Wealthy Hoarders—American style
Recently I’ve seen a spate of posts on Facebook—granted not the most veracious of mediums—bemoaning rich Americans’ penchant for “hoarding” their wealth. One envisions human versions of Disney’s Scrooge McDuck character defying physics by diving into treasure chests of gold coins.
Compared with wealthy people of the past, one can easily argue that America’s current wealth-holders are socially more beneficial. Today’s billionaires invest in real estate, stocks, bonds, and other productive investments. To be sure, they may also hold wealth in assets of lesser productivity such as mansions, fancy cars, jewels, pieces of art, and government treasury bonds.
For many thousands of years, rich people held their wealth differently. Consider those dead Egyptians. The pharaohs left behind impressive pyramids. They’ve resided entombed for thousands of years, along with a retinue of presumably unwilling retainers. They also buried large amounts of goods. While such waste may have redressed imbalances in wealth, the goods could have been put to other uses (although the pyramids currently bring in tourist dollars). The dead retainers, too, could have continued to lead productive lives. The pyramids also required vast amounts of labor, whether free or coerced.
The Greeks introduced democracy—limited, of course, by their dependence upon slave labor—and a lot of deep thoughts. They touted public works, such as public buildings. The wealthy competed to finance ostentatious projects, such as building edifices or supplying naval warships. Although such ostentatious projects persist today and provide income from tourism, just like the Egyptian pyramids, the common people reaped little benefit.
Romans gained wealth through conquest and slave labor. As with the Greeks, wealthy Romans competed to gain status and public acclaim via putting on chariot races, gladiatorial fights, and funding lavish buildings. Roman citizens enjoyed free food (funded by taxpayers), sort of a precursor to modern-day income-maintenance programs. The bread and circuses provided by the wealthy, therefore, acted as a safety valve with regard to the restless mass of Roman citizens. Aside from entertainment, however, Roman wealth provided little economic benefit for the masses.
Although the Medieval church (as well as Islamic doctrine) forbade extending loans at interest—usury—the need for loans overrode religious scruples. Church officials fought against usury with varying degrees of severity. They hit upon the dandy idea of getting usurers to repent and to pay restitution for ill-gotten gains. The church often received proceeds from such restitution. Church leaders also encouraged wealthy patrons to absolve themselves of sinful usurious behavior by donating money for cathedrals and other construction projects. One could argue that behind every cathedral there lies a crime of usury. Although some of the wealthy donated money to succor the poor, most were not too concerned with the poor (although the medieval poor were in much worse shape than today’s poor).
If today’s rich people were to disburse most of their wealth in lavish endowments to charitable and educational institutions, I suspect the rest of us would be worse off. Some of Bill Gates’ billions are invested in efforts to create new and better products that satisfy millions of people, including many poorer ones. Warren Buffett’s billions are directed to companies that he deems likely to continue to reap profits by satisfying customers with their products and services.
Gates and Buffett, just to name two of the more prominent billionaires, are free to disburse their money as they see fit. My guess is that they are and will continue to be good stewards of the wealth they currently but temporarily control. After all, unlike the dead Egyptians, few modern-day people believe the rich can “take it [their wealth] with them,” when they die.
So be glad that American billionaires are less like Scrooge McDuck, dead Egyptian pharaohs, Romans, or medieval usurers. Be thankful that American billionaires are investing they wealth in productive outlets.