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Wednesday, May 18, 2011

Walter E. Williams - My Hero explaining wealth creation

Understanding the liberal vision
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Posted: May 18, 2011

By Walter Williams
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The liberal vision of government is easily understood and makes perfect sense if one acknowledges their misunderstanding and implied assumptions about the sources of income. Their vision helps explain the language they use and policies they support, such as income redistribution and calls for the rich to give something back.

Suppose the true source of income was a gigantic pile of money meant to be shared equally amongst Americans. The reason some people have more money than others is because they got to the pile first and greedily took an unfair share. That being the case, justice requires that the rich give something back, and if they won't do so voluntarily, Congress should confiscate their ill-gotten gains and return them to their rightful owners.

A competing liberal implied assumption about the sources of income is that income is distributed, as in distribution of income. There might be a dealer of dollars. The reason why some people have more dollars than others is because the dollar dealer is a racist, a sexist, a multinationalist or a conservative. The only right thing to do, for those to whom the dollar dealer unfairly dealt too many dollars, is to give back their ill-gotten gains. If they refuse to do so, then it's the job of Congress to use their agents at the IRS to confiscate their ill-gotten gains and return them to their rightful owners. In a word, there must be a re-dealing of the dollars, or what some people call income redistribution.

The sane among us recognize that in a free society, income is neither taken nor distributed; for the most part, it is earned. Income is earned by pleasing one's fellow man. The greater one's ability to please his fellow man, the greater is his claim on what his fellow man produces. Those claims are represented by the number of dollars received from his fellow man.

Say I mow your lawn. For doing so, you pay me $20. I go to my grocer and demand, "Give me two pounds of steak and a six-pack of beer that my fellow man produced." In effect, the grocer asks, "Williams, you're asking your fellow man to serve you. Did you serve him?" I reply, "Yes." The grocer says, "Prove it."

That's when I pull out the $20 I earned from serving my fellow man. We can think of that $20 as "certificates of performance." They stand as proof that I served my fellow man. It would be no different if I were an orthopedic doctor, with a large clientele, earning $500,000 per year by serving my fellow man. By the way, having mowed my fellow man's lawn or set his fractured fibula, what else do I owe him or anyone else? What's the case for being forced to give anything back? If one wishes to be charitable, that's an entirely different matter.

Contrast the morality of having to serve one's fellow man in order to have a claim on what he produces with congressional handouts. In effect, Congress says, "You don't have to serve your fellow man in order to have a claim on what he produces. We'll take what he produces and give it to you. Just vote for me."

Who should give back? Sam Walton founded Wal-Mart; Bill Gates founded Microsoft; Steve Jobs founded Apple Computer. Which one of these billionaires acquired their wealth by coercing us to purchase their product? Which has taken the property of anyone?

Each of these examples, and thousands more, is a person who served his fellow men by producing products and services that made life easier. What else do they owe? They've already given.

If anyone is obliged to give something back, they are the thieves and recipients of legalized theft, namely people who've used Congress, including America's corporate welfare queens, to live at the expense of others. When a nation vilifies the productive and makes mascots of the unproductive, it doesn't bode well for its future.

4 comments:

  1. This is a very naive point of view. It's almost impossible to become extremely wealthy without resorting to immoral and unethical practices. For example, Bill Gates basically stole DOS, then deliberately sabotaged competing applications by making it impossible for them to run on the operating system. Sprinkle in some predatory marketing practices and - voila! - you have a whole lot of wealth. And these tactics were mild compared to deliberate actions taken against human beings in terms of worker safety, living wages, child labor, etc., etc., etc. I do not understand how a religious person could not only not be upset by such inhumane treatment, but be supportive of it.

    ReplyDelete
  2. Nearly all rich people got that way by being immoral? Do you have any statistics to back up such an outrageous statement?

    And who precisely is being supportive of inhumane treatment?

    One last thing. I would appreciate it if you could address a point brought up by the author of the piece. One will do.

    ReplyDelete
  3. "I would appreciate it if you could address a point brought up by the author of the piece. One will do."

    The sane among us recognize that in a free society, income is neither taken nor distributed; for the most part, it is earned. Income is earned by pleasing one's fellow man. The greater one's ability to please his fellow man, the greater is his claim on what his fellow man produces. Those claims are represented by the number of dollars received from his fellow man.

    Okay, here's a start.

    “Private socialism occurs when the wealth generated by common assets is not generally shared but captured by a small minority and when, at the same time, the public absorbs the losses when the wealthy fail. From the growth of inequality to the current Wall Street bailouts, this is precisely what we have today. What allowed it to develop was, at bottom, a morality of entitlement that did not contemplate the value of societal contributions or the obligations they generate.”

    ALPEROVITZ, GAR, and LEW DALY. "Who Is Really 'Deserving'?." Dissent (00123846) 56.4 (2009): 88-91. Academic Search Premier. EBSCO. Web. 28 May 2011.

    ReplyDelete
  4. Let's make a distinction between crony capitalism, which is the unholy alliance between business and government, and free market capitalism, which is the willing and legal exchange of value.

    Your quote is a description of the results of crony capitalism. Phrases like "Common assets" and "the value of societal contributions or the obligations they generate" are not manifestations of free market capitalism, they have more in common with statism.

    The fact that the public absorbed losses of Wall Street via the bailouts is a violation of free market capitalism.

    I note that you did not address a full 2/3 of my response to you. Answer the two questions.

    ReplyDelete