Say I argue to someone that redistribution of wealth (a straight transfer of cash from Person A to Person B), ethics of the action aside, does no good. I say it's because Person A won't be able to spend that money to buy clothes for his children, and that may inevitably increase unemployment in the clothing sector of the market. Person A could also save that money in the bank and make it easier for others to take out loans.
What would I say if someone came back at me with, "Well, then Person B would have the money to invest or spend, so it equals out to the process being done, just by different people."
Who has a greater chance to spend a given amount of money more economically, someone who had to spend time and effort to receive it or guy B? The answer here is obvious.
EDIT: I should add whoever is "redistributing" will take his cut too. Better off just leaving that money where it is.
From "Why Capitalism?":
"The singular tendency of capitalism is to provide for individuals the satisfaction of their wants according to the extent of their contribution to the satisfaction of the wants of others." -- Danny Sanchez
Z.
THIS. I knew how to partially answer this question, and it's what you said in your sentence that I had been forgetting.
This I had not thought about. So you're saying that Person A will basically find better deals in the market, and that action will reward more competitive firms?
Yes in order for your analogy to apply you have to fine tune your scenario a little more:
Money from person A is taken forcibly, during tough economic times when he himself might have an urgent need for it.
This prevents him from spending it on basic human needs first and if there is any left over, invest the rest in an industry that shows great return on investment (is in high demand by the public)
Some Mafia like organization has to employ vast numbers of beurocrats to collect, audit, and account for the money and vast organizations that are involved in enforcement and punishment of non compliers.
Then the money is given to a distribution wing that is ignorant of laws of the economy and in fact does not give two hoots about the industries that have the highest demand for their product.
In fact, the sole criterium used, is how can this money be spent to buy me the most political influence. After chipping off vast sums for earmarks for friends and fraudulent diversions, one or two prominent projects are chosen by how newsworthy they are. Maybe cash for clunkers or bullet trains.
Then these contracts are not given to the best provider, but to the friend of the distributor- leading to delays, cost overruns and further fraudulent diversion, that has to be investigated by a committee still drawing their salary from the original donation. Along the way a few thousand union jobs are created (is this the end receiver person B you were talking about?)
Sure they get to take home a piddly amount of the original stash, but after a few years, they retire on a huge pension and the original provider person A is coerced into coughing up some more dough for the recipient person B to spread around. (Not to mention a big interference- most likely a serious suppression- in the free market of non union labor)
So there can be no scenario where this would end up being better for the people in the long run. None!
It entirely depends on the context. For such a basic straight forward question I would say the fallowing. 1. A person who deserves the money is the person who works for it
2. People who do what person A does that people like person B doesn't want to do, are allowed to charge more. (free market / competitive costs)
3. I love this quote "A person who takes a little time to study what nobody else will can charge for a life for learning what someone else refused to learn" (Plumbing, Auto Mechanics, etc)
4. Theft is theft.
5. A person who is poor has equal rights to wealth, riches, success and happiness as much as anyone else. The difference between person A and person B (assuming they both came from nothing) is one of them was able to strategize, compete, and maximize his efficiency in the (free) market. And person B is screaming "CHEATER! FOUL!"
6. A free nation with a free market cannot sustain a population of people who feel they are entitled to anything other than freedom. (Even if that freedom sadly includes taking away freedoms from others such as the pursuit of wealth)
7. Maybe government should take from the poor to give to the rich who produce goods and services that provide jobs, goods, and services for the low, working, and middle classes, and furthermore make the economy stronger and improves living standards. (assuming you just want to be a argumentative butt-hole in the conversation)
1. A person who deserves the money is the person who works for it
This is reminiscent of the labor theory of value. If you spent all day collecting a pile of sticks but there was not a demand for this resource, do you deserve money? I understand what you were implying but I wouldn't state it as plainly as you wrote it. It leaves you open for critism. You have to build up walls to protect yourself when arguing against economic egalitarians.
You can't hurry up good times by waiting for them.
If you're taking money from Person A and giving it to Person B, then you're raising the implicit marginal tax rate, thus harming reducing economic productivity. I started writing a long response to your OP, and then I realized that what I wanted to write has already been written better by a certain Clifford F. Thies here. To put it simply: wealth redistribution acts as an incentive for everyone to work less, because those getting the redistributed wealth will not get it if they work more or harder on their own, and those getting their wealth stolen for redistribution have an incentive to work less, for they will get less money for working more or harder than they otherwise would in the absence of taxes for redistribution.
Political Atheists Blog
mahall: 1. A person who deserves the money is the person who works for it This is reminiscent of the labor theory of value. If you spent all day collecting a pile of sticks but there was not a demand for this resource, do you deserve money? I understand what you were implying but I wouldn't state it as plainly as you wrote it. It leaves you open for critism. You have to build up walls to protect yourself when arguing against economic egalitarians.
No, what it means is that if you spent all day collecting a pile of sticks that were previously owned by no one, you have the right to keep those sticks. Or, in other words, no man with a gun can demand that you hand those sticks over to him so he can give them to someone who "needs the sticks more" (something that the grand larcenist is not able to determine in the first place).
krazy kaju:No, what it means is that if you spent all day collecting a pile of sticks that were previously owned by no one, you have the right to keep those sticks. Or, in other words, no man with a gun can demand that you hand those sticks over to him so he can give them to someone who "needs the sticks more" (something that the grand larcenist is not able to determine in the first place).
I see your point. I felt her point #1 to have a similar vibe to that of the LTV. Just a suggestion for her to explain the position better as you did above.
I appreciate the feedback. :) In all honesty I am not an economist and I am not a debater, I prefer other methods of communication and influence.
With such a vague question in the original post I feel i cannot give much more than a vague response. It is definitely a great question to use as an exercise to go all out on though for personal fun and learning experience. I am still very new to the concepts, ideas, and community of the Mises Institute and the Austrian approaches in economics, so I have a lot more to grow in this direction for sure. Since watching virtually every clip on YouTube hosted on the MisesMedia account, I feel like things are finally making sense in a way nobody has explained to me before so I am very interested in learning more and applying the concepts taught.
Remrie Arrie:7. Maybe government should take from the poor to give to the rich who produce goods and services that provide jobs, goods, and services for the low, working, and middle classes, and furthermore make the economy stronger and improves living standards. (assuming you just want to be a argumentative butt-hole in the conversation)
Brian Anderson:Say I argue to someone that redistribution of wealth
The first mistake in your argument is that you are objecting to something that does not and cannot exist in the capitalistic market economy.
Redistribution of wealth implies that there is some process of distribution of wealth, distinct form the process of production, that occurs in the first place and can later be "redistributed", perhaps according to a more "just" method of distribution. But no such distinct process exists. In the capitalistic market economy, all wealth comes about as someone's private property. Production and "distribution" are one indivisible process that cannot be split up. There is but only one way to transfer wealth from A to B, and that is by confiscation. Not by redistribution.
Johnny Doe:What if you say that the person that produces a good/service, deserves that good/service or the buying power it represents in a free market? Or a part of the good/service and/or buying power that he/she has voluntarily agreed upon with the other people involved in the production process.
"Wages are not paid for labor expended, but for the achievements of labor, which differ widely in quality and quantity." -Mises
"The laborer is an entrepreneur in so far as his wages are determined by the price the market allows for the kind of work he can perform. This price varies according to the change in conditions in the same way in which the price of every other factor of production varies." -Mises
"In the market economy the worker sells his services as other people sell their commodities. The employer is not the employees lord. He is simply the buyer of services which he must purchase at their market price." - Mises
These are all from Human Action. I feel your statement is on sold ground referencing the words of Mises.