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Redistribution of Wealth -- Yea or Nay?


By Daniel L. Uffner, Jr.

The United States of America is in a life and death struggle. No, not the battles in Iraq and Afghanistan nor the struggle against terrorists, but for the very soul of our country. It is a no-holds-barred conflict between those who believe the State should be all-powerful and dictate what its subjects must and must not do as opposed to the view of our nation’s Founders that individuals are sovereign and have the authority to elect representatives who are to carry out the people’s wishes when making laws.

The latest battle, Health Care Reform, was won by the Statists in spite of polls showing that 75% of the people were opposed to it. It is a political solution to a non-political situation. Its 2,700 pages include a mandate that everyone is to be covered and must pay for health care insurance, including young adults who have generally postponed that expense while they are healthy and just getting started in life. The Statists justify that inequity to permit older insureds to pay lower insurance premiums. It is a redistribution of wealth from the young to the old. By not complying, the young will be subject to fines, imprisonment or both. 

Yet, on the other end of life, this new law includes the fairy tale that its cost will be partially paid for by reducing the amount of subsidy for Medicare by half a Trillion Dollars over ten years. Does anyone really believe that politicians will ever willingly take any money away from medicare? If they renege, this program will add that much more to the total U.S. debt and unfunded liabilities of over $100 Trillion.

Also, this struggle discloses priorities. In spite of a 10% official unemployment rate, which increases to about 17% when under-employed and discouraged workers are included, federal and state governments are adding new and higher taxes to make up for shortfalls in their revenue needed to support current and new programs. What people need are lower taxes and jobs that will enable them to feed their families and keep their homes from foreclosures. But Statists show, by raising and adding new taxes, that they are more interested in feeding governments than allowing people to be able to feed themselves.

When debating the points to be included and excluded for the U.S. Constitution, our Founders benefited from looking back on the fortunes of the Jamestown Colony from 1607 and the Plymouth Bay Colony from 1620. Both began as communal enterprises in which everyone’s production would be placed in a common storehouse and distributed as each person needed, even though some produced much more than others.

Since disbursements did not relate to production, it was a redistribution from the more productive to the less productive. This discouraged the better workers, who became less productive in ensuing years. It did nothing to improve their neighbors’ output.

In nine years, Jamestown lost 90% of its inhabitants to starvation; Plymouth Bay residents had a similar fate, losing 50% of its population in only two years. Both were saved from annihilation when it was decided that everyone could keep and do as he wished with his personal production. At the end of the Bay Colony’s third year, the harvest was so bountiful that they had a joyful, community feast to thank God for this turn around, and, thus, established the very first Thanksgiving.

Communal ideas look good on paper, and it makes us feel good on the inside that we have such altruism. But human beings are not perfect; we are flawed, and have selfish desires of wanting more. We want to know that if we work harder and smarter, we will be rewarded for that effort. We deem it unfair if those rewards are forcefully taken away and given to others who did not or would not earn them.

That simple idea, coupled with a very limited government that allowed individuals, without intervention or restrictions, the freedom to risk everything for an idea that may enable them to become rich, led to the United States becoming the wealthiest nation the world has ever known with the highest standard of living for the rich, the middle class and even the poor. 

U.S. officials have declared that people with less income than $20,000 a year are considered impoverished. Compare that with more than one-third of the world’s population, some 2 billion people, who must subsist on three dollars or less a day. No wonder so many people risk coming to our country, even though they could die trying.

Now, many of our government leaders have publicly avowed that they want to enact laws that will transfer wealth from haves to have-nots, repeating policies that have failed miserably in the past. Some are now openly supporting socialism, a system in which the government owns or controls all production and distributes goods and services as leaders see fit.

That plan always requires the government to forcefully take from the producers of wealth and give to non-producers. We would do well to heed the advice of Margaret Thatcher, a former prime minister of Great Britain, who said, “The problem with socialism is that sooner or later, you run out of other people’s money.”

If we wish to remain the world’s richest country, we have to resist the empty government enticements that promise “free” bounties that take from the “rich”. The first need to create jobs is capital, and it is the rich who have discretionary capital that can create jobs. If the government takes their capital with exorbitant taxes, unemployment will increase.

Another adage we would be well to remember, this one by economist Thomas Sowell, “What people want is more than there is.”


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