Two “facts” are being asserted with increasing regularity today when the topic of capitalism arises. It is said, first, that “the rich are getting richer while the poor are becoming poorer.” Secondly, it’s commonly asserted that “the gap between rich and poor is widening.”
So what’s the truth?
I’ve been making inquiries into the matter for the last few years and I’ve come up with some interesting data. You see, my father is a wise man who taught me never to jump upon ideological band wagons. It’s better to think for oneself and to investigate before joining in those massive waves of “group think” that often infect the human population. To suggest this is not to say that groups of people can’t be correct in their assertions, but it is also important to remember that one’s values should be carefully chosen and not decided by a popularity contest.
What has my own research taught me? Well, here it is in a nutshell. As a general rule, the rich are getting richer. But so are the poor. This is a product of free markets where people decide how to spend their income and where some of those free people invest their money into businesses that not only hire the unemployed, but that also provide goods and services in ways that are increasingly effecient and at lower cost.
This really is self evident. Think back fifty years. Then think back a hundred years. Then two hundred. Get the picture? Health and wealth are improving for the ordinary guy and gal at a record pace (at least until recently). And this has been going on ever since power and wealth were wrestled from the exclusive grip of royalty and the most privileged and was exercised by the common man and woman. The weapon used in this economic revolution? Free trade.
As to the second assertion proposed at the start of this blog entry, my research convinces me that it is true. The gap between the rich and the poor, as a general rule, is getting wider. But to my way of thinking, this fact is of little or no economic or moral value. Another way to put it is that while all of us who benefit from free markets are growing more wealthy, some are growing wealthy faster than others. In a society that values freedom and private-property rights, this fact should not be the concern of government.
Some of us learn faster than others. Some of us inherit more than others. Some of us are prettier or more masculine than others. Didn’t your momma teach you that life isn’t always fair? Our rule of government (the Constitution) was never meant to guarantee equal outcomes. It guarantees equal standing before the law. Whatever situation you are given in life by birth, aptitude and your own actions, the Constitution says you are equal in legal standing to everyone else. It was not always so.
Of course, there are many diddling busybodies who disagree and who want to see the power and coercion of government brought to bear upon the most successful among us in order to “take from the rich and give to the poor”–in other words, to guarantee equal outcomes. Doing so makes them feel morally righteous and it increases the power of those in elected office who can claim to be the saviors of “the little person.”
But it comes at a dear price. Very dear, indeed.