Verses: The Versed considers current social, cultural, and political issues and weighs up both sides of the argument.
They make iPhones, sell books over the internet, and blast convertible cars into space, but do billionaires benefit society as a whole?
Despite being home to just 4% of the world’s population, the US disproportionately accounts for 25% of the world’s billionaires. There are around 2,208 of them in total and 680 are based in the US, according to figures from CNBC. That’s 140 more than in 2016 (540) and more than the amount in China, India, and Germany combined.
That’s a lot of billionaires, and their numbers in the US are rising rapidly. But, is their presence synonymous with a healthy and prosperous society or with an increasingly unequal one?
The case for billionaires
Billionaires often receive praise for job creation. Teslatari, a news outlet that focuses on the developments of the various business of billionaire Elon Musk, says that “Musk’s role in job creation has had a deep impact on thousands of lives, and on a global scale. Between all of his companies, Musk employs over 35,000 employees globally, of which 30,000+ are in the US”.
Reno, a city in the US state of Nevada, is cited as a place that has benefitted immensely from Musk’s construction of a $5 billion Gigafactory nearby, which has helped to create a “boom in job growth and a resurgence in the housing market” in the surrounding area.
Other billionaires employ far greater numbers than Musk, however. Amazon’s Jeff Bezos has over 230,800 employees on the books, Starbucks founder Howard Schultz employs more than 300,000, while the owner of FedEx, Frederick Smith, provides jobs for over 323,035 people.
Capitalism is the system that enables the creation of billionaires, and it is also responsible for lifting millions out of poverty, according to the director general of The Institute of Economic Affairs, Mark Littlewood. He recently told the BBC that reducing the wealth of billionaires “won’t lead to redistribution, it will destroy it to the benefit of no one”.
He believes that society should be focussing on “economic growth” rather than “criticising” billionaires.
Data collected by The Versed on US residents found that most of the people surveyed think billionaires are “good for society”. Nearly 1000 individuals participated in the data collection which also found that those who earn more are more likely to say that billionaires are beneficial.
52% of those asked who earn above £100k a year said they thought billionaires were good for society while that percentage fell to 31% for those earning between £16-25k.
The negative impacts
In January 2018, Oxfam published a report that found 82% of wealth created in 2017 went to the top 1% while the poorest half, around 3.7 billion people, experienced no increase in wealth.
The International Executive Director of Oxfam, Winnie Byanyima, said of the results that, “the billionaire boom is not a sign of a thriving economy but a symptom of a failing economic system”
“The people who make our clothes, assemble our phones and grow our food are being exploited to ensure a steady supply of cheap goods, and swell the profits of corporations and billionaire investors” she added.
While ostensibly, the creation of hundreds of thousands of jobs is a positive thing, the treatment of those employees often falls short. Jeff Besos of Amazon has come under criticism countless times for the way in which Amazon factory workers are exposed to unacceptable working conditions.
An investigation by the Guardian published on the 30th July 2018 has revealed “numerous cases of Amazon workers being treated in ways that leave them homeless, unable to work or bereft of income after workplace accidents”
Jeff Bezos is currently the richest man in the world with a net worth of $143.1 billion.
Billionaires and their businesses are often criticised when it comes to paying taxes too. In 2016, Mark Zuckerberg’s company, Facebook, reported UK revenues of £842.4m, while the amount of corporation tax they paid was a mere £5.1%. The figures for Amazon are even more astounding. The company’s revenues in Europe fro 2016 amounted to £19.5 billion, and yet, they paid just £15 million in taxes.
Do the charitable offers of billionaires and their creation of jobs offset their low tax rates and poor treatment of employees?