Billionaire Wealth Does Not Lift All Boats

Defenders of extreme wealth love to argue that billionaire success benefits everyone. A recent Financial Times article, for instance, argues that “billionaires make the rest of us richer, not poorer,” claiming that the economy isn’t zero-sum, and pointing to figures like Jeff Bezos as proof. With his $240 billion fortune, they argue, he hasn’t taken anything from the rest of us — he’s made our lives better. Amazon’s convenience, low prices, and fast shipping are held up as examples of how one man’s riches supposedly translate into shared prosperity. We’re told to thank Bezos, not question him.

This is just trickle-down economics in new packaging. The idea that billionaire wealth is the “rising tide that lifts all boats” is a rerun of the Reagan-era theory that slashing taxes and regulation for the rich would spark investment and raise living standards across the board.

Forty years later, the evidence is in: billionaire wealth has soared, wages have stagnated, inequality has exploded, and upward mobility has collapsed. Mainstream institutions like the International Monetary Fund (IMF) and Organisation for Economic Co-operation and Development (OECD) now admit that the trickle-down model doesn’t work. When wealth pools at the top, it doesn’t trickle down — it consolidates power. In 2024 alone, the top 1 percent in the United States became more than $6 trillion richer while the entire bottom half of the country has just $4 trillion of collective assets, only 2.5 percent of the nation’s total.

The issue is that billionaires don’t participate innocently in the economy — they rewrite the rules to benefit themselves. Elon Musk, for instance, owes his rise to billions in public subsidies. Yet after becoming the richest man on Earth, he became an ardent crusader against government oversight, labor protections, and democratic accountability. Like that of Bezos, Musk’s trajectory shows how vast wealth begets vast power — to shape laws, markets, and narratives that serve the ultrarich at the expense of everyone else.

The same pattern can be seen in the Gilded Age, another era of runaway wealth that was marked by monopolies, political corruption, and boom-bust instability. It wasn’t billionaire benevolence that delivered the broad-based prosperity of the mid-twentieth century. It was political action: a powerful labor movement, robust public investment, and a tax system that made hoarding wealth prohibitively expensive. It wasn’t until the New Deal, particularly the advent of a top marginal tax rate that averaged over 80 percent, that inequality was curbed and broad-based prosperity took hold.

We Don’t Need Billionaires to Drive Innovation

Another common defense of extreme wealth is that billionaires are essential for innovation — that without the lure of limitless riches, no one would take the risks or make the breakthroughs that move society forward. When Senator Bernie Sanders, appearing on the Netflix series What’s Next? The Future with Bill Gates, remarked bluntly that he believed “we should eliminate the concept of billionaires,” Gates responded with exactly this line of thinking.

But this idea doesn’t stand up to historical scrutiny, either. Perhaps the most prolific period of American innovation — from the birth of modern computing to the Apollo program — unfolded at a time when the top tax rate averaged 81 percent. Far from dampening ambition, high taxation prevented hoarding and channeled surplus wealth into public goods and scientific progress.

The biggest breakthroughs of the past century — like the internet, GPS, and mRNA vaccines — weren’t driven by billionaire visionaries. They came from government-funded research, university labs, and publicly backed infrastructure. Gates, Musk, and Bezos didn’t create these technologies from scratch; they commercialized them after decades of public investment had laid the foundation.

The truth is, innovation thrives not in economies dominated by billionaire incentives but in those that prioritize shared investment, collective capacity, and equitable opportunity. It’s not the billionaire class that keeps innovation alive — that achievement belongs to a public sector they so often refuse to fund.

Billionaires Don’t Deserve Their Wealth

Of all the arguments used to defend billionaires, this may be the most persistent: the idea that we live in a meritocracy and that extreme wealth is simply the reward for talent, hard work, and risk-taking. The “self-made billionaire” has become a cultural archetype — bootstrapping their way from humble beginnings to unimaginable fortune, powered by grit and genius alone. Many today aspire to be billionaires.

But this story also falls apart under scrutiny.

In addition to the role of publicly funded innovation — and the fact that many of the most celebrated “self-made” billionaires (e.g., Bill Gates, Elon Musk, Jeff Bezos, Mark Zuckerberg) all relied on significant resources from their parents — every billionaire fortune rests on a vast infrastructure of public goods: roads, ports, internet protocols, legal systems, publicly educated workforces, and government-funded research. These are the hidden scaffolds of wealth creation. Amazon, for example, relies on postal subsidies, roads, and digital infrastructure built with taxpayer dollars — yet dodges taxes itself and fights unionization at every turn.

Many of these billionaires — through offshore accounts, tax loopholes, and lobbying — refuse to support the very systems that enabled their ascent.

Inequality Does Matter

When all else fails, defenders of extreme wealth retreat to a final argument: inequality is a distraction. The real problem, they say, is poverty — not the fortunes of billionaires. Why worry about how much some have, as long as others have enough?

This is a dangerous sleight of hand. Extreme inequality doesn’t just coexist with poverty — it perpetuates it. When vast wealth is concentrated in the hands of a few, it distorts political priorities, undermines public services, and hoards resources that could be used for collective benefit. This is exactly what the One Big Beautiful Bill Act shows. The problem isn’t just that billionaires have more — it’s that their wealth gives them the influence to keep it that way.

Furthermore, the data is unambiguous: research has shown that inequality corrodes every domain of social well-being. More unequal societies suffer from worse health outcomes, higher crime rates, lower educational achievement, and deeper political distrust. These aren’t side effects — they’re structural consequences of allowing the wealthy to pull so far away from the rest of society.

Reducing poverty is essential. But pretending that inequality doesn’t matter is an obfuscation designed to protect those who benefit most from the status quo. If we want a healthy democracy, we need to care not just about how little some have — but also how much others hoard.

Abolishing billionaires is not about envy of their wealth as some claim — it’s about rebalancing power. As Supreme Court justice Louis Brandeis famously said, “We may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both.”

We must stop treating billionaires as saviors and start seeing them for what they are: products of broken systems, symbols of a moral failure to distribute opportunity, and agents of oligarchic capture. Mamdani’s comment was a glimpse of a saner future. We should heed it.