Answer: A country that is growing in wealth across all income brackets.
Yes – You read that correctly. The middle class
has shrunk a great deal over the past fifty years, and the lower class has shrunk significantly too, with a large percentage of the lower class moving into the middle and upper classes, and a fair percentage of the middle class becoming rich. Most would call that a good thing.
Income inequality has also grown, but ask yourself how much of a problem income inequality is when everyone is becoming better off?
Income inequality is actually a very positive force when it is driven by market mechanics. We want a world where smart, innovative people who are willing to work hard and take risks, can get rich by building businesses that improve the lives of other people.
Steve Jobs did not make the iPhone out of a burning desire to save the planet. He did it for profit. Bill Gates did not make computers accessible to the masses out of a sense of philanthropy. He did that for profit.
During the ‘Robber Baron’ era, Andrew Carnegie made steel. He was an innovative man, and he figured out ways to make steel better, and cheaper, than anyone else could. Over time, he became one of the richest men in history, cornering the steel market and making a boatload of money before selling the Carnegie Steel Corporation for $480 million, in 1901. That would be $13.25 billion in today’s money.
Incidentally, Andrew Carnegie started out as a Bobbin Boy in a Pittsburgh cotton factory, making $1.20 a week.
People sometimes pretend that these men harmed us. Did they? As much money as Andrew Carnegie made, his steel made everything from cars, to airplanes, to refrigerators, to bridges, cheaper and stronger than they had ever been before. Everything made with steel became significantly less expensive, thanks to Andrew Carnegie, and our lifestyles are immeasurably better today as a result.
Bill Gates was tried for antitrust violations, but not because he was charging too much for his products, using his monopoly to take advantage of consumers. Rather, he was guilty of giving away too much for free. Can you imagine what today might look like if you still needed to go to college to learn to use a word processor? Our lives are immeasurably better because of Bill Gates.
There are two kinds of monopolies: those created by and supported by government, and those that come up by themselves, in a free market. I would dare anyone reading this to name one monopoly ever that was created without direct government support, that was able to raise its prices, while maintaining its monopoly. Name one. You have all of recorded history to look through.
The truth is that no such animal exists. You’ll find monopolies that raised pricing, and who suddenly found large competitors in their market, and you’ll find companies that maintained their monopoly status for some time by continuously improving their products while reducing their pricing, but you will not find any monopolies, save those setup by government, that maintained their monopoly positions while raising pricing. The thing socialists fear most from free market capitalism has never even occurred once, in all of human history. Think about that for a moment.
We live in the richest nation in the history of mankind, and half the public wants to tear it down. Why? Because they say it is exploitative of the poor. They say this in spite of the fact that the poor are, as we see from the census data above, becoming less poor. They say it is because the middle class is getting squeezed, but we can see from the chart above that the middle class is moving into the upper class. They say that the free market capitalism we enjoyed from 1789 to 1913 created sweat shops and child labor. They forget that sweat shops and child labor replaced misery and starvation, and that the rate of growth in both living and working conditions, in the United States, during that time frame, was the fastest ever recorded in human history. The fact of the matter is that as bad as the living conditions of the 1800s may look when compared to today, they were immeasurably better than the living and working conditions of the 1700s, and in fact the living conditions in 1900 were immeasurably better than those in 1800. Living conditions today look better, not because the way we run our economy is somehow better, but because today comes after that earlier time period. Today, quite literally, stands on the shoulders of yesterday. What might today look like if we had maintained the rates of growth of working and living conditions we saw in the 1800s? Those who say that slavery caused that growth need to consider that there was no per capita GDP growth in the South. Before the Civil War, all the per GDP growth was in the North, where slavery did not exist. The South began to see rapid growth in living and working conditions only after slavery ended there too.
