In spite of rumors, billionaire Corona beer founder Antonino Fernández's estate will not be distributed among the residents of his home town.
Residents of a small Spanish village thought they might become millionaires overnight. There was a rumor the people of Cerezales del Condado would be the beneficiaries of Corona beer founder Antonino Fernández's wealth after his passing. He left behind an estate valued at about $210 million, which the village thought they might get a cut of.
It’s uncertain where the money will be going. Communications Director for the Fundanción Cerezales Antonino y Cinia Lucía Alaejos told Buzzfeed news, “Antonino did a lot for the village where he was born and for the Foundation. But he did it during his life.”
Had money been given posthumously, it would have been quite a story of charitable giving to see the wealth of one man spread amongst the small town where he grew up—to the people below. The distributed wealth would have amounted to around $2 million per resident, and would have been a scene of trickle-down economics in-action—a rare, if ever witnessed, sight.
The philosophy behind trickle-down economics assumes investors and company owners are the drivers of economic growth. Give more breaks to the wealthy and the additional money will trickle-down in the form of increased wages, additional jobs, and so on. However, this doesn’t come to pass, because it depends on people to behave in a certain way. When it comes to wealth, the rich have a higher propensity to save and save more. So, this additional money meant to help take the stress off businesses and allow for more job creation or increase in the salaries of the middle class winds up going into a savings account.
There are many ideas floating around in how we create more jobs, increase wealth—make life better for everyone. Trickle-down might work, if the rich behaved they way economists wanted them to, but they don’t. Wealth is more likely to be hoarded than given away so freely. There is one method to increasing wealth and prosperity which may pass the human behavior test: basic income. It's being tested very soon in Ontario, read more about that here.
Earners keepers? According to Larry Kudlow, there's a secret history behind the US's history of tax reduction and it involves John F. Kennedy.
On December 14 in 1962, at the Waldorf Astoria Hotel in New York City, President John F. Kennedy unveiled an economic plan that would breathe new life into the stagnant US economy. His focus was on growth incentives; he proposed reducing marginal tax rates for all taxpayers, cutting the lowest earners' taxes from 20% to 14%, and the highest earners' taxes from 91% to 65%. His tax code also closed a series of loopholes and tax exceptions. These measures worked, and the U.S economy grew by roughly 5% every year, for almost eight years.
Radio broadcaster and CNBC senior contributor Larry Kudlow credits JFK as the initial force behind Reaganomics, and believes Democrats today should take heed and embrace tax cuts over tax hikes. Kudlow doesn’t believe in taxing your way to prosperity, and it’s the thread throughout his new book JFK and the Reagan Revolution: A Secret History of American Prosperity, which he’s co-authored with Brian Domitrovic. The book aims to correct the historical record, which Kudlow and Domitrovic feel omits the truth about Kennedy’s economic persuasion, which came about under advice from his Republican Treasury Douglas Dillon.
Are Kudlow and Domitrovic on the money with their thesis? Some people are strongly opposed, such as broadcaster, entrepreneur and bestselling author Thom Hartman, who says that "there's just one major, glaring problem with Kudlow's analysis: It's not true." Read here for a counterargument to Kudlow’s view.
Despite his chat with Big Think kicking off on the misguided notion that "we all start at the same beginning, the starting line is the same," hear Kudlow out and consider whether there's validity to his argument for tax cuts – does a rising tide really lift all boats? Or would its success hinge on the simultaneous closing of tax loopholes and exceptions, true to Kennedy's 1962 plan?
Kudlow and Domitrovic's book is Reagan Revolution: A Secret History of American Prosperity.