Can Anyone Be An Ethical Billionaire?
The question of whether it is ethical to be a billionaire has gained renewed attention in recent years, with politicians such as Senator Elizabeth Warren and Alexandria Ocasio-Cortez proposing higher taxes on those with extreme wealth. Warren has proposed an extra tax burden for those with more than $50 million in wealth, while Ocasio-Cortez has called for an increase in the marginal tax rate for those making $10 million or more per year. These proposals have prompted backlash from the affected billionaires, with Rush Limbaugh comparing Ocasio-Cortez to Hitler and Howard Schultz, former CEO of Starbucks, calling criticism of the system that allows for billionaires to be "un-American."
Billionaires are a relatively new phenomenon, with the number of billionaires in the US doubling since 2008 due to low tax rates. The path to becoming a billionaire is multifaceted, with factors such as lax regulations, low tax rates, poor labor protections, government-funded research grants, and strict intellectual property laws all playing a role. Billionaires also have the resources to take advantage of loopholes and avoid paying taxes. Economist Stephanie Kelton has described billionaires as individuals who "plunder" and "strip" their wealth, while Ocasio-Cortez has referred to billionaires as a result of "policy failure."
The US tax code used to require a greater contribution from those earning more, with a top tier of 70% between 1936 and 1980. However, in the 1980s and 1990s, the idea of becoming a billionaire was fetishized, with tech billionaires particularly revered. This shift in attitudes coincided with the rise of neoliberalism, which prioritized the needs of businesses over those of individuals. As a result, tax rates for the wealthy have decreased, leading to a concentration of wealth among the top 1%.
In addition to proposing higher taxes for billionaires, Warren and Ocasio-Cortez have also called for the breakup of large tech companies, which they argue have gained an unfair advantage due to their size and access to data. Critics of billionaires argue that the concentration of wealth at the top has negative consequences for the rest of society, including increased income inequality and a lack of opportunities for those outside the top 1%. Others argue that billionaires create jobs and contribute to the economy and that higher taxes on the wealthy would discourage entrepreneurship and innovation.