The Rich Are Not Job Creators

The fellow pictured at the left in entrepreneur and investor Nick Hanauer. He is in the richest 1% of Americans. But like Warren Buffett, he understands economics and realizes that his own economic well-being depends on the economic well-being of ordinary Americans.

While the congressional Republicans claim that the rich are the job creators in this country (thus justifying their efforts to lower taxes on the rich, Hanauer disagrees. And he recently told a Senate Banking Committee why. He said:

In the same way that it’s a fact that the sun, not earth is the center of the solar system, it’s also a fact that the middle class, not rich business people like me are the center of America’s economy.

As an entrepreneur and investor, I have started or helped start, dozens of businesses and initially hired lots of people. But if no one could have afforded to buy what we had to sell, my businesses would all would have failed and all those jobs would have evaporated.

He also found it silly that some think the rich can control demand in this country (since there just aren't enough of them to buy enough to truly affect an economy as large as ours). As he said:

I earn 1,000 times the median wage, but I do not buy 1,000 times as much stuff.

And he had a solution for our country's economic woes:

Tax the wealthy and corporations – as we once did in this country – and invest that money in the middle class-as we once did in this country.

That may sound like a crazy liberal idea to many right-wingers, but it is just sound economics. Hanauer understands that when demand increases he will make more profit and become wealthier (even if he has to pay a little more in taxes). No one is an island in our economy, and the rich can only take so much from the rest of us before it starts affecting their own bottom line. It's nice to see that at least some of the 1% understand this.