of concentration greatly exceed wealth inequality estimated in other countries. (See Research Brief 11/20 (December 2020, SA-TIED, authored by Aroop Chatterjee, Léo Czajka, and Amory Gethin) Extreme inequalities: The distribution of household wealth in South Africa”. To read this document click here.

Wealth Inequality in South Africa: Some Precise Data

In detail, available data reveal that net household wealth is extremely concentrated in South Africa. The top decile (10% of households) owns 86% of total net wealth. Within those 10% the top 1% of the adult population (about 350,000 individuals) own 55% of aggregate personal wealth. And close to a third of aggregate household wealth in this country falls to the top per mille (1 in 1000 adult individuals). This leaves about 15% to the 3540 super-rich people mentioned above.

And here is the next step: The top 1% of the South African adult population (350,000 individuals) own 55% of aggregate personal wealth. The top 0.1% alone (35,000 individuals) own almost a third of all wealth. The top 0.01% of the distribution, amounting to some 3,500 individuals, own about 15% of household wealth. That’s greater than the share of wealth owned by the bottom 90% of the population consisting of 32 million individuals.

The Research Brief cited above highlights the scandalous fact that the lower half of the South African population have negative net worth. This means the levels of the debts that they owe exceeds the market value of the assets they own.

Drawing Lessons?

Michael Sachs said it was time to stop thinking of inequality as a problem of the poor, and to start thinking about it as a problem of the affluent:

‘We need to think more about what the sacrifice is the affluent need to make in order to overcome this problem’.

Without to actively working to change the structures of society, without transforming institutions, progress will be stunted, Sachs added.

Professor Michael Sachs is a professor in economics at the Southern Centre for Inequality studies at the University of the Witwatersrand. Drawing a lesson from all those alarming facts, he spoke at that webinar organized by the University of Cape Town’s (UCT) African Centre of Excellence for Inequality Research (ACEIR). Find the source at http://www.aceir.uct.ac.za/

Unsurprisingly, however, the International Monetary Fund (IMF), one of the main protagonists of the free market economy (better: “free profit economy”) holds a different view. According to its article Six Charts on South Africa’s Persistent and Multi-faceted Inequality, South Africa needs to focus on ‘creating a business environment more conducive to private investment and job creation”. This article can be found at https://www.imf.org/en/News/Articles/2020/01/29/na012820six-charts-on-south-africas-persistent-and-multi-faceted-inequality. More of exactly the diet that failed to cure the patient that is South Africa for 30 years?

*New World Wealth and AfrAsia Bank South Africa

**Rigalado, A.: Google’s Long, Strange Life-Span Trip. MIT Technology Review, December 15, 2016

*** BUSINESSTECH: See https://businesstech.co.za/news/wealth/459046/south-africa-is-losing-thousands-of-millionaires/


“For unto every one that hath shall be given, and he shall have abundance: but from him that hath not shall be taken even that which he hath.

[Matthew 25:29]

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