United For a Fair Economy, the left-leaning policy group, held a press call Tuesday to argue for preserving the estate tax before it temporarily expires in 2010.
During the call, Vanguard-founder Jack Bogle made an interesting argument for why the wealthy should pay the tax. In short, he said the wealthy owe a large part of their fortune to the country and its government.
“I’ve known many people in the financial business, who said I’m really proud because I did it all myself,’” he said. “When someone has the temerity to say that to me, and a lot of people do, the first thing I say is, ‘Isn’t that wonderful. You did it all yourself. I think that’s terrific. I don’t know many people that have done that. But tell me, how did you arrange to be born in the United States of America.’”
He added: “Our birthright has created enormous wealth and stability of property and for us to think that we don’t want to pay our fair share of the costs running this nation when our young citizens, let us not forget, are dying in wars out there trying to protect democracy and the nation we built up, it seems to be quite outrageous.”
Bill Gates Sr., father of the Microsoft founder, made a similar argument. He cited economists who estimate that the nation’s stable market for goods and assets adds 30% to the goods we own.
He said 50% of the annual growth in our economy is a function of new technology — technology often created with government support, since it spends $96 billion a year on research and development.
“The largest and most generous venture capitalist in the universe is Uncle Sam,” he said.
“And it’s clear that those who become wealthy did not do it alone. The people owe something back to society that enables them to create that wealth.”
Do you think the wealthy can truly “make it on their own?” What do they owe the government for their success?
Joseph Schumpeter's Business Cycles
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Business Cycles
The link above takes you to a pdf file of Joseph Schumpeter's book.
16 years ago
