Free Markets, Free People


The fallacy of redistribution

Thomas Sowell, as he often does, puts the blue state model’s deficiencies into perspective in an easily understandable article. In this case he addresses redistribution.  If honest, even the most rabid redistributionist should come away from reading it understanding how redistribution is a doomed scheme.

Why?  For the same reason most blue state ideas fail.  They run counter to human nature.  In fact, they naively believe they can do something counter to human nature and it will both work and be sustainable.

Redistribution has been something tried among many nations in the past.  And, it has pretty much failed each and every time. Again the quesiton: “why”?

Those who talk glibly about redistribution often act as if people are just inert objects that can be placed here and there, like pieces on a chess board, to carry out some grand design.

But if human beings have their own responses to government policies, then we cannot blithely assume that government policies will have the effect intended.

Bingo.  While such schemes may work initially, they never factor in the reaction of human beings to something they find disagreeable, dishonest or just plain wrong.  Politician who want to tax things to change behavior find this out all the time.  But apparently we have to learn these lessons over and over and over again.  Throughout history, schemes which run counter to human nature rarely if ever succeed over any extended period of time.   There’s a reason for that:

In theory, confiscating the wealth of the more successful people ought to make the rest of the society more prosperous. But when the Soviet Union confiscated the wealth of successful farmers, food became scarce. As many people died of starvation under Stalin in the 1930s as died in Hitler’s Holocaust in the 1940s.

How can that be? It is not complicated. You can only confiscate the wealth that exists at a given moment. You cannot confiscate future wealth — and that future wealth is less likely to be produced when people see that it is going to be confiscated.

This would seem a simple lesson, given the amount of history in which it has been proven.  Yet, for whatever reason, politicians on the left (and many on the right) seem to discover it afresh in each generation.  That and the belief that the only reason it hasn’t worked in the past is because they weren’t in charge of its implementation.

We have one of those in office now.  For the “smartest guy in the room”, he has yet to understand how human nature works in this regard.

All I can say is if he’s unable to wrap his head around the consequences of pursuing such a policy and is still considered the “smartest man in the room”, it must be an awfully small (and empty) room.

~McQ

Twitter: McQandO

Facebook: QandO

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24 Responses to The fallacy of redistribution

  • Unless, of course it’s completely intentional, which is what I’ve come to believe.


  • http://www.mediaite.com/tv/msnbc-panel-baffled-why-anyone-would-think-redistribution-of-wealth-is-bad/

    Are these people confused…

    OR are they working at CONFUSING?

    “Redistribution” is really not a muddy term.

    But then, neither is “property rights”…or “slavery”.

    • People who have no plan to be the wealth source targeted for redistribution never see a problem with it.

    • This is a fun part:

      Guest host Ari Melber defined redistributive government as any centralized mechanism for taking in funds and then reallocating them in ways that planners view as the most constructive for the economy or that achieves the maximum social benefit.

      Two things:
      1) …most constructive…   $16 trillion in debt later and there are people who still see this as constructive?
      2) …maximum social benefit.  For who?  The TBTF bankers sure got their benefit and I’m getting the tab.  You’ll just have to excuse me if I don’t see the maximum social benefit there.  Because I’m getting screwed.

      • Any socialism or wealth redistribution plan makes the issue of wealth distribution a political issue. Some politician or government worker will make the call of who get what.

        In free markets it is decided by supply and demand, by the collective decisions of the people who make up society. The “fight” for more is done via competition in the marketplace, by providing better values.

        In the redistribution method, the “fight” is a political fight, a fight for political influence, which can naturally extend to violence.

    • When “According to their ability and to them according to their needs” becomes policy, people develop lots of needs and the ability approaches extinction.
      “They pretend to pay us and we pretend to work” – Russian comic Yakov Smirnov

  • This goes back to the whole magic thinking of the Collective.  Well, and their appeal to the basest facets of human nature.

    • History is for those stuck in the past …

      The parent, who asked not to be identified, attended a football last Friday night with his children. He said he was shocked by what he saw. “It was Glee meets the Russian Revolution,” he told Fox News. “I’m not kidding you. They had giant hammers and sickles and they were waving them around.”

  • How can that be? It is not complicated. You can only confiscate the wealth that exists at a given moment. You cannot confiscate future wealth — and that future wealth is less likely to be produced when people see that it is going to be confiscated.
    And then you (to use your example of Soviet farming) blame the Kulaks and Wreckers, kill a few million people to Make An Example, and then quietly force people to be farmers, while sort-of reversing the whole Collectivization thing, but pretending you haven’t…

  • There is nothing new here, people who want to take from some and give to others are plunderers, and as it says in the bible, The thief comes only to kill to steal and to destroy. There is nothing good about the left, at all. Nor any of the crooked businessmen and rent seekers who want government bennies.

