Yahoo Finance AOL co-founder Steve Case: Capitalism needs a reboot
AOL co-founder and startup investor Steve Case said it’s time to dial up a new approach to capitalism.
“It hasn’t been inclusive [capitalism] and we need to reboot capitalism and entrepreneurship so everybody gets the benefits and everybody has the opportunity to participate in the innovation economy,” Case told Yahoo Finance Live.
Prominent business people calling for a change in capitalism (with the preferred system being stakeholder capitalism) such as Case and Salesforce founder Marc Benioff have some new stats to arm their debates.
America’s billionaires saw a collective $1.1 trillion rise in their wealth in the first 10 months of the COVID-19 pandemic, according to new research out Tuesday from the Institute for Policy Studies. The combined fortune of the nation’s 660 billionaires as of Jan. 18 stood at $4.1 trillion, up 38.6% from March 18, 2020. There have been 46 newly minted billionaires since the beginning of the pandemic.
The wealth boom among the billionaire crowd has been fueled mostly by the rising stock market, surging business valuations and higher home values. More often than not, these are things the average American doesn’t have exposure to — and if they do, it’s not huge exposure.
At $4.1 trillion, the research shows the total wealth of America’s 660 billionaires is two-thirds higher than the $2.4 trillion in total wealth held by the bottom half of the population (165 million Americans). Looking at how a Bernie Sanders would look at it, billionaires and millionaires have financially cleaned up during the pandemic while the average Joe has gotten poorer.
“Billionaires are reaping unseemly windfalls of wealth during the pandemic,” said Chuck Collins of the Institute for Policy Studies in a statement. “They benefit from having their competitors shut down or controlling technologies and services we are all dependent on in this unprecedented time. We should tax these windfall gains to pay for recovery.”
The Biden administration is widely expected to raise corporate taxes and taxes on high earners within the next 12 months to help fund various relief efforts for average Americans hurt by the pandemic. But capitalism critics are usually quick to say more needs to be done to reform the system than hiking taxes.
For his part, Case has used his platform as founder of venture capital firm Revolution to bridge the societal divide. Case started Revolution back in 2005. In 2017, the firm launched its Rise of the Rest seed fund to identify promising startup ecosystems, and invest in companies in the middle of the country.
Thus far, the Rise of The Rest fund has invested in more than 100 companies across more than 30 states.
AOL is a sister site to Yahoo Finance, owned by their parent company Verizon Communications.
Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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