Billionaire bashing is back. Here's a better idea for America
- Well, they've done it again. The Democrats running for president continue to make bashing the rich a key theme in their 2020 primary race.
- We saw that all too clearly during the Democratic presidential debate last week with a number of comments disparaging America's billionaires.
- But none were more memorable than Senator Elizabeth Warren's attack on a fundraiser for Mayor Pete Buttigieg, where she decried the influence of those "billionaires in wine caves."
Well, they've done it again. The Democrats running for president continue to make bashing the rich a key theme in their 2020 primary race.
We saw that all too clearly during the Democratic presidential debate last week with a number of comments disparaging America's billionaires. But none were more memorable than Senator Elizabeth Warren's attack on a fundraiser for Mayor Pete Buttigieg, where she decried the influence of those "billionaires in wine caves."
Let's be clear: no one has to feel sorry for billionaires, or feel the need to worship them or their achievements. But it's just as ludicrous to prejudge all billionaires unfavorably. Actress Jane Lynch seems to have said it best after last week's debate when she tweeted a simple message about how we shouldn't disqualify anyone's voice in America based on wealth:
But Lynch's sentiments are swimming upstream against a clear disrespect for the very wealthy that's been festering in America for much longer than our current election cycle. That is, the idea that billionaires don't deserve respect because they most likely got their wealth through luck. It's an idea that even prominent liberal economist Robert Reich has promoted for years. He tweeted this message out the very same day that Lynch made her statement:
Thankfully, Reich's point is the result of a cherry-picked piece of data that ignores the bigger picture. Reich is focusing on a total amount of disembodied dollars inherited as opposed to the uplifting story of how many actual people have indeed become much richer in America. Since we're talking about people here, the more important statistic is that according to the Fidelity Millionaire Outlook Survey more than 80 percent of America's millionaires and billionaires are self-made.
But let's just say that Reich is right and pretend that the entire idea of self-made success is unlikely. Where does that leave us as a society? What is the motivation for anyone to work hard if we promote the message that inheritance or luck is what matters most?
This kind of thinking is apparently not far from the justification for another idea gaining traction in America known as Universal basic income (UBI). These plans argue that too many Americans are straddled with too many challenges to meet their expenses. The idea has support from a number of politicians and business leaders, but Democratic presidential candidate Andrew Yang has made his $1,000-per month giveaway to every American adult a hallmark of his campaign.
But while the idea seems like it comes from a place of compassion, a closer examination shows evidence of disdain for the plan's beneficiaries. Couldn't the $1,000 per month Yang wants to give to everyone with a pulse be better spent providing more educational or job training opportunities?
It can't if you believe too many of those recipients don't have the basic skills to take advantage of a better education. Perhaps UBI advocates secretly, or not so secretly, believe in Reich's depressing and dangerous message that people simply can't improve their economic lot in life without random luck.
Even if that isn't the case, the UBI is yet another policy idea that seeks to throw money at voters instead of doing more to help them. This mixed up set of priorities is also a severe flaw in plans like Medicare for all and student loan forgiveness for all.
Luckily, not everyone is buying into a defeatist-based economic policy. The idea that public assistance programs can be a pathway to work and even wealth is not completely dead. Perhaps the best example of that is Kansas City, which will become the first major metropolis in the U.S. to provide no-fare public transit starting next year.
The idea is simple. So much of welfare at least indirectly pays people not to work. That is, it pays out more benefits to those working and earning less. Sure, you might make a little more money than welfare by taking a low-paying job. But when you throw in the hassle of getting up every morning, commuting, etc. the difference may not be worth it. That's why so many experts believe offering very low or free transit fares truly pays off for a municipality.
Much of the world will be watching to see if the Kansas City plan succeeds, but here's a spoiler alert: it's already a success. That's because this is a welfare plan that bets on people who want to get up and out of their homes and get working. It's a plan that implies that people can improve their situation. At the very least, it's also a plan that seeks to encourage those who are already working by taking away one part of the cost or hassle of doing so. If the program doesn't boost the city's GDP, it will certainly boost its collective psyche.
Meanwhile, the Kansas City experiment will be philosophically competing with the sentiment that success is just too random in America. Kansas City is trying "can do" over Yang's and Warren's "can't do."
Which would you choose?
Jake Novak is a political and economic analyst at Jake Novak News and former CNBC TV producer. You can follow him on Twitter @jakejakeny.