Dear Mr. Gates and Mr. Buffett:
Your charitable initiatives via the Gates Foundation and your efforts to persuade other billionaires to match your generosity are highly commendable. Nonetheless, one must wonder, given the current challenges facing our country, if the path you have chosen truly represents the best way to leverage your accumulated wealth.
While the efforts undertaken by your foundation are certainly significant, they pale in comparison to the overall generosity of the American people. The U.S. government provides about 30 billion dollars per year in direct foreign aid, while private charitable contributions amount to over $300 billion annually. That level of generosity, and its global impact, is made possible by the unparalleled power of the American economic engine. But that engine is now severely unbalanced -- and the situation is rapidly worsening.
Overall American prosperity is deeply intertwined with the well-being of the middle class. It was the rise of a vast and vibrant consumer class during the post-war period that drove the U.S. economy to unprecedented heights. And both you Mr. Gates, and you Mr. Buffett, rode that rising tide and leveraged the power of American markets into your vast fortunes. Both of you benefited enormously from the infrastructure of American capitalism -- from access to free and efficient markets, from well-defined property rights, and from our democratic institutions. The legal system and the institutions that define American capitalism and upon which both of you built your fortunes were created and maintained by all Americans: by millions of middle class workers who paid their taxes and supported our economic system with the expectation that it would continue to offer them and their children the opportunity for a better future.
Today, however, the American middle class is disintegrating before our eyes. Wages for average workers have been effectively stagnant for decades, while the cost of housing, healthcare and education has exploded. The concentration of income in the United States now stands at historically unprecedented levels.
There can be little doubt that advancing information technology and globalization are among the primary forces driving us toward increased concentration of income. Surely you, Mr. Gates, must understand that technology will not stop progressing and that its impact will continue to be relentless. New forms of automation will arise. Improved technologies will further streamline globalization and will likely make it even easier for businesses to employ offshore labor.
If nothing is done, these forces will continue to destroy the middle class, and the number of American consumers with the income and confidence to drive robust market demand will continue to contract. The reality is that there is simply no viable force -- either economic or political -- to counteract the relentless concentration of income and opportunity that now characterizes our society. Our government has largely degraded into a plutocracy of special interests. While specific agendas vary, collectively these powerful players act to accelerate the drive toward further income inequality -- even as they attempt to dismantle the few safety nets that exist for middle class Americans.
In the absence of a countervailing force, income inequality seems poised to reach levels that may ultimately be socially, and even economically, unsustainable. If that is allowed to happen, the ramifications may be both dire and unpredictable.
Mr. Gates and Mr. Buffett, why not deploy a substantial fraction of your wealth at home? Why not create a powerful political voice -- and a well-funded lobbying organization -- to speak for the interests of the bulk of Americans: for the bottom 80, or even 90, percent of the income distribution?
The American middle class needs reasonable safety nets and access to shared prosperity and opportunity. It needs affordable access to health care, and it needs assistance with higher education. The country desperately needs to invest in the physical infrastructure upon which all Americans rely. Without these things, the American middle class will continue to disintegrate, and as it does so, the vast consumer market upon which you both built your success will continue to contract and degrade.
I urge you to consider putting some of your wealth to work for all Americans -- and for the continued prosperity of our country. Create a force to push back against the powerful interests that seem content to watch our way of life and our economic security evaporate. If you will not do this, then who will? Who else has the wealth and power that you control?
The reasons for you to act are compelling. It is not simply a question of repaying the debt you owe to your country. American generosity has always been founded on our overall prosperity. If that prosperity is threatened, the effects will be felt globally -- and the negative impact throughout the world will surely far exceed any benefit from your direct charitable contributions. There is simply no task that is more important than the preservation of a vibrant and balanced American economy and society. There is nothing more worthy of your wealth and your energy, and nothing that would contribute more to the well-being and security of people throughout the world.
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Martin Ford is the author of The Lights in the Tunnel: Automation, Accelerating Technology and the Economy of the Future (available from Amazon or as a FREE PDF download) and has a blog at econfuture.wordpress.com .