The concept of “elite overproduction” was developed by social scientist Peter Turchin around the turn of this century to describe something specific: too many rich people for not enough rich-person jobs. It’s a byproduct of inequality: a ton of poor people, sure, but also a superfluity of the wealthy, without enough positions to house them in the influence and status to which they think themselves entitled. In a modern context, that would mean senior positions in the government and civil service, along with the top tier of finance and law, but Turchin tested the hypothesis from ancient Rome to 19th-century Britain. The names and nature of the contested jobs and titles changed; the pattern remained. Turchin predicted in 2010 that by the 2020s it would be destabilising US politics.
Turchin didn’t specify exactly how much wealth puts you in a situation with an overproduced elite, but he didn’t mean debt-laden students; he didn’t mean MPs; he meant, for brevity, billionaires or the top 1%. When a lot of your media are billionaire-owned, those media sources become endlessly inventive in taking the heat off billionaires, nipping criticism in the bud by pilfering its vocabulary and throwing it back at everyone.
Elon Musk could never have got himself elected into office in the US. But as the cost-cutting tsar, a made-up role Trump has promised him, he would exert extraordinary power to cause pain, with the only choice left to citizens being whether or not to hug it. Another billionaire donor, John Paulson, has been floated for the treasury secretary job, and Trump has a track record of rewarding big-ticket donors with a seat at the table – the billionaire Stephen Schwarzman boasted in print about his role in the new North America Free Trade Agreement negotiations in 2018, and as part of Trump’s “strategic and policy forum” during the 2017 administration.
I'd argue against the word "earn" even. One cannot earn one billion dollars at all.
Nobody deserves $1 billion when it would take a teacher about 20,000 years to make the same amount. And it's not earned if it's not deserved.
But that's just semantic ranting, you're right.
Even the best teacher on Earth can only teach so many students a year. You can't become a billionaire without being able to 'scale up'.
But, for example, someone who invents something that makes a common manufacturing process just a few % more efficient, can affect millions if not billions of products that millions if not billions of people around the world buy. Even a small increase in profit margin can aggregate to a huge amount of increased wealth.
If you create that level of aggregate value, then you absolutely have earned that aggregate sum.
Also, it is literally not possible to become a billionaire by simply underpaying employees. That'd be the same kind of linear increase used in all of the dumb 'if you made $X every day for thousands of years (and interest didn't exist for some reason)' analogies, so I know the people who argue this do understand that linear growth doesn't get you there in a lifetime.
P.S. if employees were such an automatic profit source, why does downsizing exist? If labor is a profit source, firing people is throwing money away.
While I agree, billionaires don't just have a 10+ figure checking account. Most of their networth is in non-liquid assets.
Which is why we should tax unrealized gains over a certain amount, and loans against those unrealized gains.
Owning that much of a company that is valued that highly is still damaging to society, even if it isn't liquid cash. Even putting aside their ability to take out loans with the shares as collateral, if the company is really worth that much it should be owned by a larger number of people with each taking a reasonably sized share to ensure that decisions are not made selfishly.
Taxing unrealised gains also hurt working class people dabbling in the stock market to try and improve their circumstance. IMO once you reach a net worth of $1B you get a pat on the back that you won captalism, and a 200% tax rate on anything beyond that to force you to give it up. No one person should own and control so much of a company if it truely has so much value, divide it among those that created the value i.e. the employees.
No, I realized that after I wrote it and did the lazy thing and didn't edit.