Let Jordan Speith Keep His Money!

Tamny in RealClearMarkets, Key points:

  • If wealth redistribution is truly the goal, then the ideal scenario would be one in which Spieth holds on to as much of his Masters paycheck as possible.
  • Assuming what seems observably untrue, that Spieth is a wasteful, prodigal spender, wealth redistributors should seemingly rejoice such a scenario. Spieth could quickly spend the portion of the winnings he keeps on private jets, hotels, cars, and booze, and per the alleged Keynesian multiplier, expand the economy through aggressive consumption. Even better, the money wouldn’t have to sit in Washington in wait of politicians to vote on its final destination.
  • …it’s important to remember that there’s no such thing as idle wealth. Applied to Spieth, unless he intends to stuff his Masters winnings under a mattress, the $1.8 million he earned will quickly migrate to the hands of many people not named Jordan Spieth, and who are not nearly as rich as he is.
  • Parsimony in no way subtracts from demand…As opposed to reducing demand, savings merely amount to a shift of consumptive ability from the saver to the borrower. If Spieth chooses to put his Masters windfall in the bank, his deposit will soon enough represent loans to individuals who need money to buy a car, to pay the college tuition of a son or daughter, who need a home loan, or who perhaps need credit in order to start a small business.
  • As opposed to reducing demand, savings merely amount to a shift of consumptive ability from the saver to the borrower. If Spieth chooses to put his Masters windfall in the bank, his deposit will soon enough represent loans to individuals who need money to buy a car, to pay the college tuition of a son or daughter, who need a home loan, or who perhaps need credit in order to start a small business….What this tells us fairly explicitly is that the single best way to redistribute the wealth of the rich is to let them hold onto it.

 

 

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