Equality of Income: Richard Epstein of NYU School of Law on the subject of Income Distribution

Watch Does U.S. Economic Inequality Have a Good Side? on PBS. See more from PBS NewsHour.

HT Cafe Hayek blog

Class Warfare Politics: upon further review, poverty is the best policy

Each time class warfare politics raises its ugly head in regards to taxes, the rich are vilified and the vilification is used to argue for an increase tax on the so called “rich“. The argument put forth by politicos is the general and usual notional argument with concepts such as “fair”, “just”, “fair share” and so on. Purely political notional concepts that only have absolutely no meaning except in the context the politico presents e.g. fair is merely what you are doing and the other guy is not doing. That is to say, its an argument with no arguments. Vilification and notional concepts do not make for empirical underpinnings of any policy be it public or private.

Moreover, when the dust clouds of class warfare politics settle, everyone ends up paying more taxes. Stated alternatively, if one climbs on the magical bus of class warfare to tax the rich, at some point one has their very own class warfare bus ticket punched and ends up thrown under the bus of higher taxes. Odd huh?!?

Its not really that odd at all. You see, in a system of “some people” politicos want/need more money to spend. Why? The conduit of taxpayer dollars must increase at an increasing rate allowing the politico to use such funds for political constituency building exercises. Special interests and dependency constituencies [recipient class] are built with taxpayer money. The existing taxpayer-dollar-funded-constituencies, as well as any newly proposed constituency building targets, require vast amounts of taxpayer dollars flowing into the sphere of the politico. The flow must increase at an increasing rate in order for the politico to “grow their constituency”.


“Here it may suffice to observe that, on the theories of the social philosophers to whom I have referred, we should get a new maxim of judicious living: Poverty is the best policy. If you get wealth, you will have to support other people; if you do not get wealth, it will be the duty of other people to support you“. - W.G. Sumner (1)


Therefore, the politico promoted class warfare argument purposely plays James and Jane Goodfellow for saps. It sounds great as the politico weaves and frames the argument that you can have some other group of people pay for some crisis or problem. The politico is going to save you from the expense of solving a problem by merely making someone else pay for the problem.

The question one must ask oneself is: the centuries upon centuries of basically the exact same politico promoted class warfare argument has done exactly “what” to solve any and all problems? The politico wants you to judge them by their intentions and not their results. Exactly what results do we have presently? Do we have a tax problem or a spending problem? The politico wants the answer to be that we have a tax problem as they want more tax dollars to “grow their constituency”. The politico must direct the problem away from the spending side of the equation as decreases in spending means the collapse of existing political constituencies built and dependent on taxpayer dollars and disallows the acquisition of newly proposed constituency building targets.

“The good news is that, according to the Obama administration, the rich will pay for everything. The bad news is that, according to the Obama administration, you’re rich.” - P.J. O’Rourke

Notes:

(1) On a New Philosophy: That  Poverty is the Best Policy, William Graham Sumner, 1883

　

　

Saving the American Idea: Rejecting Fear, Envy and the Politics of Division - by Paul Ryan

Occupy: The 1883 Response.

The excerpts below are from the "forward" of the 1883 book by William Graham Sumner entitled What Social Classes Owe to Each Other. Take special note of the second paragraph below.


“Who are those who assume to put hard questions to other people and to demand a solution of them? How did they acquire the right to demand that others should solve their world-problems for them? Who are they who are held to consider and solve all questions, and how did they fall under this duty?

So far as I can find out what the classes are who are respectively endowed with the rights and duties of posing and solving social problems, they are as follows: Those who are bound to solve the problems are the rich, comfortable, prosperous, virtuous, respectable, educated, and healthy; those whose right it is to set the problems are those who have been less fortunate or less successful in the struggle for existence. The problem itself seems to be, How shall the latter be made as comfortable as the former? To solve this problem, and make us all equally well off, is assumed to be the duty of the former class; the penalty, if they fail of this, is to be bloodshed and destruction. If they cannot make everybody else as well off as themselves, they are to be brought down to the same misery as others“.


“The little group of public servants who, as I have said, constitute the State, when the State determines on anything, could not do much for themselves or anybody else by their own force. If they do anything, they must dispose of men, as in an army, or of capital, as in a treasury. But the army, or police, or posse comitatus, is more or less All-of-us, and the capital in the treasury is the product of the labor and saving of All-of-us. Therefore, when the State means power-to-do it means All-of-us, as brute force or as industrial force.

If anybody is to benefit from the action of the State it must be Some-of-us. If, then, the question is raised, What ought the State to do for labor, for trade, for manufactures, for the poor, for the learned professions? etc., etc. - that is, for a class or an interest - it is really the question, What ought All-of-us to do for Some-of-us? But Some-of-us are included in All-of-us, and, so far as they get the benefit of their own efforts, it is the same as if they worked for themselves, and they may be cancelled out of All-of-us. Then the question which remains is, What ought Some-of-us to do for Others-of-us? or, What do social classes owe to each other?

I now propose to try to find out whether there is any class in society which lies under the duty and burden of fighting the battles of life for any other class, or of solving social problems for the satisfaction of any other class; also, whether there is any class which has the right to formulate demands on "society" - that is, on other classes; also, whether there is anything but a fallacy and a superstition in the notion that "the State" owes anything to anybody except peace, order, and the guarantees of rights“.

