There are a record 2,208 billionaires in the world, up from 2,043 in 2017, according to Forbes. And the average wealth of the billionaires is $4.1 billion, a record high.
Taken together, the billionaires of the world are worth $9.1 trillion, up from $7.7 trillion last year, Forbes reports.
What country has the most?
The U.S., of course, with 585 billionaires.
In 1987, when the Forbes 400 list was first issued, Forbes found 140 billionaires, including 96 outside of the U.S.
There’s no doubt that the reason for this exponential rise in the number of billionaires is an expanding free market around the world. In his most recent Washington Post column, Fareed Zakaria points out that this global expansion of the market has not just been good to billionaires, but for the poor and downtrodden as well. Fareed writes that “since 1990, more than 1 billion people have moved out of extreme poverty. The share of the global population living in these dire conditions has gone from 36 percent to 10 percent, the lowest in recorded history.”
But is that really fair?
Perhaps an even better question to be asked is, are these elite billionaires essential to the success of free markets, or are they just an out-of-control symptom of that success?
And, moreover, now that we have seen such dramatic success in global free markets, shouldn’t “we” check to make sure that this success is not being funneled more and more narrowly to the enjoyment of a privileged few?
Fareed makes the point that on a world-wide scale, inequality has actually dropped over the last few decades. But that fact belies what is happening in individual markets of most western countries. In the U.S. inequality is now at levels not seen since the 1920’s. And that’s what is sparking the rise of populism on the left and right.
Of course, there are stark differences in the opinions of populists on the left and right about how to fix the inequality problem. Those on the right point to government by the elite as the problem, while those on the left look to government for solutions.
On the right we’ve seen the rise of Donald Trump. He claims to be a billionaire himself and his governing approach seems wholly market driven and transactional, a get government out of the way, trickle-down approach. He came into office saying that he would “drain the swamp”, but during his first two years it seems the swamp has only become “swampier.”
The left-leaning populists, led by the likes of Bernie Sanders and the newly minted, 29-year-old, congresswoman, Alexandria Ocasio-Cortez (AOC), want to take some of the wealth concentrated at the top and spread it around for the benefit of those in the middle to bottom rungs of the economic ladder.
Who’s right?
Truth be told, no one really needs to be a billionaire. That’s more money than any person can ever expect to spend in one, or even several, lifetimes. So, what happens is that all that wealth gets handed over to succeeding generations of billionaires and that’s how inequality is perpetuated over the decades.
Would it really do great damage to the free market for there to be less, or even no, billionaires?
The argument that staunch free-marketers usually make is that if you take away wealth from billionaires, you’ll also take away their incentive to achieve those phenomenal business successes that, admittedly, inure to the benefit of society at large.
But does the disincentive argument really hold water?
If the highest net worth I could ever expect to achieve in my lifetime was one dollar short of a billion, would I just throw my hands up and run off to Costa Rica to live a stress-free life in the jungle? Well, I sort of did do that, but it certainly wasn’t a result of my disillusionment about never being able to become a billionaire.
I think it’s just downright silly to suggest that the world would take a turn towards the dark ages if “we” refused to allow a tiny (and growing) group of elites to continue to control more wealth than 90% of the world’s population.
The premise behind the free-market argument in support of the billionaire class is that they worked hard for their money, so they deserve to keep it.
But do billionaires really “work harder” than, say, brick-layers?
Billionaires achieve such incredible degrees of wealth because they take very intelligent advantage of markets in a way that’s consistent with the following Noam Chomsky quote…
A basic principle of modern state capitalism is that costs and risks are socialized to the extent possible, while profit is privatized.
One of the largest categories of billionaires is that of the so-called tech giants, like Jeff Bezos, Bill Gates and Mark Zuckerberg. But where would those guys be without the internet? And where did we get the internet? From the John Q. Taxpayer funded government, that’s where.
Billionaires are interesting characters, that’s for sure. Life would certainly be more boring without them. They are more than just super successful businesspeople. They’re celebrities. We love to read about them. We inspire to be like them. We hang on their every eccentric move.
So, I guess in that sense, the existence of this odd creature called the billionaire does add some positive entertainment to our world. The problem is that this entertainment value comes at a great societal cost as inequality spins wildly out of control with the birth of each newly minted billionaire.
In my opinion, this world does not need billionaires…
when the people of Flint, Michigan still don’t have clean water…
when over 20% of children in the richest country on earth live in poverty and go to bed hungry…
when the wealthiest 1 percent of households owns 40% of the entire country’s wealth.
As the notorious AOC was quoted recently as saying…
Every billionaire is a policy failure.
