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Samizdata quote of the day

Bill Gates took a huge slice of pie, but he didn’t take it from me. By starting Microsoft, he baked millions of new pies. He made the rest of the world richer, too. Entrepreneurs create things.

Over the past few decades, the difference in wealth between the rich and poor has grown. This makes people uncomfortable. But why is it a problem if the poor didn’t get poorer?

John Stossel

20 comments to Samizdata quote of the day

  • Laird

    The problem isn’t Bill Gates, or other entrepreneurs who actually created something. The problem is that governmental action (notably QE, but also including the financial system bailouts of a few years ago), rather than productivity, is greatly exacerbating the disparity of wealth in this country (I’m in the US). In the last decade or so, much of the nation’s aggregate wealth* has become concentrated in far fewer hands. Today the top 20% hold 93% of the nation’s wealth; the top 1% hold 40%. This is a far greater disparity than is historically normal or, I think, healthy. And the principal reason for that growing disparity is the relentless pumping of newly-printed money into the financial system, which is artificially inflating prices on the stock and bond markets (where, of course, most wealth is stored). The middle class is being relentlessly squeezed out of existence. I find this troubling.

    * Note that I’m talking about wealth, not income. Income disparity doesn’t trouble me because it changes regularly, whereas wealth tends to accumulate.

  • Laird, are the numbers quoted in that video reliable?

  • CaptDMO

    “…whereas wealth tends to accumulate.”
    I have an astonishing amount of accumulated “wealth”, on bookshelves, knick knack shelves, closets, garage, barn…I’d be happy to redistribute it to “the poor” that are not currently entitled to an astonishing amount of….well, let’s just call it welfare.
    I’d also be open to redistribution of the assets that demand an astonishing onus of annual taxation as well, but then, who’d pony up for the welfare, and gub’mint funded um….research/awareness/activism/lawmaking/infrastructure/education/”safety” for “our” children

  • Regional

    Obummer promised to take from the rich and give to the poor, if he stripped all the assets of a couple of hundred billionaires and gave to the poor it wouldn’t amount to much each. No wonder Obummer wants to share the wealth, he was a failed Constitutional Law lecturer who got a job as a Community Organiser forcing banks to give home loans to people who couldn’t afford them. His Missus was a corporate lawyer on half a million a year but in Chicago she was given a job created for her as a Ethnic Community Liaison Officer for a hospital on $300,000 a year, boy she married down there.

  • Laird

    I believe that they are, Alisa. However, they are a bit dated (I think much of the data is from 2007), so the degree of wealth disparity is probably even greater today. There is a lot of information available about this: here is one article, and while I don’t take Mother Jones as gospel the sources are provided. Here is one of those.

    Most of the people writing about wealth disparity and “income inequality” seem to take the view that some form of forced redistribution is the solution. I don’t share that opinion. Income and wealth disparity is a normal and necessary consequence of a free market, and to some degree is in fact desirable as it helps provide incentives for striving. What concerns me here is the artificial (i.e., government-induced) cause of much of that disparity, and the rate at which it is increasing. Curtailing and ultimately eliminating QE should help to mitigate the problem, as it would remove the artificial stimulus propping up stock prices. Unfortunately, I don’t see that happening at any time in the foreseeable future; even the hint of moderation by the Fed causes the markets to swoon and puts the monetary authorities into a panic. I really do think we have “QE-infinity”. However, nothing lasts forever, and eventually the flood of new money will take its toll, probably in the form of significant inflation and eventual market collapse. That will “cure” the problem, too, but the overall effects on society will likely be devastating. We’re so deep in this hole that I can’t see any way out.

  • Paul Marks

    Jon Hunstman (senior) might be a better example, or (if one really wants to irritate the left) Charles or David Koch.

    One of the (several) problems with using Bill Gates as an example is that the leftist can simply reply “but Mr Gates himself accepts that inequality is a terrible thing and supports higher taxes on the rich…..”

