Peter1469
01-27-2019, 08:08 AM
Why America needs more billionaires (https://theweek.com/articles/819262/why-america-needs-more-billionaires)
The attacks against billionaires is short sighted and ignore the importance of the super-rich in the developed world.
So it's the game Ocasio-Cortez claims to hate — "a system that allows billionaires to exist" amid poverty — not the players, at least perhaps if they are charitable. Yet surely a billionaire can represent a "moral outcome" just by being good at business and selling a good or service that people value. Take Gates, for example. Microsoft, the company he co-founded with Paul Allen, helped revolutionize home computing, generated massive wealth for retirement plans everywhere, and created hundreds of thousands of jobs over the decades. (Indeed, the American tech sector, while producing lots of billionaires, also produces jobs with annual compensation twice the U.S. average). Surely, Gates' lifework wasn't a net negative for society until he decided to start the Gates Foundation and fund efforts to boost education and reduce global poverty.
And Gates' story is hardly the exception in the United States. Among the 400 richest Americans — all billionaires, according to Forbes (https://www.forbes.com/forbes-400/#62eb3dcf7e2f) — about 70 percent (https://www.forbes.com/sites/afontevecchia/2014/10/02/the-new-forbes-400-self-made-score-from-silver-spooners-to-boostrappers/) created their own fortunes. That's up from less than half in the 1980s. Indeed, the United States generates (http://www.aei.org/publication/americas-superrich-getting-way-entrepreneurship/) more billionaire entrepreneurs per million residents than all other advanced economies other than Hong Kong and Israel. If one wants to differentiate between the good and bad superrich for the purposes of public policy, are super-entrepreneurs really the same as those billionaires of inherited wealth or, say, sellers of opioids? But it gets more complicated: What if the born rich are dedicated philanthropists and the nouveau-riche like Amazon founder Jeff Bezos are merely serving consumers and creating jobs? Bezos, after all, has not promised to give away his billions. Who are the true characters of moral worth in the AOCverse?
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This is a moldy argument also used by writer Annie Lowrey in a much-cited article in The Atlantic last year titled "Jeff Bezos' $150 billion fortune is a policy failure (https://www.theatlantic.com/business/archive/2018/08/the-problem-with-bezos-billions/566552/)." Lowrey argued that Amazon is able to succeed because the government "ameliorates the effects of poverty wages with policies like the Earned Income Tax Credit, Medicaid, and the Supplemental Nutrition Assistance Program." But this reasoning ignores the economic and business reality that if you are going to have a private sector, then private firms simply aren't going to hire workers at a wage more than they are worth to the firm. It also ignores the fact that the Earned Income Tax Credit is a government benefit that promotes work and boosts living standards. And if Medicaid benefits corporations at the taxpayer's expense, then it's strange that leftists like Ocasio-Cortez don't view Medicare-for-all — which would let employers completely off the hook for health coverage — as a massive subsidy to business.
The attacks against billionaires is short sighted and ignore the importance of the super-rich in the developed world.
So it's the game Ocasio-Cortez claims to hate — "a system that allows billionaires to exist" amid poverty — not the players, at least perhaps if they are charitable. Yet surely a billionaire can represent a "moral outcome" just by being good at business and selling a good or service that people value. Take Gates, for example. Microsoft, the company he co-founded with Paul Allen, helped revolutionize home computing, generated massive wealth for retirement plans everywhere, and created hundreds of thousands of jobs over the decades. (Indeed, the American tech sector, while producing lots of billionaires, also produces jobs with annual compensation twice the U.S. average). Surely, Gates' lifework wasn't a net negative for society until he decided to start the Gates Foundation and fund efforts to boost education and reduce global poverty.
And Gates' story is hardly the exception in the United States. Among the 400 richest Americans — all billionaires, according to Forbes (https://www.forbes.com/forbes-400/#62eb3dcf7e2f) — about 70 percent (https://www.forbes.com/sites/afontevecchia/2014/10/02/the-new-forbes-400-self-made-score-from-silver-spooners-to-boostrappers/) created their own fortunes. That's up from less than half in the 1980s. Indeed, the United States generates (http://www.aei.org/publication/americas-superrich-getting-way-entrepreneurship/) more billionaire entrepreneurs per million residents than all other advanced economies other than Hong Kong and Israel. If one wants to differentiate between the good and bad superrich for the purposes of public policy, are super-entrepreneurs really the same as those billionaires of inherited wealth or, say, sellers of opioids? But it gets more complicated: What if the born rich are dedicated philanthropists and the nouveau-riche like Amazon founder Jeff Bezos are merely serving consumers and creating jobs? Bezos, after all, has not promised to give away his billions. Who are the true characters of moral worth in the AOCverse?
***
This is a moldy argument also used by writer Annie Lowrey in a much-cited article in The Atlantic last year titled "Jeff Bezos' $150 billion fortune is a policy failure (https://www.theatlantic.com/business/archive/2018/08/the-problem-with-bezos-billions/566552/)." Lowrey argued that Amazon is able to succeed because the government "ameliorates the effects of poverty wages with policies like the Earned Income Tax Credit, Medicaid, and the Supplemental Nutrition Assistance Program." But this reasoning ignores the economic and business reality that if you are going to have a private sector, then private firms simply aren't going to hire workers at a wage more than they are worth to the firm. It also ignores the fact that the Earned Income Tax Credit is a government benefit that promotes work and boosts living standards. And if Medicaid benefits corporations at the taxpayer's expense, then it's strange that leftists like Ocasio-Cortez don't view Medicare-for-all — which would let employers completely off the hook for health coverage — as a massive subsidy to business.