It's 'Disastrous' for Wealthy to 'Hand Their Money Over to Government'
Understanding how the world's economy works may seem daunting, but in reality, it's as easy as knowing the facts and figures of sports, rock 'n roll and even Paris Hilton, John Tamny, who covers economics and politics for Forbes.com and is editor-in-chief of RealClearMarkets.com, told Newsmax TV.
"The idea behind the book was that economic growth is so simple and everyone knows it, thats because they know the world around them," Tamny author of "Popular Economics: What the Rolling Stones, Downton Abbey, and LeBron James can Teach You About Economics," published by Regnery told "The Steve Malzberg Show" on Newsmax TV.
A prime example: LeBron James, the 6-foot-8 small forward for the Cleveland Cavaliers.
"If you want to understand free trade, Lebron James is a very good example of it. He is the best basketball player in the world. Thats how he can create the most wealth for himself," Tamny said.
"But it is said by football players that he can also be a tight end in the NFL. So I make the argument, if he did so, that would be a disaster because it would be at the expense of him being the best basketball player It actually reduce his income if he did both.
"Free trade is no different. Its entirely possible that youre the best chef and the best tailor and the best builder in the world, but if you were to do all three of those things, it would be at the expense of doing what youre best at which is being the host of a TV show."
Tamny also a senior economic advisor to the Fresno, California-based Toreador Research & Trading said since individuals all trade freely, "we let others do things theyre good at and we concentrate on what were best at because that allows us to command the most in the economy."
Tamny said he believes giving money to the government the worst thing that can be done in growing the economy.
"Its a disaster for the economy and its particularly disastrous when the rich hand their money over to the government rather than holding on to it," he said.
"The reason for this is basic, when Paris Hilton gets $100,000 to deejay a show in Las Vegas, she puts that money into the bank. In short, her wealth is immediately redistributed to those who are not Paris Hilton and thats why we want the rich to hold onto their wealth.
"They put it in the bank, its lent to someone who needs a car loan or needs a college tuition or who needs a small business loan. If they invest it in the stock market theyre providing capital to businesses."
With the other option, "we know [the government is going to consume it," Tamny said. "At least when the rich hold onto it, they redistribute it to us."
But what choice do individuals have when it comes time to pay taxes?
"Thats the problem When government is taxing us, it is robbing us of future ESPNs, future Intels, Googles, all these great companies," Tamny explained.
"Thats what were missing out on when government is taking too much of our money."
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