Are Billionaires Evil?
by Ankit Kumar, BBA(FIA)’24
What would you do with a billion dollars? Spend it for fighting poverty, medical research, reversing climate change, and making the world a better place? What does it mean to be a billionaire? It isn’t someone who earns a billion dollars a year or has a billion dollars in the bank, as some people believe. A billionaire, on the other hand, is someone with a net worth of $1 billion or more. After deducting their debts and liabilities, their assets total more than a billion dollars. Cash, real estate, stocks, and pretty much anything else that can be traded for money are all examples of assets. As of 2021, there are 2,755 billionaires in the world, which is 660, more than last year. In India, currently there are 142 billionaires.
Billionaires have more money than most people could ever spend in a lifetime leading many to wonder is, it is evil to be that rich. This is a complicated topic. This might turn into a lengthy discussion. It’s also fairly subjective because it’s about ethics. However, we’ll take a look at some of the key points of contention in this discussion.
A large number of people don’t like billionaires as people believe they can eliminate poverty, illiteracy, and make the world a happier and better place to live with their wealth but they are not working in that way. People also believe billionaires are corrupt because some have been caught in money laundering cases. Many individuals are against the tactics that billionaires use. Well, the main reason is the increasing inequality gap so it becomes obvious that people will get angry or jealous by seeing the rich getting richer, and they are not even meeting their expenses.
According to the world inequality report, in 2022 income inequality will increase from 20% to 44% between 2000 and 2021. In 2021, the top ten percent of the population owns 65% of the household’s total wealth. The situation is same all over the globe as the wealthiest ten percent of the global population will own 76 percent of total household wealth and capture 52 percent of total income. During the first year of the COVID-19 pandemic, the wealth of billionaires increased by 37%. While 230 million Indians were pushed to poverty.
Billionaires’ defenders claim that they deserve their wealth because of everything they provide to the society, job creation being one of the examples. Amazon, for example, has 1.3 million people working for the company all around the world. But are those jobs new or just the ones shifted from the thousands of small businesses which have closed down due to Amazon’s rise to dominance? While assigning an exact amount of blame is not right for the collapse of other businesses there’s no denying that big retailers steer customers away from small companies and when you’re a business owner, the easiest way to make money is hiring as few employees as possible at wages as low as possible, In most countries, small businesses with less than 500 employees account for 50 percent of jobs. So, while large corporations contribute to the economy by creating employment, they are not the only ones.
People now argue that they provide us with innovation and convenience. It’s difficult to disagree that Amazon has made shopping a lot more convenient. And Amazon’s service is quite popular. They deserve credit for that, but do they deserve it all? After all, they didn’t come up with the idea. For decades, people have predicted the arrival of internet commerce. The internet, the technology that eventually made it possible, was developed using taxpayer money. It’s safe to say that even if Amazon didn’t exist, we’d still be ordering our books, batteries, and bottles from the internet.
Billionaires are notorious for dodging taxes. The wealth defense industry’s lawyers, consultants, and accountants can find tax breaks and loopholes, hide money overseas, and use other technically legal, but undoubtedly dodgy methods. Bringing billionaires’ income tax bills down to, well, very little. Taking out loans is one of the most devious methods for billionaires to avoid paying taxes. The ultra-rich borrow money in large amounts not because they have to, but because it allows them to access their money without technically generating income. Let’s look at how it works, if a billionaire takes a high salary, they will be entitled to a 42.7 percent income tax. This is why so many of them pay themselves at low salaries, for example, Jeff Bezos’ basic salary at Amazon in 2020, was $81,840. The value of all of the Amazon stock he holds, which grows every year represents his true wealth. However, if he ever sells any of that, say to purchase a yacht or a new house, he’ll be subject to capital gains tax. Instead, he and many other billionaires pay for their luxurious lives with low-interest loans. Loans aren’t included as income. They’ll take out another loan to pay off the previous one when it comes due.
What about that billionaire who is paying their taxes and not exploiting anyone? Who pays taxes and does not take advantage of others? Are they evil only because they have so much money? When there is so much poverty, disease, and devastation throughout the entire world. Well, not if they’re helping to do something about it. We can’t deny it. There are some charitable billionaires. Warren Buffett has contributed $42 billion in his lifetime. Bill and Melinda Gates have donated a total of $30 billion. Some billionaires have even gone so far as to donate their wealth. that they are no longer billionaires, However, the truth is that for every philanthropic billionaire, there are a lot more people who are saving their money. Only 223 billionaires, or less than 10% of the total, have signed The Giving Pledge. The billionaire also pays less tax by donating to charities and NGOs as the Income Tax Department permits you to claim an exemption under Section 80G for the money you donate to charities and NGOs to encourage individuals to give to good causes.
Capitalism isn’t perfect, but it’s a system that allows individuals to gain from their risks and hard work, and it’s helped millions of people escape poverty over the last century. As a result, some economists say that holding billionaires accountable is a defense of capitalism. Inequality in the world today is of a magnitude that has never been seen before. When so many families are struggling to make ends meet, and so many schools and public programs are cash-strapped. Meanwhile, a tiny percentage of people control half of the country’s wealth. That’s when people started to feel as though their economic system has failed them, and they want to either reform it or find a new one.