Wealth and redistribution thought-experiment #1

January 11, 2010 – 1:22 pm

Wealth can be created and destroyed.

For proof of this, imagine that you, Dave and I are stuck on a deserted island in the middle of the ocean, with nothing but the clothes on our back.   We are as poor as three people can be.

Now suppose you invent a system whereby the fallen branches of a dead tree can be fashioned into a 2 bedroom home with a central heating fireplace.

After a brilliant idea and a lot of labor on your part, you have built a meager home.  Wealth has been created.

Now, you “control” 100% of the wealth of the region.

Is this unfair?

In exchange for Dave and I sharing the 2nd room, you suggest we pay “rent” to you in the form of gathering food and firewood for you while you watch the sunset each evening for an hour.  This sounds good, so we agree.  After a few months of this, however, we begin to resent the “fat cat” who lounges while we labor…..

Would it be just for me and Dave (the majority) to “vote” that anyone with wealth must give a portion of that wealth to those with less….and failure to do so would result in forfeiture of wealth to the community and forced confinement?

If this island policy were enacted, would you be likely to create more wealth in the future?   Do you think that the island would be more likely to have large standard-of-living advancements with or without this policy of redistribution?

At what point in the wealth-creation cycle does “equality of result” defeat “incentive to create”?

  • Dark Knight
    By using those branched I did deprive you and Dave of those branches.

    My creation is more valuable than the materials clearly.

    But deciding on what exchange for my labor and knowledge for your and Daves right to the materials is equitable to all parties is up to negotiation and all parties should live up to their agreements.

    If the resource is limited assuming ownership because I found it first leads to squatting and wasted opportunity assuming I grab up resources that you or Dave could have used to build your own houses.

    If the resource is plentiful there is nothing stopping you from building your own house unless I were to say you and Dave are not allowed to enrich yourselves by imitating my efforts that also seems unfair of me.

    A system that creates perpetual indebtedness of one party to another party with no avenue for parity is slavery. I don't imagine I need to explain why slavery is unfair.
  • Good comment. Thanks
  • brecksavage
    But most of those who create wealth do so by utilizing the infrastructure the government has provided for them.
  • Bil Wise
    Wow, you're 1/3rd owner of a private island, you're rich!

    To answer the question; the question is wrong! The objective of our founders and society was not to create "equality of result", it was to create an open society in which individuals were free to create, succeed, and build. Accordingly, the amount of any tax levied on any entitie(s) success should never exceed an amount necessary to ensure the continuance/stability of the existing infrastructure, (think both tangible and intangible) which was necessary for and or facilitated this success (caveat below). Society and structure are the key to "allowing" those who can produce and innovate to do so and provide a solid base upon which each generation may build, ideally improving their own lives, as well as the lives of the generations to come. As individuals, we are collectively no more intelligent than the population of the world a few thousand years ago, the difference is that as a whole, we gradually learned to collect and build upon an immense knowledge base, create sustainable structure, divide labor and create the opportunity for specialists to flourish and collaborate to achieve goals on many scales. The result, we have eliminated or inhibited many crucial barriers to success for our greatest minds and society has benefited accordingly. Continued advancement is predicated upon the continuance of a similar form of structure and base need stability.
    With that said, when the tax exceeds the amount required to keep the system moving in the right direction and the surplus is misappropriated to poor "investments" in our future advancement, such as the use of funds to create and/or support the existence of a non-producing, dependant class of otherwise capable individuals, then we have a problem, as we are leaving resources (albeit our worst resources) idle and creating a non-sustainable segment of our system that actually possesses the very real potential to negatively impact our efforts towards productivity and advancement in our other segments. While, to an extent, it is our recent technological advancement (primarily in the areas of automation and mechanization) that has helped create this class (once utilized as general laborers), they too must adapt to fulfill new productive roles. Thus, I see the extent of our obligation at the "temporary" provision of the knowledge, structure, and basic needs necessary to facilitate the transition. The current policy of class placation as a means of avoiding this inevitable necessity is logically flawed and non-sustainable. The caveat, cited above, is that it is in our basic interests to ensure that our assets are productively employed. Accordingly, slowly stripping idle assets from those who fail to utilize and/or protect them and deploying them elsewhere benefits our interests. Along those lines, tax may also serve to keep those who can produce from prematurely ending their productivity (retiring), as it is even worse to leave this asset idle than any asset in the dependant class, a practice that is beneficial and sustainable as long as the proceeds are transformed into the prize for the future winners and not squandered on non-performing assets.
    What happens when a single hot woman lands on the island?:)
  • I was hoping for a new thread to post this on, but this will do, with the proviso that it has nothing to do with our discussion of the above, but is in fact, an unrelated anecdote that I'm pretty sure you will love.

