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Wealth: Creation and Distribution

Whenever you hear people talk about wealth, its distribution, and wealth/income inequality, you should immediately in your mind classify that person as: a zombie leftist, a huckster leftist trying to pull the wool over the eyes of zombie leftists, or a Marxist. And I’m serious about that. The whole dialog about wealth inequality and the distribution of wealth is nothing more than tired Marxist bellyaching that has been taken up by mainstream leftists because most liberals (and people in general) are too stupid to realize how stupid it is to talk about the distribution of wealth. What we should be talking about is the creation of wealth.

First and foremost: wealth is not a fixed asset. I’ll say that again because it is a concept everyone really, really needs to understand. WEALTH IS NOT A FIXED ASSET! There can be more of it; there can be less of it. Wealth is not a pie; simply because someone has more wealth does not mean that you have less wealth. Wealth is something where if you want a big slice you should make your own pie.The top 1% have a disproportionate amount of wealth not because they stole it from the bottom 60% (who, for the most part, never had much wealth in relative terms to begin with), but because the top 1% is responsible for the creation of much of that wealth (or they inherited it from someone who did create it).

America is not not Europe. It is not like there is a landed, ruling class who own everything, denying others the ability to make new wealth and inherit all their wealth in a perpetual cycle. America is still a land where economic classes can be mobile. The poor can move up and the rich can move down.

The outrage over this supposed mal-distribution of wealth is even more stupid when one asks the question: what is the ideal distribution of wealth and who decides what that is? Marxists say an even distribution of wealth is the ideal, but how does anyone know what the optimum or “fair” balance of wealth is? For all we know, the current pattern of distribution could be the fairest distribution of wealth there ever was!

Wealth is not a story of rich vs. poor, but young vs. old. Old people are much wealthier on average than are young people, and this would make sense, wouldn’t it? Young people have few or no assets and have to work for a living. Old people have worked all their life and have built up assets in savings, investments, real estate (especially this), and even things like cars. This always, always, always skews the “distribution of wealth” because a nation almost always has more young people than it does old people (although in Europe and increasingly America, our birthrates have dropped to the point where that may no longer be true in a few years’ time).

If you want a more equitable distribution of wealth: don’t let the government sort it out! That will not result in a “fair” anything, be it a “fair” distribution of wealth or a “fair” way of life because it will instead merely create a ruling class who take from everyone and keep a large chunk of it for themselves. Everyone is greedy. Businesses are greedy, the rich are greedy, and simply because someone works in government does not make them any less greedy. It just so happens that while those involved in business are usually greedy for money, those in government are usually greedy for power (since with power comes money). Whether the politicians simply embezzle the money in the fine tradition of kleptocracy or adhere to the “modern” technique of elaborate but thinly veiled quid pro quo schemes, they will always find a way to keep the money for themselves and their friends.

Giving the government apparatus the power to confiscate wealth on a massive scale (through out and out confiscation or mere taxation) and redistribute it as they see fit will fail to redistribute wealth adequately because those in government have no inherent self-interest to see the wealth distributed adequately. Even if their re-election depends upon it, they need only make it appear as though wealth has been adequately and equitably distributed, which can easily be done through corruption, graft, bribes, bailouts, or whatever else because the politicians have immense power (since they have everyone’s money or most of it and can decide what to do with it). And of course, they can always rely upon the average voter and their mind-numbing stupidity.

Returning to the motif of pie, the best way to ensure an equitable distribution of wealth is not to have some central power take hold of the pie and divvy up everyone an equal sized piece. Instead, make it easier for people to make their own pie. If everyone can easily start up a business or otherwise go about their lives free to create and earn wealth, free of excessive regulation and taxation, then you will have a decent distribution of wealth. Perfect? No, nothing can be perfect, but better at least. Of course, that assumes the distribution of wealth matters at all, which I doubt.

-SL

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