Those Who Seek To Redistribute Wealth End Up Redistributing Poverty
Thomas Sowell points out why wealth redistribution doesn’t work. It’s because while existing wealth can be divvied up, there is less future wealth created once producers realize that big chunks of what they produce will be taken from them and given to others.
If we’re going to redistribute anything, we should redistribute not wealth but the knowledge and skills it takes to produce wealth.
In theory, confiscating the wealth of the more successful people ought to make the rest of the society more prosperous. But when the Soviet Union confiscated the wealth of successful farmers, food became scarce. As many people died of starvation under Stalin in the 1930s as died in Hitler’s Holocaust in the 1940s.
How can that be? It is not complicated. You can only confiscate the wealth that exists at a given moment. You cannot confiscate future wealth — and that future wealth is less likely to be produced when people see that it is going to be confiscated. Farmers in the Soviet Union cut back on how much time and effort they invested in growing their crops, when they realized that the government was going to take a big part of the harvest. They slaughtered and ate young farm animals that they would normally keep tending and feeding while raising them to maturity.
We have all heard the old saying that giving a man a fish feeds him only for a day, while teaching him to fish feeds him for a lifetime. Redistributionists give him a fish and leave him dependent on the government for more fish in the future.
If the redistributionists were serious, what they would want to distribute is the ability to fish, or to be productive in other ways. Knowledge is one of the few things that can be distributed to people without reducing the amount held by others. That would better serve the interests of the poor, but it would not serve the interests of politicians who want to exercise power, and to get the votes of people who are dependent on them.
The mistake people who support high taxes, expansive government regulation and redistribution make is assuming that these policies won’t change the way people behave. But this is nonsense. The harder you make it to start and run a business, the fewer businesses you’re going to have. And if you remove the incentives for creating wealth through taxation or redistribution, you’re going to get less of that too.
Instead of attacking those who are rich, seeking to drug them down to the lowest common denominator with taxes and redistribution, why not look to lift others into prosperity? Which is what the free market does on its own without the need of any policy or guidance from bureaucrats.
Tags: Economy, jobs, Taxes, thomas sowell, wealth redistribution
