It's simply because money is compoundable. The more money you have the more you can make, and the more you make means less other people have.
https://fortune.com/2026/01/13/us-workers-smallest-labor-sha...
Having lots of wealth does not mean other people have less. If that were the case, there'd be as much wealth today as there was 1000 years ago. Making a company and having it valued at whatever value, does not remove that amount of wealth from other people.
> There's not a finite amount of wealth.
I think there is a finite amount of wealth, at any given time, same as "money". Money is a transactable medium to measure value, rather than as a type of good on its own. The medium can change region to region and over time.
Wealth is an aggregate of all valuables you possess, including expected gains. Wealth is also subjective, because of these properties. People agree on some approximations for the purposes of transactions with money.
> Making a company and having it valued at whatever value, does not remove that amount of wealth from other people.
Depends on perspective, I would say. When the value rises in a public company, even when it's just the expectation, you have people dumping their wealth (as money) into the company. So yes, it does for large public companies. While it does grant some rights, in a practical sense it's a hole you dump money into with the expectation that you can reach in and take out some amount in the future. I can understand this is what is envisioned, when people talk about wealth as zero sum. I don't agree, but I get what they are going at.
> If that were the case, there'd be as much wealth today as there was 1000 years ago.
Wealth is partially based on expectation. The growth in population fuels increases in wealth, because that's the part of the equation that is speculative.
That's not how it works at all.
If I have a $200K net worth, and I'm living in a city where the range is $1M to $500M, then I'm pretty much living in poverty, even though I have "more wealth" than in scenario 1.
This is also why, although my absolute wealth today is hundreds or thousands of times more than a king in the middle ages, I'm not actually living like a king today.
It's also how gentrification works. You're living somewhere and all of a sudden a bunch of very wealthy people move in, raising the prices of everything. You're no more or less wealthy than before, but everything has become slightly worse.
Can everyone be rich enough to not be in the bottom 20%? No, no matter how rich we become.
Can everyone be rich enough to have servants? No, unless you count machines as servants. But if you do, then I'm rich enough to have several.
You live way better than a king. Your expected lifespan is higher than kings because of access to better food, nutrition, and medical care. You have access to luxuries like chocolate, and coffee that kings might have tasted once in their life, or at best every few weeks.
Not understanding what wealth is, is precisely what leads to this mistaken thinking.
As for gentrification, it is often just confusing correlation and causation. People blame rich people moving in, when really a place just actually became better due to improvements in goods or services like public transit exapansion.
It's not an issue that they are wealthy, it's that they are abusing that position to gain even more wealth at the expense of the rest of the population.
> Making a company and having it valued at whatever value, does not remove that amount of wealth from other people.
This is a strawman. The ability of people to accumulate wealth is affected by every aspect of the economic system, including the means by which those companies are acquiring wealth.
Proverb from my granny to contemplate: the devil always craps on the larger heap.
Lots of people with great ideas, skills, and work ethic don’t have $250,000 lying around to invest.
And Bezos's biological dad was a unicyclist, his mom got pregnant with him at 16 and later dropped out of college, and his stepdad was a Cuban refugee who got an education and became an engineer for Exxon. Going from zero to billionaire in two generations actually says something remarkable about our system.
Think about it another way. If the government doled out $500k to fund business ideas, do you think that investment would be available to kids of refugees? Of course not. There would be gatekeeping behind credentials and connections, and it would be open to a lot less than 10% of the population.
[1] In terms of birth lottery, having top 10% parents is like being born smart enough to get a 1290 on the SAT or having a 120 IQ. Not exactly rarified aid! https://research.collegeboard.org/reports/sat-suite/understa...
I don't buy that this is a common scenario. How many of those actually own a franchise and how many of them are drowning in debt trying to pay off the loan?
The average retirement savings at that age is around $500,000 according to Edward Jones. That’s average, not median, which means that a ton of people have a lot less money saved up than that by that age.
The Bezos family had $500k adjusted for inflation in money they could risk and lose 100% on. That money was also in an account the presumably was liquid enough to spend (I.e., I can’t spend my 401k money before retirement age without enduring a massive penalty and tax burden).
I must reiterate that no parent would liquidate their entire 401k for a business investment. Middle class people are not starting McDonald’s franchises. At best they are starting a Subway or a Dunkin with borrowed money, and usually the families that do that are putting the whole extended family in on that investment.
Finally, I will address the way in which you our bootlicking our hyper-capitalist system: you praise the virtues of a system that allows people like Jeff Bezos to make it big while downplaying the wild inequalities in that system caused by under-taxation of people like him.
10% of Americans, over 20 million people, have no health insurance. Why is that okay?
How do we know that it wasn’t a financially irresponsible move that in this case happened to pay off?
It does? I mean, sure, it's better than having only the already rich stay rich, but let's not kid ourselves that this is a life outcome that everybody, or even 10% or 1% of the US can shoot for. The vast majority of people stay closer to zero. Who gives a shit that a few people get to win the right-time-right-place lottery?
So it matters a lot where a society’s elites come from. In most societies, entering the elite requires family pedigree, credentials, and connections. If your society is such that simply becoming upper middle class gives your kids a sufficient platform to become a billionaire, that has a huge effect on who makes up the elites. Having elites whose parents were refugees or restaurant owners is hugely different from most countries.
This data point doesn't distinguish between a system that fairly rewards abilities, and one that works like a lottery. My guess is that the US is in between: it unfairly rewards abilities, and chance plays a large role.
