Friday, September 22, 2006

 

More bad economic news: the wealthy have wealth

The Super-Rich Get Richer: Forbes 400 Are All Billionaires announces the Washington Post today, giving Frank Ahrens one more opportunity to put on display some examples of widespread economic ignorance.

The big deal for 2006 is that, for the first time, all 400 listed are billionaires. Naturally, one might expect this to raise a few eyebrows and Mr. Ahrens delivers those concerns.

“Yet not everyone finds the billionaire boom beneficial.

"I think it's very bad," said Dean Baker, a macroeconomist at the Center for Economic and Policy Research in Washington.”

Now Mr. Baker is more than just some macroeconomist for CEPR, he’s a co-founder. His organization is a reliable source for left-leaning quotes (despite their purported non-partisanship). Here’s why he thinks it’s “very bad”.

“"If these people pull away so much wealth," he said, "that means everyone else has less."

I almost question whether Mr. Ahrens quoted him correctly because, despite ample evidence to the contrary, I still find it difficult to believe that an educated economist in this day and age apparently believes that wealth is a zero-sum game. If the stock market tanked in the next five minutes such that Bill Gates and Warren Buffet lost 75% of their wealth – how would that benefit me (or anyone) in the least? His rationale for his “very bad” verdict is, quite simply, ignorant.

And speaking of ignorant, Mr. Ahrens go to another reliable source of ignorant thought – Harvard University. There he called upon economics professor Larry Katz, formerly of the Clinton Administration:

“"We could do a lot more with the tax system and with policies . . . to help out those who are less fortunate," Katz said. On the other hand, "not every dollar that goes to a rich person is taken away from someone else."

While he at least recognizes that the rich aren’t necessarily robbing the rest of us, his instinctive appeal to use the tax system and some non-defined policies to help the “less fortunate” reflects little more than the traditional liberal mindset for solving all the world’s problems. This is little more than earnest liberal speak for "put me in charge." Not reflected is the irony of this coming from someone at Harvard. If ever there was a case for a redistribution of wealth, putting Harvard’s billions to at least a somewhat productive use would be it.


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