If you need to vent or have something to tell the world, don't be shy.
Too many billionaires, not enough millionaires and hundred-thousandaires...
Capitalism -- following through with an idea and making a buck -- can be a beautiful thing, but do we have true capitalism in America? Sometimes it seems more like wanton thievery or some sort of high-tech feudal system. Small businesses -- real businesses -- are struggling mightily, but a small group of ultra-rich people -- the Forbes 400 -- grows ever more ridiculously rich. Billionaires Up, America Down explains some of the numbers, most straight from Forbes itself. To wit:
- Until 2006, one didn't even have to be a billionaire to make the Forbes list of the 400 richest Americans.
- Now there are 82 billionaires who aren't even rich enough to make the list.
- The average Forbes 400 member is worth $3.8 billion.
- 45 of the list members are new this year, of them, over half made their money in speculative trading (i.e., not by actually producing anything) in hedge funds or private equity.
- The number of women on the list has dropped from 75 in 1982 to 39 now.
- In 1982, the Forbes 400 controlled less than 3 percent of GDP. Now they control 11 percent.
- The Bush tax cuts have saved the top 1 percent of households $79 billion per year -- more than the budgets of the Transportation Department, Small Business Administration, Environmental Protection Agency and Consumer Product Safety Commission combined.
Let's break this down. Points 1 and 2 above show that there has been a tremendous flow of wealth upward in just the past two years. You hear a fact like, "82 billionaires aren't even rich enough to make the list," and it might not seem like a big deal. Assuming that that $82 billion was the only $82 billion gained by the very rich over the past two years, it's still absurd. That's enough money to create 82,000 new millionaires or to earn 820,000 people $100,000 each. The sad fact is that much more wealth than that flowed upward since 2006. It's impossible to say how much without performing an extensive study, but at least $82 billion bubbled up to the richest 483 people.
How much wealth is enough? I could live very well for the rest of my life on 10 million conservatively invested dollars. A billion is a thousand million.
For a little thought experiment, let's say the billionaires deserve to be billionaires. Let's allow that for whatever crazy reason, they need that much money. The average wealth of the Forbes 400 was $3.8 billion. Let's say that we stripped them each of an average $2.8 billion. Hey, we're being nice, letting them keep a billion apiece (and their heads). Just how much money is that, and what could be done with it? Well...
2.8 billion x 400 = 1.08 trillion
Just how much money is that? It's enough to create 1 million millionaires or to pay 10 million people $100,000 each. It's enough to give every man, woman, and child in the USA $3,400 each. As a capitalist, I would vote against giving everyone $3,400. Most people would squander it. What I would do is re-allocate about half the money to small business people -- you know, the ones who do things like dry clean your clothes and grow your food -- in small grants and loans. So you take from the 400 billionaires to create 10,000,000 new millionaires (as the investments help businesses grow). And the billionaires are still billionaires! What a deal! Oh, and the other half of the money would go toward paying down the national debt.
Some would say that the reallocation of wealth is anti-capitalist. I would say that they are stupid or assholes or both. Wealth is constantly being re-allocated -- that's what capitalism is all about. Government is a market force -- a huge market force. The richest have understood this and marshalled the force to drive ever more of the nation's wealth to themselves for some insane reason. A healthy democracy leads to a healthy economy and true capitalism -- a situation in which the market creates wealth in the form of useful goods and services, rewarding those with the best ideas and the energy and courage to follow through with them. When 400 people have so much more power than the other 300,000,000, it's not democracy or capitalism -- it's a kind of feudal dictatorship. No, there's nothing anti-capitalist about re-allocating wealth through government action. When the rich set their effective tax rate at 15 percent (what you pay on a capital gain -- which is where they get most of their income), they were making use of the market force of government to re-allocate wealth (yours and mine) to themselves.
So how do we reverse this unfortunate trend? Baby steps, I would say. Organize at the local level. Invest and consume consciously. Pressure politicians to fix tax laws -- repealing retroactively the Bush tax cuts would be a great start -- and to create institutions that foster the public good by protecting our environment, educating our children, financing our entrepreneurs, and assisting those in need. No longer can we afford to have a small gang of apparently sociopathic thugs making all the decisions in our society. If we take civic responsibility seriously, we'll have a lot more millionaires and hundred-thousandaires -- and we'll still have 483 billionaires. And we'll all be a lot better off, even the billionaires.
Great disparity of wealth serves no one, even the billionaires. Economic injustice is un-American.
- chuck's blog
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Comments
Interesting.
I'm not enough of a sophisticated economic thinker to put the fine comb to your argument, but I like the way you lay this out. I would love to a robust (and thoughtful) debate started from a post like this, just to see where it went. Would be cool to see this idea hammered at by some opposing perspectives. One contention I definitely agree with is this "free market" worship that so many notable "conservatives" in the public eye refer to. I'm highly dubious about a "free market" where major competitors become so good at competing that they acquire the heft to use government to constantly rewrite the rules in their favor. This seems to me where the competitive model hits a tipping point and starts breaking down.
Col. Hector Bravado
denversixshooter.com
Col. Hector Bravado
denversixshooter.com
i'm all for a free market
a free society cannot exist without the rule of law. the same is true of markets. left to their own devices, markets tend toward disequilibrium. at some point, the balance of power between labor and capital is skewed unfairly toward capital.
a truly free market is one that is regulated to an extent that the playing field remains somewhat level so that the best ideas can find traction in the market, not just the most heavily capitalized ideas.
When life hands you sh*t, make fertilizer.
I can't believe...
...that this post hasn't generated more discussion.
Doesn't anybody else care that a scant few people have so much while so many of us are falling through the cracks?
When life hands you sh*t, make fertilizer.
guess not
oh well
When life hands you sh*t, make fertilizer.
It's all part of their plan.
These people know what their doing. They have already invested globally, so when they destroy our economy their assets will be safe. Allot of them probably don't live here anymore. The one thing standing in there way of a one world government and total power was the U.S. middle class backed by the Constitution. Well they have pretty much destroyed our middle class, which is what made the U.S. so great. I guess the next step will be to disarm us and take whats left of our rights away. Oh and good luck organizing against the system, they will just label you a terrorist and adios amigos.
I don't buy it
The game's not over, man, and you have to remember that if it ever does become time to rumble, there are a hell of a lot more middle class and former middle class people than there will ever be elites. If they push too many people too far, it won't take more than a day or two before they're running scared. You can't call everyone a terrorist, especially after you just screwed them over and they know it.
With any luck, it won't come to that, though. We'll simply take control of our government again and do away with this legislatively and by pursuing those who have broken current laws to their own immense benefit and our detriment.
Don't give up. You do that, and it's over for you.
When life hands you sh*t, make fertilizer.