How redistribution of wealth kills the entrepreneurial spirit

There is a perception, especially on the left, but also on the “big government” right, that the federal government should be responsible for redressing every inequality that occurs in society. This is true whether the person brings misfortune on themselves or whether it is accidental. The problem with this wealth redistribution is revealed when you think about the incentives this introduces to the producers and the victims.

  1. Government does not transfer wisdom, skill or responsibility from producers to victims
  2. Government transfers money from producers to victims
  3. Being productive involves risk and hard work on the part of producers
  4. Receiving money involves ingratitude and rationalization on the part of victims
  5. If the government confiscates a large enough portion of the earnings of the producers, they stop producing
  6. Every dollar taken from producers is a dollar less they have for engaging in their productive plans, (e.g. –  running a business or raising a family in a responsible way)
  7. The more money is that transferred to victims, the more the frequency of bad behavior increases – because being a victim is easier
  8. If you subsidize being a victim, you get more of it
  9. If you tax production, you get less of it

“Going Galt” is named after the character John Galt in Ayn Rand’s novel Atlas Shrugs. Galt is an industrialist who withdraws from the economy when faced by punitive tax rates and burdensome regulations. Going Galt refers to slowing down or ceasing production, because the risks and effort involved in producing are not worth the portion of the earnings that producers keep after taxes are redistributed to the victims.

The idea was first brought up afresh by Dr. Helen Reynolds in October 2008 on her blog Ask Dr. Helen. A more recent discussion of the phenomenon is here at the Washington Independent web site.


“Just this weekend,” said Rep. John Campbell (R-Calif.) on Wednesday in an interview with TWI, “I had a guy come up to me in my district and tell me that he was losing his interest in the business he’d run for years because the president wanted to punish him for his success. I think people are reading ‘Atlas Shrugged’ again because they’re trying to understand what happens to people of accomplishment, and people of talent and energy, when a government turns against them. That’s what appears to be happening right now.”

The plot of Rand’s novel is simple, despite its length — 1,088 pages in the current paperback edition. The United States is governed by bureaucrats, “looters” and “moochers,” who penalize and demonize creative people. The country is in decline because creative people are disappearing — they have followed the innovative John Galt to a mountain enclave, “Galt’s Gulch,” where they watch society crumble. Creativity has gone on strike (the working title of the novel was “The Strike”), and the engine of capitalism cannot run without it.

For Campbell, this is a powerful and relevant story. The congressman calls “Atlas Shrugged” an “instruction manual,” and inscribes the copies that he gives to interns. Rep. Paul Ryan (R-Wis.), the ranking member of the House Budget Committee, also gives copies of the novel as gifts and refers to it to make the case against President Obama’s policies. “It’s an audacious scheme,” said Ryan in his speech to the Conservative Political Action Conference last week. “Set off a series of regulatory blunders and congressional meddling, blame the free market for the financial crisis that follows — then use this excuse to impose a more intrusive state. Sounds like something right out of an Ayn Rand novel.”

Michelle Malkin is posting a lot of messages on her blog from people who are suggesting other ways to Go Galt.

Excerpt from one of the producer’s letters:

It is now fashionable and politically expedient to extend blame for the current financial crisis on greedy businesses and predatory lenders. The reality is that individuals and poorly managed businesses were responsible for the bulk of the problems. Government also played a role – and it was both parties – that encouraged and supported unsound business practices. Now the Government “must” step in to “save” these poor people from losing their homes, and “save” these “too big to fail” financial institutions. What about those of us, and those businesses, that chose to act responsibly? Who chose to live within their means? Who chose sound financial decisions over high risk behavior?

Enough is Enough. Let them all fail. It is not too late. I don’t care about the homeowner that borrowed more than they could afford and now find themselves potentially without a home and bankrupt. I don’t care about the businesses that overlooked sound financial decisions in the name of short term profits. We all make choices in life and it is time to let those that made the bad choices live with their decisions and finally reward those that chose to act responsibly. It has come down to this – either we let those that made the bad decisions fail, or we end up sacrificing our nation, our national identity and our very way of life.

Related posts.

Obama’s first 50 days: worst president ever

Oh, there’s no doubt that he’s the worst president ever. Gateway Pundit has the re-cap, in point form.


** He’s lost at least 3 administration nominees due to tax fraud.

** He’s promoted a tax cheat to run the IRS and Treasury.

** The Dow has dropped faster under Obama than any other new president in 90 years.

** Obama’s budget more than doubles the national debt held by the public, and adds more to the debt than all previous presidents — from George Washington to George W. Bush — combined.

** Obama managed to spend more than the wars in Iraq and Afghanistan combined.

** Obama will quadruple the deficit this year.

** Cap & trade was introduced that will cost America 4 million jobs and cost Americans at least $700 per family per year.

That’s just about some of the spending and the socialism. Click here to see more about his energy policy, foreign policy, social policy, trade policy. We’re doomed. We’ve elected an unqualified socialist who does not understand anything about how the world works, on any level.

