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The Assault on Wealth

Summary:
As noted above, I don’t accept that behind every fortune, or even most fortunes, is a great crime. Interestingly also, neither does the main economist who got the ball rolling on wealth taxes earlier this decade. The economist who, more than any other, made attacks on the wealthy more generally respected, is Frenchman Thomas Piketty. His 2014 best seller, Capital in the Twenty-First Century, which, incidentally, made him a wealthy man—by January 2015, it had sold 1.5 million copies—gave a sustained argument for heavy taxes on wealth. But even Piketty admits that one can acquire a huge fortune without committing a crime. Piketty writes, “To be frank, I know virtually nothing about exactly how Carlos Slim [the richest man in Mexico] or Bill Gates became rich, and I

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The Assault on Wealth

As noted above, I don’t accept that behind every fortune, or even most fortunes, is a great crime. Interestingly also, neither does the main economist who got the ball rolling on wealth taxes earlier this decade. The economist who, more than any other, made attacks on the wealthy more generally respected, is Frenchman Thomas Piketty. His 2014 best seller, Capital in the Twenty-First Century, which, incidentally, made him a wealthy man—by January 2015, it had sold 1.5 million copies—gave a sustained argument for heavy taxes on wealth. But even Piketty admits that one can acquire a huge fortune without committing a crime.

Piketty writes, “To be frank, I know virtually nothing about exactly how Carlos Slim [the richest man in Mexico] or Bill Gates became rich, and I am quite incapable of assessing their relative merits.” Translation: even if they didn’t commit crimes, the government should take a substantial portion of their wealth. Addressing the possible relationship between crime and wealth, Piketty continues, “In any case, the courts cannot resolve every case of ill-gotten gains or unjustified wealth. A tax on capital would be a less blunt and more systematic instrument for dealing with the question.” Excuse me? A tax on capital is less blunt than using the legal system to go after those who have committed crimes? That makes no sense. If the goal is to go after ill-gotten gains or unjustified wealth, a tax on capital, i.e., wealth, is a completely blunt instrument.

This is from my latest article for Hoover’s Defining Ideas, “The Assault on Wealth,” December 4, 2019. Read the whole thing.

And notice that I quoted from a popular 1960s song at the start from a group that included my fellow Canadian Neil Young.

David Henderson
David R. Henderson (born November 21, 1950) is a Canadian-born American economist and author who moved to the United States in 1972 and became a U.S. citizen in 1986, serving on President Ronald Reagan's Council of Economic Advisers from 1982 to 1984.[1] A research fellow at Stanford University's Hoover Institution[2] since 1990, he took a teaching position with the Naval Postgraduate School in Monterey, California in 1984, and is now a full professor of economics.[3]

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