Our nation's wealthiest need to invest in jobs
There was an article on the Internet that told the story of how Denzel Washington, the actor, wrote a check on the spot for a unit to house families of veterans being treated in veteran hospitals. It’s possible that Denzel may be among or very close to the nation’s richest top one percent.
As I read this story, I wondered why there aren’t more Denzel Washingtons. I’m sure that there are enough rich Americans who with a few strokes of a pen could greatly benefit the nation’s welfare without missing a beat in their lives.
As I thought more about the possibilities, I came across other articles that declared that the richest one percent of the population owned anywhere between 34 to 44 percent of the nation’s wealth. The richest 10 percent owned about 80 percent of the nation’s wealth. That would indicate that the bottom 90 percent owns about 20 percent of the nation’s wealth or less than the combined wealth of the top one percent.
The nation’s total wealth seems to be in a range between 44 and 50 trillion dollars. If we use the lower figure of 44 trillion and the lower 34 percent for the wealth held by the top one percent, we get a figure of around 15 trillion dollars for the total wealth held by the richest one percent. The top 10 percent would have a combined wealth of around 35 trillion dollars. Doesn’t this analysis suggest that there is a glut of capital held in investments that are not benefitting anybody but a handful of people?
In the Great Depression of the 1930s, an era I was born into, the big problem was that money was tough to come by because the distribution of wealth was worse than it is today. In today’s economy, I would estimate that the lion’s share of the economy is being driven by 70 to 80 percent of the population while the bottom 20 to 30 percent is struggling. In the ‘30s, a lot of people never realized how poor they were because just about everybody was poor.
Finally, I concluded that even if only a trillion dollars was transferred from the useless investments held by the top 10 percent into creating new industries and new jobs, it would be a big impact toward healing the economy. Note that a trillion dollars could pay two million workers each $50,000 for 10 years.
If the three to one multiplier for new jobs created by one job is true, then the two million jobs could create six million jobs. Ironically, who has the most to gain from such a chain of events, none other than the top 10 percent? If T. Boone Pickens can see possibilities by investing in wind powered energy, surely some of his fellow fat cats should see similar opportunities.
Edward Jacobs Ypsilanti
Comments
Ram
Tue, Apr 27, 2010 : 6:44 p.m.
Has anyone considered that the richest 10 percent might also have 80 percent of the nation's genius?
Diagenes
Tue, Apr 20, 2010 : 9:31 p.m.
When the "rich" hoard their money, they do not put in in a suitcase under their bed. Yes, some people get very rich by manipulating the system. People like Warren Buffet, who buys and occasionally sells businesses, including insurance companies and newspapers. Got very wealthy manipulating the system and then contributed tons of dough to Pres. Obama. The vast majority of rich people got that way by honorable means. They should not be villified because they have a lot of money. The big problem is that government has made it a better investment to put their money in financial instruments, than take a risk in the real business world. The "supply side" economic policies of Pres. Reagan led directly to the economic growth from 1983 to 2000.
Hot Sam
Tue, Apr 20, 2010 : 2:41 p.m.
"""the Republican lead legislature """ Are we referring to the Democratic controlled house AND senate here???
Hot Sam
Tue, Apr 20, 2010 : 2:31 p.m.
"""@HotSam by "we" do you mean the Republican lead legislature under GW, because that is where the bail out originated.""" By "we" I mean "we the people"...whether we like it or not... I am by no means forgiving GWB...any less than this bunch who have amplified the insanity...
LBH
Tue, Apr 20, 2010 : 8:59 a.m.
@HotSam by "we" do you mean the Republican lead legislature under GW, because that is where the bail out originated.
Hot Sam
Tue, Apr 20, 2010 : 6:26 a.m.
"""It's already been proven that trickle down economics doesn't work.""" Some of us tend to be forgetful...can someone show us the "proof"?
Hot Sam
Tue, Apr 20, 2010 : 6:23 a.m.
"""but they fail to acknowledge the obscene amounts of money extracted from the system by clever people who have figured out how to manipulate the system either right up to the edge or over the line of the law""" Like the bankers we just bailed out????
URmaster
Mon, Apr 19, 2010 : 4:27 p.m.
Two words: Goldman Sachs. Thanks!
Atticus F.
Mon, Apr 19, 2010 : 10:58 a.m.
If you give tax breaks to the wealthiest people, most will simply pocket the money and consider it profit. It's already been proven that trickle down economics doesn't work...The reason why, is that middle class people are more likely to spend money, while the rich are more likely to hoard money in offshore acoounts and keep said money out of circulation.
LBH
Mon, Apr 19, 2010 : 10:21 a.m.
It feels like people are blinded by the "entrepreneurial spirit makes this country great" argument, which is generally trotted out when regulation or tax issues are mentioned, but they fail to acknowledge the obscene amounts of money extracted from the system by clever people who have figured out how to manipulate the system either right up to the edge or over the line of the law. When the manipulators are called out, the toddler argument is trotted out, 'you said I couldn't fill-in-the-blank not that I couldn't fill-in-the-blank, so you can't touch me.' There is an enormous difference between people who build up a business by re-investing profits from that business, (and personally benefiting from it, why not, it is their capital at risk) and people who tweak a system, contributing nothing except to their own fortune. Tweakers buying yachts, cars, homes, stocks, derivatives (then betting against them in their hedge funds), etc don't employ nearly enough people to make them anything other than bottom feeders IMHO.
Diagenes
Mon, Apr 19, 2010 : 7:13 a.m.
The rich do invest in jobs, research and development, and other economic activities by putting there money in the stock market and buying bonds. When they buy an expensive house or car they indirectly create jobs. If your point is that the rich need to start more businesses and create new jobs then you need to concentrate on eliminating the roadblocks to economic expansion. Road blocks such as capital gains taxes, corporate income taxes, regulations, and other restrictions place on business by government. BTW Pickens wants the feds to move to wind power, and CNG powered cars because of his holdings in the gas industry and wants government to subsidies the wind mills. If windmills were efficient we would have alot more of them without government help.
shawnsbrain
Sun, Apr 18, 2010 : 10:04 p.m.
It is easy for the writer to declare that the investments of the "rich" are useless. Are his investments "useless" as well. Be careful how you judge others lest you find yourself judged. Tearing down wealth and prosperity only serves to promote mediocrity and glorify the least common denominator. Striving for excellence and riches is the essence of the american spirit!!
stunhsif
Sun, Apr 18, 2010 : 4:38 p.m.
"It's possible that Denzel Washington may be among or very close to the nations richest top one percent ". Not only possible, Denzel is without doubt among the top.1 of 1%. He commands 20 million dollars per film and is an awsome actor. He shares his wealth without looking for fanfare and recognition unlike most of the Hollywood elite who "squawk loudly" their Liberal drival. I have no problem with asking fortunate folks like Denzel if they would like to step up and help out but I don't think we should demand it. It is their money and they already pay a higher tax percentage than us farther down the food chain.