Tuesday, January 28, 2014

The Legitimization of Freeloading: Today's State of the Union and Obama's Promise to "Fundamentally Transform America"

President Obama's State of the Union speech tonight is said to be focused on "income inequality," although I heard that he may not actually use that term. Instead, he may use the term "ladders of opportunity" or some such catch-phrase.

Either way, his lead focus will be on the alleged problem of the gap between the rich and the poor and middle class. The NJ Star-Ledger discussed income inequality in today's editorial. Obama, with State of the Union speech, faces long political odds but controls debate:

    As President Obama takes the stage for his State of the Union speech tonight, the two words everyone’s waiting for are “income inequality” — what he’s called “the defining issue of our time.”
    This idea now resonates with most Americans. We haven’t seen such a broad income gap between our nation’s wealthiest and everybody else since right before the Great Depression.

What's to do about this "defining issue?"

    Large majorities agree the income gap is growing and want government to do something about it, polls show. And government action is what Obama will argue for tonight.
    The president is expected to push once again for investing in our middle class, in order to trigger the demand that creates and grows jobs. This means raising taxes on the rich and applying more funding to areas such as education and infrastructure. . . .
    By focusing on the issue of growing inequality, he will continue to keep Republicans on the policy defensive — and the American public solidly with him.

I left these comments:

If it is true that "the American public [is] solidly with him" in his quest to attack income inequality, then Obama has largely succeeded in his 2008 campaign promise to "fundamentally transform America." It means that Obama has managed to legitimize freeloading and degrade productive achievement in the minds of most Americans.

Leaving aside the few who grow rich by criminality and government favor, most money is earned  by producing values that others are willing and able to buy. The great fortunes are earned because the fortune builders are so good at it. They produce affordable values that better the lives not of a few but of tens and hundreds of millions of people around the country and around the world who willingly buy the products and services that they are selling—and in the process foster trillions of dollars in economic activity. People don't make money and grow rich by plundering, as the neo-Marxist fools would have us believe, but by lifting others along with them.

Income inequality is a natural result of people rising economically as far as his ability and ambition will carry him, within the context of his own personal attributes and personal circumstances. This is the beauty and justice of economic freedom. To the extend that we are free, each of us gets to keep what he has earned, which is our moral right regardless of the level of our earnings. Contrary to the Obama view, making more than the next guy is not a threat to him, nor is the next guy making more a threat to you. The threat is politicians looking to "fix" the problem of income inequality through government force; redistribution, regulation, fiat money ("quantitative easing"), and government spending (which actually exacerbates the problem Obama claims to want to do something about—e.g., look at the stock market bubble). Ask yourself why the struggling economy and middle class coincides with the welfare state reaching its biggest ever.

"Income inequality" plays well to material parasites by giving them a shot at unearned wealth. It plays well to spiritual parasites by giving them a shot at the moral illusion of caring about the "little guy." And it plays well to power-hungry politicians by giving them a shot at further interference into private economic affairs in order to "fix" the alleged problem, like forcibly redistributing wealth ("investing in our middle class") on the absurd myth that "demand . . . creates and grows jobs" (as if you can consume before you produce).

But for those Americans who still value and admire achievement—right up to the fortune-builders who bring us the great companies, products, and jobs—"income inequality" is just another catch phrase that stands for the putrid stench of envy. Regardless of the polls, I'm not so sure that achievement-respecting Americans are yet in the minority. We'll see.

Related Reading:

America's Economic Troubles a Result of Lack of Free Markets, Not the "Widening Wealth Gap"

1 comment:

Steve D said...

'Ask yourself why the struggling economy and middle class coincides with the welfare state reaching its biggest ever.'

This is a very good point and a very good question and not just for our present situation but for all times in history and countries. There is a high corellation between the government activities you mention and how strongly an economy performs.

Obama is pretty slick though. Offer poison as an antidote for poison and as the patient gets sicker, offer it in larger amounts!