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Redistribution or theft?
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If a robber gave your goods to someone who is desparately in need, is it still theft?
In my last editorial I cited Vilfredo Pareto who is best known for the concept of Pareto optimality. Under this concept, reasonable allocation of resources is achieved when it is not possible to make anyone better off without making someone else worse off. Although this is the way in which government functions, it is not the way in which our capitalistic system is designed to work.
To assume that a citizen cannot become better off without causing someone else to become worse off is to assume that there is just so much wealth to go around, and once the wealth reaches a point of equilibrium, no individual can gain wealth unless another individual loses it. But as technology advances and new ways of creating wealth develop, it is possible for the hard working entrepreneur to gain as much as he or she chooses without causing harm or others.
Let’s assume that you own a bicycle shop. A bicycle is not critical to survival. Your customers choose to purchase bicycles using discretionary income, or funds that they have in excess of what is required to pay for necessities.
Does the sale of the bicycle make you better off and the customer worse off? If you answered yes, go to the corner of the room and face the wall. The purchase of the bicycle makes both you and your customer better off.
You, as the business owner, have become better off from the profit on the sale of the bicycle, and your customer is better off through improved quality of life: Enjoyable recreation that comes with riding the bicycle, a healthier lifestyle gained from the exercise that the bicycle provides, increased pride in ownership, and many other considerations. Both you and the customer have made a net gain through that sale.
But what if the government comes to your bicycle shop and forces you to give a bicycle to a person who doesn’t have a bike to ride? In this case, although the recipient of the bicycle is better off, you are worse off. In government thinking, this is redistribution of wealth.
It is not the responsibility of government to level the economic playing field. Assume for a moment that all the cumulative wealth in America can be placed in a large basket. On January 1, 2010 every citizen receives an equal share of wealth. There no longer are desperately poor people and filthy rich people. Everyone now has an equal share. On January 2, the government stops the redistribution process and steps aside to allow every citizen to control his or her share.
Human nature dictates that some people will invest or risk their resources for gain and others will squander them. How long will it take for there to once again be desperately poor and comfortably rich people in our society? Not long.
If any party, through threats or force, takes something of value from you and gives it to someone else you’d consider that to be theft, even if the recipient is desperately poor and in need. When government does it through taxation, it is called redistribution. But here’s the dirty little secret. No matter what you call it, redistribution is still theft.
Let charities, faith based, or other private philanthropic organizations help those who are disabled, aged, or otherwise unable to be productive. Let those who choose to work, take risks, and invest keep their wealth and at the same time allow those able bodied individuals who have become dependant on government to break the shackles of economic slavery and encourage them to gain wealth of their own.
Government consistantly tinkers with our capitalistic system. But, when not over regulated, Capitalism always functions in the way in which it is designed. The playing field is truly leveled, not through redistribution of wealth, but when everyone has an equal opportunity to succeed.
It’s time to allow the American people to be charitable on their own terms. It’s time to trim the fat out of government, repeal the income tax, abandon any idea of national health care or Cap and Trade, eliminate capitol gains and inheritance taxes, and institute a fair tax.
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