Income Wealth and Poverty
Distinguished economist Thomas Sowell, senior fellow at the Hoover Institution, remembers as a young person asking the question “why this great disparity” in wealth he observed while working in Manhattan.
He has worked his entire life trying to understand the reasons why and has written a new book titled “Wealth, Poverty and Politics: An International Perspective.”
He is quoted in an article I read in The Daily Caller “I was struck by all this and puzzled as to how and why it came to be”. He said his response, was “I was led to Marxism because it offered a simple explanation and there was no competing explanation, it’s one of the things that’s bad about our educational system.”
In his new book he examines the four factors that he believes influence the production of wealth: geography, society, culture, and politics. He describes the “general human tendency to find not simply causation but blame”.
Geographic factors are largely neglected, he states “Obviously people living in remote mountain villages are going to have very little contact with what’s going on in the rest of the world,” He believes isolation is one of the main factors in poverty and backwardness.
Interesting because the ideologue of the left is to stifle speech they do not agree with or do not want the general public to be informed about, i.e. their attempt to shut down talk radio.
His thoughts on cultural factors is “Probably the biggest debate today is between people who think that those who are less successful are less successful because they’re genetically incapable of a level of intelligence,”
He goes on to state that what both sides ignore is production, or the motivation to produce. He is once again quoted in the article stating:
“Both sides of that issue tend to ignore is the fact that you have to want to do something – you must not only want it in some abstraction. We would all like to be billionaires, but most of us aren’t doing anything to move in that direction […] you must have a desire to do something or put forth the effort and make the sacrifices.”
He believes there is a widespread misconception of the definitions of “income” and “wealth,” which he believes “are just two fundamentally different things. It’s not just a matter of semantics”.
Mr. Sowell states “Income is a flow of money during a given time period and wealth is an accumulation of over time.”
Raising the income tax will not hurt wealthy people, what it will do is make it harder for people to actually accumulate wealth. They have already accumulated their wealth and do not grow their wealth through income.
He states in the article what I have been saying for years “all kinds of attempts to finance things by raising taxes on the rich have had terrible repercussions in the sense that you don’t even get any more tax revenue that way. If anything you get less tax revenue by having very high tax rates, because people always have the option of sending their money into some jurisdiction where the tax rate is lower or to move themselves.”
Wealthy people will move their wealth were the taxes are lower, they will not just sit back and let the government strip them of what they have accumulated over a lifetime or their families lifetime.
So the question you must answer is why does the ideologue of the left attempt to make it harder to accumulate wealth first via income?
They may have good intentions in the beginning but the negative consequences of their solutions actually stifle the lower and middle class from acquiring wealth.
Let’s discuss this today on my program, The Live with Renk show, which airs Monday through Friday 9 a.m. to noon, to let me know your thoughts at (269) 441-9595.
Or please feel free to start a discussion and write your thoughts in the comment section.