How to explain this sense — expressed by Representative Alexandria Ocasio-Cortez (D., N.Y.) and New York Mayor Zohran Mamdani, among others — that billionaires are taking from society rather than contributing to it? I argue in Project Syndicate that there are several reasons, including the view “that the economy is a zero-sum game, in which the only way for your income to rise is for mine to fall.”
This is dangerous nonsense. The game is not rigged. In the US economy, people receive their just rewards. Compensation is primarily determined by productivity — effort, risk-taking, skills, and choices. Billionaires have outsize wealth primarily because the market value of their economic contributions to society warrants it.
We should celebrate their success as a message to young people. We should want more billionaires, not fewer — certain in the knowledge that they give much more to society than they take from it.
Consider Mamdani’s ludicrous implication that hedge fund CEO Ken Griffin is not pulling his weight in New York City.
“As mayor, I believe everyone has a role to play in contributing to our city,” Mamdani said. “And some, a little bit more than others.”
Well. Griffin and his firm, Citadel, contribute much more to New York than the average citizen, though perhaps in ways that are less obvious than the creators of Amazon and Google Maps. According to a memo by Citadel’s chief operating officer, the firm’s New York employees paid $2.3 billion in city and state taxes over the past five years. A proposed $6 billion Park Avenue office project for Citadel would require 6,000 construction jobs. (And Griffin himself has donated $650 million to philanthropic causes in New York.)
Moreover, like tech entrepreneurs, hedge-fund managers create value that accrues to all of society. Apart from building projects and tax revenue, firms like Citadel help to ensure that capital is allocated efficiently throughout the economy, which ultimately makes workers throughout the entire economy more productive, increasing their wages and living standards.
By contrast, Ocasio-Cortez and Mamdani’s ideas could harm the workers they claim to care about. After all, Griffin is expanding his operations in Florida in part because he is concerned that New York’s desire to target the affluent will escalate, and several prominent tech executives from California have recently staked claims in Florida as well.