Why I hope the rich get richer
By Katie Kieffer
IVANKA TRUMP. Image credit: Activedesktopwallpapers online.
Insecure business moguls like Warren Buffet occasionally spout anti-affluence nonsense like the rich “…should be paying a lot more in taxes.” If Buffet won’t defend the rich, I will. I love rich people. I wish them well and I hope they get richer.
I specifically love rich people who live in a capitalistic society like America. The richer they become, the richer, healthier and happier everyone else becomes. Unlike rich rulers in a monarchy or, worse yet, wealthy dictators, American capitalists are the average person’s best friend and entrepreneurial inspiration.
Wealthy Americans do not rule over other Americans. The Constitution does not grant them special privileges or royal titles. Unlike Queen Elizabeth II, who tried to tap into a fund for low-income families to heat Buckingham Palace, rich Americans don’t receive public funds to heat their mansions.
Let’s say you bump into your old college roommate at a baseball game and you ask him how he’s been. He says, “I’m doing well. I started my own tech firm. I’ve hired a little over 500 people. Oh, and remember how I was always so frugal? Well, I broke down and bought a Lamborghini. I’ve always wanted one. I figure I’ve earned it.”
Image credit: “Lamborghini Murcielagos” by 98octane on Fickr via Creative Commons.
Unless you’re Michael Moore, you wouldn’t hate his guts. You wouldn’t jealously snap, “Well, I’m glad you’re having fun making piles of money and splurging on yourself.” You would be happy that he pursued his passion, worked hard, took risks and is now helping hundreds of families put food on their tables.
When new innovators rise to achieve wealth and when the already-rich get richer, it’s a sign that the economy is thriving and public policies are business-friendly. The markets are healthy. Inflation, interest rates and taxes are typically low.
Most mainstream journalists do not understand wealth. For example, TIME Magazine columnist Bill Saporito says, “The wealthiest 5% earn 21.7% of the nation’s income but spend proportionately less of it than average folk. That’s logical and also explains why the former save more than the latter and thus become wealthier.”
But money has to come from somewhere. You don’t just stumble upon a billion dollars. You create a billion dollars by taking risks, persevering and working hard.
Even if you inherit all of your money, someone worked hard at some point to create it. For example, if Facebook founder Mark Zuckerberg’s future children or relatives inherit his wealth and become rich, their luck does not negate the work and innovation it took for Zuckerberg to build his wealth.
Simply saving money does not magically yield more money, as Saporito infers. No one increases their wealth by hoarding it under a pillow. At the end of the day, wealthy people—whether they are self-made or heirs—must take some level of risk by investing their money if they wish to become wealthier.