Book Summary Preview : Why We Want You To Be Rich

The Big Idea

America’s middle class is disappearing. Today, if you are middle class, you either need to become rich, or you are in danger of suddenly becoming poor. That’s because the US economy is at risk: the dollar is falling, jobs and industries are being exported abroad, wages are decreasing, oil prices are rising, and Social Security and Medicaid are going bankrupt..  Today’s middle class are in danger of losing jobs, retirement pensions, Social Security, and Medicare, and the government cannot protect them.  

Donald J. Trump and Robert T. Kiyosaki wrote “Why We Want You To Be Rich” because they believe the solution lies in financial education – teaching people not only how to avoid being poor, but also how to become rich. By sharing their own success stories, Trump and Kiyosaki show how people can think, act and be rich.

A Crisis Is Coming

Under globalization, industries and jobs are being transferred to other countries, and America, as well as other developed countries, is becoming a consumer rather than a producer. With oil prices controlled by supply and demand on a global scale, the US economy has become dependent on global trends. With the decline of the middle class, economic stability and democratic capitalism is also in danger.

In a few years, some 75 million baby boomers will retire. If each of them collects just $1000 a month, the government has to pay out $75 billion monthly. This is similar to the cost of a Hurricane Katrina or an Iraq war – every month.

Today’s poor and middle class needs to wake up to the fact that soon, the US government will not be in any position to take care of them. America has become the biggest debtor-country in the world; 44% of the debt is owned by foreigners. For years, government has not been managing the economy well, putting off problems instead of confronting them.

A Mismanaged Economy
Poor financial management has made such benefit programs as Social Security and Medicaid unsustainable. The US also has 423 million dollar trade deficit and it is growing, meaning it is consuming more than it produces, just like a family that earns $5,000 a month but spends $6000.  

Also, the current tax system favors the very rich over the poor and middle class. Tax cuts for example benefit the rich more than the poor. That means millionaires pay less taxes than the poor and middle class. 

But instead of coming up with solutions, government has continued to borrow money to pay its obligations. Poor financial management also afflicts many big corporations, like General Motors.

II. The Problem: Low Financial IQ
Most Americans, however, are poorly equipped to handle the crisis because of lack of financial education. When you have low financial intelligence or IQ, you keep doing the wrong thing and end up poorer than you are now. 

For example, people expect the government to solve the problems facing the poor and middle class. But the truth is, government has not enough resources or power to do so. Many of our problems today are global in nature, such as the price of oil, terrorism, and the exporting of jobs and capital to other countries.

At the same time, people in America think that they are entitled to jobs and job security, health care, wealth and prosperity. This overdeveloped sense of entitlement has made America’s middle class complacent in the face of the impending crisis. When America’s baby boom generation retires, the government will be hard put to cover benefit payments. 

Another factor contributing to this problem is the lack of financial education in America. Many Americans grow up well educated, but know little about money. For the most part, the poor are taught to rely on welfare, and the middle class imbibe the dictum of saving, working hard and investing their money safely in mutual funds and other safe investments.

This kind of poor financial education has only made the poor poorer and the middle class at risk of being poor. Poor financial education has also made people vulnerable to financial scams, rip-offs, or simply legal but dubious ways of investing.

For example, people continue to invest in big, well-known companies without being aware that many of these companies are mismanaged or in trouble. People continue to count on Social Security and Medicare, even though these programs are going bankrupt.

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