Land was wealth 300 years ago. So the person who owned the land owned the wealth. Later, wealth was in factories and production, and America rose to dominance. The industrialist owned the wealth. Today, wealth is in information. And the person who has the most timely information owns the wealth. The problem is that information flies around the world at the speed of light. The new wealth cannot be contained by boundaries and borders as land and factories were. (p.95, Rich Dad Poor Dad: What the rich teach their kids about money—that the poor and middle class do not!)
Chew on that above paragraph for a few days and you’ll start to realize how profound Robert Kiyosaki’s words on finances are to a variety of realms. Think about it: the latest news—the most timely information—has power to sway masses of people that can influence a nation’s election. Yet this is true in a thousand other areas as well. In terms of social good, for example, if victims of human trafficking were equipped with the right information at just the right time, we could significantly reduce if not eliminate modern day slavery.
Kiyosaki’s best seller has given me huge insight into the significance of wealth creation. Most people work the majority of their lives for an employer, sending most of their income to the bank for loans and to the government in taxes. For the most wealthy, however, Kiyosaki points out that no matter how much we try to tax them to redistribute wealth more equally, they always find loopholes to evade the system. So taxes never affect those who are the most well-off. His words came to mind during last night’s Presidential debate. Donald Trump has successfully evaded our tax system his entire life. Yet after watching I thought to myself, “As offensive as I find the man, he was probably right when he accused Hillary’s financial supporters of also tapping into tax evasion loopholes.” The wealthiest people always do.
Kiyosaki’s advice is not to avoid paying taxes, but rather than spend our energy complaining about the wealthy not sharing (because essentially they never well), he encourages readers to focus on wealth creation. While reading his Rich Dad Poor Dad book last week, I came across a similar challenge from a vastly different source: a workshop at a Christian conference focused on international development by means of business.
“It’s time to ask, ‘what causes wealth?’” our white-haired facilitator said.
- Churches consume it.
- Families consume it.
- Governments consume it.
- Nonprofits consume it.
- Only businesses create wealth.
Kiyosaki had expressed similar sentiments through his cash flow charts: much of what poor people and middle class people consider to be assets actually consume our income. And just like our workshop facilitator said, Kiyosaki emphasized how in government, successful budgeting is combined with spending (a.k.a consuming):
The government ideal is to avoid having excess money. If you fail to spend your allotted funds, you risk losing it in the next budget. You would certainly not be recognized for being efficient. Business people, on the other hand, are rewarded for having excess money and are applauded for their efficiency. (p.85)
Spending as close to the amounts allotted us in our budget to avoid losing money for future seasons is also a common practice for many churches, nonprofits and aid organizations-places often dedicated to fighting poverty. Our workshop facilitator, however, pointed out that “Good intentions don’t end poverty. Enterprise and freedom end poverty.” Many organizations are beginning to recognize this with the development of social enterprise, high-bred fusions of business and non-profit worlds. But we need to keep pushing, beyond providing jobs for people.
“Instead of training job seekers, we need to train job makers,” our workshop facilitator instructed. And he backed his advice up with scripture:
“Remember the LORD your God, because he is the one who gives you the ability to produce wealth,” (Deuteronomy 8:18 NIV)