Redistribution of income and wealth
Redistribution of income and redistribution of wealth are the transfer of income and of wealth from some individuals to others by means of a social mechanism such as taxation, charity, welfare, public services, land reform, monetary policies, confiscation, divorce or tort law. The term typically refers to redistribution on an economy-wide basis rather than between selected individuals.
(Arranged alphabetically by author/source)
- The free market’s the best mechanism ever devised to put resources to their most efficient and productive use. … The government isn’t particularly good at that. But the market isn’t so good at making sure that the wealth that’s produced is being distributed fairly or wisely. Some of that wealth has to be plowed back into education, so that the next generation has a fair chance, and to maintain our infrastructure, and provide some sort of safety net for those who lose out in a market economy. And it just makes sense that those of us who’ve benefited most from the market should pay a bigger share.
- Warren Buffett, statement to U. S. President Barack Obama, as quoted in The Audacity of Hope: Thoughts on Reclaiming the American Dream (2006), Ch. 5
- Five steps for saving America's capitalist system:
- America needs leaders at the top that proclaim the current state of inequality to be nothing less than a national emergency.
- A bipartisan committee should work on developing new means of redistribution and community development.
- Those leaders must be held accountable to statistics that measure the progress of their reforms.
- Resources need to be redistributed for the purpose of providing equal opportunity to the vast majority of Americans. This can be done through increasing taxes on the wealthy, further taxing societally harmful things like pollution, and develop public-private partnerships that link business goals with societal goals.
- Coordinate fiscal and monetary policy (i.e. increase cooperation among the Federal Reserve, Congress, and the White House).
- "The problem is that capitalists typically don't know how to divide the pie well and socialists typically don't know how to grow it well," Dalio wrote. He says that his "American Dream" of rising from a middle-class upbringing... to the head of the world's largest hedge fund was possible due to opportunities that included good public schools and student loans, but that equal education and job opportunities are no longer available.
"While most Americans think of the US as being a country of great economic mobility and opportunity, its economic mobility rate is now one of the worst in the developed world," he wrote. He explained that there is essentially two Americas, for the top 40% and bottom 60%. The former is faring significantly better, and those at the highest level of wealth are as far removed from everyone else as they ever have been...
- If machines produce everything we need, the outcome will depend on how things are distributed. Everyone can enjoy a life of luxurious leisure if the machine-produced wealth is shared, or most people can end up miserably poor if the machine-owners successfully lobby against wealth redistribution. So far, the trend seems to be toward the second option, with technology driving ever-increasing inequality.
- Stephen Hawking, quoted in "Stephen Hawking Says We Should Really Be Scared Of Capitalism, Not Robots" Huffington Post, October 8, 2015
- The "Austrian" economists, more consistently than those of any other school, have criticized nearly all forms of government intervention in the market — especially inflation, price controls, and schemes for redistribution of wealth or incomes because they recognize that these always lead to erosions of incentives, to distortions of production, to shortages, to demoralization, and to similar consequences deplored even by the originators of the schemes.
- Lacking much historical information and assuming (1) that victims of injustice generally do worse than they otherwise would and (2) that those from the least well-off group in the society have the highest probabilities of being the (descendants of) victims of the most serious injustice who are owed compensation by those who benefited from the injustices, ... then a rough rule of thumb for rectifying injustices might seem to be the following: organize society so as to maximize the position of whatever group ends up least well-off in the society. ... These issues are very complex and are best left to a full treatment of the principle of rectification. In the absence of such a treatment applied to a particular society, one cannot use the analysis and theory presented here to condemn any particular scheme of transfer payments, unless it is clear that no considerations of rectification of injustice could apply to justify it. Although to introduce socialism as the punishment for our sins would be to go too far, past injustices might seem to be so great as to make necessary in the short run a more extensive state in order to rectify them.
- In the last 30 years, there has been a massive redistribution of wealth. The problem is this redistribution has gone in the wrong direction.
- Nothing can you steal,
But thieves do lose it.
- William Shakespeare, Timon of Athens, Act 4, Scene 3
- Should the nation's wealth be redistributed? It has been and continues to be redistributed to a few people in a manner strikingly unhelpful.
- Economic inequality
- Living wage
- Negative income tax
- Social inequality
- Social justice
- Universal basic income