In Defense of Millionaires; W. Peterson

94 William H. Peterson In Defense of Millionaires First, this proliferation is bad news because a millionaire, like that old gray mare, Uain't what she used to be." Inflation, in other words, is breeding a new caste of millionaires who, because of a runaway inflation rate, have seen a sharp appreciation in the nominal value of their per sonal holdings and investments such as oil stock, defense investments, gold, silver, platinum, antique fur niture, diamonds, jewelry, real es tate and especially farmland. (Farm states show the highest millionaire densities.) The upshot is that thou sands of Tennesseans and other Americans are realizing the Horatio Alger dream of piling up a cool mil lion dollars in personal assets. But in terms of, say, 1940 dollars that million dollars would be more like $200,000 or so. Indeed, if inflation keeps escalating, everybody will be IN DEFENSE OF MILLIONAIRES 95 a ~~millionaire" before very long but a rather pauperized one.

The further bad news is that envy and social harassment still dog the millionaire. Look at our plays and novels, our movies and television programs. Millionaires are usually if not always portrayed as venal, grasping, shallow men and women. The TV phenomenon of ~~Dallas," which I confess I greatly enjoy, is about par for the course. As a char acter in F. Scott Fitzgerald's The Rich Boy put it: ~~Let me tell you about the very rich. They are differ ent from you and me. They possess and enjoy early and it does some thing to them, makes them soft where we are hard, and cynical where we are trustful in a way that, unless you were born rich, it is very difficult to understand." Even some church officials get into the act: ~~Ours is a world in which wealth is superabundant, exists be-, side and depends upon, the poverty and starvation of countless of God's human children. Some humans de-, vour the resources of the earth while: innumerable others languish in want and despair. The church must stand.

within that struggle, making its: voice heard in behalf of the power·, less and the forgotten. It must point out the superfluous wealth is an ab·, horrence to God in a world where" for the majority, economic failure" means permanent disaster." The war against wealth has taken. more extreme forms: the holocaust of Jews in Germany, the liquidation of Kulaks in Soviet Russia, the slaughter of the Ibo tribesmen in Nigeria, the killing of nearly a mil lion overseas Chinese in Indonesia, the massacre of whites in Uganda. To be sure, in all these cases there were factors besides that of an anti wealth mentality. A subtler form of that mentality lies in the progressive income tax, which Karl Marx and Friedrich En gels expressly called for in their Communist Manifesto as a means of making ~~inroads upon the old social order, and ... revolutionizing the mode of production." Today the pro gressive income tax is especially ne farious in our inflationary age, cut tingever more deeply into the ability of everybody, especially salaried people, to reach the nirvana of mil lionaire status.

As it is, the top 50 percent of in come earners pay 93.5 percent of the Federal income tax bill, according to the 1978 figures compiled by the Tax Foundation of Washington, D.C. And of course, with mounting inflation, this concentration of the tax burden at the upper end of the income spectrum is on the increase. Thus the irony of the progressive income tax is at least twofold: First, through ubracket-creep," the effec tive federal income tax bite is mak ing upward mobility in real income terms harder and harder.

96 THE FREEMAN Secondly, millionaires and other high income earners are blunted in their ability to inadvertently serve the poor. The rich, you see, have a function in society not unlike that of the honey-seeking bee spreading pollen as it flits from flower to flower. Millionaires, in other words, are savers and investors par excellence, and thus they are our chief creators of capital formation, which is the raison d'etre of the well-being of our society-public sector and private sector, rich and poor but especially the poor. Inflation and the progres sive income tax thus become harsh regressive taxes on ((the underpri vileged." Further, envy of the rich is mostly misbegotten. Many believe that the rich exploit their wealth from the poor, that one man's profit involves another man's loss, that Corporate America rapes the environment, that the consumer stands helplessly be fore ((sharedmonopoly,"that the poor become poorer and poorer and so on.

To meet all these and other argu ments of what Ludwig Mises called ((the anticapitalist mentality" is impossible in terms of time and space. Enough to say that the con sumer-mostly the little fellow-is sovereign if not dictatorial in the marketplace, that the marketplace is strictly voluntary in contrast to the coercion involved under social ism, that both parties in an ex change profit, that if Reggie Jackson, Sophia Loren and many entrepreneurs are millionaires their wealth is most willingly bestowed on them by consumers, including the poor, for coming up with better and better goods and services at lower and lower cost. But, 10 and behold, some good news for the poor: Their secret friend, the millionaire, is acquiring some pow erful friends of his own in the court of public opinion. For example, ac cording to Thomas Sowell, the bril liant black UCLA economist, the rich, like the poor, have become a fullfledged uSociaIProblem." Dr.