The Rich Stay Rich...And Other Reasons Why Living in the UK Would Be A Hard Sell

Well, I'm finally recovering from my latest bout of illness. It was the flu this time, methinks. Came on suddenly, all the classic symptoms, and I even missed a day of work. There's this theory that is murmured in the quiet hours of dreary office mornings or droll afternoons that London is a particularly hostile climate to live in because of the combination of harsh environmental conditions and the manic lifestyle. It's been said that it takes newcoming immune systems a year or two to adapt. It's especially hard on the body in the grey days of October - February where the sun is rarely seen and almost never felt.

Perhaps there is some truth to that. I'm quite sure the cause of the latest infernal bug is attributable to one of my fellow early morning commuters. There's nothing like hurling down dark tunnels in tightly packed steel and plastic containers at 60 mph while rampant germ incubation exposes the lot to all sorts of hostile and unmentionable contaminants. And, since I've been living pretty healthy the last couple weeks (no drinking, no smoking), I'd have to say that the environment got the best of me since the lifestyle was not in play. Yet another reason to flee this city before the dead of winter sets in and the sun is banished from the sky forever.

But, none of that has to do with what I wanted to talk about today. Instead, I figured a bit of melodrama about my own personal illness that has dominated the week could garner a glimse of sympathy.

No, today, the topic is one of pure insanity. See, I've always wondered about that phrase, "the rich get richer". While the liberal elements in me suggest there must be some truth to it, the cynic in me argues that phrases like that are just simple, consumable packets offered by elites to buy support from the masses because either A) they're convinced that the masses won't understand an actual argument; or, B) they're afraid there is no real argument to sell (sort of like how there is no labor movement in America anymore even though there are plenty of big buildings in downtown DC that think there is). And, if you followed that extended run on sentence, then kudos for you, because I've lost track of where I am.

Let's see. The rich staying rich. Right.

At my newish job, I have a co-worker who is in the market for "property" (a flat). We've talked about it a good bit because she's the nice sort and, all things being even, when you're doing work that a trained chimpanzee could accel at, well, you need some chit chat every now and then to ensure that you don't go completely insane. Over the course of our working relationship, she has educated me on the nature of property "ownership" in the UK and why the system is completely rigged for those who are wealthy landowners of a bygone era.

See, unlike the US, in the UK there are "Freeholders" and "leaseholder". Both can "own" and "sell" property, but only one is actually the owner. The Freeholder is the individual who actually owns the property. A good majority of Freeholders (in London at least) are legacy Freeholders. They've owned the property for centuries or longer. Many times, they received the land through some type of Royal arrangement. Other times, they bought it fair and square.

The Leaseholder, however, is the current "owner" of the property. Freeholders "sell" the property to a "Leaseholder" for a variable amount of time. It could be as low as 75 years; it could be as high as 125 years. That's the range. Thus, many (if not most) properties "for sale" in London are actually for "lease" for a period of 75 - 125 years depending on the actual contract.

This is legacy wealth. If you own a property that you inherited from your family that you sell, then you will earn money on that property. However, if you "lease" that property for 75 years, you still make the exact same amount of money, but then your kids (or grandkids) get to do the same thing and regenerate family wealth that you may have depleted through your notorious GDW fetish (Gambling, Drink, and Women).

Comparatively, Average Alistair would never be able to benefit his family as such. Instead, in order to perpetuate family wealth, he would have to contain his GDW fetish, save and invest, and, if fortunate enough, purchase a Freehold.

I'm not sure why this bothers me so much. But when my co-worker educated me about all this, my reaction was, "And you actually put up with this????" Apparently, you have no choice in this country. I'm shocked that someone hasn't attempted to litigate this away. I don't know what the legal standing would be, but this system is rooted in the archaic swill of a Royal legacy that's past its expiration date.

I suppose that understanding this quirk of English property law really angers me because I see just how difficult it is for a hard working, bright, and ambitious young woman to purchase a property that is of suitable size and in a location not likely to get you mugged, raped, or killed. It's an impossible real estate market as is and when you throw the Freeholder phenomena into the mix you create an even more difficult situation for aspiring owners. Property ownership should be about investing. It should be something people want to do, something that benefits them in the long run so that they have a real stake in their neighborhood, their residence. Long term leasing (because that's what it really is) removes those values from the ownership system and undercuts the entirety of why property rights are a good idea. Not only that, the system makes it tougher for people of the middle class persuasion to improve their standing and their lives. On it's merits, the Freehold system is a sham and should be abolished.

Thank God I don't have to deal with that in the US or elsewhere. Instead, we have a simple system where the rich stay rich the traditional way - by taxing the poor and paying their accountants thousands to wiggle through the tax code at the cheapest price, i.e. The American Way.

All of this, however, raises an entirely different question. Just as I'm so appalled by the British system, citizens here just accept it as the way things are. They don't like it, but they're not going to get irate about it or anything. Instead, they just navigate it to the best of their abilities and carry on. Which, I suppose, demonstrates that all things are relative.