  • This from just yesterday…

    “One of the issues that I have been preaching about around the world is collecting taxes in an equitable manner, especially from the elites in every country,” Clinton said to laughter from the audience. “You know I’m out of American politics, but – (applause) – it is a fact that around the world, the elites of every country are making money.”

    Clinton continued her rift on the rich. “There are rich people everywhere. And yet they do not contribute to the growth of their own countries.”

    http://www.weeklystandard.com/blogs/hillary-clinton-pushes-global-tax-elites_653011.html

    That is FLUCKING amazing.  “The rich” do not contribute!?!?  Imagine the level of STUPID you have to accommodate to say something like that.

    • I can imagine it.  It’s the same level of stupid that has no embassy guards, the same level of stupid that mandates the ones we do have guard the embassy with less ammo than Barney Fife, the same level of stupid that thinks they can con everyone into thinking that they have a viable international policy in place, and the same level of stupid that thinks Barack Obama is a good President.

  • It, being human nature, to want as much as possible for as little work possible, makes us quite vulnerable to the siren song of ‘free stuff’. It is therefore most imperative that the one thing we don’t allow is to grant power to anyone to give that which is not theirs to give. I do believe that was the very basis, of the founding, of our Republic. We have lost our way, if we don’t reset the Norm, we are toast.

  • Sowell is a conservative economist—he begins at a place of conservatism for his economic hypothesis (and doesn’t realize it).  He starts with a belief in the nature of human beings which has yet to be scientifically proved—his Hobbesian model (that people are in essentially non-cooperative by nature, and always in competition).  And he continues with statements that are contrary to fact at most, and not empirically verifiable, at least—that redistribution has failed in all societies (there are plenty of successful democratic socialist countries which cast doubt on such assumptions).
    Sowell the simply issues right-wing propaganda, and conservative people believe it  because it is consistent with their own unexamined beliefs.

    • Really, we don’t need your daily dose of MORON.  Not.  At.  All.

    • Ahh, but redistribution always fails. Sweden, with a homogenious and well behaved culture can get away with it longer then an ethnic melting pot like the US, but it fails in Sweden as well.

      Germany, that is, West Germany, grew at 15% during the economic miracle of free markets, then cooled to slow growth when they adopted the welfare state. That is a consistent result.

      Redistribution fails.

    • Oh, and Sowell began as a Marxist. Reality pushed him away from Marxism. Will reality push you away from Marxism? My guess is “no”.

    • “He starts with a belief in the nature of human beings which has yet to be scientifically proved”

      Pardon me, but how the fluck do you know what he believes about human nature.  Why don’t you try arguing the evidence he presents instead of doing another BS based Alinsky dance for us?

      For example, show us ‘plenty’ of the examples you mention of successful, free, long running, societies that redistribute or redistributed.  And ‘plenty’ needs to be more than Sweden or Germany, just so you know in advance.

      • A place like Sweden is almost ideal for socialism, due to the culture and homogenious ethnicity. Yet even there socialism grinds things to a halt.

        In free markets, the “fight” for resources is through market competition, i.e., providing more value to get more in return. By contrast, in socialism or redistribution schemes the “fight” is political. What is the end point in a socialist socity with a mix of ethnix groups? It isn’t the end result that Tad is looking for.

        • My bet is Tad is a starry eyed dreamer in this regard.  And I’ll bet he’s perfectly willing to force you to participate in his dream if that’s what it takes.

          It will be for your own good of course.

          • You are no doubt correct, but Tad will find out that the redistribution he seeks is not the redistribution he will recieve. Look at the Obama “green energy” bailout of failing wind and solar companies. That is the expected outcome, even though it probably isn’t what Tad had in mind. But it is unlikely Tad will be calling the shots, someone else will, and the problem, in Tad’s view, will be that the wrong person is deciding what to reward.

            That is how redistribution will work. Tad will dream about what could be, while pissing about what is. His reality will never match the dream, but someone with power will decide the allocation of resources. And Tad will continue to think, “if only the *right person* was in charge!”

  • Here ya go Tad – the successful product of years socialism

    http://www.cnbc.com/id/49162890

  • Don’t cry for me Argentina!

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