    From John Ratzenberger, (Cliffy from Cheers):

    Here's some more from John Ratzenberger's remarks at Brown rally earlier:

    This isn't the Democratic party of our fathers and grandfathers. This is the party of Woodstock hippies. I was at Woodstock — I built the stage. And when everything fell apart, and people were fighting for peanut-butter sandwiches, it was the National Guard who came in and saved the same people who were protesting them. So when Hillary Clinton a few years ago wanted to build a Woodstock memorial, I said it should be a statue of a National Guardsman feeding a crying hippie."
  • I agree with you that "Capital punishment is as fundamentally wrong as a cure for crime as charity is wrong as a cure for poverty."
    What are the incentives of the inventor of the house to the teach the rest of the island's population how to build their own houses in exchange for food supplies for several months? If the other two guys also become house owners, they won't have any incentives to work for the inventor any more. In this case the inventor will forced to make a new invention, which he can use to exchange for the other guys labor or goods. This is how the living standard on the island will constantly grow.
    If the inventor doesn't help the other 2 on the island to create what he has, the inequality on the island will remain and even becomes bigger. The inventor might decides that he likes the status quo and decides not to share his knowledge or helps the other 2 to become richer. In this case there won't be any progress on the island and it will remain on the same level of living standard. At some point the equality might reach an extreme point, where the 2 workers decide to get rid off the inventor.
    Henry Ford knew that in order to create bigger market for his products, he needs to pay more to his employees.
  • Andy,

    I'm probably closer to your end of the political spectrum than some of your other commenters, but I'll play devil's advocate here, since simply agreeing with you wouldn't be as fun.

    It's tough to argue with the merits of the desert island scenario you've laid out in this post, but here are three things to think about.

    1) The home builder in your example isn't representative of all well-off folks in America. For every successful entrepreneur who created his own shot off the dribble, how many affluent folks got fed a perfect pass under the basket (by a relative, the government, etc.)? Not everyone who is wealthy is a Hank Reardon or a John Galt; some are Oren Boyles or Wesley Mouches. For example, think of all the guys getting fat bonuses on Wall Street now, who work at firms that would have gone bust last year if it weren't for providential government largess. Or think of Rockefeller's descendants, who tried to hamstring XOM a few years ago with their ridiculous proposals.

    2) Anytime you have a democracy and a population that differs greatly in its abilities, some amount of redistribution is inevitable (that said, we'd all be better off if the golden geese were treated better).

    3) Who wants to live in a society where the poor and sick are left to die on the street? Not many, apparently, considering that even a rightist autocracy such as Singapore (perennially near the top of the Heritage Foundation's index of economic freedom) has something of a social safety net (though Singapore's relies a lot more on enforced contributions than redistribution).

    Bonus thought: the way to minimize the need (and political demand) for redistribution in this country would be to encourage the affluent to have more kids and the poor to have fewer kids -- and to limit immigration to those who are (or are likely to become) more affluent than average.
  • Thanks Dave!

    1) True but I believe the % of people with over $100m that are "self-made"
    in America is extraordinarily high compared with the rest of the world....a
    vast majority in fact.

    2) I agree.

    3) No one wants that, and that's the point. "compassion" doesn't take
    place at the wrong end of a government-held gun. I'm ALL FOR
    redistribution-by-choice.....and I plan to redistribute plenty on my own
    terms (the government will never know if I do or do not). I strongly
    believe that charity and TRUE compassion (teaching men to fish) would be
    much better off if people weren't relying on the government to "take care of
    those people". It breaks my heart to know that there are people being
    herded into a recipient class, and children who will never learn the concept
    that they can in fact create their own wealth.
  • No problem, Andy.