Why do people want to believe we live in a terrible country when it is not true? Why do people want to complain that no opportunity for advancement exists, when we are surrounded by such opportunity? I’ll tell you why: socialists use two emotions in their siren song: envy, and guilt. Socialists tell those who are not successful (often young people who would be successful if they tried) that their lack of success is someone else’s fault, and promise to improve their lives by taking wealth from those who earned it. That’s envy. Socialists also tell those who are successful that their success is unearned, and that by being successful, they are harming others. That’s guilt. When one is unsuccessful and envious, it is easy to hate those who are successful, and when one is successful but guilty about it, it is easy to hate those who are also successful, but who feel no guilt.
Let’s talk about success and guilt. The average CEO in America today makes $4 million dollars. The highest paid CEO in the country is Leslie Moonves, of CBS. He got paid $68.6 million last year. Mark Wahlberg, the actor, also made $68 million last year. Robert DeNiro’s net worth is $200 million. Sean Penn’s net worth is $150 million. Tom Cruz is worth $480 million. These are the people telling us that a CEO, running a company that employs as many as 2.3 million people, is not worth much. Where is the outcry of hypocrisy when actors who make more than CEOs call CEOs ‘greedy’? How many people does Robert DeNiro employ?
Elizabeth Warren, who very famously lied about being a Native American, to go to college on the backs of the taxpayer, before becoming a champion of those who want to take down the 1%, is worth $8 million. Do you really trust her to decide, for you, how to spend your money? What percentage of those who hate the 1% are a part of it? Would Colin Kaepernick kneel for the national anthem of a nation where he could not build a net worth of $16 million, throwing a football? Shouldn’t these people protest themselves?
People call free markets ‘trickle down economics’. Let’s look at that for a moment. In a free market economy, such as the one that built the wealth of this nation, each person earns what they can, and that wealth stays with them. There is no magic pot of gold for wealth to ‘trickle down’ from. Wealth, rather, is organic. In Bernie’s world, government seizes all the wealth, letting millionaire politicians like Elizabeth Warren, and The Clintons (worth over $200 million), spend what they want, including on their own salaries and pensions, before letting some of it, hopefully, trickle back down to those who earned it.
Bernie Sanders has three houses, and yet I have never heard him rail against his own greed. His wife is under a criminal investigation for running a college into bankruptcy, and yet people want him to run the country. We see his politics in Venezuela. I saw in the news today that the government of Venezuela is encouraging the populace to survive by breeding and eating rabbits. This is what Bernie Sanders wants to bring here.
I have another challenge for anyone who hates free market capitalism. Name a nation that got wealthy with a welfare state. I’m not looking for a Scandinavian country, because all of them got wealthy on free market capitalism, without welfare states, before they created their welfare states (and their growth stalled). Rather, I’m looking for a nation that got wealthy through welfare. I’m looking for a single example of where Keynesian or neo-Keynesian economics made a nation rich. Just one. Surely, if Modern Monetary Theory and neo-Keynesian economics works so well, there is one example, somewhere, where it worked. I can name nations that got rich through free market dynamics all day long; every nation that is rich got there that way.
If you are a socialist reading this, then I ask you to wake up. Everything you base your world view on is a lie, as the chart at the top of this editorial shows.
As always, if you agree with The Daily Libertarian’s message, please share our posts, using the share buttons below for whatever social media platforms you use. Please also consider donating using the donation button on the top right of this post. There is no advertising on The Daily Libertarian – we survive solely based on the generosity of our readers. We also do not pester those who donate. You can expect an e-mail thanking you for your generous donation, but we value your privacy and will not e-mail you asking you to donate again.
As long as NAIRU is a factor, everything believed by Social Democrats is most certainly not a lie.
And if inflation is caused by having too much money chasing too few goods and services, and not by unemployment dropping too much, what then?
Hi, Wallace. I agree with everything you say. Your piece is well written and well organized; however, as an English teacher, I notice that you use unnecessary commas. About five sentences could have eliminated some commas while maintaining clarity. I give you an A. Christine
It’s funny that you would say that. I have a book going through the publication process, and my editor told me I use too few commas. I am now careful to use more!
You talk about how socialists use envy and guilt. I think that is one reason why the left is against having the ten commandments up in public places. Because one of them is “Thou shalt not covet” (envy).