Robin Grieve - Billionaires: Why Should Success Be a Moral Offence?

The question posed by Jack Tame in the TVNZ leaders’ debate was straightforward: “Is it morally acceptable for any one person to be a billionaire?” The responses from Christopher Luxon and Chris Hipkins were revealing because neither could give the straightforward answer anyone who champions aspiration would.

Labour’s discomfort with rich pricks is well known, although strangely they are keen to give billionaires free doctors’ visits, and of course they support race-based assistance to New Zealand’s Maori billionaire to help him overcome his disadvantage.

National’s apparent discomfort with championing wealth is new and is more concerning because it demonstrates the success of the left’s narrative that great wealth comes at the expense of everyone else, that the rich prosper by making others poorer, and that the benefits of economic growth never “trickle down” to ordinary people.

This is a false narrative being aggressively promoted by the left. It resonates with many because it appeals to some of our less admirable human instincts: resentment of those who have more, covetousness, envy, and the comforting desire to find someone else to blame for our own circumstances.

At its heart is the misleading idea that one person’s success must come at someone else’s expense. It ignores the wealth created when businesses develop new products, improve productivity, employ people and invest in new opportunities. The economy is not simply a fixed pot of money to be carved up by politicians. Wealth is not merely redistributed; it is created.

The left’s approach treats the economy as a cake of fixed size: take a bigger slice from the wealthy and everyone else can have a little more. But the cake can grow, and it grows through enterprise, investment, innovation and hard work. Policies that penalise success will reduce investment and result in shrinking tomorrow’s cake, all in the pursuit of a larger slice today.

Much has been made of the risk of capital flight if governments tax the wealthy too heavily. Yet a more fundamental question receives far less attention: what is the money doing now, and what happens to the economy when the Government takes it away?

Money deposited in banks helps fund loans to first-home buyers, farmers and businesses. Money invested in shares provides capital for companies to expand, develop new products, buy equipment and employ more people. Successful businesses generate wages, contracts, exports, tax revenue and opportunities for thousands of suppliers and service providers.

Take that capital away and it does not magically reappear as a bonus for the public. There is an opportunity cost. Less money available for investment will mean fewer business expansions, fewer jobs, less innovation and lower future production. The Government may gain revenue to spend today, but the economy will lose some of the wealth it could have generated tomorrow.

Money is not made more productive by transferring control of it from a successful businessperson to a politician.

Even a superyacht creates jobs

What if a billionaire spends money on something extravagant, such as a superyacht? Even that supposedly frivolous spending supports an industry.

Luxury boats are expensive to buy and to maintain. Once launched, it needs a captain and crew, fuel, food, cleaning, repairs, maintenance, insurance and port services. Marinas need staff to manage berths, security, waste disposal and maintenance. Local businesses benefit when the crew and owner spend money ashore.

The same principle applies to other luxury spending. The economic value of such spending should not be ignored.

The real question is how to create prosperity

New Zealand should aspire to produce more successful businesses, more productive workers and more people with the financial freedom to choose their own futures. We should celebrate achievement.

The question is not whether a billionaire has too much money. It is whether New Zealand benefits from the enterprise, investment and employment that helped create it—and whether taking money out of the economy in more taxes, to spend on welfare handouts and public services will make us more or less prosperous as a Nation.

Robin Grieve, a tutor, orchardist and retired farmer, is Chairman of Pastural Farming Climate Research HERE.