Anonymous
Anonymous asked in Politics & GovernmentGovernment · 1 decade ago

How do poor people get richer by making rich people poorer?

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  • 1 decade ago
    Best Answer

    Actually, there are quite a few countries that do this ... the Nordic Welfare Model states (Sweden, Denmark, Norway, Finland, and Iceland) are the most successful examples of such efforts. The idea being that equality transcends mere idealistic definitions and should encompass a comprehensive set of areas (economic, social, political, etc ...). Ideally (and note I use the word 'ideally," not 'realistically') the state sponsored redistribution of wealth would lead to all people having equal access to capital, and a more or less uniform income level (leading to a very large and strong middle class). However, while the Nordic Welfare Model states have led with great success in redistributing the wealth within their countries it has become self evident since the late 1980's the sustainability of such a system is elusive to maintain. In particular they have had to deal with many of the numerous socialistic dilemmas caused by the very type of governmental programs required to accomplish "equalizing" of the economic classes.

    Part of the reason the Nordic countries have had so much success is dependent on the following factors ...

    1. Free education, and a highly educated populace ... allowing for high market fluidity in an industrialized economy.

    2. Low populations relative to the overall GDP. Sweden is roughly the same geographic size as California and has near equal economic capacity, however Sweden's population is about 1/8 that of California.

    3. Mass emigration of the uneducated lower classes to North and South America directly preceding industrialization (1850's-1900). Some estimates show that countries such as Sweden and Denmark lost almost half their populations over this time period due to emigration.

    Now, none of these factors are solvable in the United States economy. Furthermore, any attempt to instigate such a program would cause catastrophic and endemic economic failure, the likes of which would make the depression of the 1920's look like an economic boom. This is besides the fact the type of wealth distribution politicians are talking about in the United States does not take wealth from the top 10% and give it to the bottom 50% ... it takes the wealth from the top 10% and gives it to the government. In particular, in our current context there is growing resentment towards the oil industry and what is viewed as 'profiteering' at the expense of the US lower and middle classes. Ideas such as "windfall profit taxes," and nationalization/socialization of the oil industry does not necessarily put wealth into the hands of those who supposedly need it the most ... it puts it solely in the hands of the government (which to this day has a penchant for horrible money management). Sure, they'll cut you another $600 "stimulus check," and they'll keep the other $12k that should be redistributed to you.

    The other factor that makes this type of wealth distribution unadvisable is the character of lower socioeconomic behavior. What is the first thing a person in this class does if they get money ...? They, more often than not, will spend it on frivolous and empty purchases. It is rare they would use it to invest or pursue an education (although I will concede there would be a infinitely small minority who would). What would happen in this scheme ...? You give wealth to the poor, and the poor just give it right back to the wealthy ... All this does is enable the lower uneducated classes into making poor economic decisions, and makes them completely and hopelessly dependent on the government for their welfare.

    This is beyond the fact I find it hilarious people all the sudden are outraged by corporate CEO's with salaries in the tens of millions of dollars, yet have no problem whatsoever with athletes being paid the exact same wages. What they seem to be saying is, "you actually work for your money, are educated, and successful, so we're going to have to punish you." Besides, I think most Americans are ignorant of the fact (or choose to have selective amnesia) that the top 10% of Americans already pay roughly 75% of the national taxes! And, perhaps even more important is industries like oil aren't hell bent on making profit solely for themselves ... they have these things called 'shareholders." That right, average middle class Americans have millions of stocks in oil companies ... not the top 10%. Why ...? Because its profitable. If the government where to adopt some sort of "windfall profit tax" it would directly translate to a massive dive in oil stock prices, which would mean all those average American's with stocks in oil would lose BILLIONS of dollars. I think that would hurt the economy just a little bit (notice I'm being sarcastic). Furthermore, if the government were to nationalize/socialize the oil industry they are required by law to give "just and adequate compensation" for whatever they expropriate. Just to give you an idea of how much money we're talking about here last year alone the oil industry put more than $115 Billion dollars into development (that doesn't include capital). A nationalization of the oil industry would likely cost the government well over $1 Trillion dollars ... and I don't know if I have to mention that would have serious consequences on the economy (and it doesn't guarantee cheap gas either - Norway is a major oil producing country with a state monopoly on gas sales and gas is near $9 a gallon there).

  • 1 decade ago

    The way it happens is revolution but it will not happen here. So the poor gets poorer and the rich gets richer.

  • 1 decade ago

    It's usually an element of some of the various flavors of socialism.

    In Marxist-Socialism it's less about taking money directly out of the rich people's pockets, and more about ending their exploitation of their employees.

    In the more revolutionary variations such as Stalinism, Leninism, and Maoism, it's more about taking money from wealthy and giving it to the exploited.

  • Poor young woman get married with rich old man and it's started!

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  • 1 decade ago

    It's called Communism and usually starts with lining up all the rich people against a wall!

  • Anonymous
    1 decade ago

    It won't happen. I sometimes get my employees in a rant that unions are no good and the rich shouldn't pay hardly any taxes.

    I sit back and laugh at them all. What a bunch of saps!

  • 1 decade ago

    When they sue them. Since they didn't earn it, it is usually short lived and they are broke with in a couple of years due to mismanagement of funds.

  • 1 decade ago

    They sell expensive purses.

  • jelle
    Lv 6
    1 decade ago

    socialism - tax the rich

  • 1 decade ago

    That will never happen.

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