The Rational Use For Excess Money is Longevity Science
Let me be far from the first to observe that humans, collectively, are grandly and suicidally irrational. I point to war and destructive waste of institutional government as the primary symptoms, but there countless others. We humans are instinctive builders of social hierarchy, and aggressive optimizers in short-sighted search of the local maxima of our personal wellbeing. We'll ignore any number of fascinating mountains on the the horizon to climb to the top of the pitcher's mound right in front of us.
These two aspects of human nature - the short-sighted quest for gain and the need for hierarchy - combine to form a collective insanity, and are the root of the grand and depressing cycle of human societies. Production of wealth in a free society leads to the creation of a violence-backed hierarchy of rulership - the state - which in time bloats to become a police state or an empire. In either case power is concentrated enough for those at the top to destroy their society through the simple exercise of human nature. Corruption, destruction, unintended consequences, and the urge to personal enrichment. The resulting collapse removes the hand of the state to at least some degree, leading to the freedom needed to create wealth once more. And so it begins again.
This is the way it will be until some faction of humanity engineers changes in human nature: which will happen, probably near the advent of strong artificial intelligence, but not on a timescale useful to a discussion of what will happen to present to the present dominant empires, such as the US.
In any case, I'd like to point out a different form of insanity that springs from our human lust for local maxima and blindness of distant mountains: in this day and age, the rational use for any amount of money - beyond that needed to get by, for whatever definition of "get by" you care to use - is longevity science. Research into extending the healthy human life span by repairing and reversing the biochemical damage of aging. Why is this? Because time is limited, and money is not.
Time spent alive is the root of all property, all human action, and thus all wealth - both the silver in your pocket that provides for present choice, and the wealth of possible choices created by past investment. Time is everything. How much have time you spent reading this far? Could you have been doing something more useful, more optimal from your perspective? We make these small evaluations constantly, because time is the most valuable thing we have.
A hundred years ago, additional time was a limited commodity. You could spend resources to have a little more of it - doctors, a good life, the learning needed to take advantage of these items - but after a certain point there was no amount you could spend that would let you live for even one additional day.
This is no longer the case.
A sufficiently massive directed research program could, for example, realize the SENS program for rejuvenation within a couple of decades, to produce the planned and presently understood methods for repairing the biochemical and cellular damage that causes aging. Say $2 billion spent at $100 million a year, and you'll have working rejuvenation in mammals in the laboratory, ready to move to development in humans. It really is that cheap to go from where the research community stands now to completed proof of concept, and that would fund the full spectrum of development: replacement of mitochondrial DNA, safe breakdown of AGEs, amyloids, lipofuscin, and other unwanted chemical gunk, replacement of damaged stem cell populations, immune system restoration, and so forth. Cures for all cancers are in that list as well, but I'm actually fairly confident that will happen anyway before 2040 rolls around.
If you have time and health, you can always make more money. If you have neither time nor health, then money is worthless. So it seems fairly obvious where a rational person should direct the money not needed to get by. It should all go to longevity science: increasing the chance of you personally living into an age of indefinite healthy, youthful life spans, brought about by medical technologies of maintenance and repair that can reverse the course of aging.
But of course, we're all irrational seekers after local maxima, and so longevity science is largely unknown and unfunded. It's that mountain on the horizon - the biggest of them all. But that just seems to make it easier to ignore. So we keep climbing that pitcher's mound while the empire rolls towards its demise around us.
You make a great point about time. What's more important, potentially decades (or more) of healthy years added to your life, or buying a slightly nicer car that you won't even think twice about once you've been driving it for a week? I think we should all give any excess $ we have to the SENS Fdn or Methuselah Fdn. (And those of us rich enough to be reading this blog on a computer indeed do have excessive money, relative to most people on the planet.) I don't have much, but I've made several donations, and plan to make more.
I disagree with some of your points about "the state." For example, much important basic biology research is done only by govt, because it's not lucrative or short-term enough for businesses to do. (And nonprofits don't have enough $ to do it all) Private industry then sorts through this research, and creates applications. Private industry can do a lot of things well, but it can't do everything. IMO, it's about balance - not too much govt, not too little. Anarcho-libertarianism strikes me as being as flawed as communism is on the other end of the spectrum.
Regardless, the West is in no danger of becoming anarcho-libertarian anytime soon, so the point is moot; we must work within the system that exists.