"Owing to the efforts of Americans
who were enamored with socialism, all that changed in the 20th century.
The federal income tax was adopted. The welfare state was enacted. The
Federal Reserve was established. Paper money was implemented. The system
changed from one based on economic liberty and freedom of choicer to one
based on confiscation of income and mandatory redistribution of wealth.
"The people who have suffered most from this economic revolution
have been the middle class and the poor. That’s ironic because they are
among the biggest supporters of this economic revolution."
Friday, October 5, 2012
The Real Debate We Should Be
Having
by Jacob G. Hornberger
Imagine a society in which there is no income taxation, one in which
everyone keeps everything he earns and then decides what to do with his
own money -- invest, spend, lend, save, or donate it.
Along comes someone who exclaims, “I’ve got a great idea. Let’s change
the system to enable the federal government to confiscate 10 percent of
young people’s income and transfer the money to senior citizens.”
Someone else pipes in, “That’s a great idea. I’ve got a better one. Let’s
change the system in that way and also enable the federal government to
confiscate 30 percent of people’s income and transfer the money to people
who need it more.”
Of course, this isn’t just fantasy. That’s pretty much what happened here
in the United States. Our economic system was founded on the idea that
people have a fundamental, God-given right to engage freely in economic
enterprise, to keep the fruits of their earnings, and to voluntarily
decide for themselves what to do with it.
Owing to the efforts of Americans who were enamored with socialism, all
that changed in the 20th century. The federal income tax was adopted. The
welfare state was enacted. The Federal Reserve was established. Paper
money was implemented. The system changed from one based on economic
liberty and freedom of choicer to one based on confiscation of income and
mandatory redistribution of wealth.
The people who have suffered most from this economic revolution have been
the middle class and the poor. That’s ironic because they are among the
biggest supporters of this economic revolution.
Why would people support something that is contrary to their interests?
One reason is that they don’t realize that the welfare state has
victimized them. And, two, oftentimes they become dependent on the
system, thereby losing the concepts of self-reliance and belief in one’s
self.
In the original American system, the poor had a realistic chance of
becoming wealthy. By working hard and saving their money, they were able
to keep 100 percent of what they earned. With their savings, they were
able to start businesses in competition against the well-established
wealthy businesses or simply multiply their savings through the magic of
compound interest.
That’s the biggest reason why thousands of penniless immigrants were
flooding American shores every day, especially during the late 1800s.
They knew that they had a good chance at becoming rich.
But there was another way that the free market benefited the poor and the
middle class -- through the offering of a vast array of consumer goods at
ever-decreasing prices. Producers and manufacturers realized that they
could make tremendous profits through production of consumer goods for
the masses, as compared to focusing solely on the rich.
Thus, the poor and middle class found their standard of living soaring
simply through the inexpensive clothing, food, and other items that were
being offered to them in the marketplace.
How were the poor getting jobs? In large part, they were being employed
in businesses being opened by the rich. This is what statists oftentimes
simply do not understand or appreciate. When a rich person opens a
business, he is risking his own money, sometimes everything he owns. In
the process of doing that, he offers employment to people at wages that
he is guaranteeing.
Thus, if it weren’t for people who were willing to risk their own money,
many of the poor wouldn’t have jobs.
Does an owner of a business operate out of altruism? Of course not. He’s
operates out of self-interest. Perhaps he wants to get wealthy. Or
perhaps he just loves his work. But notice that even though he’s
operating out of self-interest, his efforts benefit others, including the
people he’s hiring and the consumers to whom he’s offering goods and
services.
Consider Bill Gates and Steve Jobs. Let’s assume that they were motivated
purely by the quest to become rich and by their love of creating things.
They both became tremendously wealthy. So what? Why should that bother
us? Look at how those two men improved the lives of all the rest of us.
Why is this so important? Because it shows us that God has created a
consistent universe, one in which people’s interests dovetail in a free
society, and one in which the sins of “Thou shalt not covet” and “Thou
shalt not steal” create severe disharmonies in society.
In a free market, there is a harmony of interests between employers,
employees, and consumers. But once people permit covetousness to grab
hold of them and make stealing an official part of their economic system,
things turn rotten.
That’s precisely what has happened with America. Everywhere you look, the
economic system is in crisis. Social Security? Bankrupt. Medicare and
Medicaid? Soaring costs, rampant fraud, and doctors fleeing the
profession. Education grants? Graduates drowning in debt and hounded by
federal debt collectors. The dollar? Forever dropping in value. Federal
spending? Out of control.
It’s no different, of course, in the foreign policy sphere, where America
abandoned the philosophy of a limited-government constitutional republic
in favor of a vast permanent military establishment, overseas empire of
military bases, and foreign interventionism. Anti-American anger and
hatred grows by the day, and the federal government continues to clamp
down on the civil liberties of the people, while continuing its worldwide
campaign of assassination, occupation, and drug busts.
It boggles the mind to imagine what the American standard of living would
have been like if the federal government had not turned in the wrong
direction had not confiscated the billions of dollars necessary to fund
the welfare state and warfare state for the past 50 years. Imagine, say,
being able to buy a brand new Lexus for the equivalent of $5,000 instead
of $100,000. Or a $300,000 house for $10,000. It is impossible to measure
the extent of damage to the poor and middle class by virtue of having
removed all those savings and productive capital from the private sector,
but the damage nonetheless has to be extensive.
The real debate America should be having is not over which variation of
statist reform should be adopted or over which statist would be best at
running the statist system. The real debate should be over which economic
system should be embraced by the American people the free-market system
our American ancestors bequeathed to us or the statist one that was later
foisted upon our land.
http://www.fff.org/blog/jghblog2012-10-05.asp
--
Thanks for being part of "PoliticalForum" at Google Groups.
For options & help see http://groups.google.com/group/PoliticalForum
* Visit our other community at http://www.PoliticalForum.com/
* It's active and moderated. Register and vote in our polls.
* Read the latest breaking news, and more.
