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Reexaming the 1%er Argument

By: Frank Yunker

Date: 2017-06-27

Updated Chicken and Pot slogan
Updated Chicken and Pot slogan

“Billionaire” Donald Trump was carried into the White House by the vote of common, everyday laborers. The “gilded class” often went for Hillary Clinton or, before that, with “Feel the Bern” Sanders, the darling of the “Occupy Wall Street” crowd. Let’s examine why the everyday laborer – core of the 99%ers – would vote for a man who created an image of himself as a 1%er?

The whole argument about the top 1%ers is all nonsense. What matters is the net worth of the average laborer. Can you graduate high school, get a job and assuming you stay employed, can you afford a house and car? These are the basic economic questions. Is there “a chicken in every pot and a car in every garage?“ Envy about the richest of the rich is misguided. What do you think those super-rich do with their money? They either spend it or invest it.

If they spend it, then the golf course hires another greens keeper, the yacht club hirers another salesman or the casino hires another blackjack dealer. It doesn't matter. If a rich person is spending, someone is getting hired. If, on the other hand, they invest it, some other things will happen. A rich person investing in a new company will make the stock price rise... and every average Joe investor will see their portfolio rise. Like the "Trump Bump" the stock market increasing brings additional wealth to many middle class people who have retirement accounts. But beyond that, the companies funded by these super-rich will hire more people and those people will built products that makes everybody's life better off. When an engineer quits Corporate America to join a new company funded with venture capital, the world is better off. Maybe they want to build drones to deliver organs for life-saving transplants. Hospitals currently use a combination of vans, helicopters and people on foot to get an organ from a donor to a recipient. There is the cost of personnel and also the cost of time. Both are expensive.. The super-rich donor wants to get richer, but not by stealing from others. He believes electric drones will save lives and reduce the costs in terms of transportation and money.

The truth is, we need the ultra-rich. If the drone idea fails, it is only a few rich people who will suffer. When Obama gave half a billion to Solyndra and it failed, we the tax payers were on the hook for the half-billion. That's the kind of legalized criminal activity that got lots of Trump voters to chant "drain the swamp."

The best part of all that investment is that when it pays off, it does so in the form of reducing the cost of something. When the middle class and richer folks find reduced costs, it allows them the luxury of disposable income. They now have spare money that they can spend on anything they want. That means bowling alleys, golf courses and tourist trap hotels. It means an increased variety of local restaurants. But how does it affect poor people? It makes it easier for them to afford life. The hydraulic lift made oil changes cheaper. Good for rich people, but that makes owning a used car more affordable for poor people. And a used car is literally the vehicle to get poor people out of poverty.