    Re your points,

    1) Definitely a higher percentage of "self-made" super-rich in the U.S. than elsewhere, but a non-trivial percentage of our "self-made" super-rich got that way through rent-seeking, regulatory capture, connections, etc. Granted, that's even more the case elsewhere, so your point still holds, but there are Americans with $100 million+ who are technically "self-made" who you and I probably wouldn't think of as poster boys for entrepreneurship (e.g., the former NJ governor, Jon Corzine).

    3) This gets to a subject I've raised with Fred Wilson a couple of times on his blog, but not everyone has the chops to be a good fisherman, even if you are compassionate enough to teach them. The best way to keep average Americans out of the recipient class is to promote industrial policies that facilitate the creation of good-paying, blue collar jobs (unfortunately, some on the left consider many of these jobs -- e.g., those in natural resources, heavy manufacturing, etc. -- to be "icky").

    Another way is to limit the immigration of unskilled workers who drive down the wages and raise the unemployment rate of unskilled Americans.
  • Aaargh! I HATE the "poor left on the streets" straw man argument. As if it weren't for our benevolent loving Gummint, all of our social problems would be magnified.

    Howabout the fact that top down centrally planned gummint forcible charity encourages resentment, and actually gives people the "I gave at the office" excuse to disregard his fellow man, even at the local level?

    People never think of the tradeoffs. Big Brother does not care about you once his job is institutionalized, no matter how "compassionate" the aim. He only cares about expanding next year's budget.
  • It's not a straw man argument, Jake. The reality is that not everyone has what it takes to make it on their own in an advanced society, and without government assistance of one form or another a lot of them would be on the street. In fact, a lot of them were, before we had the welfare state we have now. That's just a historical fact.

    That doesn't mean that you are wrong in arguing that government largess often incites resentment, and encourages an "I gave at the office" attitude; I made the second point myself in a blog post a while back ("Are Liberals less inclined to pay their taxes?").

    Your claim that people never think of the trade-offs is itself a straw man argument. I am fully aware of the trade-offs. I think our social programs could certainly be improved to reduce dependence, reduce resentment, and encourage self-sufficiency. But I'm also aware that before we had these social programs, a lot more Americans were hungry and destitute.
  • It was also a historical fact that we used to light our lamps with gas instead of electricity. Tallow provided one candlelight's illumination before that.

    Are you saying that today -- in 2010 -- there wouldn't be robust market-ready charitable institutions using modern technology and modern methods of management available had not the welfare state begun encroaching on their territory in the early 20th century?

    This is another liberal fallacy (note, I'm not calling you a liberal, I don't know you, but this is a common liberal shibboleth). Truth is, this country was a lot poorer 100 years ago than it is now. Truth is, most of the country didn't have indoor plumbing 100 years ago. We were, for all intents and purposes, a Third World nation in our economic development. But times change, technology advances and most important -- standards of living increase.

    (All thanks to entrepreneuralism and innovation I might add).

    To contend that somehow the government can do a better job of taking care of our social ills than can focused private parties (at multiple levels) doesn't even reflect the reality of our welfare state system in place today. Much good work is farmed out to private individual charities, with only the gov't as payor -- or gatekeeper of the charitable dollar. (aside: which can cause lots of problems in its own right)

    If taxes were 20% across the board, don't you think that additional capital made available to our innovative economy would do that much more good in increasing living standards and making employment available for that many more people?

    Do you really believe that the charitable impulse would disappear were it not for the gun of State at our temples? This is an insult to the millions who give to religious and secular institutions in time and money every year DESPITE being taxed by the State for providing (or serving as payor conduit) for those same services.

