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THE AGENDA HORST TER MAARTJE Diary The Davos-defying Dutch historian Rutger Bregman on protests, taxes and why his latest book was misunderstood Some people have said that my new book Humankind argues that we are naturally good or that we’re born to be good. But that’s not what I’m saying. I’m saying that people have evolved to be friendly; that, deep down, we’re pretty decent, which is not the same as being an actual good person. That is much harder. If you live in a normal, healthy society – like, say, Sweden – right now, then you don’t need a lot of heroes. You don’t need a lot of really good people. Just average nice, decent people are enough. Because you just have sensible laws and procedures, things are going to work out all right. History is the most subversive of all the social sciences. It just shows you that things can be different. There’s nothing inevitable about the way we structure our economy and society right now – it can all change, and it used to be very different. That is the same with hope. I’d like to make a distinction between hope and optimism. Optimism is that worldview where you feel that things will turn out to be all right and we can just sit back and enjoy the ride. Look at the graphs: the decline of extreme poverty, child mortality. We are richer, we are healthier and wealthier than ever. That is the optimist’s worldview. I think hope is much more about possibilities. Things can get much worse. We can see that happening before our eyes. Look at the situation in the US: you have a country that not very long ago was trying to make the world safe for democracy by invading other countries. Now it has to worry about its own democracy. That would have been unimaginable not very long ago. But it also works in the other direction. In the past ten years, ideas that used to be dismissed as crazy have been moving into the mainstream. One fascinating recent moment was when the Financial Times ran an editorial where they said we need to reverse the policy direction of the past 40 years. That gives me hope, but it doesn’t give me any confidence that things are going to turn out to be all right. I think that optimism makes you a bit lazy, and hope tells you to act. When I was at university in the Netherlands, and in the US at UCLA, one of the things that I would I think that optimism makes you a bit lazy, and hope tells you to act write about was why my generation wouldn’t go out and protest. I was sort of trying to say: ‘Well, we do care, but it’s just not our thing, we don’t really go out in the streets.’ That sounds completely ridiculous right now. Ten years later, we’re seeing the biggest protests in the history of the United States. The Black Lives Matter movement reverberated around the globe. The same is true for the climate justice movement. Crises tend to expose things that we’ve always known but now become really clear. So one of the most interesting moments was when governments around the world started publishing these lists of so-called essential workers. This makes you think: ‘Who are the real wealth- creators in this world and society?’ Sometimes it seems as if we live in this upside-down world, where the people who do the most valuable work are paid less than those who do the more expendable work. My previous book [Utopia for Realists] had a lot of fun looking into whether there’s ever been a strike of bankers. In all of world history I could find only one example: striking bankers in Ireland in the 1970s. The bankers were really angry that their wages were not keeping up with inflation. They said: ‘You know what? We’re going to go on strike.’ They went on strike, the strike lasted for six months, and nothing really happened. Bankers got back to work. I’m really glad that taxes have become much more of a political subject. Ten or 15 years ago, the tax evasion industry was already huge and very few people were talking about it. It wasn’t a subject that came up at elections. And now we’ve seen Trump’s tax returns. I think that we should focus more on taxes and I think that is happening. In the Eighties and Nineties it was the era where we said that greed is good and paying taxes was not really something to be proud of. I think that now we’re moving into an era where public service becomes more important, and where even if you evade your taxes, you’re not going to brag about it at a birthday party or something like that. That’s a real generational shift. S As told to Arun Kakar
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SPEAR’S PARTNER Intelligent design As UHNWs live increasingly global lives, their family offi ces must keep up. Steve Sokic, IQ-EQ’s group head of private wealth, explains why the next generation of internationally mobile high-net-worth individuals have such complex requirements – and how the firm is meeting their needs ´ IQ-EQ believe their services best preserve family wealth ‘IN TODAY’S WORLD, when people are living 80-plus years, it’s not uncommon to have four or even five generations alive at one time,’ says Steve Sokic, group head of private wealth at IQ-EQ. ‘That complexity is one big driver of the use of family offices.’ ´ The widely anticipated ‘great wealth transfer’ is set to be particularly interesting, as there are three clear differences between the inheriting generation and the incumbents. ‘First of all, there are more women involved in the wealth, stewardship, and leadership within the family,’ says Sokic. ´ The second distinguishing characteristic of the ‘next-gen’ is their investment preferences. Millennials have an appetite for ESG and impact investing, as well as private equity and venture capital. ‘For decades, bricks and mortar has been the preferred investment for families, but you’re seeing a shift towards other types of assets,’ says Sokic. ´ Finally, and perhaps most significantly, families are becoming increasingly global; they are marrying, sending their children to school, investing and buying property in jurisdictions all over the world. And whenever people and investments cross borders, they are exposed to more legal and regulatory regimes, including taxation, succession and laws around asset ownership. ´ Casting his mind back 20 years, Sokic recalls a cross-border environment that was much less mature. ‘There weren’t as many rules around cross-border investments,’ he says ‘The last two decades have seen a proliferation in that respect, because there have been a number of scandals in public and private markets.’ ´ From CFC rules to tax information exchange agreements, rules and legislation are tightening. So what does this mean for UHNW clients? ‘Things take a little longer,’ says Sokic. It is this multi-jurisdictional complexity, he adds, that gives rise to the need for the governance, discipline and organization that family offices provide. So, if a family emanating from one jurisdiction has dispersed across America, Europe and Asia, how do they best preserve their family wealth? ‘You can have the wealth in a centralised jurisdiction with good law, good jurisprudence and good courts – usually in the form of a trust or similar,’ says Sokic. ‘But then you can ´ have sub-structures to accommodate the circumstances of the family. And that’s not simple.’ Indeed, protecting and growing the wealth of multi-generational families spread across the globe is becoming a taller and taller order. Off-the-shelf products do not fit this new environment as they perhaps did 20 years ago, at least in some circles. Rather, says Sokic, families require an ‘ecosystem’. ´ ‘What you’re seeing is family offices outsourcing to specialists,’ he says. ‘A one-stop shop for all wealth, advisory and products is really difficult in this environment, and it’s going to get even more difficult.’ IQ-EQ, therefore, provides structuring solutions for families via trusts, foundations, funds, and private funds, while liaising with law firms and other third parties to help families remain compliant – an issue that ‘has never been more critical’, according to Sokic. ´ ´ So the firm, the services it provides and the relationships it maintains are integral to many successful ecosystems that conserve international multigenerational wealth. ‘Let’s not forget that families’ ultimate objective is to preserve wealth over generations,’ says Sokic. ‘That’s really what we help them to do.’

