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The rich often get a bum rap. Liberals are incensed when it is suggested that "the rich" get any type of tax reduction even though the top 50% of wage earners pay 96% of all income taxes. Since they spend more money, the rich also pay a disproportionate amount in sales, property, entertainment, and excise taxes. Without the rich, most people would not have jobs.
The first computer American Vision purchased cost $7500. It was huge and could only perform a few simple tasks, mostly word processing. The floppy disks were the size of dinner plates and held very little data. Almost overnight, computer prices dropped and performance levels increased dramatically.
The first portable computer built by Compaq was the size of a sewing machine, but it was a vast improvement over what was then available. Today’s laptops have multi-gigabyte drives, super thin monitors, built-in modems, CD/DVD drives that can play music and movies, and much more, all in a 3 to 4 lb. package.
The first cell phones were the size of a small suitcase. You needed a shoulder strap to carry it. Now they are smaller than a pack of cigarettes. They are so cheap to own and operate that many people have given up using conventional (land-line) phone service.
What made these performance gains and price reductions possible? People with lots of money purchased the first high-end machines. They had the financial ability to lay out "excess" capital for what most people would consider luxury items.
The research and development costs of any new technology are enormous. That’s why the initial entry of new products into the market are expensive. But over time, when costs are recouped and production increases, costs and prices fall. The first CD players cost hundreds of dollars. They now sell for under $50. DVD players sell for under $50. This price reduction will lead to the end of higher priced and mechanically inferior VHS players and tapes. The spending by rich people fuels the market for future goods at lower prices which benefits everybody.
Slamming the rich by contending that they should pay more in taxes to equalize income is the sin of envy. Envy is not the same as jealousy or covetousness. The covetous person says, "I wish I had what he has, and I’m miserable that I don’t have it." Envy is quantitatively different. "I’d like to have what he has, but I know I can never get it. Nobody should be allowed to have it or at least that much of it. I’ll work to destroy it. Maybe I can get the government to make it illegal to own or too expensive to keep." This is why the Bible describes envy as "rottenness of the bones" (Prov. 14:30).
Societies that struggle to exist economically are infected with envy. Prosperity in others infuriates the envier and moves him to destroy what he does not have and will not work to get. Western enviers are more sophisticated. We don’t burn a villager’s crops or sabotage his well (Gen. 26:12-15). We run for political office or vote for those who do so we can stick it to the rich in the name of “tax fairness.” The long-term result is the destruction of the prosperous man’s ability and incentive to create wealth. In the end, the destroyed crops, the poisoned well, the high taxes hurt all of us. With no "excess" capital, there is no one to buy those initially expensive goods that make life easier for all of us. So, instead of envying the rich man, thank him.
The reality of these truths hit home in the aid that has been pouring into those areas hit hardest by the aftermath of the tsunami. If rich America and the other developed nations weren’t around, if the enviers had gotten their way and leveled the economic playing field through wealth confiscation and redistribution, the aid would only be trickling in if at all. Food, fuel, and transportation would be scarce and expensive.