    There are very few things the gov't can do better than the private sector, and certainly, taking care of people in need in a humane fashion is far below the list. But gov't safety nets absolve people of personal responsibility, and therefore they are popular.
  • To emphasize, I'm not a fan of the current form of government safety net. And I am in no way disparaging the charitable impulse of Americans. Americans donate more to charity than anyone else in the world. But I do think some form of government safety net is still necessary in the U.S. (more so if we are going to continue importing unskilled immigrants). Not because Americans don't have a charitable impulse, but because parts of this country don't have the cohesiveness or human and social capital to survive without outside assistance, and because the charitable impulse of other Americans can't always be relied on to fill that void.

    An example that comes to mind is Katrina. Individual Americans (and corporations such as Wal-Mart) made heroic and generous efforts to aid refugees from New Orleans. But compassion fatigue inevitably sets in, for most, when they see the intractability of poverty (and the often self-destructive behavior of the poor). The WSJ wrote about an example of that several years ago, a compassionate lesbian couple in MN that welcomed a single mother, her kids, and her grandmother to their home. The rest of the town helped out, too. A few months later, it all came to grief, and one of the lesbians (the stay-at-home one; the other was a long-haul trucker) regretted helping at all.

    The government is still there when private donors have moved on and turned their charitable impulses elsewhere (to save the animals, support a museum or a hospital, or whatever). Could the government do a better job? Sure. Should more capital be made directly available to charities? Sure. If it were up to me, there would be tax credits (not deductions) available for any American who donated to the sort of charity that could replace aspects of government assistance for the poor. But I think it remains true that a lot of people would be out on the street without the government backstop.
  • Katrina was a natural disaster, not an institutionalized social problem (though the latter did have a hand in making remediation more difficult, as in Haiti).

    We are still "private donors" to the government, so to make the assertion that the funds would not be there is cynically calculating that the charitable impulse would disappear were it not for the hand of the State.

    Sorry, not the world I live in.
  • Not being cynical, Jake, just realistic. It depends on the community, but there are plenty of places in this country where if the various and sundry government aid programs and transfer payments disappeared tomorrow, there is no way that void would be filled by private individuals.
  • I know Hackey-Sack, I'm from the Guyland.

    Of course there'd be a void, but that void was created by years of gov't crowd out. If the USPS went away tomorrow, there'd be a void in rural delivery.

    But guess what? It'd be filled relatively quickly by the private sector. Were UPS and Fedex to go dark tomorrow, how quickly and efficiently do you believe that void would be filled?

    Again, your faith in government as the answer is a result of conditioning, not "reality."
  • Your mention of the USPS versus UPS/Fedex suggests to me that you don't get what I'm saying. I'm not arguing that private firms aren't more efficient than state-owned ones -- of course they are. I didn't even bring that up.

    I don't have "faith in government as the answer". I am just realistic enough to know that private charity absolutely would not replace the level of assistance provided by government today. Without government programs and transfer payments, we'd have shanty town favelas like Brazil does (actually, probably worse, since Brazil's favela-dwellers have generations of experience in jury-rigging electricity, and don't have to deal with harsh winters).
  • PS -- don't forget to send some money to Haiti. ;)
  • I gave a buck at Whole Foods today when I bought a slice of pizza.
  • Agree.
  • So much for my attempt at devil's advocacy. ;-)
  • As long as it benefits client, yes
  • Benefiting clients is its primary purpose; the additional volume would be a secondary effect.

    We're just putting the finishing touches on it, but I should be able to e-mail you a link in the next couple of days.
  • phoneranger
    Andy: Can you point to one example in history where the 'productive' class did not have a monoploy on power? In your island example your hero would have been outnumbered 2 to 1. He'd be foolish build something for his private enjoyment without the protection of the state. Which is what the propertied classes have always endeavored to do. Do guns fix the problem? Temporarily. That's the model the Spartans used to control the far more numerous helots. (BTW how come high school football teams are never nicknamed the Helots?)

    2nd BTW WTF has Kentucky ever created since the invention of bourbon? Answer nothing except giving the Japanese a place to build cars with cheap labor.
  • Your Kentucky cheap shot is just ignorant and bigoted.

    I guess there aren't a few restaurant companies that employ millions of
    people that were started and based here? I guess the first hand transplant
    wasn't done here? I guess the first fully effective cancer vaccine wasn't
    developed here?

