This man you see on the screen is LEE KUN HEE and he is
the first human being to be dead and alive at the same time.
Yes, you could say he’s something like Schroendinger’s cat
but in real life!
By the time we make this video, KEE KUN HEE will have spent more than 4 years hidden
in a South Korean hospital, and nobody dares to reveal
his condition.
And you might wonder… why?
Who is this man?
Well, we’re talking about the president of SAMSUNG,
one of the wealthiest men on the planet.
The day he dies, his son will inherit between 10 and 15 billion dollars.
And right after, he will have to pay 65% of this fortune to the
South Korean Government.
And yes, yes, I know what you might be thinking!
What’s the problem?
Who wouldn’t want to have 35% of 15 billion dollars?
Believe me, at the end of this video, you will totally understand why his
son isn’t happy about this.
And you might even admit that, yeah, you don’t really want to know if Lee Kun Hee is dead
or alive.
Let’s get started!
Money is that thing Kanye West tries to get rid of as soon
as possible.
Don’t believe me?
Just check out this news.
Kanye West & Kim Kardashian Spend Nearly $1 Million On
Gold Toilets Exactly… a lot of people hate to have Money
in the bank.
But a lot of other people love Money.
And among those who love having Money are the billionaires.
The wealthiest people on planet Earth.
Yes, this might be a very small Group of people but it’s growing day by
day.
Number of billionaires worldwide surged to 2,754 in 2017
This has an easy explanation: emerging countries.
All of a sudden, countries like China and Vietnam are
starting to have their own billionaires.
And you might wonder… is this good or bad news?
Well… it depends on who you ask!
For example, according to Gabriel Zuckman, a marxist
economist, this is a hell of a problem.
And let me make a quick aside here.
You often hear about some sort of conspiracy theory claiming that
the mainstream media tries to silence all the
critics of capitalism, right?
And yet, both Gabriel Zuckman and Thomas Piketti are the new anticapitalist
rockstars and they’ve been on the cover of Bloomberg magazine.
And no, they weren’t painted as the bad guys.
So… remember that the next time your smartass friend shares
their mainstream media conspiracies!
But let’s get back to our story.
What’s the problem with billionaires according to Zuckman?
They’re destroying social mobility.
And what is social mobility all about?
It’s the academic term for the ‘American dream’.
Think about it…
it’s hard to go from rags to riches if you’re competing with a
guy who was born rich and went to the best universities.
According to some economists, wealth in America is getting
more and more concentrated in the hands of a small elite
group.
Are they right or not?
It’s hard to tell!
In fact, there is no way to effectively measure social mobility
so far.
So there are arguments to prove both sides.
But the truth is…
Zuckman’s arguments are becoming more and more
influential.
So today’s question is…
Should we tax wealthy people more?
Are there counties that already do that?
Does it work?
And what does the dead and alive Samsung president have to do with all of this?
Today we are going to answer to all of these questions but, before
we do, let’s take a look back at the history.
EAT THE RICH!!!
Nobody likes tax raises.
But, unless you’re Larry Ellison and you’re watching this video — in which
case, Hello Larry! — you probably don’t get nervous at the mention
of special taxes for billionaires.
Still, you might wonder… but what do billionaires think about paying more taxes?
Well… you might be really surprised!
Warren Buffett and Bill Gates agree that the rich should pay
higher taxes Yes, you heard that right!
But wait a minute because this proposal of taxing billionaires is more complicated
than it seems.
They don’t just want a higher income tax.
We’re talking about a wealth tax.
And this is very important because wealth is one thing and income is
another.
And pay attention because this is the key to understanding
the rest of the video.
Let’s hear Erik’s explanation!
Let’s use Bill Gates as an example.
He has a net worth of around 103 billion dollars.
But make no mistake!
He doesn’t have it in cash!
If we could sneak into his bank account, we wouldn’t see that much Money.
So then, where is all of his Money?
The answer is in assets: valuable things like houses, artwork, and, of course, Microsoft
shares.
This means that, if Microsoft shares suddenly lost
their value, Gates’s wealth would decrease.
And this is why anytime you hear that this person’s net
worth is this or that, it’s just an estimation.
In fact, it’s really hard to measure somebody’s wealth.
And this is why proposals like this generate so much debate.
‘I have a plan’: Sen. Elizabeth Warren discusses proposed
wealth tax and more in Cedar Rapids So right now, rich people in America pay taxes
like anybody else: whenever they get income and whenever
they spend it.
But with this would-be wealth tax, they would have to pay
between 2 and 3% of their net worth every year.
Even if they didn’t touch their Money that year.
And yes, we aren’t just talking about cash, but all kinds of
assets that would have to be valuated by some expert.
So far, there are already four countries that have similar taxes:
Switzerland, Belgium, Norway, and Spain.
We’ll talk about those cases in another video.
But the truth is, there is a better formula for taxing the rich and that’s with an inheritance
tax.
An inheritance tax is the amount we would have
to pay any time we inherited Money.
And it really has a similar effect to the wealth tax.
It’s just that, instead of paying a percentage of your net worth while you’re alive, you
pay it when you die.
Many countries and American states have this kind of
tax system.
Yes, these taxes pose a big ethical debate.
Many of you might think this is good because you think
it’s unfair to be born rich.
But many might think that it’s even more unfair to
end up paying more than half of the wealth you’ve created
to the Government.
In many cases, if we combined all the taxes you paid while alive plus what you pay
when you die, you might end up keeping a very small share
of what you made.