Also, Gateway Pundit reports here that Obama wants to sign a trade deal with communist Cuba after rejecting a trade deal with our capitalist, pro-American ally Colombia recently. Meanwhile, Canada has a free trade deal signed with Colombia already.

Michele Bachmann and Marsha Blackburn defend free market capitalism

Representative Michele Bachmann
Representative Michele Bachmann

UPDATE: For all the people that are searching for Michele Bachmann, this blog is FILLED with stories on Michele Bachmann!!!  Here is a good summary of some of her best material. Here’s her latest video.

More recent posts

Here are my recent posts on Michele Bachmann:

Videos of Michele and Marsha defending capitalism

Here’s Michele Bachmann, on the floor of Congress, explaining economics and defending free market capitalism. She touches on many important topics: intentions versus incentives, learning from past economic failures, American exceptionalism, economic growth, private ownership of property, the rule of law, private contracts, tax law, the law of unintended consequences and the “forgotten man”.

Well, if we’re going down as a nation, it won’t be because no one understood what was happening. Michele knows – because she is a trained tax lawyer and she understands economics and business – she and her husband Markus own a small business. They have 5 children and 23 foster children, so they know enough not to saddle the next generation of Americans with debt. Life experience matters.

And then there is another “M.B.” in the house, Marsha Blackburn.

Representative Marsha Blackburn
Representative Marsha Blackburn

Marsha Blackburn also voted against porkulus 1 and porkulus 2, and the cramdown bill:

Congressman Marsha Blackburn (TN-7) today voted against passage of H.R. 1106, a housing bill that will allow bankruptcy judges to “cramdown” the principle on a mortgage, change the interest rate, or extend the life of the loan. The consequence of this legislation for new homebuyers and homeowners who have lived within their means is dire. As banks attempt to absorb the cost of crammed down mortgages, they will be forced to raise fees, increase down payment requirements, and increase interest rates for potential home buyers.

“This is yet another bailout for bad actors. It rewards those that gamed the system or knowingly lived beyond their means at the expense of responsible taxpayers. I would have been more comfortable with a bill that helped those who legitimately fell on hard times and excluded unscrupulous borrowers and lenders.” Blackburn said.

“Some of my colleagues claim that this program is cost-free. It isn’t. Struggling banks, who are at the core of our economic problems, will be forced to rebuild their bottom line somehow in order to remain solvent. That cost will be paid for by the first time home buyer who will now have a much harder time getting a mortgage as banks insure themselves against risky loans. It will be paid for by responsible home owners who will watch their bank fees increase as bankruptcy judges cram down home values in their neighborhood.”

Congressman Blackburn supported proposed Republican changes to the bill that would have prohibited taxpayer assistance to any borrower that misrepresented or lied about their income on a mortgage or to any lender that failed to follow proper underwriting standards.

Mary Fallin and Sue Myrick, two of my other favorite representatives, also voted against all 3 of these socialist bills. Not only are these 4 representatives fiscal conservatives, but they are also pro-life.

You might remember that Sue was the one who wanted to revoke Jimmy Carter’s passport when he met with Hamas.

UPDATE: More Michele Bachmann here and here. She is also Mrs November in a new 2010 calendar. A full list of all of my many posts on Michele Bachmann is here.

Debt and the return of real men?

Captain Capitalism posted this rant which is an excellent, although very snarky, read. He starts with the fictitious case of Cindi, a suburban princess whose every need was provided for by her hard-working Daddy. But Daddy had to take on enormous amounts of debt in order to buy Cindi everything her heart desired.

Much like debt misled suburbanite Cindi to think free Audi’s, nightly dinners at Applebee’s, free food clothing and shelter, and avoiding any real career that requires math was “standard,” the amount of debt the government and economy as a whole has taken on has brainwashed nearly 3 generations of Americans to be similarly overly optimistic as to just how easy their lives should be. Debt has allowed pretty much every American to live above their means of support. Debt has allowed pretty much every American to live a life that does not produce the wealth necessary to support it. If you can’t afford a car, take it out of your home equity line. You don’t like math or science? That’s alright, piss away some of your dad’s money majoring in political science. Don’t have a down payment for a house? Don’t worry about it, we’ll loan you 100% of the money anyway. But the problem is not just the obvious unsustainability of this behavior, but even worse is how it corrupts and destroys society’s ability to live in the real world.

And where has this avoidance of math and science, normalization of debt and instant gratification led us?

You think the divorce rate in this country isn’t due to people being spoiled rotten brats and thinking marriage is some kind of trial balloon?

You think the childish and [very bad] behavior of people having “kids” and then dumping them off at daycare to have somebody else raise them because the kid was too much of a burden for them to handle, but they still wanted them anyway would have flown during the frugal 40’s?

Would teenage pregnancy even exist if the government wouldn’t perpetually bail these losers out because the government can perpetually “rollover” its debts and borrow more to finance a litany of social programs?

Would you have such a volume of frivolous lawsuits and parasitic lawyers in this country driving up the cost of doing business and destroying the standards of living?

