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Sunday, January 19, 2014

Paul Krugman, "The Undeserving Rich": Steve Jobs, Bill Gates and . . . Barack Obama?

In his latest New York Times op-ed entitled "The Undeserving Rich" (, Paul Krugman takes aim at America's affluent. Krugman writes:

"And who are these lucky few? Mainly they’re executives of some kind, especially, although not only, in finance. You can argue about whether these people deserve to be paid so well, but one thing is clear: They didn’t get where they are simply by being prudent, clean and sober."

That's quite an across-the-board condemnation of people such as Bill Gates, Steve Jobs and even . . . Barack Obama. Yes, President Obama. Already multi-millionaires before taking residence in the White House, Barack and Michelle are expected to fetch in the neighborhood of $30 million for their presidential memoirs (see:

Whereas you can contend that the incomes of people such as Gates and President Obama need to be taxed at a significantly higher rate and distributed among the poor, it is hard to argue with the impact that they have had on America.

I have worked closely with more than a few extremely successful executives, whose assets and income would place them in the wealthiest 1 and even 0.1 percent of the populace. Some have been saints, others have been less saintly. Yes, these people have all been different from the general populace. But what most characterized these people was not their greed, but rather their drive, ambition and readiness to take risk. Yes, these people have all been different from the general populace.

The readiness to take risk? New York Times columnist Thomas Friedman wrote in his book "The World Is Flat" (my emphasis in red):

"America is the greatest engine of innovation that has ever existed, and it can't be duplicated anytime soon, because it is the product of a multitude of factors: extreme freedom of thought, an emphasis on independent thinking, a steady immigration of new minds, a risk-taking culture with no stigma attached to trying and failing, a noncorrupt bureaucracy, and financial markets and a venture capital system that are unrivaled at taking new ideas and turning them into global products."

In this rare instance, I agree with Friedman.

Tax these risk-takers at a higher rate? No problem.

Demean them as a group? Get real.

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