Posts tagged with: wealth

52-Kids-innovationInequality in consumption used to be a matter of acreage. Throughout most of history, economic value was chiefly found in land or personal property. The divide between the rich and the poor was therefore between those who owned property and those who did not.

But the age of technology has changed that. “A billionaire and a member of the middle class have relatively equal portals to the wonders of the internet,” says John O. McGinnis, “certainly far more equal access than the rich and the rest of society would have had to the material goods that defined wealth in centuries past.” Nowadays, if we want to reduce inequality we need to focus on redistributing the benefits of ideas and innovations:
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Acton Institute President Rev. Robert A. Sirico stopped by the studios of TheStreet.com today and spoke with host Joe Deaux about how Pope Francis differs from his predecessors in his approach to economic issues.

The pope is emphasizing “human solidarity,” Sirico said. “He quoted Benedict by saying that globalization has brought us to be close, to be neighbors, but not to be brothers.” Achieving a sense of fraternity is the goal.

We’ve embedded the video for you below.

greedIn a New York Times op-ed, Daniel Goleman, a psychologist and author, declared, “Rich People Just Care Less.” How does he know this? Because studies have been done. So there. Rich people lack empathy, don’t listen to people lower on the social ladder than themselves, and

…seem to pay particularly little attention to those with the least power. To be sure, high-status people do attend to those of equal rank — but not as well as those low of status do.

Except, it’s not quite true. It’s a little off. Skewed. Downright…flawed. (more…)

This morning at Acton University I attended a fascinating lecture by Dr. Edd Noell, “Origins of Economics: The Scriptures and Early Church Fathers.” I have briefly examined one ancient Christian perspective on wealth in the past (here), but Dr. Noell’s survey today was far more expansive. For the benefit of PowerBlog readers, I would like to reflect on some of the major themes of his talk here as a sort of preview of what one could expect once the audio is available for sale. (more…)

The Good Rich and What They Cost Us, Robert Dalzell Jr.In a new book, The Good Rich and What They Cost Us, Robert Dalzell Jr. aims to address “a great paradox at the core of the American Dream: a passionate belief in the principles of democracy combined with an equally passionate celebration of wealth.”

In a review for the Wall Street Journal, Amity Shlaes notes that although the book provides an in-depth look at the history of American philanthropy, the author’s own personal prescriptions lend too high a trust to government redistribution:

“The Good Rich” starts out like a tour through a portrait gallery, describing rather than judging. For much of his narrative, Mr. Dalzell refrains from giving his own opinion explicitly and reports merely that the rich have often blamed themselves for their lapses or oversize good fortune, or that their peers did.

Toward the book’s end, though, Mr. Dalzell drops his own screen, putting forward a familiar argument: that democracy suffers unless wealth and philanthropy are redistributed to reduce economic inequality. Even the “good rich” cost us: They don’t give wisely, Mr. Dalzell contends, spending too much on “elite institutions like Harvard, Yale, MIT and Princeton, which seems unlikely to reduce the income gap by much.” …For the sake of the public good, then, the rich must fashion better charity projects while handing over more of their money to the government.

Such philanthropic efforts deserve to be thoroughly examined. Likewise, from the poorest of us to the wealthiest, we should be energetic in examining our own activities, using discernment and wisdom in how we use our resources. But as Shlaes indicates, if it’s difficult for we individuals to wrestle with these deep questions about stewardship — particularly when we’re calling on the Divine for wisdom, as many philanthropists under Dalzell’s microscope claim to have done — how much more difficult will it be for a bloated government machine to utilize proper discernment? (more…)

Radical Together, David PlattOver at Thought Life, Owen Strachan uses David Platt’s book, Radical Together, as a launching pad for asking, “Are you and I making and using money as if there is no such thing as the work of the gospel?”

I’ve already written about my disagreements with Platt’s approach in his first book, Radical: Taking Back Your Faith from the American Dream, and Strachan expresses similar reservations. While appreciating Platt’s emphasis on “exaltation of and dependence on a sovereign, awesome God,” Strachan is concerned that on the topic of wealth—a primary target of Platt’s—readers might easily rush to the assumption that wealth and prosperity are bad altogether.

