Free stuff is a lousy way to address wealth disparity

I’m not convinced that wealth disparity is a problem. I do firmly believe, mind you, that the world is rich enough now that no one should starve or freeze to death, at least not involuntarily, and that the injured or diseased should be given medical treatment.

In America, we’ve achieved that, and more. Poor people in America not only have plenty to eat (as is evident from their physiques) but also have automobiles, air conditioning, color cable television, smart phones, and free tuition.

The wealth disparity complaint is not about starvation or freezing. It’s the complaint that some people have far more luxuries than others. Some have fancier cars or more of them. Some have more frequent European vacations. Some have televisions in the bathroom. Some fly First Class on their own dime. Some drink not just wine – everyone drinks wine now – but the expensive kind.

Some of these people indisputably have more luxuries than they need. But so do the poor people, just not as many.

What the complaint really boils down to is simple envy. The debate is framed in the rhetoric of fairness and needs, but it’s rooted in envy and covetousness. The complainers are simply envious of people who exert the effort to acquire more wealth than the complainer. That’s human nature, and I don’t condemn them for it.

What I condemn is their solution. They want free stuff. They want free college tuition, but only for the “needy” who of course invariably include themselves. They want free phones, free internet, free housing, free transportation, and a free ride, all for the “needy” such as themselves. All this free stuff, they suppose, will lessen the disparity in wealth between them and those they envy. It will salve their envy.

It is a lousy solution. First, this free stuff doesn’t add up to much in the grand scheme. Lots of free stuff will not appreciably lessen the disparity in wealth between you and Bill Gates who has something north of $100 billion.

Second, the administration of these freebie programs is very costly. The providers take a big cut off the top.

Third, the programs are often corrupt. The participants and providers lie and cheat, as people seeking or granting freebies tend to do.

Fourth, it encourages politicians to pander to the middle class with endless promises for more and more free stuff, as if stuff can be created for free out of thin air. It can’t, and promises that it can is no way to run a country or a government.

Fifth, and most importantly, it all encourages a something-for-nothing mindset. Maybe hard work is one of those dead white male European traits (I personally don’t think it’s limited to that demographic at all) but history has proven its value in creating a more just and more wealthy society for everyone. When hard work as a strategy for getting ahead is replaced with strategies for getting something for nothing, society declines and so does its wealth.

Here is a better way to address wealth disparity, if you think it must be addressed (I repeat, I don’t). Make the income tax system even more progressive than it is. Tax the rich even more than we already do.

Sure, it’s true that the top 1% already pay about 40% of income taxes, and the top 10% pay about 70%, but that could go even higher. In the past, it has. Today’s top marginal rate is about 40%. In the past, it has been as high as 90%.

Questions arise as to where those rates should kick in. Do we collect a 90% tax on income over $10 million? Or $100 million? Those are policy decisions for the politicians and economic decisions for the economists. At some point, you get to confiscatory tax rates that discourage investment and work, and so you wind up collecting less, not more, in taxes.

I personally think taxes should be raised on everyone who makes more money than I do, and I’m not alone in that regard. If I were a politician, I would promise to raise taxes on everyone who makes more than the person I’m talking to.  

By the way, I think everyone at every income level should pay something in taxes, even those few people who make less than I do. Even a person making $20,000/year should be a stakeholder in America, and should pay something in taxes.

I’ll say for at least the third time that I don’t see wealth disparity as a problem in this country so long as people aren’t starving or freezing, and they’re not. But if society disagrees with me, let’s address it straight up in an efficient way, not a way that is destructive, dishonest, and divisive.

30 thoughts on “Free stuff is a lousy way to address wealth disparity

  1. Compassion is not marked by giving the poor someone else’s money. Maybe compassion is shown best by origanizations like Samaritin’s purse, Red Cross, Mercy Ships that give of money willingly given to them?

    • All three, cottage-industry groups.
      Above all, “Administrative Costs” – and other people’s blood and money.

    • Robert, Jakki and HR, respectively: Please allow me to -briefly- expound. There ARE very good causes out there. Still, over the years I’ve become extremely wary of the middlemen, again, it’s an actual cottage-industry. Nonetheless I implore all, do what you can, when you can, for whomever you can. Give to the needy, not the greedy.

      • For almost 30 years I’ve produced an annual Fundraiser for a Special Needs Children’s Hospital in Southern California, I KNOW where every cent goes. For close to 25 years I participated greatly in Christmas and Thanksgiving Turkey and all the Fixings + bare necessities for the Salvation Army only to find out that I’m a WHITE OPPRESSOR in their eyes. They can rot in Progressive Hell for all I care. By the way, thank YOU for assuming the un-charitable Worst case of us.

