By Katie Kieffer
IVANKA TRUMP. Image credit: Activedesktopwallpapers online.
Insecure business moguls like Warren Buffett occasionally spout anti-affluence nonsense like the rich “…should be paying a lot more in taxes.” If Buffett 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.
When wealthy Americans are confident in the economy, they invest more aggressively, they expand their businesses faster, they lend more generously and they spend their wealth more freely. This behavior produces innovative technologies, loans and jobs so that millions of other people have access to homes, cars, vacations, higher education and high-tech toys.
This summer, affluent parents flying their children to week-long summer camps in private jets took heat from the mainstream media for supposedly over-indulging their children—while the rest of the country struggled with unemployment, foreclosures and rising food prices.
In reality, when a wealthy person drops a few grand on a “luxury” like a round-trip private plane rental, they enrich ordinary Americans by supporting their businesses. An Augusta State Airport manager, Dale Kilmer, told the New York Times: “We have 50 to 60 jets up here in just that one day (when campers flew in).” Ordinarily, the airport caters to just a handful of private planes per day.
We hurt ourselves by envying, over-taxing and slandering the rich. Anti-wealth public policies will only persuade independently wealthy Americans to shut down their businesses, stop hiring and retire early to their hammocks in the tropics. On the other hand, if we “love” the rich, we will receive the love back in the form of ample jobs, loans, innovations and investments.
Image credit: “Beach hammock” by - MattW - on Flickr via Creative Commons.
Let’s love the rich—and the aspiring rich—by implementing pro-business tax reform that motivates them to take risks, invest and create jobs. For, as Justin Timberlake sings: “What goes around, goes around, goes around…Comes all the way back around.”
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That’s the thing.
Lefties think there is a limited pie, so if the rich get a bigger slice there is less to go around.
They don’t understand that the rich make that pie BIGGER for everyone. So, even if they take a bigger slice (probably not when the pie gets bigger), it also means that EVERYONE ELSE gets a bigger slice.
Plus, who are the ones creating jobs?? That rich guy who built up a business employing 500 people (and maybe more as the business grows) or some leftist ‘community organizer’ working to get people on the dole??
Our elected officials don’t care to understand this, as using the ‘hate the rich’ rhetoric helps them get voted in.
Ms. Kieffer,
I just discovered your blog and think I will enjoy reading your thoughts. I happen to be very heavily invested with Mr. Buffet. In fact, I was going to place additional funds with Mr. Buffet this week but his op-ed piece has me in such a tither I couldn’t do it, I actually purchased some additional real estate instead. I’ve followed Mr. Buffet long enough to understand that his opinion piece probably has a self serving interest (and hopefully my interest) in mind. But admit I am at a total loss as to how exactly how I am going to communicate my displeasure to him. The thought of explaining to him how, as his stock is undervalued, perhaps he could sport an apron and go sell some See’s Candy has crossed my mind. I am seldom at a loss for words but I will get my point across, I’ve just been distracted with other business. Thanks for your thoughts, I will keep them in mind when I address Mr. Buffet. I look forward to reading your blog.
I read Ms. Kieffer’s column about the “rich getting richer.” It makes perfect sense. It is amazing that a young lady like Katie can understand this concept, yet our elected officials in Washington can’t get it.