Socialism and the Very Wealthy

Shannon over at Chicago Boyz has a great post about how socialism benefits the very wealthy. It is based on a revealing article by the Tax Foundation about how the United States already has the most progressive income tax system among the wealthiest nations. And it goes back to a fundamental truth about socialism and it's sloppier brother Progressivism: While Marx's ideals were about worker empowerment, every time a nation becomes more socialist, the only ones who benefit are those in government and those who can influence government. It is a shame that when the Progressives claim to be fighting for the working poor and middle class, Conservatives never hit back with truth. When government grows its income, it has to spend the money somewhere. Only 60-70% of that money makes it back to the people in most governments, and 80% in the most efficient governments. The remaining 30-40% either stays in government or goes to the most favored outside of government, whether they be Wall Street bankers or Stuttgart military contractors with no-bid contracts. The same favored class lean on governments to regulate their competitors into a non-threatening position. Finally, when taxes are increased, they never destroy those producers already in power. They destroy those on the margin, which are small competitors and start-ups. Progressivism and increased central planning tends to create a small permanent upper class, and a large, poorer, more equal lower class. The only thing that allows greater class mobility is removed barriers to market entry (real deregulation), greater opportunity, and removed disincentives for investment.

The incomparable Barry Goldwater had this to say about progressive income taxes in his classic The Conscience of a Conservative: "What is a 'fair share?' I believe that the requirements of justice are perfectly clear: government has a right to claim an equal percentage of each man's wealth, and no more.... The graduated tax is a confiscatory tax. Its effect, and to a large extent it's aim is to bring down all men to a common level. Many of the leading proponents of the graduated tax frankly admit that their purpose is to redistribute the nation's wealth. Their aim is an egalitarian society -- an objective that does violence both to the charter of the Republic and the laws of Nature. We are all equal in the eyes of God, but we are equal in no other respect."