    • HR, I thank-you for the most impressive charitable work that you’ve done. Indeed, an exemplary American and Man. Still, I stand by my statement and if the shoe don’t fit…..

  2. Two comments, 1) what about a progressive tax on dividends and interest instead of huge income tax increases? 2) Hard workers are still out there! I see true immigrants from Mexico and India that work like dogs and make a good life for themselves! The Libs “free” giveaways disincentivize poorer people from working hard and sacrificing to raise their living standards.

  3. One of your better articles, Glenn. Not sure I’m following you on “tax everybody richer than me” theory but I’ll assume you’re being facetious. But you are now a journalist, so, maybe the journalisms left gravitational pull has sucked you into their vortex.

    But I’ll offer this in response to your statement that….”When hard work as a strategy for getting ahead is replaced with strategies for getting something for nothing, society declines and so does its wealth.”

    https://education.nationalgeographic.org/resource/banana-thief

  4. A tax on income is basically a slave state solution. The power to tax a man’s income is simply a means of appropriating his labor without compensation. That is the definition of slavery. I propose another alternative, viz., a progressive national sales tax. A sales tax is imposed on purchases, and the less one purchases, the lower the tax. This gives the individual a choice whether to purchase any given item or not, thereby incurring the tax or not. Of course, an exemption would be in place for food, not including food served in restaurants. Every other item of personal property gets taxed, including stocks and bonds. Moreover, a progressive sales tax places a higher rate on more expensive purchases, which will, by their very nature be made by and therefore the tax thereon borne disproportionately by the wealthy. You can buy a rowboat with a 6% sales tax or a grand yacht with a 26% sales tax. I believe that Jeff Bezos would still have bought his megayacht regardless of a 26% sales tax. Of course, this is purely hypothetical, since our current system of tasation, being one that is more entrenched than a tick on a dog, is not likely to be eliminated.

    • I like sales taxes, or value added taxes as they’re called in Europe, and so do most economists. That’s because they tax consumption, which economists see as the place money goes to die, rather than taxing saving and investing, which economists see as the place money goes to grow and reproduce.

      It’s difficult, however, to make sales taxes as progressive as people like. It’s certainly true that wealthy people, or more specifically people who spend a lot, pay a lot more. But that still doesn’t get you to the level of progressiveness that most Americans seem to want. (Whether they SHOULD want that is a different issue.)

      Your idea of escalating the percentage of tax on luxury goods sounds good, but I think would be very hard to operate. To use your example, at what point does a rowboat become a yacht, and who decides? At what point does a house become a luxury house? Is it when it reaches a certain size? But what if the owner has a very large family? What if the house isn’t large but it’s on a large piece of land? Etc etc etc. Having an army of bureaucrats to tell us what constitutes “luxury” of various degrees, seems unworkable.

      • Thanks for your thoughtful response. To clarify, it is not necessary to classify products subject to my proposed sales tax (or VAT, as you point out) into “luxury” or any other category. It is only the price of the product or the amount of the transaction that determines the rate of tax. And I specifically exempted real estate transactions (housing) from the scheme. Otherwise, I acknowledge that it would likely be more difficult to impose and collect a sales tax than an income tax, but certainly many countries have imposed a VAT for many years, so templates for the system abound. Moreover, in my view, merely because it might be difficult to switch our tax mechanism, it does not change the fact that income taxation is slavery and sales or VA taxes are not.

      • Ah, I thought you were proposing taxing luxury goods at a higher PERCENTAGE. My bad. I agree that a fixed percentage is totally workable, though I think many citizens (but not I) would think that approach is insufficiently progressive

      • A VAT and a sales tax are not the same thing. A sales tax in a one time tax at the point of sale to the end user. A VAT is a tax on goods at each stage from manufacture to end user. At each point, the tax increases because a middle man has increased the value of the item. While it is true that the end consumer eventually pays for everything, the amount paid in taxes for a VAT is more than for a sales tax. With a VAT, most of the taxing is hidden from the consumer, unlike a sales tax which is visible when the consumer makes the purchase.

        One of the beauty’s of the sales tax is that it is a flat tax that is applied equally across the board regardless of item.

  5. I’m glad you used the word ‘salve’, instead of ‘solve’. Because solving a problem is low, or purposefully absent, on their bucket lists. The simple interpretation is usually the correct one. The activists can only extort more from the producers if they continually drive a wedge into the American people. An honest person knows that poor people aren’t poor because wealthy people are wealthy.

