Northern Ireland needs more billionaires

On the benefits of the hyper-rich

I want a healthy, economically prosperous society in Northern Ireland – one with the living standards of Switzerland, not one that is about to be overtaken by Poland.

To make this happen, NI needs a lot more private sector activity. Dynamic economies are driven by successful businesses, not government spending. 

However, a thriving private sector will have consequences, and one of those is the hyper-rich. The owners of successful businesses, especially the founders of startups, are liable to become very well-off as their firms grow.

These billionaires are a consequence of modern economic development, so it’s no surprise that Northern Ireland has hardly any of them right now: only Lady Ballyedmond, who owns pharmaceutical giant Norbrook, and Stephen Fitzpatrick, CEO of UK retail energy company Ovo, fit the bill (and Fitzpatrick lives in England, so he only half counts).

Some rough statistics: with a population of around 1.9m, Northern Ireland has one billionaire for every 950,000 people. The rest of the UK has around 175 billionaires and a population of about 65m, so they have a billionaire for every 370,000 people or so – 2.5 times more billionaires per capita.

The mainstream perception of billionaires is generally quite negative; they are variously described by the media as the source of the world’s ills, from fascism to climate change. Perhaps their greatest perceived sin is their very existence, which itself generates economic inequality. One might argue, then, that billionaires are an unfortunate, unhelpful consequence of economic growth. Almost everyone wants a booming economy and more jobs, so we have to accept the existence of the hyper-rich.

No. A new class of billionaires would be great for Northern Ireland for a whole host of reasons – and it’s worth specifying why.

Employment

One of Northern Ireland’s biggest economic problems is productivity, i.e. the average output per hour worked. The stats here are fairly grim: NI is the UK’s worst region for productivity, lagging far behind the UK average, but also significantly behind the Republic of Ireland:

What does this actually mean? On average, when someone from Northern Ireland works, they are generating less economic value than people in the rest of the UK. Their wages are therefore lower, and people are poorer.  

Billionaires would help here. They typically conduct economic activities that generate more high paying jobs; anything from interior designers to corporate lawyers, from construction to high end concierge services. (They will also spend money on services like restaurants, which aren’t bad but won’t improve productivity figures – those jobs are less likely to be paid above average salaries.)

As mentioned, billionaires’ wealth is typically built through the creation of new businesses – startups – or the expansion of existing ones. It’s hard to build a new billion-pound business that’s premised on paying its employees a bad wage – in fact, startups and big businesses are often where people can go for some of the best compensation available for their work. What’s more, many billionaires are serial entrepreneurs and use wealth made from one business to build the next one – that means more jobs.

Tax receipts

In addition to the tax revenue generated from new jobs billionaires create, they will also pay taxes on their own incomes. This is extremely significant in a progressive tax system (i.e. where those with higher incomes are taxed at a higher rate than those with lower incomes), as rich people pay a greater share of overall tax receipts than poor people. As the UK government notes, ‘The 10% of income taxpayers with the largest incomes contribute over 60% of income tax receipts.’

Of course, billionaires don’t necessarily have high incomes, they have high wealth, which is taxed differently. There are other ways of taxing wealth, such as capital gains tax. However, the tax receipts on the money that billionaires do spend, such as VAT on a fancy new car or yacht, also provides revenue for the government.

Admittedly Northern Ireland doesn’t benefit directly from taxes it collects, as they go to the UK government, which then sends back government funding. In 2021 Northern Ireland’s government had overall tax revenue of £16.6bn, and expenditures of £34.6bn; in other words, NI is dependent on the UK. More billionaires can help us cut that huge deficit.

One might argue that billionaires are insufficiently taxed overall, and pay lower effective rates, especially when they construct complex financial schemes in order to minimise their tax bill. This might be true, but even if it is, more billionaires paying any taxes would increase the tax receipts of the government and allow them to lower taxes on the poorest people. (Check out this list of what the UK’s top taxpayers actually pay.)

Investment & innovation

Northern Ireland already has a startup scene, and investment in it has risen in recent years. However, it’s striking that the majority of the funding comes from outside the country. Startups won’t stick around in Northern Ireland, or get started, if there is no funding for them! They will want to move closer to venture capitalists (who can fund them), talent pools (that they can hire from), and larger markets (that they can sell in). NI will never be ‘best in class’ on all those fronts, but there’s no reason it can’t take steps to be as good as possible.