Evangelicalism desperately needs Platt’s laser focus on the gospel and missions. The church exists to make disciples for the glory of God, both locally and abroad. I would only point out that I think that wealth and philanthropy can actually be our friend here. In other words, if you want to apply the “radical” model–with its many strengths–I can think of few things more radical than using one’s wealth for gospel purposes. Maybe the most spiritual thing to do to support the promotion of the gospel is this: stay in your job, save and invest scrupulously, and keep pumping out money to support missionaries and pastors.

Here’s just one example of thousands we could give on this point. A forgotten man named Henry Parsons Crowell made vast amounts of money through the Quaker Oats company. Did he hoard it? Nope. He gave away 70% percent of his massive income and helped bankroll Moody Bible Institute, the school that…has sent out thousands upon thousands of missionaries in its century of ministry. Yes, every time you eat Quaker Oats, you’re paying masticular homage to a man who–merely by giving money–helped catapult the gospel all over the world

…This is a testimony to what wealth, including but not limited to truly fabulous wealth, can do if committed to the Lord. It’s one of countless others we could share of evangelicals of great or small means who tucked money away not for themselves, but for the work of Christ’s church. (more…)

King Solomon, the original 1%

King Solomon, the original “1%”

Last Thursday, NPR ran an interesting piece by Alan Greenblat that featured the perspective of several of the nation’s rich (read: annual household income over $250,000) in relation to President Obama’s determination that the Bush era tax increases end for the nation’s rich as part of any deal related to the looming “fiscal cliff.” The article features a variety of perspectives, but I would like to reflect upon one particular section of that article here. Greenblat writes,

[Mark] Anderson recognizes that the kind of tax increases Obama proposes aren’t going to impinge on his life materially, and he supports them philosophically. But he adds that he thinks Obama and other Democrats make being rich “sound like a bad thing,” which he says is a mistake.

The top 2 percent of earners already pay 35 percent of all federal taxes, according to the Tax Policy Center. In terms of personal income taxes, the top 1 percent alone pay 37.4 percent of total receipts, according to the Tax Foundation — double the share they paid back in 1979. [Edward] Kfoury, who is president of a land trust in Maine, points out that there are years when his personal tax bill has run into seven figures.

“What would make me feel a lot better is if I heard the president say, ‘I want to thank the rich people who, because of our progressive tax system, pay the most — but we don’t have enough money, so we’re asking the wealthy people to help the country out by paying more than their fair share,’ ” says Martin Krall, a 71-year-old “semi-retired” attorney and media executive who lives in Palm Beach Gardens, Fla.

“Instead, you’re made to feel like you’re a bad guy,” Krall says. “People resent the notion that somehow they’ve done something wrong by becoming successful.”

Joe Carter recently examined why soaking the rich won’t fix the deficit, so I will not explore that question here. Instead, I would like to focus on the issue of human dignity, political rhetoric, and an ancient Christian perspective on wealth. (more…)

Forbes recently ran a profile of Christian billionaire and Hobby Lobby CEO David Green. According to Forbes, Green is “the largest evangelical benefactor in the world,” giving “at upwards of $500 million” over the course of his life, primarily to Christian ministries.

Yet, for Green, his strong Christian beliefs don’t just apply to how he spends his wealth; they’re integral to how it’s createdin the first place:

Hobby Lobby remains a Christian company in every sense. It runs ads on Christmas and Easter in the local paper of each town where there’s a store, often asserting the religious foundation of America. Stores are closed on Sundays, forgoing revenue to give employees time to worship. The company keeps four chaplains on the payroll and offers a free health clinic for staff at the headquarters–although not for everything; it’s suing the federal government to stop the mandate to cover emergency contraception through health insurance. Green has raised the minimum wage for full-time employees a dollar each year since 2009–bringing it up to $13 an hour–and doesn’t expect to slow down. From his perspective, it’s only natural: “God tells us to go forth into the world and teach the Gospel to every creature. He doesn’t say skim from your employees to do that.”

