The Redistribution of Wealth to the Rich
The following is about the redistribution from the poor and
middle class to the wealthy. There are at least a hundred ways
this is accomplished, but just a dozen or so of the more important
ways will be covered here. What lead me to do this research was
the controversy of the 2008 presidential campaign after Obama
made the political mistake of advocating "spreading the
wealth around."
Of course, saying that seemed shocking to some, but what false
outrage! Virtually all Republicans and Democrats alike believe
in certain social programs that "spread the wealth."
I didn't hear any of them advocating the dismantling of welfare,
Medicaid or public education. These certainly help poorer people
at the expense of the wealthier who pay most of our taxes.
It was called "socialism" when Obama advocated the
same thing most Republicans believe in. Why? Because he advocated
a bit more wealth be redistributed? That's not a principled argument.
By the way, in 2000, complaining about the Bush tax cuts, McCain
said "When you reach a certain level of comfort, there's
nothing wrong with paying a little more."
My Own Perspective
I don't much care for labels, but my economic beliefs are
closer to a capitalist philosophy than any other. I would prefer
less redistribution of wealth (at least through government force),
but I also understand why the public thinks there is something
wrong with capitalism and free markets. What we have is neither,
but if we are to call it capitalism, then I suppose I'm against
capitalism as well.
The way things are currently arranged, those who are very
wealthy are provided with many legal ways to take from the poor
and middle class to enrich themselves further. That isn't fair,
to say the least. It is also ultimately destabilizing for a society.
If people ever fully understand the many "reverse Robin
Hood" scams out there, the wealthy here will eventually
all have to live behind guarded walls like they do in much of
the rest of the world.
Here are some of the ways the rich get richer unfairly. You
can click through the links to read more on each of these.
Corporate Welfare - Redistribution
From Poor to Rich - At least 100 billion dollars is taken
from all of us taxpayers and handed over to corporations in this
country every year. Much of that is then handed out in bonuses
to wealthy managers of these companies.
How the Rich Get Richer - This
post on the New Ideas Blog is about a scam that Warren Buffet
pointed out at least seven years ago (and nothing has been done
about it). It's a legal way for corporations to raid the pension
funds of employees and put the money in the pockets of their
wealthiest managers.
Spread the Wealth? -
While calling Obama a "redistributionist," John McCain
suddenly announces during a debate that he wants to spend $300
billion to buy bad mortgages and reduce the principle. Those
of us who responsibly bought homes we can afford (ours was $65,000)
get to have our money redistributed to those with $300,000 homes?
A Bailout for the Rich
- The "bailout" begins. $10 billion to Morgan Stanley
- they hand out $6.44 billion in bonuses. Goldman Sachs gets
$10 billion and pays out $6.85 billion in bonuses. I'm not making
this up. That $700 billion constitutes a huge transfer of taxpayer
money to some of the wealthiest Americans.
Tax Loopholes for the Rich
- There was a time when I argued that loopholes only allowed
the wealthy to keep more of what is their's to begin with. But
what if they paid nothing (or too little) while benefiting from
government services paid for by others? Isn't that an upward
redistribution?
Millionaire Welfare Farmers
- Why should minimum wage workers have their money taken to give
more money to millionaire farmers? They shouldn't, but that's
what is going on. The poor that get hurt the worst don't live
in this country though.
Some Corporate Welfare
Examples - I hate to focus on the negative, but it's difficult
to understand the magnitude of the transfer of wealth from poor
and middle class to the wealthy if we don't look at a few examples
of it. You'll find five more examples here.
Corporate Welfare
- A Definition - My definition and a few examples of indirect
subsidies.
The Working Poor Do Pay Taxes
- Contrary to the claims of some conservatives that 40% of Americans
pay no taxes, most pay far more than is realized. A guy flipping
burgers may even be paying a higher percentage of income in taxes
than Warren Buffet, as you will see.
Social Security Rip Off
- Recent studies showed that some retirees need social security
to avoid poverty - 12% of them. The other 88% simply get to improve
their lifestyle at the expense of working folk who support this
Ponzei scheme. In fact, about $100 billion annually goes to retirees
who make more than the average household income - a huge transfer
of wealth from young to old and sometimes from the poor to the
wealthy.
The Poor Side of Town
- Living in a mobile home for years, I watched as the process
unfolded. The poor are regulated out of town - another way the
poor are taken advantage to make people wealthier.
Preying on Poor Countries
- Imagine a scheme to make rich bankers richer while making some
of the poorest people of the world poorer, and all at U.S. taxpayer
expense. You don't have to imagine it - it has been around for
a while.
Property Tax Rates Are Higher
for the Poor - Unknown to the average person, it is renters
who actually pay the property taxes on the homes they rent. And
these properties are taxed much more heavily than others.
Federal Reserve Fraud -
How do you take billions from the people without them knowing?
Print money to loan to their government at interest. This is
one of the biggest rip-offs you'll ever read about.
Get Rid of Corporate Taxes
- See who really pays these taxes, and what should be done instead.
The Rich Get Richer With Government
Help - This page tallies up the damage done - far more goes
to the rich than the total of all welfare aimed at the poor.
Poor People - How to Push Them
Away - Banning ugliness in our communities.
Now to clarify some things:
1. The primary way the rich get richer is by providing things
that benefit society. In other words, they create value. We are
not forced to buy Bill Gates products, but we do so because of
the great value they have to us. The wealthy do not primarily
look for a bigger piece of the pie - they make more pies.
2. There's nothing wrong with being wealthy, but how you get
there matters. In a fair and free society getting rich does not
cause anyone's impoverishment. Historically, we have all benefited
from an economy that rewards those who create the most value.
3. The danger of great wealth is that it buys great power,
which can be used to take advantage of the poor and middle class.
This is what has been happening more and more in recent years.
Laws and regulations have been lobbied for and passed which allow
the redistribution of wealth from the poor and middle class to
the wealthy.
4. Some will rightly point out that the wealthy pay most of
the taxes that support our government and all of its programs,
but this does not make laws written for the rich more just. Also,
some of the ways wealth is moved from poor to rich are not visible
in the tax code, nor easily measurable - and all are unfair in
any case.
5. Life takes precedence over other values, so if some redistribution
to the poor is needed, it is entirely justified (who would honestly
allow a child to starve next to a rich man's banquet?).
6. Even if some us prefer that the redistribution of wealth
be kept to the minimum necessary, it is clear that the lesser
of evils for a society is a transfer from rich to poor rather
than the other way around.4.
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