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THE AGENDA

HORST

TER

MAARTJE

Diary The Davos-defying Dutch historian Rutger Bregman on protests, taxes and why his latest book was misunderstood

Some people have said that my new book Humankind argues that we are naturally good or that we’re born to be good. But that’s not what I’m saying. I’m saying that people have evolved to be friendly; that, deep down, we’re pretty decent, which is not the same as being an actual good person. That is much harder.

If you live in a normal, healthy society – like, say, Sweden – right now, then you don’t need a lot of heroes. You don’t need a lot of really good people. Just average nice, decent people are enough. Because you just have sensible laws and procedures, things are going to work out all right.

History is the most subversive of all the social sciences. It just shows you that things can be different. There’s nothing inevitable about the way we structure our economy and society right now – it can all change, and it used to be very different. That is the same with hope.

I’d like to make a distinction between hope and optimism. Optimism is that worldview where you feel that things will turn out to be all right and we can just sit back and enjoy the ride. Look at the graphs: the decline of extreme poverty, child mortality. We are richer, we are healthier and wealthier than ever. That is the optimist’s worldview. I think hope is much more about possibilities. Things can get much worse. We can see that happening before our eyes. Look at the situation in the US: you have a country that not very long ago was trying to make the world safe for democracy by invading other countries. Now it has to worry about its own democracy. That would have been unimaginable not very long ago. But it also works in the other direction. In the past ten years, ideas that used to be dismissed as crazy have been moving into the mainstream.

One fascinating recent moment was when the Financial Times ran an editorial where they said we need to reverse the policy direction of the past 40 years. That gives me hope, but it doesn’t give me any confidence that things are going to turn out to be all right. I think that optimism makes you a bit lazy, and hope tells you to act.

When I was at university in the Netherlands, and in the US at UCLA, one of the things that I would

I think that optimism makes you a bit lazy, and hope tells you to act write about was why my generation wouldn’t go out and protest. I was sort of trying to say: ‘Well, we do care, but it’s just not our thing, we don’t really go out in the streets.’ That sounds completely ridiculous right now. Ten years later, we’re seeing the biggest protests in the history of the United States. The Black Lives Matter movement reverberated around the globe. The same is true for the climate justice movement.

Crises tend to expose things that we’ve always known but now become really clear. So one of the most interesting moments was when governments around the world started publishing these lists of so-called essential workers. This makes you think: ‘Who are the real wealth- creators in this world and society?’ Sometimes it seems as if we live in this upside-down world, where the people who do the most valuable work are paid less than those who do the more expendable work.

My previous book [Utopia for Realists] had a lot of fun looking into whether there’s ever been a strike of bankers. In all of world history I could find only one example: striking bankers in Ireland in the 1970s. The bankers were really angry that their wages were not keeping up with inflation. They said: ‘You know what? We’re going to go on strike.’ They went on strike, the strike lasted for six months, and nothing really happened. Bankers got back to work.

I’m really glad that taxes have become much more of a political subject. Ten or 15 years ago, the tax evasion industry was already huge and very few people were talking about it. It wasn’t a subject that came up at elections. And now we’ve seen Trump’s tax returns.

I think that we should focus more on taxes and I think that is happening. In the Eighties and Nineties it was the era where we said that greed is good and paying taxes was not really something to be proud of. I think that now we’re moving into an era where public service becomes more important, and where even if you evade your taxes, you’re not going to brag about it at a birthday party or something like that. That’s a real generational shift. S As told to Arun Kakar

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