Galt's Gulch

Bill Gates - Economic moron

Posted by Robbie53024 10 years ago to Economics
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According to Gates, someone who spends money on goods/services, is not delivering as much value to society as one who is investing in their business. But if there wasn't consumption, then the investment in business would be wasted. Economic moron.
SOURCE URL: http://fortune.com/2014/10/15/bill-gates-income-inequality/?xid=ob_rss

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  • Posted by CTYankee 10 years ago
    @Robbie, I don't quite agree with your analysis of what was written in the article.

    A little Econ-101 teaches us that Investment is the driving force behind the multiplication of wealth. Also you are correct that investment into production without consumption of the product results in useless inventory, the consumer does in fact 'degrade' that which was produced, but they do create Demand.

    The whole issue of Charity, as in the transfer of Wealth without expectation of Return, can at best be lateral, and at worst be destructive to GDP if the proceeds are spent poorly.

    You can disagree with Gates on many issues, you can say he's wrong, foolish, brainwashed even, but he's no moron. ;^)
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    • Posted by Robbie53024 10 years ago
      Disagree if you'd like. What BG said is that investment is more valuable than consumption - but without consumption investment is wasteful. They are neither more nor less valuable. They need to exist for an economy to function. The fact that there are imbalances point out where there is over and under production - that is one of the functions of trade. Not to understand this fundamental aspect of economics makes BG a moron.
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  • Posted by Kerryo 10 years ago
    I would still like to know where the dividing line is between the middle-class and the rich. If this isn't determined, how do they figure out who receives the redistribution? The whole discussion turns my stomach, frankly.
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    • Posted by LetsShrug 10 years ago
      Yes. I also want to know the exact dollar amount that changes a person from an applauded success to an evil, greedy person to be despised and an object to be looted. What's the magic threshold? Your success is only tolerated if you give it away happily and willingly. If you fight to keep what's yours you some how no longer deserve it. With this rampant way of thinking the moochers and looters have us by the tail and we're being swung like a bag of dog shit on a playground.
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      • Posted by Kerryo 10 years ago
        You do have to laugh at how they play the game. Warren Buffet is classic. Publicly supporting paying more taxes while he fights behind the scenes to keep his wealth out of the government accounts. I despise games because they are so dishonest.

        And yes, that's exactly what I'm asking. That line between evil and middle class seems to depend on your own personal perspective.
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        • Posted by LetsShrug 10 years ago
          Why is the line even up for discussion? What does me having less and you having more have to do with anything? If I wanted what the next guy had I'd work for it. We're not taking anything from each other...THAT'S fairness. And nothing but nothing can make people have equal abilities...
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      • Posted by Robbie53024 10 years ago
        There's no amount, it's how you got the money and what philosophy you advocate. The likes of Beyoncé, Snoop Dog, Bill Gates, Kim Kardashian, the real housewives of ___, etc., etc., etc. If you have money and the right (or actually, left) philosophy, you are just fine.
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        • Posted by LetsShrug 10 years ago
          The philosophy of "I owe everybody a hunk of what I earned"? Or better yet, the philosophy of "YOU owe everybody a hunk of what you earn."
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          • Posted by Robbie53024 10 years ago
            None of the moochers are demanding theirs from those I cited. They only want those of us who work for ourselves to give to them.
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            • Posted by $ allosaur 10 years ago
              Right on, comrade citizens, the untold riches of our more than equal elite betters are not to be squandered on the little people who are dependent on the needful leadership of those enlightened few.
              It is for the capitalist middle class to pay for what they did not build until that class is finally eradicated.
              That is the way to achieve the true equality that shall bring the long dreamed-of Utopian State into full fruition.
              Fist salute time, y'all! Hold that salute on high and cry to the top of your lungs: "Power to the people!"
              And that felt so good. Say it did.
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      • Posted by $ Thoritsu 10 years ago
        AMT is a pretty good measure for the consequences of success. It was supposed to distinguish this, but has fallen on a lot lower shoulders now.

