2.8 Does wealth tend to concentrate?

It is difficult to know the extent to which wealth would concentrate under VoTa given its unconventional nature. Many of its features would increase competition among producers, making it harder for a small number of firms to dominate markets and their owners to earn extraordinary incomes. Others would broaden opportunities for people starting with little wealth to build wealth of their own. These features include:

• No cronyism: wealth cannot secure selective State privileges, subsidies, or bailouts.
• No intellectual property rights: patents and copyright cannot provide exclusive rights that prevent competitors from using ideas or reproducing works.
• Avoidance of asset bubbles: VoTa's monetary arrangements are intended to prevent asset bubbles from driving wealth accumulation.
• Unavoidable consumption taxation: at a 50% consumption-tax rate, wealthy people cannot escape the tax when using their wealth for consumption. Reinvestment remains untaxed, while the share of consumption-tax revenue allocated to UBI redistributes purchasing power.
• Lower barriers to starting businesses: without licensing restrictions or costly regulatory compliance, people need less initial capital to compete with established firms.
• Support for new producers through UBI: entrepreneurs often draw on personal income and savings while establishing a business. By helping cover their living costs before a venture can support them, UBI could make it possible for people with little wealth to develop inventions, start businesses, and compete with established firms. It could also reduce their need to borrow or sell ownership stakes, helping them build wealth through ownership of successful ventures.
• Tax deferred until consumption: although consumption tax and income tax can be equivalent under simplifying assumptions, the timing matters for new businesses. Under VoTa, entrepreneurs can reinvest their profits without paying tax on them until they choose to use them for consumption—even a decade later. This leaves more funding available during the critical years of establishing and growing a business, reducing the need to borrow or sell ownership stakes.
• Competition from imports: without tariffs and quotas, domestic owners have less protection from competitors who could undercut their prices.
• No welfare penalties for saving: people can build savings or increase their earnings without losing UBI, supporting accumulation among people starting with little wealth.
• Greater bargaining power through UBI: UBI makes poorer workers less reliant on a job for survival, strengthening their ability to demand better pay and refuse poor employment terms.
• No zoning restrictions: removing restrictions on additional housing could reduce scarcity-driven gains for existing property owners.
• Direct access to Central Bank accounts: people can hold and transfer currency without buying financial services or accepting a private bank's credit risk.
• Taxpayer-funded competitors to technology giants: taxpayers can unionise and pool their public-service funding to support alternatives to X, Amazon, Facebook, YouTube, Microsoft, and Google. These services could reduce dependence on dominant private platforms and put competitive pressure on their prices and profits.
• Reduced financial-sector power: banks cannot create Central Bank currency when extending credit; they can only intermediate transfers of existing currency. Commerce settles through the Central Bank Payment System, removing dependence on banks for payment settlement. Banks receive no bailouts or State deposit guarantees and face no special banking regulations. Any business may lend, opening financial services to wider competition and limiting banks' ability to extract fees and profits from a privileged position.