If a politician has a net worth of, say $2 million, does it matter in what form they hold their wealth?
Suppose they have $2 million in Treasury Bills. If the gubmnt provides them with a monthly allowance to cover their rent, people do not seem to object too much.
But suppose instead they have a $2 million home. If the gubmnt provides them with a monthly living allowance to cover the implicit rent on their home (what they could have earned from renting it; or, alternatively, what they could have earned from selling the home and buying other assets such as T-bills), people get so terribly upset.
So a Brit politician sold her house merely to justify to the econo-ignorant receiving a monthly rent cheque.
The Sunday Telegraph has learnt that the Wintertons have decided to move out after being barred from claiming any more in Additional Cost Allowance (ACA) for living there. Instead, they will move into a rented flat in Westminster which will cost the taxpayer thousands of pounds a year in ACA.
Lady Winterton, the MP for Congleton, Cheshire, has written to John Lyon, the Parliamentary Standards Commissioner, informing him that the family trust, which owns their previous home on behalf of their children, would now rent it out to a new tenant "at the current market rate, as now".
And the ignorantia are upset by this.
Again, I ask, what's the difference? Why should it matter how the politicians hold their wealth? If they are to receive a rent allowance, is there a wealth test? If not, whether they own a flat/house should be irrelevant.
Addendum: The criteria for who should qualify for the ACA do, indeed, seem to open the door for some questionable activities (see this); but given the criteria, the buy-rent decision and the wealth of the MPs should not cloud the issue. Opportunity costs are still important.