They are sitting on roughly $40B. Why? Well, if they gave out dividends Bill would have sizable income taxes to pay. So they've been investing that money in a variety of mostly losing propositions and otherwise just hanging on to it with low return.

If dividends become tax free, Microsoft will start paying them. Bill will take his portion and invest in whatever he likes w/o worrying about what other MSFT stockholders might do. The other stockholders can do whatever they like as well. They can use the money to buy digital VCRs and Plasma Displays or use it to buy more Microsoft stock. Money is free to move and will move in millions of directions. That's different from what happens when it is "locked-up" in Microsoft in essentially money-market accounts.