Economists have increasingly recognized the ways in which healthy stewardship and property rights are linked—how increased ownership leads individuals to weigh costs and benefits more thoughtfully and effectively. Green’s comments add a slight twist to this approach, calling Christians in particular to reconsider who the “owner” actually is and how we might weigh particular costs/benefits and subsequent action accordingly:
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Blog author: aknot
posted by on Wednesday, August 8, 2012

French President François Hollande has promised a 75% tax rate on those in his country who earn an annual salary above one million euros ($1.24 million). Not surprisingly, this number has struck fear into the hearts and wallets of quite a few of France’s top earners, including some who are contemplating leaving and taking their jobs with them. The New York Times has the story:

Many companies are studying contingency plans to move high-paid executives outside of France, according to consultants, lawyers, accountants and real estate agents — who are highly protective of their clients and decline to identify them by name. They say some executives and wealthy people have already packed up for destinations like Britain, Belgium, Switzerland and the United States, taking their taxable income with them.

They also know of companies — start-ups and multinationals alike — that are delaying plans to invest in France or to move employees or new hires here.

The potential tax increase threatens to handcuff “les Riches” and, ironically enough, undercut France’s prized notion of egalité, taking with it liberté and fraternité, the remainder of the country’s tripartite maxim. In Hollande’s France, these principles may not apply to the wealthy.

Of course, Hollande’s tax initiative is sure to have some beneficiaries. No, not the poor or the middle class. The real winners? Well, they live on the other side of the border. Also from the Times:

“It is a ridiculous proposal, but it’s great for us,” said Jean Dekerchove, the manager of Immobilièr Le Lion, a high-end real estate agency based in Brussels. Calls to his office have picked up in recent months, he said, as wealthy French citizens look to invest or simply move across the border amid worries about the latest tax.

“It’s a huge loss for France because people and businesses come to Belgium and bring their wealth with them,” Mr. Dekerchove said. “But we’re thrilled because they create jobs, they buy houses and spend money — and it’s our economy that profits.”

The entire story reminds me of a passage from Rev. Robert Sirico’s latest book, Defending the Free Market: The Moral Case for a Free Economy. In a chapter titled “The Idol of Equality,” Sirico addresses the unsustainable nature of simple redistribution. Instead, business development and job creation are essential–and lasting–tenets of economic growth. From the book:

When most people picture the 1 percent and their wealth, what comes to mind is designer clothing and jewelry, yachts and limousines, mansions and penthouses—all sorts of alluring and attention-grabbing luxuries. Luxuries so distracting, in fact, that we tend to lose sight of the fact that most of the wealth of the wealthiest is invested. It is put to work in the businesses they own and manage, and in stocks and other financial vehicles that provide the capital for countless other businesses. These are the businesses that provide the 99 percent with the goods, services, and employment that they regularly enjoy and often take for granted.

Whether it’s a big automotive plant or a small bakery on the corner, a microchip manufacturer or a family farm, all businesses that produce goods and employ people are owned by someone. It’s businesses that make up most of the wealth of the 1 percent. Confiscating that wealth and giving it to the other 99 percent would mean shifting much of that wealth from investment and production to consumption, since the poor and middle class consume a far higher percentage of their income than the wealthy do. This sudden shift from investment and production to consumption would demolish the infrastructure that makes jobs, goods, and services possible.

Hollande would be wise to read Defending the Free Market. Doing so might save his nation and preserve liberty, equality and brotherhood in the process.

I was listening to news radio and heard an update in which the senate majority leader Harry Reid gave his interpretation of events on the debt ceiling negotiation. The part that really got my attention was where he insisted that further committee work would go after those “millionaires and billionaires.”

I wondered, “What is he really saying?” Let’s begin with millionaires and billionaires. Is Reid charging them with having committed some evil? If a person had made a lot of money by force or fraud, then I would agree that disapproval and punishment might be merited. Can we confidently say that rich people, as a class, have committed evils which make them suitable subjects of a public official’s desire to punish?

Why is he so angry? Why does he make these people sound like bad people? Is it the fact that they have quite a bit of money? I suspect he does, too. Indeed, it has been noted that Reid has become a somewhat wealthy man while holding office. Does he impute ill motives or actions to himself by virtue of his possession of resources well above the average?

What if we do think that having a lot of wealth is a sign of moral weakness? Perhaps we believe that having much more money than is needed to live (even live comfortably) represents a bad choice. Even if we think that, does that mean we invest the government with the moral right to appropriate that wealth as needed so as to operate without hard debates about limits on spending? Maybe our only right is the right to have our own opinion of how wealthy people should spend their money.

I think Harry Reid needs to think more about why he’s so morally exercised. Follow the conclusions of that anger and maybe we’ll get down to basic principles. Once we get there we can have a legitimate discussion.