        Another example of well-meaning programs, running amok, and now they generate too much tax revenue to kill. Flat rate, would be a lot better.
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    • Posted by Walt 10 years ago
      Perhaps, Bill Gates Bill Gate's mansion that overlooks Lake Washington in Medina, Washington, United States of America is the dividing line. The 66,000-square-foot (6,100 m2) mansion is noted for its design and the technology it incorporates. It is nicknamed Xanadu 2.0 after the title character's estate in Citizen Kane. It took seven years to build and cost $63.2 million.
      In 2009, property taxes were reported to be US $1.063 million on a total assessed value of US$147.5 million.
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  • Posted by $ blarman 10 years ago
    Any tax is a disincentive to production. There is no two ways about it. But even worse is a tax that only applies to some and not to others because of a "bracket". Those amount to punitive taxes - a punishment.
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    • Posted by Robbie53024 10 years ago
      No disagreement here. But, that said, if a tax is going to be levied, it would be better levied on consumption than on income. People are always able to moderate their consumption, but why would we want to moderate their production?
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      • Posted by $ blarman 10 years ago
        I'm of mixed feelings there. Are savings the precursor to investment? Yes. But should we be penalizing people based on their available assets or on their use of them? If we tax based on consumption, you encourage hoarding - not investment. I'm not convinced this is a wise course of action.
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        • Posted by Robbie53024 10 years ago
          That could be prevented by using a system where income is reported, and savings are reported (which would need to be distinctly defined - capital investment would be included). The difference is consumption.
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  • Posted by Danno 10 years ago
    As Jefferson stated, to paraphrase, you can tax Capital, Income, or Sales but if you tax more than one or all three you will surely kill the economy.

    Free markets are more equitable since monopolies are very hard to form without state sponsor. A free market in money would control inflation much better thus helping the poor tremendously.
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  • Posted by Herb7734 10 years ago
    I'd like to think that Billy G. and his ilk, were Hank Rearden types. That they understood how economics worked and where they belonged in the world of commerce. It turns out that their success had more to do more with the fickle finger of fate rather than anything else. Idols often have feet of clay, but the Gates of this world don't need feet of clay since they never reached idol status.
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  • Posted by woodlema 10 years ago
    Apparently Bill Gates to me, is saying: "I have a product that has no value, and have no idea why anybody buys it. Just invest in my business and I will give you a return on investment." That by definition is a PONZI scheme.

    Bill Gates has become so out of touch he does not even remember how he became so wealthy
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    • Posted by $ jdg 10 years ago
      Wrong, and probably libelous. A Ponzi scheme doesn't produce anything, it's just a fake investment firm. A business that produces goods or services is not a Ponzi scheme, even if its products turn out to be valueless and it goes belly-up.
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      • Posted by woodlema 10 years ago
        Not libelous. Please see the context of the comment. Bill Gates indicates that the "Customers" that purchase are not near as important as those investing in his business "Stock Holders." Based on Bill's comments and his current belief system, that is a Ponzi Scheme. We know that Bill is wrong since without those customers paying for the software THAT in itself provides the revenue for his business to grow, not the "investors"

        I wish folks would look at the full context of what is written.
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        • Posted by khalling 10 years ago
          The level of consumption depends on wealth creation. Not the other way around.
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          • Posted by eddieh 10 years ago
            Henry Ford doubled the worker's salary and reduced the workweek hours to 40 so the workers could own the cars they produced. That way he could get and keep productive workers.
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            • Posted by khalling 10 years ago
              He was able to do this because he created a market and a manufacturing system for which he had few competitors. This created wealth which allowed him to retain quality employees. When you pay your workers more providing they are productive, you turn out higher quality product more efficiently. It ends up saving you time and money. Then unions came along...
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              • Posted by Robbie53024 10 years ago
                Unions at FMC were unnecessary. The same is not true for GM. The problem with unions (and any hierarchy of power) is that those in positions of power see maintaining that power as more important than the mission of the organization.