Taking Jeff Bezos as example: 1) he certainly has remarkable abilities but maybe not 1,000,000 times more than the median American, yet he has about 1,000,000 times the wealth; 2) it's plausible that the US population of 350M includes several people with abilities similar to Bezos yet no notable wealth due to various circumstances. Both points suggest an unfair system.
My point is that having tycoons with 1,000,000 times the wealth of the median person is not a fair distribution, no matter which reasonable function you choose.
If you think superficially of "fair" like in a game, then yes a winner-take-all system can be fair. But when talking about socioeconomics, I think fairness goes a bit deeper. For example I would say a society with a lottery that picks one winner and tortures all others is not fair to those who lose (even though it's game-fair).
Amazon does not have an exceedingly high profit margin, and my understanding is that a lot of it comes from stuff like AWS, not Amazon deliveries - correct me if I'm wrong here. So I'm not sure that "three amazon deliveries a day" - if this is even common - is why that man is personally rich. Even if it were a big source of revenue, that would go into Amazon's coffers, not necessarily his directly.
Another way to look at this: Even if Amazon is wildly successful, does that mean Jeff Bezos specifically should become filthy rich as a result, instead of all its employees and investors? How should the gains from successful entrepreneurship be distributed?
Jeff Bezos owns 9% of Amazon. So 9% of the expected value of the money going "into Amazon's coffers" indefinitely into the future is counted as part of his current "wealth." It's not money under his mattress.
Is your argument that people shouldn't be allowed to own 9% of a company that they started?
The term "capital" is an abstraction that's not helpful here. The big "wealth" numbers are all about equity ownership in highly valued companies. Bezos owns 9% of Amazon stock. That's why he's "rich." What should happen to that stock? What happens to his voting control over Amazon?
It was not so abstract when Musk came up with 44 billion to buy Twitter... The details are complicated but in the end it's still wealth.
> Bezos owns 9% of Amazon stock. That's why he's "rich." What should happen to that stock? What happens to his voting control over Amazon?
Presumably he would sell the stock to pay the wealth tax (or whatever mechanism is there to limit wealth)?
As for the voting control: when you're down to 9% this ship has sailed hasn't it? Anyway I don't think society has a moral obligation to allow individuals personal control of a trillion dollar company because they founded it (and if society disagrees with me, super-voting shares can be used as Alphabet does).
The question boils down to a feeling that when the revolution comes, that no one person needs more than, say, $100 million for themselves, or not. Trying to distract the conversation into defining "for themselves" will only prolong your time before the firing squad, comrad.
The answer depends on how should the losses from unsuccessful entrepreneurship be distributed?
For whatever reason, construction hits a snag or revenues are not enough to cover expenses, how would it become “society’s” problem? Do I get made whole by the government giving me $1M, and the government takes posession of the property?
If so, I foresee a lot more opportunities for corruption.
You declare bankruptcy. Your vendors who extended credit get hosed. Your employees go on unemployment benefits. Each of these costs money, and each of these reduces taxable income.
The aforementioned suggestions are a great way to kill any incentive to take risks and start a new business with one’s savings, further tilting the playing field to SP500 dominance.
The above would be Microsoft for context. For some reason your comment assumes that what a company was "founded as" should dictate what they do decades later.
This is a false zero sum view of wealth that is unfortunately all too common.
No, that logic doesn't follow. Say my wealth grew by 3% and my neighbor's grew by 5%. That doesn't imply any sort of "siphoning" at play.
Which is exactly the same as "my neighbor's the same and my wealth decreased"
Which is exactly the same as "getting siphoned to the rich"
Money have no intrinsic value: its only value is relative the others (and also depends on what can be bought ..)
> Which is exactly the same as "my neighbor's the same and my wealth decreased
No, not even remotely true. This is a fixed sum view of wealth that assumes the only way to obtain wealth is to take it from someone else.
Say I have a 3,000 sq ft house on a quarter acre lot, and so does my neighbor. My neighbor's company has a successful IPO and he sells his equity to buy a 6,000 sq ft house on a half acre lot, then how has my wealth decreased?
It may be easier to understand globally: if you have no raise but everybody have a raise, then you are poorer (because everything cost more, but you have no raise)
This is just factually wrong. If my neighbor gets a raise and I don't, and stuff costs the same amount then I have not gotten poorer. If my neighbor doubled his income tomorrow, how would I be any poorer? In theory, you could argue that his higher income results in inflation, but that's only the case if total productivity doesn't match the increase in the money supply.
Wealth is not zero sum: inflation adjusted wealth has increased over time: more houses and cars get built, more advanced industries increase productivity, etc. Wealth is not a fixed pie, the total amount of wealth in the world increases.
Wealth has no intrinsic value, it is only relative to other and to what can be exchanged with money
The numbers may always go up but the things that can be exchanged does not. Hence the "you become poorer"
No, the things that can be exchanged for money does go up. More houses get built, more cars are manufactured, etc. The total value of goods in the economy increases.
The economy is not zero sum.
Yes indeed, every body can have everything. In the end, everybody will have a palace near the beach, everybody will have a mansion with a qualitative neighborhood, everybody can have a mona lisa at home
(trying ad absurdum to see if it helps you)
We don't live in a post-scarcity society, but we also don't live in a world where economic output is zero sum.
If you have a 3 bedroom house, and your neighbor builds a palace on the beach, you still have a 3 bedroom house. Nothing was taken from you, someone else created a new asset.
Capitalism concentrates capital in fewer hands.
And thinking about bubbles, imagine what happens when the GenAI one pops. The wealth some new billionaires had will go up in smoke, their assets will go on sale, and they'll be gobbled up by the old billionaires.
But I think still a lot of people would argue the distribution is too unequal.