But, again, this is a debate for other videos.
What we want to tell you today is what happens in
the most extreme case of inheritance taxation.
And where does this take place?
Of course, in South Korea.
Pay attention because now is when our good friend, Lee Kun Hee,
president of Samsung, comes into the picture!
THE SECRET OF ETERNAL LIFE South Korea is one of the most prosperous
countries on the planet and this means they have a lot of very
rich people.
However, South Korean wealth is very different from
American wealth.
In South Korea, 74% of billionaires have inherited their fortune.
If you’ve been subscribed to VisualPolitik for a long time, you already
know that the South Korean economy is based on the so called
CHAEBOLS.
By the way, if you still aren’t subscribed to VisualPolitik, you
should be.
Why?
Because we give you a great worldview so you can understand what is going on and make
better decisions in your life.
Where else would you learn about taxes in South Korea, huh?
So go subscribe to this channel and hit that bell button so you won’t miss
any posts.
And now let’s get back to our story!
Companies like SAMSUNG, LG, and HYUNDAI became the
behemoths that they are Today because of their connections with the Government.
And these chaebols have something in common; they are all family
owned companies.
For example, Samsung was founded by this
man here, whose name was KEE BYUNG CHUL.
When he died, his son inherited the company and the
fortune.
His son is our friend LEE KUN HEE.
And the day he dies, his son, whose name is LEE JAE YONG will inherit
the business.
In fact, while the father is dead and alive at the
same time, he’s who’s actually in charge of the company.
In other words…
Korea is not a country where you start from 0
like one of those Silicon Valley companies.
This is why South Korea has the second highest inheritance
tax of any country, only surpassed by Japan.
In South Korea, you can end up paying up to 65% of
the wealth you inherit.
Yes, you heard that right… you can end up with only
35% of your inheritance.
And I know what you’re thinking!
35% of a fortune is still a fortune, right?
In this case, the Samsung inheritance might reach up to 15 billion dollars.
Not bad, right?
Well… the problem is that we’re not just talking about
Money here… but also assets!
And this is why having a billionaire dad in South Korea can be a hell of a problem.
Korean businesses are terrified with the punitively high
inheritance tax rate, which is among the highest in the
world.
Think about it, this 15 billion USD is not cash.
Mainly, this fortune comes from shares of Samsung.
BUT those 7b dollars he could end up paying will have to
be in cash.
In other words, he would have to sell his father’s
shares in the company.
And you might now wonder now…
How many shares would he have to sell?
It depends on two factors.
The stock price at the time the father dies and the stock
price at the time he wants to sell it.
And oh boy!
The Samsung family couldn’t be more unlucky!
Rumor of Samsung Group Chairman Lee Kun-hee’s Death
Raises Stock Prices Exactly!
Whether we’re talking about LG, Hyundai, or
Korean Air… all of their owners face the same problems.
But Samsung’s situation is the most incredible of all.
In this case, Samsung stocks won’t stop growing.
This means that the son is going to inherit more and more
wealth.
But that isn’t the end of the story!
If, all of a sudden, he has to sell such a large amount of stock… what will
happen to the market price?
Of course, it will immediately drop.
This means that poor LEE YAE YONG can find himself
in the situation of getting a really small share
of the inheritance.
This means no Money and no Rights over the family
business.
And this explains why he’s willing to do anything
in order to keep his father alive.
11 months after Samsung Electronics chairman Lee Kun-
hee entered Samsung Medical Center following a heart
attack, the country’s largest business group is maintaining a
veil of secrecy over its leader’s health and the future of its
management.
In the meantime, the Samsung son is trying to make a deal
with the South Korean government in order to pay the
inheritance tax little by little.
But this won’t be easy.
His relationship with the new Korean president,
MOON JAE IN couldn’t be worse.
Samsung heir sentenced to five years in jail after corruption
conviction
Exactly!
Samsung was involved in a corruption scandal because they bribed the previous president,
who was from the opposing party.
And day by day, we’re learning how this corruption scandal was worse than we thought.
He’ll have to go back to court and he might lose all
the penalty reductions he had.
And in the meantime Samsung stock prices just keep growing… since 2016, they have
doubled their value.
So the only solution for our friend, LEE YAE YONG is
to head onto the streets of Seoul and shout: ((((CASUAL
STYLE))) ‘Please!!!!
STOP BUYING SAMSUNG STOCKS!!!
Why don’t you invest in something else?
Apple?
Hyundai?
Cryptocurrencies?
I mean… look, Samsung is OK, sure… but it’s not the shit!
Like… you’re going to end up really disappointed!’
Meanwhile, the Samsung patriarch has found the secret to
eternal life.
SInce a heart attack sent him to the hospital in
2014, nobody outside of the family has seen him.
And he continues to be the company’s president.
At least on paper.
And now you might wonder… does this inheritance tax
really work?
Is South Korea a paradise of income equality?
The truth is… not really.
You see, despite the fact that we can’t measure social mobility, we can measure
equality.
How?
With the Gini index.
Here we can see how South Korea is not especially unequal, but not especially
equal either.
Germany, the UK, and even the Czech Republic are
far more equal.
But, of course, this is a topic for another video.
Now the question goes to you.
Would you vote in favour of a higher inheritance tax like that of South
Korea?
Would you vote in favour of a wealth tax like the
one proposed by Elisabeth Warren?
And… what do you think will happen to Samsung’s president?
Please, leave your answer in the
comment section below.
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