I wonder why this has become the horrible concept that it is. After all, in the past 8 years, we have seen a redistribution of massive proportions – some of which is voluntary, some of which isn’t.
Lets look at the most extreme redistribution – health care. One can go along nicely and then, one day, have an accident or be struck by a disease. All of a sudden, the retirement is gone, the house is gone, and the family is broke. Even with good insurance. Is this not redistributive?
The recent financial crisis is another redistribution. Money was carefully saved, put into corporate pension plans, and otherwise responsibly stewarded. Then, one day, out of the blue, a “credit crisis” ensues and those who acted perfectly responsibly – with care and prudence – find their wealth redistributed or evaporated.
Trickle down has proven a failure. The wealthy haven’t recently invested in productive means, they have invested (particularly recently) in financial instruments that have little effect (or a detrimental effect) on productivity. This isn’t the days of old – where investment was made into a company that produced goods and services for the population. It is, instead, a day of investment in “financial instruments” who’s primary goal is to profit from the losses or risks of others.
Perhaps a little redistribution to the middle class would make more sense. After all, another $1,000,000 to a wealthy person is not likely to enter the commercial marketplace – instead it will be parked in a financial instrument that makes money on the margins. However, $10,000 given to a family that makes $100,000 will, in all likelihood, find itself back in the retail marketplace, buying clothes, cars, and other items that they need or want – and that keep our economy alive.
This isn’t a centrally-controlled economy – which was the real crime of communism. Instead, it is a recognition that putting money in the hands of people who will spend it will do more to bootstrap our economy than putting it in the hands of people who will invest in non-productive means.