Would you have seemingly endless legions of “environmentalists”… who have no real talents or skills, but find themselves pointless, effortless, made-up crusades to give their meaningless lives meaning at the expense of our freedoms and $3 per gallon gas?

He goes on to argue that the worsening economy will be a boon to real men. The decline of government revenues will reduce the availability of social programs to “solve” social problems that result from poor decision making. (And by poor I mean lacking wisdom, lacking respect for the moral law).

When Jimmy gets Cindi pregnant at 15 and the government is out of money, there will be two real men (the father of Jimmy and the father of Cindi) with shotguns and baseball bats ensuring Jimmy gets a job, goes to school and marries Cindi, not for Cindi’s sake, but for the child’s sake.

When somebody breaks into the house and the cops are too understaffed dealing with the crime wave that happened once the state released all those prisoners to “save money,” he’ll be the one shooting the burglar to protect himself and his family.

When a woman wants to get married and have children, the real man will wait until he’s financially stable, the country has a future, and make sure he is able to provide the kid a decent upbringing ALL THE WHILE MAKING SURE HE DOESN”T GET DIVORCED.

I am worried that the rising tax rates and inflation will cause men to withdraw irreversibly from any enterprising behavior. Big government may help people to feel more secure about making poor decisions. But responsible men fear higher taxes and punitive divorce courts… they are less likely to work hard and to marry.

Real men are just not in demand so long as marxist-feminist welfare state is there to provide everything that real men used to be sought after for. And the big appeal of the state is that it doesn’t ask for anything in return from its dependents.  But why should real men work to pay for social programs to fix the problems of other people?

One of my best friends, Andrew, got married to a fabulous Christian woman who spent time as a missionary in Russia. Men are in a terrible state in Russia – there are few real men. Her experience in Eastern Europe really helped her to understand how important the right man is for the responsibilities of marriage and parenting.

She chose to marry someone who would not only care for and provide for her, but who also understood Christian beliefs and would be able to pass them on to her children in an informed and persuasive way. But today, there is no vision for men as husbands or fathers, nor any vision of marriage as a worldview-incubator for children.

Connecticut Democrats introduce bill to re-organize Catholic church hierarchy

Yes, it’s fascism – the deliberate intrusion of the state to impose their worldview and values onto people with different, individual worldviews and values. You see, the state’s religious and moral views are more important than those of individuals. Any organization that teaches different values needs to be taken over by the state – it’s the progressive way.

Gateway Pundit cites this post from The Corner:

The [Democrat]-controlled Judiciary Committee has introduced Raised Bill 1098, a bill aimed specifically at the Catholic Church, which would remove the authority of the bishop and pastor over individual parishes and put a board of laymen in their place.

Hot Air notes that the government cannot legislate against religious organizations with voluntary membership. It is illegal:

According to the First Amendment and the Establishment Clause, the government has no business dictating to religious organizations how they should structure themselves.

Hot Air goes on to explain what the effects of the bill would be:

In other words, bishops would no longer have power over the actions of the parishes.  That’s the Connecticut legislature’s vision of Roman Catholicism, but in America, government doesn’t get to structure religious organizations to suit itself.  That, in fact, is a form of fascism that we routinely decry in other countries.  The State Department objects to China’s insistence on picking Catholic bishops itself to suit their political oppression of religion, and Lawlor’s motion would find a welcome in Beijing as another means to the same end: state control of Catholicism.

So many people toss around the word fascism without understanding what it means. Having the state control churches is fascism. notes that Connecticut’s own Constitution forbids single out any one sect or denomination in legislation.

Before we go any further, let me quote from Article Seventh of the Connecticut state constitution: “It being the right of all men to worship the Supreme Being, the Great Creator and Preserver of the Universe, and to render that worship in a mode consistent with the dictates of their consciences, no person shall by law be compelled to join or support, nor be classed or associated with, any congregation, church or religious association. No preference shall be given by law to any religious society or denomination in the state. Each shall have and enjoy the same and equal powers, rights and privileges, and may support and maintain the ministers or teachers of its society or denomination, and may build and repair houses for public worship.”

LifeSiteNews has an article explaining that this bill is an attempt to pay Catholics back for supporting traditional marriage as the best environment for children. The Maritime Sentry agrees. The left-wing northeastern states have been very hostile to Catholicism lately, even going so far as to effectively ban Catholic adoption agencies for failure to comply with politically correct dogma.

A majority of the Catholic voters voted for Democrats in 2008. They voted 54% to 45% in favor of Barack Obama. What I would like my Catholic readers to explain to me is – Why? How?

UPDATE: I just saw this post over at Deborah Gyapong: Catholic hospitals must perform abortions or be shut down.

UPDATE 2: Nice Deb has ways to take action here.

UPDATE 3: Welcome visitors from the Anchoress! Thanks for the link. More religious liberty here (conscience rule for abortion dissenters) and here (fairness doctrine would affect religious radio broadcasts) and here (stimulus bill discriminates against religious schools). Bonus: free speech in Canada.

…integrating Christian faith and knowledge in the public square

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