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Five Canadians, not two, are as rich as 30% of the population

How an Oxfam Canada report got the numbers wrong


 
Loblaw Co. Ltd. chairman Galen Weston Jr. speaks before the company's annual meeting in Toronto on Thursday May 2, 2013. The Canadian Press has named Galen G. Weston as its Business Newsmaker of the Year for 2013. THE CANADIAN PRESS/Aaron Vincent Elkaim

Loblaw Co. Ltd. chairman Galen Weston Jr. (THE CANADIAN PRESS/Aaron Vincent Elkaim)

This story first appeared at CanadianBusiness.com

Oxfam Canada, the aid and development group, yesterday claimed that the wealth of Canada’s two richest men equals the combined worth of the poorest 30% of the country’s population. The number is based on a report entitled “An Economy for the 99%,” which shows “the gap between rich and poor is far greater than had been feared,” according to an accompanying press release. That might be true. But Oxfam Canada’s facts are wrong.

Oxfam Canada lists as the country’s richest people David Thomson, CEO of Thomson Reuters, and Galen Weston, whose holdings include Loblaw parent company George Weston Ltd. and Holt Renfrew. But the headline stat has a flaw: Thomson isn’t actually Canada’s richest man. To build its report, Oxfam drew on data from the Credit Suisse Global Wealth Databook and Forbesannual list of the world’s richest people. The latter estimates Thomson’s net worth at US$23.8 billion and Weston’s at US$9.3 billion, for a combined US$33.1 billion.

But here’s the problem. Forbes’ rich list ascribes an entire family’s fortune to a single member of the clan. And that simplification hides the fact that David Thomson doesn’t own all of the family fortune. He’s not Canada’s richest person. He’s not even the richest person in his own family.

The 2017 Canadian Business Rich 100 list estimates the Thomson family fortune at $39.12 billion, or US$29.72 billion. Thomson Reuters and some smaller assets are controlled through holding company Woodbridge, which is itself divided among the descendants of patriarch Roy Thomson. David Thomson’s share of the firm is reportedly 14%, putting his estimated net worth at $6.61 billion (US$5.02 billion). The largest stake in Woodbridge is actually owned by Roy Thomson’s granddaughter Shelly Brydson. Her reported 23%, combined with the value of other holdings like plane manufacturer Viking Air and broadcaster VisaRadio, puts her at $8.63 billion (US$6.56 billion).

While Oxfam Canada’s math doesn’t quite add up, it’s still possible to make their point without too many additional rich people. Here’s how we’ll do it: use Canadian Business estimates rather than those from Forbes; convert net worth to U.S. dollars in keeping with the Oxfam report; and use the wealthiest individuals, not families, in descending order, such that for example the Saputo family, number three on the 2017 CB Rich 100, is not represented because the fortune is spread across multiple members.

Using this methodology, we cross the US$33.1 billion figure with just five names: Galen Weston (US$10.04 billion); Uber co-founder Garret Camp ($6.78 billion); Brydson (US$6.56 billion); Alibaba vice-chairman Joseph Tsai (US$6.28 billion); and David Thomson (US$5.02 billion).

It’s clear that a staggering amount of wealth in Canada and the world is held by a shockingly small group of people, and the economic and social consequences of inequality need addressing. But headline writers may want to revise their titles: Five Canadians are as rich as 30% of the population, not two. Or, if you’re attached to the number, two families.


 

Five Canadians, not two, are as rich as 30% of the population

  1. How about we give the poorest Canadians a bonus…any one making less than $30,000. pays NO income tax?
    Then the corporations who want to sell them goods and services have to rely on them instead of subsides.
    Then corporations will have to hire to fill the goods and services required.
    How about it Minister Morneau, the budget is coming up…give the little guy a break?

  2. The problem isn’t the numbers, it is the whole concept that is used. This from the blog Sobering Thoughts:
    “Every January Oxfam releases a report on global inequality, focusing on wealth. This year is no different. It’s fodder for stories on inequality and how the two richest Canadians have wealth equal to 11 million “poorest” Canadians (CBC) or that eight men own more than 3.6 billion people plant-wide (The Guardian). There are methodological problems, namely using net wealth instead of income or gross wealth figures; net wealth includes the debt of mortgages or student loans that imply some sort of asset (a home or university education). The effect is that many Americans are among the billion poorest while rural developing world peasants are not. This is just bizarre. Mark Littlewood of the Institute of Economic Affairs says the report’s focus on “aggregating net wealth figures is largely meaningless headline fodder.”

    The problem goes much deeper than that. Oxfam’s focus on the rich distracts us — the public, the media, policy-makers — from poverty. The welfare of the poor is more important than their relative income or wealth. The fact is, as Johan Norberg points out in his book Progress, people are healthier and living longer as improvements in nutrition, sanitation, and medicine reach more people. While the wealthier live longer than the poorer, the gap between the two has shrunk dramatically over the last half century. There are still improvements to make, but this has little to do with inequality and more to do with access (to hospitals, quality schools, drugs). The life expectancy gap has been steadily reduced and despite some sliding back in some jurisdictions, overall this is a mostly ignored success story.

    Another problem with the Oxfam report is the tone, which is anti-capitalist. The authors say, “super-rich elite are able to prosper at the expense of the rest of us,” which is pure economic nonsense. Expanding the circle of productivity (to use Pope John Paul II’s lovely phrase) within free markets has done more to improve well-being than foreign aid. The abject poor do not live in squalid conditions because Bill Gates or Carlos Slim or Galen Weston Sr., are wealthy, providing goods and services that enrich the lives of millions and millions of consumers. They live in squalid conditions because of corrupt governments in their own countries. Class envy doesn’t feed the hungry. Oxfam’s demonizing of the rich undermines the capitalist system that employs, feeds, shelters, and clothes hundreds of millions of the world’s poor, and they’d be poorer off without it. This is not to say the system is perfect or that there is not room for some redistribution. But Oxfam’s priorities do nothing to help those they purport to want to help.”

  3. GOSH LOOK….IT’S CAPITALISM!

    The truth is most Canadians live comfy-wumphy middle-class lives

    Not Somalia….and not 1% wealth either.

    But hey that’s the system you opted for.

    So stop complaining.

  4. How much does a 1 year old own? How much does a 10 year old own? What percentage of the country’s population is under 20? How much do they own? People with debts cumulatively have a negative net worth of billions. Offset those billions of negative net worth against the net worth of those people who have marginal net worth and you get a huge number of people with an average net worth of zero. Not only country’s richest people but also every other person on the face of the planet with a net worth of even one more dollar has more than that has a greater net worth than all of those net zero and less people combined.

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