In a new post, my friend Chris Edwards of the Cato Institute lays out why billionaires, despite being constantly bashed, are actually benefiting America. He writes:
Are rich people idle “rentiers,” as economist Thomas Piketty calls them, who inherit wealth and add no social value? In supporting Sen. Bernie Sanders’ plan for higher estate taxes, former Labor Secretary Robert Reich claimed that “America is creating a new aristocracy of the non-working super rich.” And in plugging Sen. Elizabeth Warren’s wealth tax, Paul Krugman said “we seem to be heading toward a society dominated by vast, often inherited fortunes.”
In fact, today’s economy is dominated by entrepreneurial innovation, which is generating rapid turnover in the ranks of the wealthy. And even among the declining share of the rich who inherited their wealth, many are impressive company builders or philanthropists in their own right.
In the U.S. economy, wealth is dynamic, which is clear from the Forbes annual list of the 400 richest Americans. Fully 43% of the people on the list in 2018 were not on it 10 years ago. The newcomers are entrepreneurs driving economic growth. There is Jensen Huang, co-founder of graphics chip maker Nvidia NVDA, +3.66% and Shahid Khan, who built automotive parts maker Flex-N-Gate. There are Brian Acton and Jay Koum, co-founders of WhatsApp, which provides free phone service globally for more than 1 billion users.
Reinhold Schmieding is on the 400 list. He founded Arthrex, a surgical tools company that has developed thousands of products. There is Robert Pera, founder of wireless equipment maker Ubiquiti Networks, and Judy Faulkner, who founded medical records software firm Epic Systems. Thai Lee is one of the many immigrant entrepreneurs on the Forbes list. She built business IT provider SHI International.
These billionaires are the farthest thing from rentiers. They are inventing new products and driving down prices of services that we all use. They are making our lives better.
Read more here.