    As for inequality – a lot of modern inequality is the “Cantillon effect” (after the Irish economist Richard C.) – who showed (as far back as the 1700s) that the increase of the credit money supply tended (after the boom-bust has run its course) to benefit mostly wealthy people at the expense of mostly poor people (thus making inequality more extreme).

    It is no accident that most of the countries of Latin America have been historically known as areas of high inflation and of high inequality.

  • jim holden

    One of the (several) problems with using Bill Gates as an example…

    the problem with that is most people have no goddamn idea who jon hunstman or charles koch or david koch are without googling them, whereas most people on the planet know who bill gates is.

  • Richard Thomas

    Bill Gates didn’t take his wealth from me but there’s a lot of companies that were left bleeding in the dust by his anti-competitive practices. He’s a pretty awful poster-boy in my book. I believe he has set the computing industry back 5-10 years which his shitty OS(s).

  • Richard Thomas

    which -> with

  • Runcie Balspune

    “… but there’s a lot of companies that were left bleeding in the dust by his anti-competitive practices.”

    There are far more companies that became industry giants on the back of his “shitty OS”, and as someone who can remember as far back as CP/M, I’d struggle to name an OS better than XP or 7.

  • Pardone

    The Koch brothers are crony capitalists pure and simple:

    1. Koch Industries applied for health reform subsidies made possible by the Obama administration.

    2. In Alaska, blogger Andrew Halcro reported that a Koch subsidiary in Fairbanks asked Gov. Sarah Palin’s administration to use taxpayer money to bail out one of their failing refinery.

    3. Koch Industries has been the recipient of about $85 million in federal government contracts mostly from the Department of Defense. Koch also benefits directly from billions in taxpayer subsidies for oil companies and ethanol production.

    Soo many y piggies with h their snouts inn the trough.
    4. The dirty secret of Koch Industries is its birth under the centrally-planned Soviet Union. Fred Koch, the founder of the company and father of David and Charles, helped construct fifteen oil refineries for Joseph Stalin before expanding the business in the United States.

  • Paul Marks

    Pardone “The Koch brothers are crony capitalists pure and simple”.


  • Lee Moore

    I watched a few minutes of a Stossel show on Fox a couple of days back, in which he was puzzling away – unsuccessfully – at why Hollywood is so anti-capitalist, when it’s such a red-in-tooth-and-claw capitalist business. Disappointingly – for he is much the best of the Fox talking heads – he failed to point out that Hollywood isn’t really involved in the free market at all – it’s 100% mercantilist, utterly dependent on government grants of IP monopolies.

  • Rich Rostrom

    Regional: Michelle Obama was never a high-powered corporate attorney. She was an associate with Sidley Austin, well-paid, but not the big bucks. There are reports she did little or no actual work. Her law license lapsed in 1993, the year after she married, and only four years after passing the bar. She had moved from Sidley Austin to Chicago City Hall in 1991, as a $60K assistant to Mayor Richie Daley.

    When Mr. Obama was elected to the Illinois State Senate, she was hired as “executive director of community affairs” at the University of Chicago Hospitals, at ~$100K. When Mr. Obama was elected U.S. Senator, she was promoted to “vice president for community and external affairs” with a raise to $300K.

    When he ran for President, she went to “part-time” status, at only $100K. When he was elected President, she resigned. The U. of C. didn’t bother to replace her.

    (It would be very interesting to see the record of her work for the U. of C. That is, what, if anything, did she actually do? Did she write memos or letters? Hold meetings?)

  • jsallison

    I trust that that’s a rhetorical question. Being the daughter of a Chi-town ward heeler and married to the affirmative action pResident means money just falls off trees around you.

  • Julie near Chicago

    Rich, your comment prompts me to voice aloud (figuratively speaking) my speculation as to whether UC rather wishes it had never heard of the Obamas, man and mom.

