Spread the Wealth?
October 21, 2008
I dont care to give myself any labels, but I lean towards
capitalism for moral reasons (good for the economy too, but there
are more important things). I dont believe it's a governments
job is to spread the wealth around as Obama proposes.
Wealth redistribution means you have to first take the wealth
from those who produce it, and that seems unfair except, perhaps,
for specific purposes. So why am I not running out to vote for
I probably wont vote for either, but lets look
at the income redistribution plans of each. My Republican friends
wont like hearing this, but along with the Democrats virtually
all the Republicans believe in these socialistic ideas too. They
believe in taking my money to educate other peoples children
even for college. They believe in all sorts of social
programs that take money from some to give to others. They may
not use the same words, and may not agree on the extent of these
measures, or about who should be the recipients but any
laissez-faire capitalists left among them certainly make up less
than 1% of Republican Party.
So contrary to what they may say, there is no argument on
principle here, only a matter of judging who will redistribute
how much and to whom, and what effects that will have. For example,
John McCain criticized Obama for wanting to take Joe The
Plumbers money, but then he promised Joe
Ill keep your taxes low and Ill provide available
and affordable health care for you and your employees.
Of course McCain isnt going to personally fund Joes
health care, so he obviously means to use our money for that.
Thats wealth redistribution. But wait. Joe was complaining
that he wouldnt buy the plumbing business he worked for
because Obamas tax plan would take too much from him after
his first $250,000 of profit. Most of us taxpayers dont
make nearly that much, so apparently McCains plan is a
kind of Reverse Robin Hood Plan, in which our wealth
is spread around to those who make more than us.
In the second debate McCain proposed using $300 billion of
our money to help buy the mortgages of people in trouble and
renegotiate (lower) the balances for them. As I heard
this, I looked out the window, up into the hills where the $300,000
homes are those are the ones being foreclosed on
and thought, so I get forced to help them by their homes?
We have a 65,000 home, by the way, so this is apparently another
Reverse Robin Hood plan. (As was the bailout they
both voted for.)
McCain and other Republicans (and some Democrats) seem to
reflexively fight for those who have more. This is partly why
our tax system has so many loopholes that can only benefit the
wealthy. Wealth is good in my book, and I love the idea of everyone
paying the same tax rate. But it was only a few years ago that
Warren Buffet wrote his famous opinion piece in which he pointed
out that he pays a lower tax rate than his secretary.
Obamas plans are always more vague, so its tough
to judge who will actually spend more. I suspect he wont
be able to get half of what he wants done (Clinton couldnt),
so I dont worry as much as some about the costs. In any
case, despite the promises, Republican administrations have always
spent more than Democratic ones in my lifetime. So I really dont
know who will be worse.
What I can see though, is that Obama is more likely to help
the middle class and poor, and McCain more likely to help the
upper middle class and the wealthy. This would sometimes be at
the expense of the working class, but I doubt thats his
intention. I think it is instinctive. For example, when we were
in McCains very wealthy hometown of Sedona, Arizona, I
noticed signs notifying us that it cost $5 to pull off the road
and look at the beautiful scenery (seriously). That wasnt
meant to target those making less money, but it certainly affected
them more, and they too had paid for these highways.
Consider too how wealthy communities like Sedona eventually
beautify their towns by regulating against mobile
homes one of the few truly affordable forms of housing.
It isnt meant to hurt the poor, but thats the effect.
Most workers in Sedona live in other cities now, and have to
spend a lot more money on gas. That helps the property values
of the wealthy in town, and so effectively transfers money from
the poor to the rich.
Some of these things are natural. Richer towns become less
affordable even without laws designed to help the wealthy. And
I dont think it is a conscious thing in any case. But it
does point out that those with money usually have the means and
ways to protect their interests. Thats one of the reasons
Im not too worried for them under an Obama presidency.
To spread the wealth around is not a governments
job, but the way Obama will do it versus McCain may be the lesser
of evils. Redistribution of money from rich to poorer is probably
more stabilizing to a country than the opposite. I also think
the rich will find ways to protect themselves. And though I think
higher taxes will be bad for the economy, it is silly for Joe
the plumber to give up his dream considering hell
likely make a lot more than he is currently making. (Although
with lower profits there will be less to reinvest and therefore
In other words, this is not as big a deal as people are making
it, which is probably why even the worlds richest man,
Warren Buffet, is voting for Obama. Of course there are many
other issues not touched on here, and as noted Ill probably
check the box, none of the above. I only wish that
one could win the election.
Note: This is part of a series. You can find all of
the pages listed and linked to here:
of Wealth to the Wealthy