    The list goes on, but what's the point in changing YOUR mind? After all,
    you are obviously superior to all of us rubes working for the
    Japanese.....obviously none of us are capable of creating wealth on our own.
    Nope, I've never done that from little old Kentucky.

    Don't bother visiting....you wouldn't like it a bit.
  • Don't forget the first heart transplant (and MORE, as someone I know likes to say)....
  • phoneranger
    Hah got you. Used to live in St. Matthews. And then Cincinnati. Thus my contempt is well-informed. Anyway lighten up.
  • Well since you lived here that changes EVERYTHING! I didn't know you were
    once on the INSIDE and actually know that nothing good is created
    here...that it's all a ruse.

    Congratulations on getting out! Let us know what it's like in the land of
    opportunity, wealth creation and success!
  • phoneranger
    Hey my great grandfather left Cynthiana for Cincinnati and St. Paul. He became a successful commercial illustrator (Bicycle Playing Cards, Quaker Oats guy). He couldn't do that in Cynthiana. He got out.

    Wouldn't you rather live in Stockholm than most places in KY (Louisville, Lex. the tonier parts of Covington?) KY's problem is that their really productive and creative people don't want to stay around. Same holds for backwater parts of Sweden and western China. Neither Galtists, Social Democrats or ChiCom Mandarins have an answer to that problem. We have too many people in places with nothing for them to do.
  • That's the dumbest thing I ever heard. Would I rather live in Stockholm, the major city of the COUNTRY of Sweden, or would I rather live in a small state's largest city? I guess it would depend on my lifestyle choices, but as an American, I can also live in 50 other cities larger than Stockholm, and with better weather features.

    I'm a productive person from Noo Yawk, and I moved to KY, fwiw. That bullshit they put on the license plates a couple of years back about "It's that friendly" may be corny, but its also true. Thank goodness for choices.
  • It's the old battle of might makes right versus justice and ownership. In extreme cases of poverty/starving people are likely to become desparate enough to "break" the peace that wealth creation is founded on. To believe otherwise is naive. A functional system needs to guide folks towards their own wealth creation.

    Wealth creators must also initiate means of defending their created wealth. Wealth isn't capped, so nurturing others to create wealth is my instinctual solution. Why can't more people be wealthy? Limited raw materials? The relativity of wealth (perception) is part of the issue.
  • Agree on all points.  

    Additionally, wealth is created for yourself as it is created for others.  Exclusivity of thought and jealousy are for the feeble-minded.
  • It appears I'm making great friends with rebellious liberterians that are capitalists to the bone all over the web. Liberty is entangled with the concept of wealth ownership.
  • Private property rights....the right to the fruits of one's own
    labor....these are central to a life of liberty and the pursuit of
    happiness.

    The looters have no defense on this one.
  • Hey I thought of another spin on net neutrality. Is it really a question of censorship? I have no problem with businesses competing over content creation on communication channels. I have a problem with them blocking competing forms of information though.
  • Then...after they enact that policy, they should create a tax, to make sure everybody always has jobs on the island. All three of them.

    It's too bad, guys like you and I, would never make it as a politician.
  • LScott
    Arctic or Pacific Ocean? I may be more agreeable to even wealth distribution with a tan.
  • simplycomplex
    I'm going to forgo an answer to your question and just say this:

    Don't you love the thought of entitlement? Why don't more people have the motivation to go out and make something, be something, and do something instead of sucking the life out of those that do?

  • simplycomplex
    Ok, maybe I wll answer your question...

    I'm not sure how much it would take to defeat the incentive. Not much for those who are blessed with the brains and willpower to make something out of nothing for the sole purpose of financial gain. However, for those that do such first for themselves, and secondly for money, it would take a lot to make them run scared. Maybe they never would. Though I am still sure they would rather not be regulated in such a manner!
  • I think for many, it's because they aren't taught that production is
    necessary, and noble.