  6. Noah Webster, History of the United States, 1832
    “When you become entitled to exercise the right of voting for public officers, let it be impressed on your mind that God commands you to choose for rulers “just” men who will rule in the fear of God. The preservation of a republican government depends on the faithful discharge of this duty. If the citizens neglect their duty and place unprincipled men in office, the government will soon be corrupted, laws will be made not for the public good so much as for selfish or local purposes…”

    I’ll wager that the statue destroyers have their eyes on his likeness, wherever it may be.

  7. My husband and I are planning on being debt free (no mortgage or auto loan) in roughly 33 months..give or take. Sadly, under the cure the mafia regime, we are already bracing for what lies ahead the next two years…as well as next spring (tax filing season). We live in a very small home (just shy of 700 sq feet) and have seemingly been tight with spending since we were in our 30’s. Our current home was going to be a starter home, but here we still are. I no longer work, but will be filing for social (another joke) security in early 2024. It’s frightening, as I figure by then the Medicare premium will suck up what little of a check I’ll have, Free stuff is the libtards motto. Always has been. What keeps me going most days is that I know eventually, they’ll all meet their maker and will have to account for their crimes. Biden, Hillary…all of them…for now…I’ll keep praying the midterms will bring some form of relief. But, once again…the cheaters (Dems) no doubt have their plan of action already on paper.

  8. Oh … this is a terrific topic, especially for today … Labor Day; a federal holiday that is supposed to recognize the value of a man’s work in which he is entitled to keep the fruit of his investment, creativity, innovation, risk, and hard labor.

    America’s confiscatory taxation system is the kissing cousin to what was once legalized slavery. That cursed 16th Amendment (authorizing the creation of a federal income tax) was ratified under the racist progressive Democrat Woodrow Wilson’s tenure. Wilson, a professed sympathizer to the Southern Confederacy, surely saw the promises of a US income tax code along with his fellow so-called Progressives of that era.

    This new leviathan tax code would yoke workers back under the control of the political class (aka, those former plantation owners) so that these self-important, lazy, and entitled Democrats in suits could sit around socially engineering and managing everyone else from the nice comfortable confines of luxurious office suites while the “deplorables” and the now so-called “MAGA Republicans” do the grunt work.

    Abraham Lincoln once vividly illustrated the corruption of such coercive labor systems (case in point, slavery) with the colorful quote … “I always thought the man that made the corn should eat the corn.”

    Our current taxation system is immoral and rife with corruption and upside down incentives. If the combined incomes of a married couple working as a firefighter and a nurse exceeds $200K (a very likely circumstance in costly states like NY or California) then such a married couple could easily see up to 50% of their incomes sucked away by taxes at the combined federal, state and local levels. If government is entitled to 50% of the fruits of your labor, does that make you a half-slave?

    Lincoln first and foremost believed that the sin of slavery had little to do with race, but that its immorality is rooted in the fact that such coercion constitutes the outright theft of a man’s work. He condemned “the same old serpent that says you work and I eat, you toil and I will enjoy the fruits of it.”

    Lincoln had written in his notes in the late 1850s that this principle had been “made so plain by our good Father in Heaven, that all feel and understand it, even down to brutes and creeping insects. The ant, who has toiled and dragged a crumb to his nest, will furiously defend the fruit of his labor, against whatever robber assails him. So plain, that the most dumb and stupid slave that ever toiled for a master, does constantly know that he is wronged. So plain that no one, high or low, ever does mistake it, except in a plainly selfish way.”

    So … this is where we find ourselves at now. A spoiled, self-interested, navel gazing elite, whether they are here on the Left Coast, Aspen, NY or D.C., feel entitled to have their student loans forgiven for up to $20K per couple, though such a couple could both be well paid congressional staffers making up to $249K working for the Democrat Socialist congress critter from Taxachusetts, or Taxifornia, or … wherever.

    Meanwhile the Navy Veteran who was an engineering tech had to pay up front thousands and thousands of dollars for his HVAC tools and equipment, or the similar construction worker who has put up lots of his own money up front for his tools, equipment, work truck, etc.

    And this bit of a rant is not to pump up just blue collar workers. Lots of people legitimately work hard to attend college and graduate with their degrees while paying off their loans by themselves. These people too work hard and add value to our nation through their combined investment, creativity, innovation, risk, and hard labor.

    Yet … it is becoming more and more apparent that the political class is confiscating too much corn.

