Henry Blodget now gets it
Anybody remember Henry Blodget? This is the guy whose father was a banker. Henry Blodget is the guy who got a History degree and then went to teach English in Japan. This is the guy who was a freelance journalists and proofreader for Harper’s Magazine that turned into a ‘financial guru’.
Most importantly Henry Blodget is the guy who predicted (guessed) the meteoric stock price rise of the Internet stock Amazon.com. It immediately made him a financial media star. He seemed to be a fixture on CNBC.
Henry Blodget spent a lot of time pumping up the value of stocks even as he privately expressed negative views of the companies the stocks represented. For this he was permanently barred from the securities industry. He got rich making money like many in the wealthy class who make money on money. He got rich from contributing nothing for society. He created no product. He created no service.
Henry Blodget and his ilk along with the politicians they fund have maintained laws that privileges the acquisition of wealth via money manipulation. Those that work pay up to 39%+ in taxes while Henry Blodget’s class pay less than half that. They defended that by claiming that somehow their wealth trickles down and is better for the economy.
Of course the experience of the last 30 years of this thinking has all but decimated the middle class. It turns out, the wealthy are not the job creators at all. Their wealth do not trickle down giving the rest in society access to wealth. Wealthy entrepreneur Nick Hanauer realized this and did a wonderful TED talk on it that everyone must listen to.
A few years ago I wrote the book As I See It: Class Warfare The Only Resort to Right Wing Doom. In that book I wrote,
The reality is that our capitalist system is designed in such a manner that wealth will progressively be transferred upward. There are no real mechanisms to ensure that equitable distribution is maintained consummate to actual work or productivity. As such societal gain from marginally taxing those who benefited the most from this country providing the platform for said wealth creation, should be seen as a responsibility to maintain a viable society.
This week the Pope threw an uppercut unto unfettered Capitalism and trickle-down economics. He equated the current system as one that kills and as such incompatible with Christian tenets.
It was a pleasant surprise to read yesterday’s piece by Henry Blodget. It is titled Sorry, Folks, Rich People Actually Don’t ‘Create The Jobs’. Henry Blodget wrote,
But, more importantly, this argument perpetuates a myth that some well-off Americans use to justify today’s record inequality — the idea that rich people create the jobs.
Entrepreneurs and investors like me actually don’t create the jobs — not sustainable ones, anyway.
Yes, we can create jobs temporarily, by starting companies and funding losses for a while. And, yes, we are a necessary part of the economy’s job-creation engine. But to suggest that we alone are responsible for the jobs that sustain the other 300 million Americans is the height of self-importance and delusion.
The ending of Henry Blodget’s article is one that the wealthy as well as their purchased politicians must heed.
Hanauer estimates that, if most American families were taking home the same share of the national income that they were taking home 30 years ago, every family would have another $10,000 of disposable income to spend.
That, Hanauer points out, would have a huge impact on demand — and, thereby job creation. So, if nothing else, it’s time we stopped perpetuating the fiction that “rich people create the jobs.”
Rich people don’t create the jobs. Our economy creates jobs. We’re all in this together. And until we understand that, our economy is going to go nowhere.
Is this not a call for higher wages for working Americans and higher taxes on the wealthy? Our economy did best for all during those times. The 30 year experiment with trickle-down economics, supply side economics, voodoo economics, has failed. It has decimated the wealth of most Americans.
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Well Duh!
BS. I used my life savngs and built an engineering and manufacturing company that employes 140 high tech engineers and technicians. I sold it and am now enjoying the results. Eight of the original employees are now retired comforably after their successful careers. This article is left wing propaganda. Oh, by the way the tax is not 39.6% its actually 39.6% + 3.8%, but most in my situation are paying the lower “long term capital gains tax which is now 20% + 3.8%. The 3.8% is our contribution to the so called Affordable Care Disaster. Disgusting!
Good for you. However, the premise of the article that the middle class is the driver of the economy is spot on. I am old enough to remember life before Reagan. There were hard times, but overall, people were working and had money to spend on an ever increasing standard of living. Then came the era of 2nd mortgages. Borrowing to maintain the same standard that wages failed to make up for, even with the steady increase in productivity. Then came multiple financial/ credit crisises (of different scale and magnitude), and the sucking sound Ross Perot so aptly predicted would happen with free trade. So…light manufacturing goes offshore, the wages earned by those light manufacturing jobs are lost forever affecting consumer demand in every sector except wall street, and a lucky few businesses whose products remained in demand, primarily out of neccessity. There hasn’t been an economic boom based on anything except credit since the sixties. I don’t have a problem with anyone being wealthy, my problem lies with those who think they earned it without the mostly underpaid labor doing the “work” to “create” their wealth. It’s truly shameful that many wealthy people fail to appreciate that.