Profit Is Indispensable for Prosperity: Thomas Piketty's Popularity Explains Our Sluggish Economy

Forbes ^ | 05/08/2014 | Steve Forbes

[SeekAndFind]

FRENCH ECONOMIST and darling of the left Thomas Piketty is the latest in an endless array of economists who are clueless regarding profits and what brings about prosperity and a higher standard of living. In his call for ferocious wealth and income taxes on a global scale to combat what he believes is the growing inequality between the rich and everyone else, Piketty has become a media rock star. This merely underscores the fact that pundits and all too many journalists, politicos and economists know less about money and economics than their forebears did 100 years ago.

No wonder the global economy is struggling, despite enormous advances in technology and the prospect of incredible breakthroughs in medical care. If not for this lack of elementary understanding, the U.S. would be booming today and the Dow Jones industrial average would be surging past 30,000.

The bottom line: You don’t get economic growth without investment. Capital comes from savings and profits. Period. Every tax and regulation that hurt the creation of capital and punish the rewards of successful risk-taking hurt everyone–but most particularly those with the least, who want, as Lincoln put it, to improve their lot in life. It’s not enough to invent something great. You have to have an environment in which entrepreneurs can turn inventions into marketplace products that become increasingly better, cheaper and more accessible to all.

[Alberta's Child]

Outstanding article. I wish this guy had won the GOP nomination in one of his unsuccessful bids for the White House.

[Buckeye McFrog]

Trying to explain simple economics to our LIV’s is a bit like trying to explain nuclear physics to a small-mouthed bass.