global geopolitics

How privatisation and tax cuts turned public assets into private fortunes, and taxpayers into interest-payers for a creditor class

Editorial Analysis | October 2026

The fiscal position of the advanced capitalist state has undergone a transformation whose distributional consequences are rarely stated in the terms they require. World Inequality Lab data record that net public wealth, defined as the total value of assets owned by the general government sector minus its debts, has fallen to approximately minus thirty per cent of national income in the United States and the United Kingdom, meaning that public liabilities now exceed public assets by a substantial margin (World Inequality Lab, 2025). The same dataset indicates that private wealth has risen to record highs across all advanced regions, and that public wealth has turned negative in North America while falling near zero in Europe (World Inequality Lab, 2025). France and Germany retain public assets at roughly ten to twenty-five per cent of national income, which places them on the same trajectory of depletion though at an earlier stage (World Inequality Lab, 2025). The United Kingdom’s public wealth fell from approximately sixty per cent of national income in 1970 to negative territory by 2020, while private wealth rose from 285 per cent to 682 per cent of national income over the same period (World Inequality Lab, 2025). These figures describe a transfer of ownership on a scale that no tax or transfer programme could replicate, and they establish the material foundation for every subsequent fiscal constraint.

The mechanism that produced this depletion is historically specific and institutionally legible. The British state sold its nationalised holdings in coal, steel, rail, gas, electricity, water, telecommunications, and aerospace between 1979 and 1996, beginning with British Petroleum and proceeding through British Aerospace, Cable and Wireless, British Telecom, British Gas, the water authorities, the electricity generating and distribution companies, British Coal, British Rail, and British Energy (Cato Institute, 2025; Oxera, 2025). The United States pursued a different route, disposing of land, minerals, oil, broadcast spectrum, and public housing through give-aways or underpricing rather than through formal sale. The General Mining Law of 1872 continues to permit mining claims on federal land for nominal fees, and spectrum was allocated administratively at no charge until auctions began in 1994. Public housing stock has contracted through demolition and disposition programmes since the 1990s. The result in both countries was the same: the public asset base that had generated revenue and supported public services was transferred to private ownership, while the tax base that might have replaced the lost revenue was reduced through cuts to top marginal rates.

The fiscal consequence of asset disposal is that the state must borrow to cover expenditures that its remaining revenue cannot sustain. United States gross federal debt exceeded forty trillion dollars in 2026, having roughly doubled over the preceding decade (US Department of the Treasury, 2025). Net interest payments reached approximately $970 billion in fiscal year 2025, equivalent to nearly fourteen per cent of all federal spending and surpassing national defence outlays of $916.6 billion (US Department of the Treasury, 2025). A separate analysis placed net interest at $1.25 trillion, or 18.5 per cent of federal revenue, which exceeded the previous record set in 1991 (DoubleLine, 2026). The interest burden now rivals the largest discretionary programmes in the federal budget, and it grows automatically with the debt stock and with prevailing rates. The distributional character of these payments is unambiguous, because every dollar of interest is transferred from taxpayers to bondholders, and the bondholders are disproportionately located in the upper tail of the wealth distribution.

The concentration of wealth among the creditor class is documented in Federal Reserve data and in the World Inequality Database. The top ten per cent of American households held approximately sixty-seven per cent of household wealth in the fourth quarter of 2024, while the bottom fifty per cent held approximately 2.5 per cent (Federal Reserve Bank of St. Louis, 2024). The Congressional Budget Office recorded the top decile at sixty-nine per cent and the bottom half at three per cent in its most recent reading (Congressional Budget Office, 2025). The top ten per cent owned ninety-three per cent of all United States stocks by 2024, up from eighty-one per cent in 2013, which means that the asset inflation that has accompanied debt-financed fiscal policy accrues overwhelmingly to the same households that hold the bonds (Benzinga, 2026). The class that lends to the state and the class that owns the assets are substantially the same, and the interest payments that constitute a fiscal burden for the general population constitute a revenue stream for that class.

Marxist political economy supplies the categories through which this configuration can be understood without reducing it to a conspiracy of individuals. Marx distinguished between productive capital, which is invested in the production of surplus value through the exploitation of wage labour, and fictitious capital, which consists of claims on future revenue streams that have no corresponding productive activity (Marx, 1894). Government bonds are the paradigmatic form of fictitious capital, because they entitle the holder to a share of future tax revenue without any productive contribution by the holder. The growth of the rentier class, which Marx identified as a consequence of the expansion of public credit, is therefore not an incidental feature of the system but a structural tendency within it (Marx, 1894). The rentier relation generalises to the level of the state when the public pays interest for access to infrastructure it once owned, and when the fiscal capacity to provide health care, education, and social security is constrained by obligations to creditors who acquired their claims through the disposal of public assets.