  • Julie near Chicago

    On the other hand, while I love the University like a daughter, at least the “Community of Scholars” tradition, and at least as it used to be, I have to observe that it’s been neck-deep in Chicago politics since Homer was a pup. Allegedly, of course.

    It is possible that it challenged the Archdiocese for primacy in real estate holdings. [Consider that possible hyperbole for effect, but I bet it’s true.]

    As an example, we never could get one of the chain grocery stores in Hyde Park. (I believe the place is still unsullied by such.) We were stuck with The Co-Op, which was certainly a perfectly good store if a bit pricey, but ONE supermarket to serve the entire Hyde Park community made for disaster on Shopping Day, Saturday. And of course the parking lot didn’t begin to accommodate the weekly avalanche of vehicles. Every so often someone would have to get out of his car and direct traffic in order to unsnarl traffic jams. My own N&D came home one Saturday frothing at the mouth (unusual for him), having just done his civic duty as Traffic Patrolman-at-Large.

    Innumerable movements and Citizens’ Committees and so forth to get A&P, or National (the National Tea Company), or one of the later chains over the years; but to no avail. Ah well.

  • Julie near Chicago

    Speaking of the Koch Brothers, one of whom was a co-founder of the Cato Institute, and on neither of whom I am well-informed, see “PunditFact: Maddow’s Koch Brothers Claim Mostly False” by Jeff Dunitz, a.k.a. “YidwithLid”:

    It begins:

    PunditFact is a new site from the folks at PolitiFact which examines claims made by political pundits. On Thursday they examined a recent Rachel Maddow claim that the Koch brothers were pushing and promoting a Florida law that requires welfare recipients to first pass a drug test. Representatives for the Koch brothers pushed back against the allegation, saying they were not involved with the Florida law or the Florida group who supported the law, the Foundation for Government Accountability.

    At the heart of the controversy is Maddow’s claim The Foundation for Government Accountability, which supported a Florida law requiring drug testing of welfare recipients, is a “Koch brothers affiliated group.”

    Read the rest of this short piece at


    (TruthRevolt is a new section of FrontPageMag.com.)

    Of course, if we have to have welfare, personally I’m old-fashioned enough to believe that drug-testing of recipients is perfectly legit, and wise into the bargain. It’s not as though government-inflicted “welfare” were a just institution in the first place.

  • Pardone

    The Koch brothers are corporate welfare piggies like all the rest:

    Flagship Koch Industries has taken over $16.5 million in subsidies from 11 different awards, none of which are sales tax breaks (which generally are not subsidies).

    Subsidiary Georgia Pacific has received 72 subsidies worth over $43.9 million (none of these were sales tax breaks).

    Subsidiary Flint Hills Resources LP has received subsidies from Iowa, Kansas, Texas, and Michigan, according to the Good Jobs First Subsidy Tracker; the New York Times subsidy database, which omits Michigan but includes one more Iowa subsidy, puts the value of the Iowa and Kansas subsidies alone at just over $12.5 million (again, none of which were sales tax breaks).

    Subsidiary INVISTA has received $217,504 in training grants from South Carolina, according to Subsidy Tracker. Several other subsidies appear to be connected to this subsidiary, but none have available subsidy amounts. Again, none were sales tax breaks.

    To summarize:

    Koch Industries: $16.5 million
    Georgia Pacific: $43.9 million
    Flint Hills: $12.5 million
    INVISTA: $0.2 million

    Total subsidies to the Koch brothers:$73.1 million

    Remember, this is the minimum value of the Koch brothers’ subsidies. Some of the entries had no dollar figures available, and there is always the possibility that some incentives were missed entirely or that the awards above were only a part of a subsidy package, not the entire value. In particular, local subsidies are not well covered in either database; the same is true for my national estimates. The data just isn’t widely available.

    Meanwhile, Koch Industries is going to be the largest investor in the Big River Steel project in Osceola, Arkansas, which is expected to cost the state $132 million in incentives.

    Like I said, when it comes to the Kochs fighting subsidies, I’ll believe it when I see it.