    There are a lot of people who grow up believing that there is nothing wrong
    with an able mind and body accepting forced handouts. :(
  • I didn't say you were villifying the working classes and apologize if my comments came off that way but the Randian argument often heads there and some of this "recipient class" stuff is often a thinly veiled reference to the working class. Handouts are tough to handle and if they must be done, they must keep people at the poverty level... otherwise it is a free ride. Are there abuses of the system? sure are! but there are also abuses at higher levels that go unchecked so all of this "they're getting away with doing nothing!" panic always seems overblown. Sure the big guys are creating wealth but they're also gaming the system and receive HUGE windfalls from that. If we want to talk about making sure things are done right (including welfare, recipient class rewards, etc) then we need to do it across the board... focusing only on this poorest class reeks of classism in my opinion. Are we really talking about taking more away from those who have the least? seems instantly lopsided and designed to oppress to me.

    I pointed out Sweden as an example, not because of what advancements they have made (although there have been many... Wikipedia is fine for a cursory review: http://en.wikipedia.org/wiki/Sweden) but because their economy redistributes wealth more than ours and they haven't fallen off the face of the world economy... even though they compete without nearly the same natural and population resources.
  • That's just mistaken. Sweden is not a good comparison. They have had a far more homogenous population than the US, and a culture of feudalistic government control since long before they went parliamentary.

    That said, their current system is doomed. Like most overly taxed Western Democratic welfare states, they cannot afford to make enough children and their welfare pyramid is beginning to become tubular. Soon it will reverse, unless they massively import from the ME and Third World. Whatever the case, the Sweden we know may have climaxed in the nineties right about the time the Soviet Union started to crumble. It's all a measure of degree, and welfare states are simply not self-sustaining.
  • Shhhhh they've always got one shining example going at a time. Like
    watching a trader move from enron to tyco to madoff at all-time highs.
  • Without question when you give government as much power as we have, the
    "unchecked capitalists" will pull far more money out of the system than the
    "undeserving recipients". We agree there although we may disagree on the
    solution.

    We're not talking about taking away more from those with the least. I'm
    hoping we start taking LESS away from EVERYONE very very soon.

    My point with Sweeden is a simple one: If they aren't producing the bulk of
    the advancements they enjoy, who is? What happens if everyone adopts the
    Swedish model? (wow that may trigger some pornspam....swedish model)

    I can't imagine that anyone dealing with those kinds of tax rates can be as
    enthusiastic about taking the risks necessary to
    make technological, pharmaceutical, or other "quality of life" leaps.

    As house rake goes down, activity goes up....no?
  • The Welfare States of Western Europe have been a brain-drain boon to the USA for 60 years.

    Until recently, that is...
  • the argument that it is an all or nothing incentive system is inherently flawed and far too simplistic. If you have to share yet you want more, then you have to accumulate more and therefore share more, but also get to keep more for yourself. Just look at a country like Sweden... there are still people there creating wealth and they are incentivized to create more overall wealth as their overall take is usually lower. When the working majority resents the landholders, there can be upheaval and this has always been the case throughout history. Part of maintaining wealth is living in a sustainable and functional society. Randian thinkers often villify the "working class" who have nothing but want something yet they never villify the "having class" who have something and often do no real work to keep it. It is generally hypocritical & simplistic thinking used by those who already have to justify their own current position... and at times, laziness. Why we base SO much of our discussion of free market principles on a highly flawed piece of FICTION continues to baffle me. Seems like we do it because there is no actual science that says any of it is true and its just something that a small % of the population wants to hear.
  • It seems to be that leftists bring up "Randian" more often than not (I note you make it your strawman above). It seems to be their only point of reference.

    FWIW -- Most right wing conservatives reject Rand's overly harsh dismissal of altruism as morally flawed. Moreover, in my experience, most conservatives only differ with liberals in regard to the efficiency of government top down directed vs. locally/market-driven private charity.

    They do, however, as ASwan pointed out, wholly resent being told where to send their charitable dollars by force of law.

