On September 25, 2012, Harold Meyerson, an opinion writer for The Washington Post wrote:
Which is the more redistributionist of our two parties? In recent decades, as Republicans have devoted themselves with laser-like intensity to redistributing America’s wealth and income upward, the evidence suggests the answer is the GOP.
This article is drawing negative comments from business owners. As an example Jack Simons writes:
So let me say first that I strongly disagree with this article. Could it be that the housing market collapsed because the banks were forced (really) to make loans to people who could not pass the most basic credit muster? Read Lewis’s “The Big Short” to see what happened. I am an engineer by training with advanced degrees from two state universities. I worked my way through school running a printing press in my dad’s small town newspaper/printshop. I worked for years for several companies and in the early 90’s lost my job and then started my own company which I grew to the point where today it employs 158 high tech workers. To get to the point where the company was worth a significant amount of money it took countless hours of effort, weekends, 18 hours days, time away from family for myself and several other employee/equity holders. But I have no regrets as it was a labor of love in the sense that I have always enjoyed the benefit
s of hard work. In 2008, with the election of the current administration, I determined that it was time to get out as the incoming administration advertised its antibusiness policies and indeed they have been realized in the form of an impending huge tax increase and a plethora of regulations that the entrepreneur has to jump over in getting to the goal of making a profit. I should say that entrepreneurs (typically) manage their companies toward growth, thereby avoiding taxes which are asessed on profits. Remember that each employee that is added as the company grows pays income tax, FICA, gets healthcare, etc. So now I am a member of the <1% and have grown bored with having a boss and I am frustrated with the impediments to growing and managing the business I founded in the current environment. I have the financial resources and intellectual energy and thus I am contemplating starting a new company. As I contemplate this, what do I see on the horizon? A looming large tax increase for both the long term capital gains tax as well as maybe an effective 50% tax rate on personal income. The reason the Cap Gains tax was made low was to incentivize investment . Starting a business is an investment , and a risky one at that.
So here is the bottom line which the liberal media and approximately half of the voting public do not apparently understand. People like me create jobs and we do it with the expectation of reaping financial rewards. Do you really think that is a bad proposition? I built my company using my life savings and retained earnings and now I dont have to worry about money. Am I a bad person? Have I exploited the 158 people who draw a paycheck from the company I created? The bottom line is that I am waiting for the election results to make the determination about starting a new company and its your guess as to who I am supporting.
But the reality is that Simons, as a good businessman, would acknowledge that full employment is not an objective of businesses. Companies always strive to keep labor input and other costs at a minimum to maximize profits.
Simons says that he built my company using his life savings and retained earnings. The problem with the system is that economic growth is limited to “past” savings (retained earnings are savings not taken as personal income) and the result is that a minority representing the richest Americans continue to accumulate productive capital ownership through stock ownership in business corporations. The majority of Americans are effectively shut out of this process because they do not have the income sufficient to muster the “savings” necessary to create viable capital ownership holdings and are left to jobs and welfare as their only means of a livelihood. Simons is proud that he employs 158 people who draw a paycheck from the company he created, and he should be. But are those 158 people also owners with him in the business?
I advocate for reforming the system so that EVERY American is empowered to acquire ownership in future income-producing productive capital assets embodied in business corporations and pay for their acquisition out of the future earnings of the investments. I advocate paying out fully the earnings of capital ownership and not using retained earnings as a means to finance future growth. Instead future growth would be financed by issuing and selling new stock.
Under this proposal systemic reforms would be made to the tax, monetary, finance, inheritance, labor and welfare systems based on the sound moral, political and economic principles espoused by binary economist louis Kelso and Mortimer Adler and supported by the great thinkers of the past. This new vision would offer a truly genuine “Second American Revolution” of radically centrist “bottom-up” ideas based on the inherent dignity of every human person. It took a civil war to eliminate the institution of human slavery, the original sin of this great nation. Our challenge today is to eliminate wage slavery, welfare slavery and debt slavery, while minimizing charity slavery.
Such a new strategic goal would be guided by universal principles of economic and social justice that would lift American political debates from the politics of greed (the right) or those of envy (the left). Such a new goal would restore America’s moral leadership in the world. How? By uniting all Americans across today’s ideological spectrum, from far right to far left, behind a “solution” that would systematically create a truly new constituency working together to build a more economically just, high tech, sustainable growth economy. Uniquely such a just free market economy could be achieved without depriving current capitalists of property rights over their existing assets and would radically reduce and eventually eliminate government redistribution of income.
Please see my article “Democratic Capitalism And Binary Economics: Solutions For A Troubled Nation and Economy” athttp://foreconomicjustice.com/11/economic-justice/ or follow me on Facebook at http://www.facebook.com/pages/For-Economic-Justice/347893098576250 andhttp://www.facebook.com/editorgary
Also follow the Center for Economic and Social Justice atwww.cesj.org and http://capitalhomestead.org/ Join the OWN Team at http://capitalhomestead.org/group/the-on-team
Also see The Kelso Institute at http://www.kelsoinstitute.org/
Join the OWN Team to advocate OWNERSHIP CREATION athttp://capitalhomestead.org/group/the-own-team The only commitment is to participate in the Weekly Action Point, which is usually just a Facebook post. Other activities are strictly voluntary!
http://townhall.com/columnists/thomassowell/2012/09/20/the_fallacy_of_redistribution
