I enjoyed the below interview with Bill Gates by NY Times journalist Andrew Ross Sorkin.
The interview begins with Sorkin praising Gates as “the most consequential individual of our generation”. I wouldn’t go quite that far, but it was refreshing to see Gates fully accepting praise of that magnitude without even feigning humility.
Aside from the erratic hand gestures and awkward foot tapping (which may be involuntary ticks), Gates showed good social IQ. He got laughs from the audience when he said people at bars feel comfortable talking to him so “I try to stay away”. When mocking other billionaires’ obsession with space travel, Gates admitted he’s read a lot of sci fi, but “not as much as them”: Audience laughter.
It was also interesting the way a super high IQ billionaire like Gates looks down on investment billionaires for engaging in zero sum parasitic behavior. Just as in every day life, criminals tend to be less intelligent than productive citizens, it could be that even among the smartest billionaires, (i.e. those that made their wealth in math related fields), the most productive math billionaires are smarter than the psychopathic math billionaires.
Gates’s thinly veiled criticism of Elizabeth Warrens wealth tax was also interesting. Warren wants people to pay 2% a year on every dollar of net worth over $50 million and 6% a year on every dollar over $1 billion. According to Warren’s wealth tax calculator, Gates would have to pay $6.4 billion a year on his $107.4 billion fortune (as of today). That really adds up over the decades and if she wins the nomination, a lot of rich folks will go absolutely ballistic.
Defenders of the wealth tax insist the rich would still get richer because simply putting all your money in the S&P 500 increases wealth by 9.8% a year on average, but if it were that simple, why do so many rich people fall off the Forbes 400 every year? Indeed of the 400 richest Americans in 1982, only two still rank among the 400 richest today.
The fact is few billionaires are liquid enough to put most of their fortune in the S&P 500. Their fortunes are typically stocks in the companies they built and selling them would cause them to lose value.
It seems unfair to tax people just because they are rich. If there must be a wealth tax, Warren should tax people with a high ratio of wealth to lifetime taxes already paid. So someone who has only paid $100 k in cumulative taxes, yet has a net worth of $1 million should perhaps be forced to pay a wealth tax, but someone worth $1 billion who has already paid $500 million in taxes, should not.
Better yet, skip the wealth tax and simply increase the estate tax and capital gains taxes as Gates suggests.