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Apparently, Bernie Sanders Doesn’t Know the Difference Between Revenue and Profit


This morning, Democratic presidential candidate and Vermont Sen. Bernie Sanders (I) tweeted out his support for efforts to unionize the video game industry. He did so in a fashion truly appropriate for the man—one that made it clear that he doesn’t always grasp basic economics:


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In the tweet, Sanders confuses “revenue” with “profit.” This is not an insignificant mistake, but it’s one that is common in reporting about large American corporations. All too often, reporters talk about how much money a company takes in without offering any analysis of that company’s expenses. Amazon, for example, despite massive revenues has only recently begunĀ making an actual profit. In theĀ TimeĀ story that Sanders links to, writer Alana Semuels similarly fails to differentiate between revenue and profit when covering the efforts to organize.

It’s true that the game industry did bring in $42 billion in revenue last year from customers in the United States (and nearly $140 billionĀ worldwide). But revenue is the money a company brings in before deducting its expenses, like, for example,Ā workers’ wages. So, in reality, video game industry workersĀ didĀ get a cut of those billions. It’s only after such workers are paid (and other expenses are deducted) that we can talk about profit.

Sanders, of course, has a long history ofĀ failing to grasp the basicsĀ of market economics. He frequently sees marketplace choices as a threat, even as theyĀ open avenues and opportunitiesĀ for our poorest citizens or provide all of us withĀ ever improving mass entertainment.

Story cited here.

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