Since the rise of BLM protests in the USA and grumblings across the globe towards rising inequality, a pivotal question has arisen from the so called Left of the political spectrum: “Should billionaires exist?” In response, many have expressed support for the abolishment of billionaires yet do not express any solution to such an event. Where would the money go? Should we cap wealth? These are fundamental questions that have not been answered. Is it possible that we need billionaires more than we think?
The first reason for this is philanthropy. 90% of high net worth families give to charity. In 2018 Americans gave $427 billion to charity which accounts for 2.1% of their GDP. Warren Buffet and Bill Gates founded and developed The Giving Pledge in 2010 to encourage the world’s wealthiest individuals to give away more than half of their wealth to charitable causes. To date, more than 204 individuals and families have pledged to donate $500 billion. Bill Gates has famously pledged 99.96% of his wealth to charitable causes upon his death. The Bill and Melinda Gates Foundation has a personal goal to eradicate polio through extensive vaccination programs specifically in India; in 2019 103 cases were confirmed globally.
Another is technological innovation. Through billionaires such as Elon Musk, technology is constantly changing. StarLink is bringing worldwide internet coverage, SpaceX is developing rockets to take humans beyond the Moon and into the wider solar system and Tesla motors is 2 to 3 years ahead of its time in the electric car market. This innovation would not be possible on the same timescales without Musk investing billions into his companies. Similarly, laptops, phones, cars, and airplanes would not be at the same level if it were not for individuals and companies competing and investing to create the best for consumers.
It has been claimed that if billionaires gave $300 billion, they could end climate change. That is false. It is estimated that it would cost upwards of $50 trillion over the next 10 years to halt and reverse climate change. The world economy is worth around $150 trillion: if the world can afford to do it then why not do it? Because it has been shown that particularly in the US, UK and China, countries cannot be trusted to do the right thing for the environment. China starts construction on a new coal fired power station every two weeks, the US changes its mind on climate change every administration and the UK believes that planting trees is the solution. Solutions to every problem the world has seen comes from individuals and not governments, especially from those who invest. The coronavirus vaccine will not be developed by the government but by billion-dollar pharmaceutical industries who have the ability and the knowledge to do so.
There are 2,825 billionaires in the world with a combined net worth of $9.4 trillion. This is the top 0.0001%. Most argue that this is a travesty; but can you trust this much wealth to governments where those billionaires are based? If a hypothetical scenario of a wealth cap were to be introduced at $1 billion and the rest went to the government, would anyone trust the government with an injection of over $5 trillion to achieve the same level of innovation or technological achievement? I would not. Innovation is achieved through the individual not through the government. The US and China house just under half of the world’s billionaires, are they two countries you trust this wealth to?
The solution to this is not to increase taxes, but to make sure they pay them. The problem is not billionaires but politicians. The danger is not greed but corruption.
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