Wealth Inequality
September 24, 2025
Everyone seems to understand what Wealth Inequality is and everyone seems to be against it. Sit tight and read through this, I have a contrarian perspective to offer.
First, we should unpack what Wealth means. Wealth is not money. Wealth is a set of physical transformations that you can affect. Wealth is the abundance you create for humanity. Money is just a pointer that points towards the wealth you created.
America is wealthier than Somalia <-> America has more abundance than Somalia. Current day France is wealthier than France under Napoleon Bonaparte <-> Current day France has more abundance than France under Napoleon Bonaparte. A society that creates more and more abundance grows more and more wealthy. A company that creates more and more abundance grows more and more wealthy. A person that creates more and more abundance, for himself and others, grows more and more wealthy.
While there are some cons of using smartphones, life of everyone has become objectively better after the invention of smartphones. Apple and other companies created abundance by building something that would make people's lives objectively better. Apple grew its wealth by creating that abundance and that is reflected in their market cap. Similarly, Tesla created abundance and grew its wealth and that is reflected in their market cap.
Apple is a big company with multiple stakeholders including founders, employees, and investors. Tesla is a big company with multiple stakeholders including founders, employees, and investors. How do you attribute the wealth to each individual who is a part of this? Shareholding percentages are a definite answer here. Different people contributed to wealth creation at Apple and Tesla in a different way and are awarded in a different way. Founders own a significant percentage of market cap(wealth) because they have started the company, used the leverages available, and created abundance. Investors own a significant percentage of market cap(wealth) because they have helped the company by contributing capital at the right time. Some key employees are awarded with a percentage of market cap(wealth) because they are expected to contribute significantly to the process of creating abundance/wealth.
The other stakeholders who are not awarded the percentage/pie are awarded through money which again is a pointer towards the wealth they created. As there are multiple layers to this, different people get awarded based on the value they create. Steve gained personal wealth because he is able to create that value in Apple. Elon gains personal wealth because he is able to create that value in Tesla. Some are good at recognizing the levers and using them well. Some are not.
Elon has started companies in multiple domains that affect humanity like no other company on the planet does. He is going to become a trillionaire because he is able to create abundance (/affect physical transformations) in an astounding and unmatched way through these companies.
People argue that Elon shouldn't become a trillionaire because there are people at the bottom who have less than $10k wealth. These are fools who do not understand how wealth is created. They don't understand that "Elon will become a trillionaire only if he is able to deliver wealth/abundance to society worth multiples of a trillion dollars. He will only be awarded based on what he creates." The whole argument of wealth inequality comes from a nonsensical worldview of thinking that for one to grow wealth, someone else should lose wealth. That's not how wealth works. There should be more and more trillionaires. Humanity should have more and more abundance.
Wealth is not zero-sum. For Elon to go up, he doesn't have to pull down anyone. He, in fact, can pull people up along with him. Another example we should take is current day India. In the last decade, there are a few people who have grown their wealth to billions in India. And at the same time, India has been able to pull millions of people out of poverty. Current day India is objectively wealthier than India before a decade. Current day Indians are objectively wealthier than they were before a decade.
If you look at wealth like a limited pie getting shared between people, you will always be pessimistic. But that's not how the markets work and the concept of money works. The pie keeps growing. As long as everyone's pie is increasing, I don't think it's a problem if we have trillionaires.
There should be more and more trillionaires. Ciao.