As mentioned at the start of this essay, billionaires are a consequence of a growing economy. But they can also help the economy to grow more; more billionaires in Northern Ireland means more people who will set up VC firms and fund new companies via angel investments. This won’t create Lough Silicon overnight – there are other helpful policies that could be adopted, like tax incentives – but it will help the scene keep growing.

More subtly, the proximity of billionaires will help raise the aspirations of local talent – if you can see a billionaire in the flesh, perhaps even see how they work, some will realise that they can do that too. 

There are plenty of small countries with strong tech scenes. Israel has 9.4m people and Singapore has 5.5m, but the best comparison is Estonia, with only 1.3m people but around 300 active angel investors and 8 VC funds, resulting in 10(!) unicorns. And to their disadvantage, they have a large geopolitical enemy right on their doorstep. A strong tech scene is definitely doable for Northern Ireland!

It’s worth noting that startups are also responsible for a lot of the innovation in society. It was OpenAI who released ChatGPT, Uber who got us ordering taxis on our phones, Monzo who got us banking on our phones, Airbnb who got us staying in houses not hotels, etc. More startups means we should see more innovation like this – and if they start in Northern Ireland, the benefits of that innovation might go to us first. Imagine if Northern Irish hospitals were the first to use a pioneering new cancer treatment? Or the world’s first small modular nuclear reactor?

More broadly, it’s new ideas that generate economic growth and wealth for everyone. The world will benefit if we can get more startups going in Northern Ireland, and more billionaires will help.

Philanthropy & culture

Billionaires don’t just invest their wealth, they also give it away. Bill Gates is perhaps the most prominent example of this, though many other wealthy elites have signed the giving pledge.

I want to focus on two examples from the US of what philanthropy can look like locally. There is lots of need around the world, but it’s fair to say that need exists locally too, so I would fully expect that billionaires would engage in philanthropy in their locality too, especially if they’re from the area.

The Walton family, based in Northwest Arkansas and owners of Walmart, are worth some $200bn. Founder Sam Walton’s daughter, Alice, established the Crystal Bridges Museum, the first new major art museum in the US since 1974. Her overall donations to the museum have topped $300m. And it’s free to enter! Walton has also donated millions to food banks, healthcare initiatives, and other art-related projects.

The wider Walton family are engaged in various philanthropic efforts both in Arkansas and further afield. They haven’t signed the giving pledge, as far as I can see, but it’s great that they’re doing something. The family foundation website even has a theory of change for how they are going to build Northwest Arkansas into a place of real opportunity. I can say with confidence that the only theory of change people have in Northern Ireland is birth rates. A sprinkling of billionaires would help inculcate the kind of ambitious projects necessary to change NI for the better. More tourist attractions like the Titanic museum would also help to put us on the map.

Nearby, in Tulsa, Oklahoma, George B. Kaiser was one of the first people to sign the giving pledge. His family have been active in philanthropy in the city for some time, as Trevor Klee notes:

The Tulsa Community Foundation (or, more specifically, the George Kaiser Family Foundation and, to a lesser extent, the Charles and Lynn Schusterman Foundation, as TCF is just a house for these family foundations) have spent enormous amounts of money trying to make Tulsa a better place to live. They’ve built multiple beautiful parks (including one incredible one called the Gathering Place), a children’s museum, revitalized downtown, launched scores of programs to improve the lives of Tulsa’s underprivileged children, created Tulsa Remote (which offers $10k and relocation assistance for any remote worker to move to Tulsa for one year), and funded a bunch of different business assistance programs. And all of this is just off the top of my head. I’m sure there’s a lot I don’t know about.

It would be great if someone created Derry Remote, paying people with high-paying jobs to move to Northern Ireland’s relatively impoverished and underserved second city. Or how about birthright trips for people born abroad with a connection to Northern Ireland? The Republic of Ireland has done a great job of tapping into its diaspora, but Northern Ireland has barely even tried.

Along different lines, it would be interesting to see a bunch of rich people get involved in local sports leagues and invest in them. The owner of Larne F.C. offers a great example. Imagine if more local football clubs like Ballymena United were able to produce a really compelling product so that attendance increased. I suspect the impact on the economic fortunes – in fact, even just the vibes – in these small towns could be vastly improved by having a thriving sports scene. It might even help us stop bowling alone (or watching Netflix).

Shared benefits

Few people would oppose a thriving private sector for Northern Ireland, but it’s actually the second order effects of that which are perhaps the most exciting. The new wealth generated by these firms – much of it directed and reallocated by billionaires – could help make Northern Ireland a great place to live. Let’s embrace that opportunity.