Book of the week: Unintended Consequences: Why Everything You’ve Been Told About the Economy Is Wrong by Edward Conard
A former partner of Mitt Romney at Bain Capital argues that the superrich make life better, and less expensive, for everyone else.
Edward Conard has real guts, said Adam Davidson in The New York Times. In what could become “the most hated book of the year,” this friend and former partner of Mitt Romney at Bain Capital has put together a “tightly argued” case that the superrich make life better, and less expensive, for everyone else. In Conard’s view, the so-called 1 percent aren’t simply living it up at others’ expense. Rather, the wealthy routinely risk billions to back innovations that lift all boats, and the gamblers who win need to be richly rewarded so they won’t be cowed by the long odds of achieving new breakthroughs. Conard wouldn’t reduce the 1 percent’s share of the nation’s total wealth; he’d double it. Yes, he ignores many potential counterarguments. But he’s raising big questions.
It’s about time someone offered a “full-throated defense of economic dynamism, entrepreneurial risk-taking, and the rewards of success,” said Brian M. Carney in The Wall Street Journal. “Knocking down bogus clichés” from page one, Conard highlights some surprising facts. Take the big lie about income redistribution. Conard runs the numbers to argue that raising tax rates on the rich hurts the poor and middle class the most because it robs the economy of investment money. As an example, he points out that innovations in agriculture since 1950 have driven down the cost of food for consumers from 24 percent of income to 10. For a few, those innovations meant great riches. But by Conard’s calculations, the American public gets $20 in value for every $1 made by a business investor.
“You know the Democrats’ caricature of Republicans who only care about rich people?” said Roger Lowenstein in Bloomberg Businessweek. “Well, meet Ed Conard.” This author might be an “eloquent and passionate” spokesman for a survival-of-the-fittest economy, but the merits of his case are “overwhelmed by elitism.” One minute he’s slamming Warren Buffett for giving money to charity instead of reinvesting every cent, the next he’s deriding taxes on yachts because the economy will apparently seize up if risk-takers can’t readily flaunt their top-dog status. This “card-carrying member of the 0.1 percent” prefers that sacrifices be made by the less fortunate. Conard’s blinkered best seller clearly intends to help chase President Obama from office. “But it’s the Romney campaign that should hope it disappears.”