Ken Zimmerman summarizes: “Robert Reich suggests that one thing we could do to deal with these problems is to abolish billionaires. Robert, lays out the ways billionaires are able to accumulate that much money. First, monopoly. We can address this by vigorously enforcing anti-trust laws already on the books. Second, copyrights and patents. Robert suggests shortening these by half or more. Third, insider information. Here we need to both enforce fines to take away all the money gotten in this way, and in egregious cases send those who seek out and use such information to prison. Fourth, pay off politicians. This screams for Congress to take private money out of elections completely. And long prison sentences for those convicted of giving and receiving private money wouldn’t be a bad idea.”
Robert Reich and Ken Zimmerman obviously lack scientific knowledge about how the economy works. The proof is in the assertion: “Robert, lays out the ways billionaires are able to accumulate that much money.” Fact is that the substandard economists Robert Reich and Ken Zimmerman are stuck on the phenomenal surface and simply parrot worn-out arguments from the long history of soapbox economics.#1
The explanation of how “billionaires are able to accumulate that much money” is in the macroeconomic Profit Law, i.e. Q≡Yd+(I−S)+(G−T)+(X−M)#2, #3 which boils down to the pivotal relationship Public Deficit (G−T) = Private Profit Q which states that the Oligarchy’s financial wealth and public debt grow in lockstep.
Conclusion: profit of the business sector as a whole is zero if the government’s deficit is zero (all other factors ignored for the moment). This is the surefire way to prevent billionaires, so the need to abolish them does not arise, to begin with.
Deficit-spending/money-creation is a free-lunch program for the Oligarchy, financial wealth and public debt grow in lockstep, and fabulous financial wealth in the USA is roughly equal to humongous public debt (22 trillion). Macroeconomic profit has NOTHING to do with greed/exploitation/innovation/monopoly power/patents/copyrights/productivity ― these factors play a role for the DISTRIBUTION of macroeconomic profit BETWEEN firms ― but with growing/shrinking debt.#4
The political agenda pushers Robert Reich and Ken Zimmerman simply draw attention away from the ultimate source of profit. The very characteristic of Late Capitalism is that the so-called free market economy is on the full life support of the State. Profit is produced by the government through deficit-spending/money-creation. The Oligarchy, in turn, uses the opulent free lunches to corrupt what remains of the State’s legislative, executive, and judiciary institutions. The circular interdependence is self-reinforcing and ruinous.
Needless to emphasize that economists are heavily involved in the deception of WeThePeople and the maintenance of the Oligarchy’s circuit of self-alimentation.#5 After all, that is what the overwhelming majority of economists has been doing since Adam Smith/Karl Marx regardless of their right/center/left self-labeling.#6 Robert Reich and Ken Zimmerman and the Real-World Economics Review Blog are NO exception.
#1 Economics: failure, fake, fraud
#2 Wikimedia AXEC143d Profit Law (with increasing complexity) and Balances Equation
Profit and macrofoundations
#4 MMTers are false Progressives and false Friends-of-the-People
#5 Keynes, Lerner, MMT, Trump, etc. and exploding profit
#6 MMTers are false Progressives and false Friends-of-the-People
Related 'How the 99 percent can bring overall profit of the 1 percent legally down to zero in 2017' and 'The Profit Theory is False Since Adam Smith' and 'Proﬁt for Marxists' and 'Essentials of Constructive Heterodoxy: Profit'.