WealthInsight, a consulting firm that provides information on high-net-worth individuals, reports that even if President Obama and Congress don’t reach a deal to avert the fiscal cliff, the president will still get his whack at the 1 percent. From Quartz (a neat new source of global economic news):
Consultancy firm WealthInsight says the number of US millionaires—those with $1 million or more in assets excluding their primary residence—would fall 6% in 2013 if the US economy flatlines, as the IMF predicts it will if the fiscal cliff takes effect. The US would be short 315,000 millionaires, and the total wealth of this upper bracket would fall by about $240 billion, as their stocks and property decline in value and their businesses perform worse. That’s the red line in the chart [below].
By contrast, if the economy grows by 2.1%, as expected if a deal is reached, the number of millionaires will grow by 4%; that’s the dark blue solid line. The medium-blue dashed line, just above the red, is a middle-of-the-road scenario if a deal is reached but fails to deliver “fiscal clarity,” meaning uncertainty and tightening that is still harmful to recovery. And the light blue line shows how much wealthier US millionaires could have grown had there never been fears of a fiscal cliff at all; WealthInsight estimates that the economy would have been able to grow at 3% in 2013. . . .
The average “high net worth individual” would see their wealth fall by $230,000, Christopher Rocks, an analyst with WealthInsight says. The average millionaire had $3.6 million in 2011, according to calculations based on WealthInsight data (there were 5.1 million millionaires in 2011 who held $18.8 trillion in total).
The “uncertainty and tightening” referred to, producing the dark-blue line, could come about by some combination of expiration of the payroll-tax cut, implemented sequestration, and income-tax increases relative to current policy — all of which, at this point, seem quite possible.