Who Is Creating More Value For Society? Jeff Bezos or Bernie Sanders?

Michael R. Strain of the American Enterprise Institute has noted:

Billionaire innovators create enormous value for society. In a 2004 paper, the Nobel laureate economist William D. Nordhaus found “that only a minuscule fraction” – about 2.2% – “of the social returns from technological advances” accrued to innovators themselves. The rest of the benefits (which is to say, almost all of them) went to consumers.

If Amazon founder Jeff Bezos is worth $170 billion, then according to Nordhaus, he’s created over $7.7 trillion in value for society. Bezos has made each American around $23,000 richer. But Vermont Senator Bernie Sanders thinks an innovator’s 2.2 percent is too much. Sanders tweeted “Billionaires should not exist.”

Amazon is the second-largest employer in the U.S. with over 1.5 million full-time employees and was named by LinkedIn as the No. 1 company where Americans want to work in 2022

Amazon’s 2022 tax “contributions” were over $38 billion and include:

• $2.2 billion in current federal income tax expense.

• $6.2 billion in federal taxes that include employer payroll taxes, customs duties, and other taxes and fees.

• $4.7 billion in state and local taxes of all types.

• $25.1 billion in sales taxes collected and remitted on behalf of states and localities throughout the U.S.

But $38 billion isn’t enough for Sanders and his fellow Senator Elisabeth Warren from Massachusetts. Warren has proposed a 6 percent wealth tax. Columbia University economist Wojciech Kopczuk argued that, “If you consider a safe rate of return of, say, 3%, a 3% wealth tax is a 103% tax on the corresponding capital income and a 6% tax rate is a 206% tax.”

Thomas Sowell asks “What exactly is your ‘fair share’ of what someone else has worked for?” and noted, “Life in general has never been even close to fair, so the pretense that the government can make it fair is a valuable and inexhaustible asset to politicians who want to expand government.”

It is entrepreneurial risk takers that create wealth. The envy and resentment of democratic socialists in Congress towards wealth creators like Bezos will make us all much poorer.

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Gale Pooley is a Senior Fellow at the Discovery Institute and a board member at Human Progress.