What are the implications of redistributing wealth?
Would it end greed or cause everyone to sit on their hands? Assume the government redistributes the wealth on the very top to the very bottom, but allows disparity in the middle-class. I must clarify that I don't mean paying doctors the same as garbage-men.
Economic shocks or changes in government policy often lead to a substantial
redistribution of wealth within the population of a country. An important example
of a redistribution shock is an unanticipated inflation episode. When the
price level rises faster than previously expected, the real value of all nominal assets
declines. As a result, borrowers win—they experience an increase in real
wealth—while lenders lose. As documented in Doepke and Schneider (2005a),
the amount of this wealth redistribution can be large even for moderate inflation
Historically, redistribution of wealth only made everyone poor, look at South America, Hugo Chavez is doing a bang up job of taking care of his people, there are warehouses and semi's full of food that is rotting and his people are starving. Look at China, need I say more. Communism never makes the lives of the average person better. Capitalism drives innovation and progress. Again, I will use China as an example, stepping foot on their soil is like stepping backward in time, they have neither the money or incentive to make things better. We live in the greatest country in the world, but our President seems hell bent on changing that, redistribution of wealth would definitely change this county, if the health care bill is not repealed, in 15-20 years this country will be unrecognizable. That bill is most devastating thing to happen to this country since 9/11. That may seem melodramatic, but when we are being taxed to death and politicos are making our health care decisions for us, it will not seem so melodramatic. But redistributive changes are not the only ones on the horizon. If net neutrality is ever instituted, this type of conversation will not be allowed, but if cap and trade passes (redistribution of wealth in sheep's clothing) we will not be able to afford the electricity it takes to run computer - 2 birds with one stone. Don't even get me started on financial or immigration reform and forget about "too big to fail" and taking over the banking system (also redistribution in sheep's clothing). I just reread this, i sound like a nut, but i promise i am not, although, theoretically, if i were a nut i would likely be the last to know
Your analysis is correct, but you're assuming the redistribution is from the poorest and middle-class to the upper-class. The super-rich have been doing that since the begining of history.
Perhaps a government cannot accomplish this loafty (fair) goal---or, at least, not the kind of (centralized) government we're used to.
America could stand to share more with the hourly works. This could be accomplished by a strong union which is very unified in order to counter the power of the growing national management which has become very unified. Management of one national corporation has the same ideology as the others in America. Insider trading and price fixing is going to become the norm in every sector and cross sector due to this unifying power of management.
If redistribution of wealth was feasible, and people were very satisfied, than I would be for it. Due to our present values and behavior, if each person received a million dollars, than within a reasonable time the money would be in the pockets of those who originally had it. Las Vegas casinos would triple their profits over night. Inflation would skyrocket, making everyone relatively in the same material state because of supply and demand.
Reagan weaken the unions alone with Bush. Now is the time to unify the unions in every sector of business and begin cross sectional unification toward a national union. This shall counter the unified management of big businesses.
One last thought, the use of dossiers with psychological profiles on each employee by management is no longer science fiction. Take heed.
I wrote a hub on this. Check out "Redistribution of Wealth is Impossible", and you'll pretty much see how Governmental redistribution of wealth is nonsense.
Imagine how a government would redistribute the capital good of "a computer factory" to the entire population, and you immediately see that it's nonsense.
What are you people talking about? The country's wealth is redistributed all the time. Money is simply a means of exchange.
Redistribution simply means a change in the advantages that allow people to earn and accumulate. Right now all the advantages are for the wealthy. The money belonging to poor people and the middle class is redistributed to the more privileged.
The term doesn't mean collect all the money and pass it out again.
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