A common misconception is that the wealthy are necessarily guilty of hoarding resources that could be better utilized. But this fundamentally misunderstands both the source of and the meaning of wealth.
First off, wealth is simply the net potential value of owned assets. Say I open a gym, and over time this gym becomes highly successful. After covering my costs, I take the remainder and open a second gym, then a third, and so on until I have a whole chain of gyms. These gyms generate profit that I can then either reinvest into the gyms or take as income. But because the gyms are profitable, and because the buildings and equipment have resale value, investors might be interested in buying my gyms. Now, say I choose not to. And instead continue to reinvest the profits into the gyms, my employees, and my community. Technically, I’m wealthy because the gyms that I own are valuable. But I don’t have access to that spending power. It’s tied up in the assets.
My point is that wealth in of itself doesn’t represent opulence or gluttony. Instead, it simply represents the stewardship of resources. Whether those resources are used for productive purposes, as in my hypothetical example, or less admirable pursuits, think Jeffrey Epstein, depends on the quality of the person. And so, if we are to judge the wealthy, we should judge them based on their behavior, not their means.
To my other point, the pursuit of wealth is a critical component of a market economy. Frederic Hayek once described the functioning of the market system by example of tin. Should tin become scarce for whatever reason, the many market participants would not have to be directed by some all-knowing authority to economize on the use of tin. Market forces would drive up the price of the now scarcer tin, motivating users to seek alternatives. But what might motivate canners, for example, to substitute from tin to then now more relatively abundant aluminum? The pursuit of profit, that is, the pursuit of wealth.
For this reason, for-profit, wealth-seeking business plays a critical role in the creation of social value. Business exists to identify opportunities to repurpose scarce resources toward more valued purposes. In return, business owners receive a portion of that generated value as wealth. So long as the business is conducted ethically with due consideration to the needs of all affected stakeholders, this accumulation of relative wealth by the owners is not only warranted, but socially beneficial.