Zillionaires

One of the Blogs that I read is Politico and they had the following article today. Memo: From Nick Hanauer To: My Fellow Zillionaires You probably don’t know me, but like you I am one of those .01%ers, a proud and unapologetic capitalist. I have founded, co-founded and funded more than 30 companies across a range of industries—from itsy-bitsy ones like the night club I started in my 20s to giant ones like Amazon.com, for which I was the first nonfamily investor. Then I founded aQuantive, an Internet advertising company that was sold to Microsoft in 2007 for $6.4 billion. In cash. My friends and I own a bank. I tell you all this to demonstrate that in many ways I’m no different from you. Like you, I have a broad perspective on business and capitalism. And also like you, I have been rewarded obscenely for my success, with a life that the other 99.99 percent of Americans can’t even imagine. Multiple homes, my own plane, etc., etc. Now this caught my eye because I was wondering what this guy and his friends thought they could do in some meaningful way about income inequality. One thing they could do is to earn less because sharing doesn’t work out that well and here is what I mean. Total income in the US is 14 trillion and the top .01% earn 5% of that or 700 billion. There are 135,000,000 people working and .01% represents 13,500 people and they earn on average $50 million each. If we take all of the earnings from the top .01% and give that to the rest they will each get $5,000. Since the average household income is $50,000 that will give everyone a 10% raise. Not a small thing but certainly not equalizing income. If the .01% want to have a real impact they should give away their wealth and forget about their income. Wealth is defined as assets minus liabilities. The total wealth of the United States is about 200 trillion and the .01%ers own 12% of that or 24 trillion. Now if we divide that among the other 135 million the each get $180,000. While the gap between the superrich and the rest of us is widening the facts are that there are not enough of them and too many of us. If that zillionaire really wants to help he should continue what he has been doing and create new industries that will create new jobs which will allow more people to increase their own wealth. It is called free market capitalism.