                As has been said and proven by centuries of demonstrated examples: Power tends to corrupt, absolute power corrupts absolutely. One of the reasons our founders tried to craft a system with very little power, or at least little in any particular branch.
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          • Posted by Robbie53024 10 years ago
            True enough, but if there were no demand, there would be no consumption. Lots of businesses have invested and gone bust due to over estimating the customer demand. You cannot merely have investment, which is what BG seems to be alluding to. It is a mathematical equation and both elements are required. If either is zero, then the outcome is zero.
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            • Posted by khalling 10 years ago
              that's the funny thing about wealth creation. No one knew they wanted a car, no one knew they wanted a personal computer, no one knew they needed the internet. All of these inventions did solve problems but people tend to deal in the here and now. Demand can certainly be a driver, but it's development of technology that creates stuff from nothing. It is not consumption.
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          • Posted by livefreely 10 years ago
            It might be difficult to consume that which has not been produced.
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            • Posted by Robbie53024 10 years ago
              For some reason they have a difficult time understanding that it is a system. It cannot function only with one side or the other. Those that want to advocate that it is only investment fail to recognize that without consumers, that investment is wasted. Likewise, those who want to look only at consumption fail to recognize that if there aren't incentives for investment, the goods to consume will not exist. Only when there are consumers for goods, and investments in creating those goods will the system function. It is a simple concept that so many fail to understand. The hard part is that there is no "crystal ball" that tells investors what to create that consumers will purchase. That takes knowledge and some bit of luck. Beta was a better format, Blackberry had better security, and Lotus 123 was a better spreadsheet, yet they all have fallen (OK, BB isn't dead yet, but they're on life-support).
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  • Posted by $ Radio_Randy 10 years ago
    Bill Gates funded initiatives to legalize gay marriage and promote gun control in Washington state. For all I know, he probably funded the initiative to legalize pot, as well. The average American can't believe anything this guy says or does.
    If I weren't so dependent on Windows...I'd boycott him as I'm already doing to Amazon.com for the same reasons.
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  • Posted by ggiavelli 10 years ago
    Because of gates we now import over 700,000 indians with fake degrees every year into america to decimate our citizen software workers
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    • Posted by $ jdg 10 years ago
      That has nothing to do with Bill Gates. It's because those people will work for less. It would be unlibertarian not to let them in. It would also hurt consumers by raising the price of software. Why should we all pay more just so some American who hasn't kept up with progress can have a job instead of a foreigner?
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      • Posted by Robbie53024 10 years ago
        Yes it does. Gates, Microsoft, and other high tech companies are perpetually in front of congress demanding that H1C visa quotas be increased. They say there aren't the workers in the US, but what they really mean is that there aren't enough CHEAP workers. Those with the skills are here.
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      • Posted by ggiavelli 10 years ago
        hasn't kept up with progress? I never said anything about that. This has nothing to do with Americans low skilled in fact they are more skilled than the people who they are being replaced by. Many of these projects fail terribly once they try to use low priced scab labor.
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      • Posted by ggiavelli 10 years ago

        I agree. All national borders should be immediately dissolved and all work should go to the lowest bidder.

        Please explain to me how though we are to operate fairly when the only nation that has dissolved its border is Amerika
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        • Posted by johnpe1 10 years ago
          the u.s., sir, has screwed up by dissolving its border.
          I will not dissolve the border at my front door, and
          anyone not invited in will be confronted directly.

          a nation is an extended family, with inherent worth,
          based on culture and constitution and laws and
          shared "ideological wealth" ... and we need not
          share willy-nilly;;; I will not adopt a person just
          because they want to be adopted. -- j

          p.s. oops -- the "sir" was presumptuous;; apologies
          if errant term.

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  • Posted by lonerinfl 10 years ago
    There is a point to what BG said, but if there is no marketability of the product you produce then there is no profit. It is a point many great accounts of great wealth being created by giving away the primary product. IE: dos and Windows, cannot deny that Gates is one of the richest men in the world. And if there is nothing new to be a better thing there is no desire to spend money. Still Gates has fallen into the part of wealth that does make many dislike his views since he cannot give enough money away to offset his taxes. And he now does not worry about next weeks or next months bills. So he says things that do not apply to the masses.
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  • Posted by RevJay4 10 years ago
    I question anything the leftist, Gates, has to say. While I applaud his achievements, I don't see how he has any ground to talk about anything out his area of expertise. If he has one at this point in his life. If he had not had Daddy's money behind him, we wouldn't know who he is. Perhaps.
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    • Posted by Robbie53024 10 years ago
      Actually, Microsoft never developed anything themselves that was worth anything. Remember Bob? They were good at buying up technology then getting the gov't to mandate its use. They also gave the operating system away to computer manufacturers that then locked in DOS and later Windows use.
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  • Posted by bassboat 10 years ago
    It's not the perfect answer but a step in the right direction would be to implement the Fair Tax. Perhaps when people saw how much of their money went to the federal government for each purchase that they made they might just want to hold their congressmen to some accountability.
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  • Posted by ggiavelli 10 years ago
    I just spent 20 hours diagnosing windows thrashing problems due to explorer.exe. No it wasn't a virus, it was the operating system itself leaking memory.
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  • Posted by MagicDog 10 years ago
    He is and has always been a conman. It was once said by someone who would know that if you do business with Bill Gates you had better have a good lawyer. There is a motive behind every word he speaks.
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