My Own Pie

Libertarian Thoughts from Renaissance Guy

The Distribution of Wealth

with 2 comments

     I will be the first one to admit that the world’s resources are unevenly distributed.  A more accurate way to say it is that people are unevenly distributed.  On one end of the spectrum is a person born into a wealthy family in an area where it is easy to make a living.  On the other end is a person born into a poor family where there is hardly any opportunity at all.  That situation stinks.

     However, there is no point in blaming anyone for that situation.  If one believes in God, I suppose you could lay the blame for the disparity at God’s feet.  Otherwise, you have nobody to blame.  There’s no evil king of the world who dictates where people live or who is going to be born where.  There is no cabal that decided that certain people would be born on Fifth Avenue while other people are born in Harlem.

     All sorts of historical events put people where they are in the world today.  Nobody has control over where they are born or over the socio-economic status of their parents and their extended family.  If a person is born to a farming family in Mexico, that’s the hand that he has been dealt–just as much by fate as a poker player’s hand is dealt to him.

     People do have choice later in their life.  I know a man from El Salvador.  He came to America for what he considers a better life.  He became a physical therapist and works at the center where my son is having therapy for his knee.  It wasn’t easy for him to immigrate or to work his way through school.  I admire him very much.  At the optical center where my daughters got their new glasses, I met a man from Ghana with virtually the same story.  I was pleased to congratulate him when his soccer team beat the United States team in the World Cup tournament.

     When people talk about uneven distribution of resources or uneven distribution of wealth, I am dumbfounded.  They seem to be under the impression that there is somebody who sits over a big store of resources or money, as though it is a giant apple pie, and decides how much to give each person.  This imaginary pie server gave Donald Trump a great big piece of the pie and gave my acquaintances from El Salvador and Ghana just a tiny little crumb.  Then they say that things are “unfair.”  If somebody is giving out money, then it is unfair for that person to give it out in unequal amounts, all other things being equal.

     Wealth is not a giant pie in some magical pantry.  Wealth must be created by people.  Oprah Winfrey created wealth from her talent as a talk show host.  Bill Gates created wealth from his technological skill.  They did not sit around waiting for somebody to dish them up a piece of the mythical pie.  They made their own pies, and by lots of ingenuity and lots of hard work, they made some very big pies.  Both of them have cheerfully shared their pies with people who did not have as much.  I admire them for that.  However, I do not admire anyone who believes that they somehow owed it to others to share their wealth.  If it was owed, then the value of their donations goes down.  What makes their philanthropy so admirable is that they voluntarily chose to share even when nobody was compelling them to do so.

      One could argue that Oprah Winfrey and Bill Gates, among others,  should “give back.”  Perhaps they feel that way themselves.  For my part, I would have preferred that they charge people a whole lot less for their products in the first place.  I would have been happy to pay less for my Microsoft programs.  I don’t watch Oprah Winfrey, but I suspect that her sponsors would have been happy to pay less, and their customers might have enjoyed the cost savings on those products.  (I did enjoy Oprah’s acting in the The Color Purple.)  After all, did either one of them need billions of dollars?

     Some folks believe that it would be a good thing to even things up.  President Obama, when he was running for president, told Joe the Plumber that he wanted to spread the wealth around.  There is so much wrong with that goal, and it is so obviously wrong that I cannot understand how anyone could support it.

     I understand the desire to help those in need.  I have felt the desire and have acted on it–at a greater percentage than many of our politicians who espouse “helping the poor.”  As I wrote above, I think it stinks that such huge disparities exist in the world between the haves and the have-nots.

     There are only two ways to make things even, or closer to even.  One is by people voluntarily sharing what they have.  The other is by people being forced to give away what they have. 

     The problem with forcing people to share, is that somebody has to do the forcing.  There can be no forced redistribution of wealth without somebody doing the forcing, and who has the right to do that?  The state has the right to tax people to pay the President and his cabinet, to pay for interstate roads, to build office buildings for members of Congress, and to meet a whole host of legitimate expenses.  In essence it is “the people” contributing toward their own government.  However, the state has no right to take people’s money for the purpose of handing it out to other people.

     If a man in a mask demands money from a bank, we call it a crime.  If a man in a suit votes to confiscate your money to give away, we call it a tax.  Essentially there is no difference.  One of them looks more respectable, but it amounts to the same thing, morally speaking.

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Written by ambrosianideas

July 29, 2010 at 2:52 am

2 Responses

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  1. Three reasons to take the distribution of wealth seriously: 1) Too skewed a distribution will lead to political unrest or cronyist elitism (such as the Somoza family and his friends having something like 98% of Nicaraguan wealth — which of course eventually did lead to unrest); 2) a very bad distribution of wealth affects opportunities and the range of choices — even if it’s theoretically possible for someone to make the ‘right’ choices to gain, it’s far more difficult and limited if the distribution is really off balance; and 3) malnutrition, death and disease — if the poor are too poor you’ll have human suffering alongside opulence. Ethically, that seems wrong.

    I suspect focusing on number two — trying to assure not equal opportunity (you’ll never achieve that) but at least real opportunities for the poor would be the best way to get a more balanced distribution, and one that reflects not who has power and can shape the system to their advantage, but what people choose and accomplish. Those of us who dislike unbalanced distributions of wealth usually aren’t looking for material equality or fairness, but worry that those on the bottom do not have realistic opportunities, except perchance through rare heroic efforts, to achieve.

    Scott Erb

    July 29, 2010 at 5:59 pm

  2. Three thoughts:

    a) There is a strong need for people to claim that taxes are money “forcefully” taken away from them. People that have never lived in an underdeveloped country don’t realize that you pay taxes not only to fund the necessary government expenditures; You also pay for the stability of society, and the peace of mind associated with living in a stable society. The poor, uneducated members of society may not own much in terms of wealth, but they always have the leverage associated with their unrest. I think we can all agree that paying the extra taxes is worth not having tires burning on the street, and violent demonstrations be commonplace.

    Im sure none of us like that, but it is the great equalizer in politics. The “occupy” movement is quite possibly the most peaceful such movement that you could have expected. If wealth (and more importantly opportunity) distribution continues to diverge for different sectors of society, these demonstrations will continue to get more and more violent. So people really need to ask themselves “how much is my safety worth”?

    b) I do agree that forcing a redistribution of wealth per se is unreasonable, but forcing a redistribution of OPPORTUNITY is not. And the opportunities are not even close to being the same in this country. Another big assumption that bothers me about these arguments is that those in disadvantaged situations are even aware of what options they have, and what the consequences of their choices have. People who come from uneducated households, with uneducated parents, and without access to proper education will have a hard time understanding the value of education. THAT is in my opinion the biggest problem not only on wealth distribution, but in race relationships in the US.

    c) You can’t cite the outliers (Bill Gates, Oprah) as examples. Bill Gates is one of the rare talents in the history of technology. You are suggesting the solution for poor people is to be mind numbingly smart. Again, not realistic.

    Oprah Winfrey made a career out of something that has the success rate of winning the lottery (media/TV). Oprah has 3 half siblings, one of which died of a cocaine overdose, one which died of AIDS, and another one which was given up for adoption. Not only that, Oprah actually birthed a child at age 14 who died at birth. She then attended Tennessee State on a scholarship she won in an oratory contest. Put all those things together, and you start to realize that Oprah is the exception, not the rule, not the expectation, and not a realistic outcome for most people. If you repeat Oprah’s life as an experiment 1000 times, she’s probably successful in one of them.

    David

    March 17, 2012 at 1:19 am


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