Some Thoughts On The Wealth Of A Nation
With a democratic super majority now ruling the country with visions of sharing the wealth, is it possible or wise to attempt to make all people “equal”? Endeavors to create total economic equality have never been successful in human history – would such an attempt now represent an extreme arrogance that results in less liberty for all?
In a stimulating discussion of the proper role of government, Cris Sheridan of Financial Sense raises the following issues.
If we could distill political science and economics down to a single main goal it would really be one thing: how to achieve the most efficient allocation of resources to a society. How does a society do this?
Utilitarianism is often understood as the greatest good for the greatest number of people. Since, in economic terms, “good” refers to prosperity or wealth, it is often argued that there is an inefficient allocation of resources when someone has a dramatically higher income than another in society, especially when the latter is severely poor and doesn’t have access to the same resources like health care.
The biggest problem with utilitarianism is that it will only work in the short-run for the following reasons: 1) high income earners will work less as their incentive for working is reduced, 2) they will have less income reserved for savings and investment, which is used as financial capital for the economy, and 3) they will often find means of either hiding or removing their wealth from the state and move all or part of their capital to a more tax-friendly environment.
So what is the alternative to the utilitarian approach then? Well, as the quote from F.A. Hayek says, “there is all the difference in the world between treating people equally and attempting to make them equal.”
Negotiating the balance between the rights of an individual and not attempting to obstruct the free-market forces that allow for the proportionate allocation of resources falls into a discussion of two main categories: 1) differences in what distinguishes a right from a privilege and 2) what is considered proportionate. This, I must admit, is really what the debate is all about.
The question I leave with you today is, will the government become so overwhelmed by its liabilities and demand a burden so great from its future citizens that private property and personal liberty fall from a discussion of the latter category into the former. When that happens, and will if we don’t change our course, our Constitution and the pillars of what made this great nation are collapsed.
Entire article is worth the read .
33 percent of Americans under age 30 prefer socialism and 30 percent are undecided – (these are the guys who slept in history class and still don’t know about the economic collapse of the USSR).
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