(I apologize if this is too long, unlike my first post that you quoted I’m trying to cover all the angles of this topic)
At a glance there is the obvious tug-of-war between who feels like they’re getting robbed by through taxation and/or tax breaks.
Fortunately a free market isn’t dictated by your Manual Labor to Income ratio. In a free market, efficiency in creating income is what creates wealth. Because there are so many hours in a day a person can physically work like a builder or a farmer. As a truck driver there are only so many trucks I can drive (1) and how many miles I can drive in a day, ironically there are labor laws that -prevent- laborers from working harder to make more money by a single employer.
Because of that everyone has a fiduciary responsibility to themselves to be more efficient and cost effective as possible in the creation of wealth.
Otherwise a single farmer will be tilling the land with a single pickaxe working as hard as possible instead of tilling the land with tractors that cut the ground and plant seeds in 20 rows at once.
In a free market, allowing wealth as an incentive to being more efficient makes civilized society as a whole progress faster and more efficiently as these workers become entrepreneurs, learn to delegate (provide jobs or higher other free lance entrepreneurs who provide their own jobs at their own desired wage), and maximize production and lower costs as much as possible. Otherwise materials, resources, technology and food will not become more abundant at lower costs.
The richest who do this the most efficient way possible maximize jobs
The less employees are the more competitive the demanding wages are between the self employed who are hired by independent contract
The cheaper and easier access to resources and products the poor has which saves them money
The exception are people in service industries who do not provide tangible materials and resources, these are where you get many desk jobs that are not physically labor intensive but still require efficiency in order to turn a profit. Because everyone wants to make as much money as possible for their own wealth, it makes sense that most of the wealth will exist in a service industry that has to do with providing financial services and resources… Banking.
Assuming banks were ethical respectable members of the community who don’t break laws or manipulate them, just like Andrew Carnegie or Rockefeller or Ford or Firestone bring steel and oil, cars and tires to the public for cheap, our good friend Mr. Average Joe the banker’s goal would be to make gold and silver readily (or some other form of money such as fiat currency or Tally sticks) to people in need of money. This person gets wealthy by helping both the poor and the rich create wealth through leverage! However, the banker has no obligation to teach people how to use debt properly to get rich, so people focused on instant gratification start using banks just as a credit card for doodads and liabilities that make them poorer.
Which raises the issue of the inherent lack of financial education for the poor other than the BARE basics which are traditionally taught that ironically keeps them poorer in modern society. “Get an education, get a safe secure job, keep it for 20 years, buy everything in cash, diversify your portfolio, etc…” Unfortunately these mantras reduce efficiency and make it much harder for someone to get rich because the focused more on being as efficient as possible in avoiding poverty rather than achieving wealth.
There is a real good book called Influencer (the power to change anything) (hyper-linked) that talks about a researcher in Africa trying to solve problems with poverty. This book is about trying to influence individual or groups of people, and it tells the real life story of this man being upset with the modern banking system in that part of Africa not helping people become wealthier, and the evils of the loan sharks charging outstanding interests that keep people in debt forever. So he creates a bank of his own that issues micro-loans of only a few dollars under the terms no less than 5 people (no matter how poor they are) co-sign the loan and provide a detailed business plan of how they are going to use the money, to make money, and repay their loan.
Despite issuing loans to people with no credit, no job, no work history, who are in poverty and have no money at all, the banker has a 95% success rate in loans being paid back! The people who take out the loans create their own business (many of them women), put their children through education, have residual wealth from their business, and in the end now have a higher standard of living with quality education and freedom to break away from abusive husbands and traditions that keep them in poverty; such as dowries.
And our good friend Mr. Banker increased competition, took money away from the greedy loan sharks, filled a market niche other bankers wouldn’t, helped lift the community out of poverty, provides respectable jobs for ex militants, and creates a multi-billion dollar banking firm that makes him much wealthier than he otherwise had been. (Our Federal Reserve seriously needs to take some notes from this guy).
Taxes though are something that don’t need to exist in a free market society that is efficient and effective at creating wealth and opportunities. Because the government can create companies and firms just like any other private individual assuming the business models are successful rather than rely on taxation to make up for lost profits (for the greater good). Profits from these government run businesses that are self sustainable as individual companies not dependent on taxes in order to exist can take the profits and put them in the public/state sector at will.
But to force this through taxation of the rich (which inevitably ALWAYS taxes the poor without fail) or give tax incentives to the rich is totally unnecessary. Because just like the Income Tax and all other taxes, they are always marketed as taxes against the rich, which really mean middle class who work a W2 or 1099 (self employed) job. And the tax incentives in business and investing give the rich an unfair advantage to accelerate their growth and makes it next to impossible for the poor to compete*.*
Taxes have always been throughout history, taxes on the upper and middle class who hold jobs and self employed small businesses like doctors and lawyers. The super rich don’t get taxed the same way because they don’t physically work a job or have direct financial responsibility to the taxes and other obligations their companies have. Income tax is a lot higher than taxes on capital gains and interest. The difference is the poor, middle, and upper class and small business are paying the highest taxes, the income taxes.
Unless you change the topic to raising taxes on capital gains, interest, and passive income (rents, royalties, residuals, dividends) etc. Then the idea of take from the rich and give to the poor will never work. And this still assumes that the government GIVES it to the poor after they took it from the rich.
One can also argue what Tom Woods always says that those kinds of taxes create welfare states where people are totally dependent on the state for their income and finances through unemployment benefits, health care, etc… the same attempt at redistributing wealth forces people to depend on the state and likewise lowers their standard of living because they eventually lose their ability to create wealth on their own. After all, bringing in $1 Billion dollars in tax revenue doesn’t really help a society where 25 million are getting their fair $40 share. And even that $40 provided by the state, taken from the rich is taxed!!! Probably a decent 10% at least. Which makes their welfare check $36.00
