Billionaires, Socialism, and Envy

On April 15 in a smugly gleeful video staged in front of investment CEO Ken Griffin’s $238 million Manhattan penthouse, NYC Mayor Zohran Mamdani proposed an annual tax on pied-à-terre (second) homes, especially those owned by billionaires like Griffin. Mamdani thinks billionaires are what’s wrong with America and he’s going after them. 

Alexandra Ocasio Cortes (AOC) said in a recent interview that there’s no way anyone can “earn” a billion dollars without underpaying employees, abusing labor laws, breaking rules, and having monopoly power. 

In California a service workers’ union, the SEIU, is sponsoring an asset seizure law to confiscate 5% of the wealth of billionaires with $5 billion or more. (“They won’t even miss it.”)

Billionaires are blamed for society’s ills because, they say, too much wealth is concentrated in their hands. The socialists believe wealth disparity is bad, considering the need to fund government social programs to help poor people. Animosity to billionaires has spread throughout America. Recent polls show that most Americans see wealth concentration as a problem and that government ought to do something about it. Some polls show that 69% of Republicans see wealth concentration as a problem and 93% of upper income Democrats agree. Ditto 60% of MAGA voters.

The reasons for these attitudes are complex. The underlying economic justification is that billionaires got there by nefarious means and their massive share of wealth shrinks the economic pie for the rest of us. They say it also gives them an unfair political advantage. The real underlying reason is envy.

The usual mantra is, “They need to pay their fair share of taxes.” Here’s the reality: the top 10% of taxpayers pay 72% of income taxes. The bottom half pay 3%. The top 1% pay 40% of taxes. And if you break it down to the top 0.1%, or 154,000 people, pay about 25% of taxes. These are the billionaires and centimillionaires whom the Bernies and Mamdanis wish to destroy. A system that relies on the very few to pay for the many is a fragile system. 

I would ask those who wish to eliminate billionaires some questions. Do you use Google’s search app? Do you use Facebook or Instagram? Do you use AI programs like ChatGPT or Claude? Do you drive a Tesla or take robotaxis? Do you drive a gasoline fueled car or fly on a jet? Do you have an iPhone or Apple laptop or iWatch or a Dell PC? Do you use MS Office or Google Docs or Sheets? Do you communicate by email or text? Do you buy things from Amazon or Walmart? Do you have an IRA or 401K investment account? Do you use medications that didn’t exist five or 10 years ago?

If you do, you are responsible for making the billionaires you despise. You did so voluntarily with your own money. You weren’t forced to spend on these products and services. And you had many product choices from different companies. So I will ask you, how have you been harmed by the billionaires you made? Let me suggest an answer: far from being harmed, you have greatly benefited by them.

It’s not like they stole your money. There is no fixed pie of wealth. Wealth grows and is created every day by the efforts of entrepreneurs who give us a cornucopia of products and services. The truth is that everyone (each income quintile since 2000) has become wealthier because of the billionaire entrepreneurs who have moved us forward. This is capitalism. Otherwise the economy would stagnate and shrink from inflation.

Despite the benefits that these billionaires have given us, then why do liberals-Progressives-socialists despise them?

It’s because of envy, one of the Seven Deadly Sins. Envy is one’s discontent or resentment from wanting something someone else has that you don’t have. Psychologists say it engenders a feeling of despair from the belief that life is unfair, that you’ve been short-changed, and there’s nothing you can do about it. Envy generates anger toward those who have what you want but are unable to achieve. Such as those billionaires who disgustingly flaunt their excessive lifestyles in front of a world racked with poverty and sickness. Socialists use that resentment as a political tool to seize and destroy the wealth that was created by successful entrepreneurs. 

Greed is not what motivates entrepreneurs. They are motivated by the hope of success from their efforts. Success is hard to achieve and most fail. The wealth achieved by the successful is one of the results of their efforts. But without a capitalist economic system to incentivize risk-taking entrepreneurs we would be just another poor socialist country.

This is the harm of billionaire asset seizures. They must sell assets to pay the “tax.” Politicians take that money (capital) and distribute it to those constituents they deem to need it. Governments don’t create wealth and they are notorious for wasting money. Once spent it is gone. It can no longer be used to create new opportunities for entrepreneurs and more wealth for us. Bernie wants all billionaire assets seized. When gone, then what? It’s a golden goose thing.

Wealth seizures (taxes) have failed wherever they have been tried. They have led to stagnation and poverty and eventually were repealed. See socialist paradises like Cuba, Nicaragua, Venezuela, Bolivia, or North Korea
as exemplars.

We must fight against wealth seizures which lead to the destruction of an economic system that has made America the most successful country in mankind’s history.