    ______________
  • Hammer, meet head of nail.

    (though I don't think of Rand as harshly rejecting altruism as much as
    harshly rejecting the concept of "obligation")
  • Well, I'm not a big fan of the novels as they are turgidly written and I won't stand for that. I'm thinking more of her essays (there's a collection out there, written by her and her acolytes, including Alan Greenspan (!) called "On Capitalism" I think), where she basically scoffs at altruism as inefficient, saying that only a person single mindedly pursuing his/her own interests is best serving society.

    I would retort -- "Who says getting the natural warm and fuzzies over helping one's fellow man using the fruits of one's labors is not 'pursuing one's interests?'"

    (I would also add that I believe "giving at the office" via the W-2 form negates this very societally beneficial feedback.)
  • I have no desire to villify the "working class"....it's the growing
    "recipient class" and mostly their all-too-willing enablers that make me
    angry.

    What major advancements have come out of Sweeden in the last 80 years? I'm
    not being sarcastic...I really do not know.
  • I believe the spell-checker may have been invented in Sweeden :)
  • LOL that and the swiss watch, so I hear. And an unwavering commitment to......neutrality. That's livin.
  • Wow, I've just checked and discovered there is a Sweeden in Kentucky! I thought you were talking about Sweden. Duly humbled...
  • LOL look I can't help it the Swiss spell their Country wrong. :)
  • At what point in the wealth-creation cycle does “equality of result” defeat “incentive to create”?

    That's going to be in relation to how well the "value-pie" expands. If I, as a landlord, charge 5 coconuts per night and you and Dave can only collect 5 coconuts per day, then there is an issue due to savings, etc. It's even worse when it's negative.

    And ideally, what would happen here is that you and Dave would devise a system of collecting more coconuts more efficiently, thereby increasing value, savings and the "pie."

    But sometimes that doesn't happen, although it should.

    Thinking on this analogy brings me to the entrenched poverty found in strip mines (think "The Rundown") in which the workers can sell the gold they collect, but then the mine owners charge rent for shovels, lodging, and clothing, thereby creating debt-induced slavery, a condition that can implicitly be found in some areas of America.

    Hopefully the counterargument I provide is more the exception than the rule.
  • This is a great answer. If only parents (and schools) were teaching kids how to CREATE rather than how to RECEIVE.
  • As the Italians say, the answer always lies in the middle...
  • Respectfully disagree but love it that you stopped by this lowly blog to
    comment. My plan of kidnapping AVC's brightest is taking hold!
  • Aw Andy, I'm all flushes and blushes...

    Implicit in your post is that we all start on exactly the same level (education, culture, skills, etc). Even if that were all true, people are still not created truly equal...

    Some people are just more smart/motivated/organized than others. Where do you start drawing the line between those aspects you can control/nurture and those you can't?

    Your post is basically the barest bones of the capitalist/communist debate. I'm no Commie, but I do realize the playing field can *never* be perfectly flat. Hence some sort of redistribution (support) is justified IMO.

  • I have no problem with redistribution based on need. In fact, I'm very much
    in favor of it and an active participant!

    I do have a problem being told (by men with guns & "authority") HOW I must
    do it.
  • Are you talking about the elected executive or (more likely) an armed uprising?
  • The elected executive, of course. He brings the pot to a boil slowly and
    deceitfully.
  • Ha! The dark side of democracy. He brings his pot to boil based on how many votes he can get. Wisdom, true justice and foresight fly out the window.

    This is one of my pet beefs. Any politician would rather be elected (even) at the expense of his beliefs, than remain true to his heart and out of office.

    It was not always like that. We live in world with much less integrity.
  • Absolutely. Fortunately, this is nothing new and there is a document
    already prepared to deal with it.

    It's the US Constitution, and when strictly interpreted, it eliminates or
    drastically reduces the impact of most of the problems you describe.

    Aside: If after you die, the next place that you visit has a "BILL OF
    RIGHTS" hanging on the wall.....you're in hell. Only a place governed by
    the innately flawed would require such a document. :)
  • Great thread! hah, just mentioned the bill of rights in AVC.
  • Respect!
  • Tough question, but regardless of the "incentive to create," I think some people are just born to create, to build, to produce.
  • It just so happens that none of them live in Venezuela or Cuba right now I
    suppose ;)
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