    I despise the current income tax system. It’s overly intrusive, incomprehensible, and I deeply resent each year proving to the government how I lived my life for the prior year through a variety of statements, billings, receipts, and other assorted paperwork.

    A tax on purcahse

  9. (oops hit a wrong key … cont.)

    A tax on purchases only, or through a VAT would first have to see the elimination of the 16th Amendment and a permanent end to the repugnant income tax. We can never trust the government to add on a VAT on top of an already corrupt income tax.

    Barring such consumption taxes, if we must continue with an income tax, then it should be constitutionally capped off. I think it should be relatively flat, and capped off at no more than 20% TOTAL for federal, state, and local combined. Perhaps, a suitable breakdown could be something like 10% for federal, 5% for state and 5% for local. There could even be gradations within these levels with say wealthier people paying the full 10% for a federal tax while those of more nominal incomes would only see 1% for their federal taxes. But the total could never amount to more than 20% … if the taxman overfills and takes too much corn then he should be prosecuted and imprisoned for theft. Period.

    Happy Labor Day to all …

    https://external-preview.redd.it/QaY0HKtrMeXchIBcVJnLljGoT5MMRlJ2IJc2oyup–8.png?auto=webp&s=80e25e317d8372a5f6f95b6c8f7489ff5d55125a

  10. Having read over the above proposals, I find that, at best, they only indirectly and therefore inefficiently address “radix omnium malorum” — in plain, Kamala Harris English, “the root cause” — which Glenn correctly identifies as Envy, the green-eyed monster. As Bertrand Russell pointed out, “Next to enjoying ourselves, the next greatest pleasure consists in preventing others from enjoying themselves,” and for many the latter pleasure is greater than the first, since their moral indignation over the wealth disparity is greater even than their desire for free stuff.

    Consequently, the best solution would be to identify those people who best prompt moral indignation— ultra-MAGA Republicans, white males, police personnel, cis-gendered bigots, Jews, Christians, SUV owners, hedge funders, trust funders, and so on, lumped all together under the rubric of “domestic terrorists” and “enemies of equity and democracy” — and simply seize all their assets. (“Disappearing” the people themselves is optional, but advisable, since social justice is as important as economic parity.)

    If this final solution strikes you as not exactly novel, don’t tell the Democrats — they’re convinced that they’ve thought it up all by themselves.

  11. I’m reminded of a scene in Dr Zhivago. He comes home to find that strangers have taken over. It’s too big for one family and anyway it belongs to the people now.

  12. “envy and covetousness”
    Reading the above comments is a bit heart warming, in that I leave this page knowing that I am not an outlier, alone in my perception of what is going wrong with our government and our system and our society.

    When it all blows up, and it will… remember the old USSR, which I suspect none of us older generations expected to ever see fail… it appears that there will be some left to pick up the pieces and carry on.

    Glenn and those who comment here give me hope that all is not lost and that the United States of America will yet sustain for a while longer.

  13. It occurs to me now that entirely missing from this conversation, which is focused on how to raise more revenue, is the matter of how to spend it and on whom. Yes, the have-nots will get more free stuff, but on what basis, by what criteria? What, for example, do the homeless get — simply more housing and more needles, or massive efforts to re-program them psychiatrically and medically, keeping them off the streets unfit they are fit to return to functionality? Even if our society can reach agreement on what should be done, and the specific values that should guide its efforts, can our corrupt bureaucracies be trusted to administer the new-found largesse? Look at the debacle created by Covid money, rent moratoriums, and massive spending on public health “solutions” that have simply made more people more sick.

    Until such redistributory proposals are deemed moral and feasible, what’s the point of higher taxes?

  14. In my opinion, the fair tax is the best way to go. However, we will never eliminate the income tax, so in fact we would end up with both. So, therefore, the fair tax is not the way to go. So we are left with the income tax. I think the entire code should be erased and we start over with a tax form that has 3 lines. Line 1, Total income. Lind 2, Income tax rate. Line 3, Total tax due. We need to eliminate all deductions. After all, why should how I choose to spend my money make a difference in the amount of tax that I pay. And especially when to compared to other people who choose to spend their money differently than me. If you make $50,000, you pay tax on that, no matter how you spend your money. And, it would downsize the IRS. We would no longer need as many audits and they would be much simpler. The only difficulty would be in defining what income is. There would only be one line to argue about with the IRS.

  15. I repeat my prior comment, WHY ARE WE DISCUSSING WAYS TO MAKE SOCIALISM MORE AFFORDABLE? I don’t get it. We live increasingly under a globalist tyranny, and this is all we can talk about?

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