June 16, 2025 7:00am by David Farrar

Silly Socialism

Bryce Edwards writes:

The 119 individuals and families profiled are now collectively worth $102.1 billion – up from $95.55 billion last year. To put this in perspective, that’s more than 40% of the nation’s GDP concentrated in the hands of fewer than 120 families.

The column starts badly with this economically illiterate comparison. This is comparing wealth or assets to income. They are totally different things. The 119 families do not control 40% of the nation’s GDP (the Government almost does though!). GDP measures basically national income, not assets.

The estimated net worth of NZ households is $2.44 trillion so the rich list represent around 4.2% of household net worth.

Atop the pyramid sit the Mowbray brothers with an eye-watering $20 billion fortune from their Zuru toys empire – a single family’s net worth greater than the entire annual budget of the Ministry of Health.

This socialistic way of looking at things puzzles me. It seems to see wealth as a zero sum game. That somehow if the Mowbray brothers had not been successful, then that $20 billion would magically be elsewhere, say with the government, and available for health funding.

I understand why socialism and Marxism appealed to people around the 1900s. Wealth came very much from land (which was a zero sum game) and inheritance. Your family may have worked on the land for generations earning a pittance while the family who owned it for generations raked in the money. But that is not the economy today.

Let us look at the Mowbrays as an example. Did they earn their money through inheritance. No as an 18 year old Nick and his brother set up a toy factory that became a global giant. They now employ over 8,500 staff and sell throughout the world. They make their money because they are globally successful. Would NZ be better off if the Mowbrays and Drurys of the world didn’t live in New Zealand? No we would be poorer.