The fiscal crisis of the state, theorised by James O’Connor, describes the tendency for state expenditures to outrun state revenues because the state must simultaneously support capital accumulation and legitimate the social order (O’Connor, 1973). The dynamic described here is a concrete expression of that tendency under conditions of asset depletion and tax reduction. The state sold revenue-generating assets and reduced taxes on the class that acquired them, which diminished revenue while leaving expenditure obligations intact, which forced borrowing, which added interest to the expenditure side. O’Connor predicted that the crisis would be resolved through cuts to social expenditure rather than through cuts to the coercive apparatus, and the observation that governments reduce healthcare, pensions, and schools while military spending remains protected confirms that prediction. The military and militarised police are not ordinary expenditures, because they are the coercive guarantee of the property relations that the debt encodes, and their protection reflects the priority of coercion over provision in the reproduction of class power.

The enclosure of the intellectual commons through artificial intelligence training data represents an extension of the same logic into the sphere of cultural production. Large language models are trained on vast corpora of text, images, and code that were produced by human labour and that are used commercially without consent or compensation in most jurisdictions (de la Durantaye, 2025; Kyi and Mahuli, 2025). Creative workers report that their work was collected and used without their consent, without attribution, and without payment, and that they wish to be compensated when their work is used to train generative models (Kyi and Mahuli, 2025). The legal status of such use remains contested, with some arguing that it constitutes fair use and others that consent and compensation are morally and legally required (Creative Writers’ Attitudes, 2024). The structural similarity to the enclosure of common land is exact, because a resource that was produced by many and held in diffuse ownership is consolidated into private models that generate revenue for a small number of firms. The right to remuneration, recognised in Article 23(3) of the Universal Declaration of Human Rights, is violated when the products of labour are appropriated without payment, and the consequence is a further concentration of economic power in the firms that control the models and the compute infrastructure.

The political suppression of redistribution is a condition of the system’s reproduction rather than an accidental omission from public debate. The three options available to a state in fiscal crisis are to tax working people harder, to dismantle public services, or to tax wealth hoarding and repatriate captured public assets. The first two options preserve the existing distribution of wealth and continue the trajectory toward fiscal and social breakdown, while the third reverses the transfer that produced the crisis. The wealthy class spends billions of dollars annually on political finance, lobbying, and media ownership to keep the third option off the table, and the effect is visible in the parameters of mainstream discourse. The New York Times published a substantial article on the bond market without identifying the recipients of a trillion dollars in annual interest payments, which is consistent with a pattern of editorial selection that treats distributional questions as outside the frame of legitimate debate (Herman and Chomsky, 1988). Media organisations owned by the same class that holds the bonds and the assets have a material interest in framing fiscal policy as a question of sustainability rather than as a question of who receives the payments.

The comparison between Norway and the United Kingdom demonstrates that the depletion of public wealth was a political choice rather than an economic necessity. Both countries possessed North Sea oil, and Norway placed its revenue in a public fund that reached approximately $2.2 trillion by the end of 2025, while the United Kingdom sold its oil off and allowed its public asset base to decline (Norges Bank Investment Management, 2026). The Norwegian fund is not socialism, because it remains a capitalist investment vehicle, but it demonstrates that a state can retain public ownership of resource revenue when the political coalition supporting that outcome exists. The divergence between the two countries reflects a difference in the balance of class forces rather than a difference in resource endowment or in the laws of economics. The same material conditions can produce radically different distributions depending on which class holds state power, and the Norwegian case provides a concrete refutation of the claim that there is no alternative to asset disposal and fiscal austerity.

The trajectory most consistent with the evidence involves continued fiscal deterioration, continued concentration of wealth, and continued displacement of the burden onto public services and working people. Interest payments will continue to grow faster than revenue as long as the debt stock expands and rates remain elevated, and the political constraints on wealth taxation are unlikely to loosen without a significant shift in the balance of class forces. The enclosure of intellectual commons through artificial intelligence will accelerate the concentration of cultural and economic power unless statutory remuneration rights, collective licensing, and public data trusts are established. The choice between taxing wealth, dismantling services, and continuing the current trajectory is a political choice, and the evidence indicates that the third option is deliberately excluded from the range of policies that mainstream institutions are willing to consider. The reproduction of the system depends on that exclusion, and the possibility of a different outcome depends on the capacity of organised citizens to contest it.

Authored By: Global GeoPolitics

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References

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