The Income Inequality Myth

Income Inequality is a myth. As a concept, it assumes that the means by which income, or wealth, is produced is equal from individual to individual, and therefore the outcome of that wealth creation should also be equal. In a Capitalistic society this can never be the case because there will always be a gradient to the level of engagement by the individuals in that society. Some will excell, some will subside, and some will not produce at all. This is why “Income Inequality” as a concept is fundamentally flawed. The very premise assumes something that is simply not possible in society unless outcomes are forced instead of allowed to occur naturally.

The beauty of Capitalism is that every transaction is singular, and wholly the whim of the individuals participating. Should one choose not to participate as actively as another, their simply having existed in a realm where others do participate allows for them to benefit regardless of their involvement.

The Statist, however, believes that the State should decide the outcome for its citizenry. Hence the rhetoric attached to the photo above. “Wealth distribution” implies that there is a method to the seeming chaos that is economics that should be managed to ensure the “best outcome for all”. A translation of this would be to simply say “The wealthy have too much, and the poor have too little. We must do something about this!”, and, realistically, this is the very core principle of the Statist economic policy.

Should humanity be allowed to pursue their desires absent molestation, their desires will create expanding ripples of economic benefit for all those around them. Every individual caught in the bow shock and wake of the next individual in a Capitalistic society benefits from those ripples because they will also participate through their own personal generation of wealth.

Capitalism directly empowers the drive in human nature toward self improvement by enabling avarice. This has a powerful secondary effect in that when one becomes successful they interact with others quite differently than they would should they not have attained success, and this interaction, either passive (consumerism) or active (philanthropy), benefits society in a larger way than the avarice benefits the individual. This positive feedback loop is due primarily to the cascade effects of wealth creation, but is multiplied by the social nature of humanity.

Wealth created multiplies wealth existing, and those benefiting spread that wealth around as a matter of course. Absent corruptive interaction from government, a Capitalist system will benefit everyone who participates, and can benefit even those who choose not to. The only way, though, that these outcomes can be achieved is if Government were to voluntarily remove itself from the equation as much as possible, thereby eliminating the negative effects of cronyism and corporatism, both of which are corruptive forces that drag down the economic strength of a society and its politics.

As always, when those in leadership choose, of their own volition, to do what is right because it is the right thing to do, and continue to do those things when no one is paying attention, especially when no one is paying attention, the underpinnings of American Society can be unleashed, and everyone will be allowed to thrive, should they choose to do so. The only reason those who find themselves at the bottom rung of the income ladder seem to think that the rungs above them are broken or coated in grease is because America’s political leadership find the populist rhetoric of “Income Inequality” to be more profitable, politically, than the hopeful, empowering message of Capitalism and Individual Accountability.

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