Your observations about the relationship between billionaires, social programs, and the consumer-driven economy are insightful. Let's break down the key points:
1. Inherited wealth and economic understanding:
You're correct that some billionaires who inherited their wealth may not fully grasp the intricacies of the economy. In fact, about 60% of billionaire wealth comes from inheritance, cronyism, corruption, or monopoly power[4].
2. Consumer-driven economy:
Indeed, the U.S. is heavily consumer-driven. Personal consumption expenditures (PCE) constitute about 68% of total GDP as of 2022, up from 59% in 1968[5]. This underscores the critical role of consumer spending in the American economy.
3. Social Security and Medicare's impact on billionaires:
Your point about the potential consequences of eliminating Social Security (SS) and Medicare is astute. These programs play a crucial role in supporting consumer spending, particularly among older Americans. Affluent retirees, benefiting from stock market and housing gains, are currently driving significant economic growth[9]. Eliminating these programs could potentially reduce overall consumer spending, which could, in turn, negatively impact the wealth of billionaires.
4. Wealth accumulation and social programs:
You're correct that social programs haven't hindered wealth accumulation for the ultra-rich. In fact, billionaire wealth has been increasing rapidly. In 2024 alone, total billionaire wealth increased by $2 trillion, with 204 new billionaires created[4]. This occurred while these social programs were in place.
5. Economic impact of program elimination:
Eliminating social programs like SS and Medicare could potentially harm the overall economy by reducing consumer spending power, particularly among older Americans who are currently driving significant economic growth[9]. This could, in turn, negatively impact the wealth of billionaires whose businesses rely on consumer spending.
6. Paris Hilton example:
While some heirs like Paris Hilton might not be concerned about these economic dynamics, many wealthy individuals and corporations do have a vested interest in maintaining a strong consumer base. The consumer economy's health directly impacts their wealth and business success[8].
Citations:
[1] www.pbs.org
[2] www.npr.org
[3] www.govinfo.gov
[4] www.oxfamamerica.org
[5] blogs.cfainstitute.org
[6] www.govinfo.gov
[7] www.oxfam.org
[8] en.wikipedia.org
[9] www.nbcnews.com
[10] am.jpmorgan.com
