Debunking The Myth Of “Why Billionaires Shouldn’t Exist”

By S.G. Cheah
·  6 min read
debunking the myth of there shouldn't be billionaires Shutterstock

Every so often we’ll see a misleading, but highly persuasive socialist meme or presentation that goes viral on social media.

One of the latest is this presentation on why society should work to get rid of American billionaires.

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How Does Someone Become a Billionaire? 

Socialists like to claim that billionaires got rich through the exploitation of the working class. Right off the bat, this belief demonstrates how little they know about how money works. Billionaires are “billionaires” because the public democratically bought stocks in their companies. This means they became billionaires thanks to normal people whose net worth rises with the billionaire. Early investors of Amazon saw their net worth rise in concurrence with Bezos’s wealth because they own the same stock as Bezos. Think about that for a second. 

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Also, anyone who knows anything about wealth and finance knows that just because you’re worth billions on paper doesn’t mean that you actually have billions in the bank. Plenty of entertainers are worth a massive amount of dollars but are broke in real life. But it’s something people rarely talk about. 

The Beauty of Democratic Capitalism 

To help you think about this, consider the case of Elizabeth Holmes, the infamous founder of Theranos. Her company, which claimed that it would revolutionize the entire health industry with its new approach to blood testing, was once valued at billions. Later, it was found to be all just a sham.

In turn, the high-net-worth investors in her company lost all their money, and Elizabeth Holmes’s net worth went from a cool billion to effectively zero in one fell swoop. The key takeaway here is that investors determine the net worth of American billionaires. This is the democracy of capitalism in action. 

Financial and Economic Illiterates “Educating” the Public 

The biggest problem with the socialists isn’t just their warped sense of morality, but their utter economic illiteracy. Worse still is the growth in the popularity of their socialist ideas. This trend is unfortunate because these socialists are spreading ideas that will just make everyone else as economically and financially illiterate as they are. 

Money, wealth, finance, and economics is really very simple and straightforward. If you don’t want Jeff Bezos to become a billionaire, then don’t buy Amazon stocks. 

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Amazon’s stock skyrocketed during the pandemic because investors saw the value in Amazon’s online shopping and delivery service. Imagine if Amazon had not existed and you’d had to live life in a pandemic where retail shops are closed and you’re supposed to stay home due to social distancing. Imagine the hassle you’d have to go through when you can’t just turn on your computer and click “buy” for an item you needed at whatever time of the day, in the convenience of your own home.

Bad Theory, Bad Application, Bad Results

The theory “labor creates wealth” is incomplete. Socialists define a person using their physical body to labor away as work. Hence, you could argue that spray painting and smashing a building’s structure are both forms of labor. After all, demolition work is a form of labor. Spray painting building exteriors is a form of labor. 

But are the labors of ANTIFA rioters and violent protesters who engage in demolishing, smashing, and spray painting buildings creating wealth? Obviously not. Next time, when someone brings up the faulty “labor creates wealth” argument, ask them the same question. 

Work itself doesn’t create wealth because wealth is created by providing value for others.

Truth is, work itself doesn’t create wealth because wealth is created by providing value for others. You could make a handcrafted oak table from a tree cut down from your own yard, but unless someone sees value in that table and wants to buy it, your work won’t create any wealth.

To put it simply, value is created when you help make life better for other people. Sure, being a janitor is hard work, but the fact is, a janitor cleaning up a random building that belongs to someone else in a different state doesn’t improve my life nor bring any value to me personally. But being able to shop for food online at Walmart/Amazon and have the groceries delivered to my front door brings me value since I don’t have to drive to the store and put myself at risk of catching the COVID-19 virus. 

Investors determine the net worth of American billionaires. 

So yes, I took out the money I initially invested in cruise lines and put it into Amazon. Is it my fault that Jeff Bezos got richer? Well, I suppose it is since I made Bezos richer. To a socialist, I’m part of the problem because I made my own financial decisions to enrich the “capitalist class.” 

Imagine a World Where Billionaires and Their Companies Don’t Exist

For the sake of discussion, let's pretend that, indeed, all these billionaires shouldn’t exist. In order to maintain logical consistency, if billionaire Jeff Bezos never existed, then there would be no Amazon. Had the billionaire Walton family never existed, then there would be no Walmart. If the Koch brothers never existed, then there would be no Angel Soft, no Quilted Northern, and no Brawny paper products. 

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Imagine going through this pandemic without the convenience of Amazon delivering to your front door. Think about how without Windows or Android, you’d be left without the ability to use your computer or phone to connect digitally with your loved ones. Picture a life without the convenience of going to Walmart to stock up on your favorite Quilted Northern toilet paper. The world without these billionaires is a world without these conveniences. 

Stop the Pointless Envy

I don’t know about you, but I personally care more about the conveniences I can enjoy in my own life than I worry about how much wealthier some random billionaire is compared to me. The way I see it, if they want to remain billionaires, then they’ll have to worry about making sure that my Amazon packages arrive on time, my Android phone software updates correctly, and my Walmart is constantly stocked with at least six different brands of toilet paper products. In short, the way I see it, these billionaires? They serve me.

If they want to remain billionaires, then they have to worry about making sure their businesses stay successful.

There’s a brilliant speech about money in the novel Atlas Shrugged that many successful entrepreneurs tend to cite. This speech is often cited because it helps them understand what money is and how to properly think about money in a way that will benefit them directly. One passage in the speech goes: “Do not envy a worthless heir; his wealth is not yours and you would have done no better with it.”

Closing Thoughts

Envy is often the product of a person’s own feelings of inadequacy and failure. If you’re a happy and rational person like me who is grateful and self-contented with life, chances are, you too would derive no pleasure or happiness from seeing a billionaire’s wealth confiscated, redistributed, and destroyed. People like us have better and more important things to do with our lives than to obsess or demonize other people’s financial success.