William Graham Sumner’s famous essay “The Forgotten Man”

“I PROPOSE in this lecture to discuss one of the most subtile and widespread social fallacies. It consists in the impression made on the mind for the time being by a particular fact, or by the interests of a particular group of persons, to which attention is directed while other facts or the interests of other persons are entirely left out of account. I shall give a number of instances and illustrations of this in a moment, and I cannot expect you to understand what is meant from an abstract statement until these illustrations are before you, but just by way of a general illustration I will put one or two cases“. - William Graham Sumner, 1883 (1)

Above is the opening paragraph of William Graham Sumner’s famous essay “The Forgotten Man” written in 1883. And what did Sumner propose to discuss as a widespread social fallacy?

“These illustrations bring out only one side of my subject, and that only partially. It is when we come to the proposed measures of relief for the evils which have caught public attention that we reach the real subject which deserves our attention. As soon as A observes something which seems to him to be wrong, from which X is suffering, A talks it over with B, and A and B then propose to get a law passed to remedy the evil and help X. Their law always proposes to determine what C shall do for X or, in the better case, what A, B and C shall do for X. As for A and B, who get a law to make themselves do for X what they are willing to do for him, we have nothing to say except that they might better have done it without any law, 'but what I want to do is to look up C. I want to show you what manner of man he is. I call him the Forgotten Man. Perhaps the appellation is not strictly correct. He is the man who never is thought of. He is the victim of the reformer, social speculator and philanthropist, and I hope to show you before I get through that he deserves your notice both for his character and for the many burdens which are laid upon him“.

　

“Whenever A and B put their heads together and decide what A, B and C must do for D, there is never any pressure on A and B. They consent to it and like it. There is rarely any pressure on D because he does not like it and contrives to evade it. The pressure all comes on C. Now, who is C? He is always the man who, if let alone, would make a reasonable use of his liberty without abusing it. He would not constitute any social problem at all and would not need any regulation. He is the Forgotten Man again, and as soon as he is brought from his obscurity you see that he is just that one amongst us who is what we all ought to be”.

　

A politico by the name of Franklin D. Roosevelt (FDR) used the phrase “the forgotten man” in many of his campaign/political speeches. Roosevelt used the phase in a diametrically opposite context/meaning. That is, Roosevelt co-op-ed the phrase and possibly, and possibly meaningfully, rewrote history regarding the phrase “the forgotten man“. Roosevelt basically switched the position of “the forgotten man” within Sumner’s formula. Roosevelt merely moved the forgotten man from C to D or X and elimiated C. (2) In other words, the formula was turned upside down to generate a different meaning by eliminating C from the formula, and now A and B are providing for “the forgotten man”.

However, the essay remains and for those who would enjoy some 1883 insight, insight that remains today, the link to the essay appears below.

Note: once you reach the link scroll down a bit and the essay appears below the fold.

http://oll.libertyfund.org/?option=com_staticxt&staticfile=show.php%3Ftitle=2396&chapter=226423&layout=html&Itemid=27




Notes:

(1) William Graham Sumner, The Forgotten Man and Other Essays.

(2) Amity Shlaes, The Forgotten Man, a New History of the Great Depression.

Statistics, Conclusions, and Evidence

"Anyone who looks through enough statistics will eventually find numbers that seem to confirm a given vision. Often, the same set of statistics contains other numbers that seem to confirm diametrically opposite conclusions. The same is true of anecdotal ‘facts.’ That is why evidence is different from mere data, whether numerical or verbal.

Scientific evidence, for example, comes from systematically determining–in advance–what particular empirical observations would be seen if one theory were correct, compared to what would be seen if an alternative theory were correct. Only after this careful and painstaking analysis has been completed can the search begin for facts that will differentiate between the competing theories. Seldom is this approach used by those who believe in the vision of the anointed. More typically, they look through statistics until they find some numbers that fit their preconceptions, and then cry, ‘Aha!’ Others with different views can, of course, do the same thing. But only those with the prevailing views are likely to be taken seriously when using such shaky reasoning". -Thomas Sowell (1)

Notes:

 (1)  The Vision of the Anointed: Self-Congratulation as a Basis for Social Policy, Thomas Sowell, 1985, page 32

Duke Power Rate Hike? –Or- Rate Hike by Politicos through the Mechanism of Government?

 
Buried in Duke Energy's rate hike are two items: legal monopoly position of Duke Power and the coercive acts by politicos through the mechanism of government to cause Duke to purchase from uncompetitive, subsided energy sources.

Public utilities such as Duke Energy are legal monopolies caused by policies and legislation sponsored in part and promoted in full by the FDR administration. Power was produced privately in a robust competitive market before the policies of the FDR Administration.

Monopoly practices speak for themselves. However, it is worth pointing out that certain politicos do not oppose monopoly; they only oppose private monopoly and welcome public or state monopoly.

The other item to consider is yet another government intervention into the market for electrical power, namely the coercive power of politicos through the mechanism of government to mandate purchase of electrical power from uncompetitive, subsidized energy sources e.g. solar and wind power. Solar and wind power cost per kilowatt hour are far above [in some case four times] the cost to produce power by other means: coal, natural gas, and nuclear where available.

Moreover, a second cost exists for consumers: the cost of tax payer subsidies to solar and wind power companies.

Hence the consumer of electricity is suffering from the effects of monopoly delivery, artificially inflated prices, and is subsidizing the artificially inflated price to boot.

Maybe consumers and taxpayers would be better calling for competitive electrical generation in the private sector, where private companies are free to choose their electric power supply source, and to end taxpayer subsidies to uncompetitive companies.

H/T Triadwatch blog