Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : I Will Continue to Continue, to Pretend.... -- Ignore unavailable to you. Want to Upgrade?

To: Sully- who wrote (24714)	12/27/2006 6:48:43 PM
From: Sully-	Respond to of 35834

A dangerous obsession: Part II By Thomas Sowell Townhall.com Columnist Wednesday, December 27, 2006 The media and academic obsessions with economic "disparities" have gone international. Recent news stories proclaim that most of "the world's wealth" belongs to a small fraction of the world's people. Let's go back to square one. Just what is "the world's wealth"? You can check in your local phone book, surf the Internet or do genealogical research: There is no one named "The World." How can a non-existent being own wealth? Human beings own wealth. Once we put aside lofty poetic nonsense about "the world's wealth," we at least have a fighting chance of talking sense about realities. Who are these minority of the world's population who own a majority of the world's wealth? They are the population of the United States, Western Europe, Japan and a few other affluent countries. How did these particular people come to possess so much more wealth than other people? They did it the old-fashioned way. They produced the wealth that they own. You might as well ask why bees have so much more honey than other creatures. The rhetoric of clever people can verbally collectivize all the wealth that was produced individually, and then they become aghast at the "disparities" that are magically turned into "inequities" in the distribution of "the world's wealth." Have all the people in the world had an equal chance to produce wealth? No, nowhere close to an equal chance -- either in the world or within a given society. Geography alone makes the chances grossly unequal. How were Eskimos supposed to grow pineapples or the bedouins of the desert learn to fish? How were people in the Balkans supposed to have an industrial revolution like that of Western Europe, when the Balkans had neither the raw materials required by an industrial revolution nor any economically viable way of transporting raw materials from other places? The geographic handicaps of Africa would fill a book. French historian Fernand Braudel said: "In understanding Black Africa, geography is more important than history." What are we supposed to do about these disparities? File a class-action lawsuit against God? The 9th Circuit Court of Appeals might accept such a lawsuit but they are unlikely to be able to do much about the situation. Geographic disparities are just the tip of the iceberg. Innumerable cultures have evolved differently in different places and among different peoples in the same places. No given individual controlled this process and each generation began with the particular culture that generations before them had created. Some cultures proved to be more economically productive at given places and times, and other cultures proved to be more economically productive at other places and times. In our own time, the economic effects of these cultural differences often dwarf the effects of differences in material things like natural resources. Natural resources in Uruguay and Venezuela are worth several times as much per capita as natural resources in Japan and Switzerland. But income per capita in Japan and Switzerland is about double that of Uruguay and several times that of Venezuela. Nobody likes to see poverty in a world where technology and economic know-how already exist that could give everyone everywhere a decent standard of living. All you have to do is change people. But have you ever tried to do that? The quick fix is to transfer wealth. But more than half a century of trying to do that with "foreign aid" has left a dismal record of failure and even retrogression in Third World countries. Some countries have themselves made changes that lifted them from poverty to prosperity. Indeed, the affluent countries of today were once living in poverty. But they didn't do it with quick fixes or by turning a dangerous power over to politicians. Thomas Sowell is a senior fellow at the Hoover Institute and author of Basic Economics: A Citizen's Guide to the Economy. townhall.com

To: Sully- who wrote (24714)	1/2/2007 9:30:41 AM
From: Sully-	Respond to of 35834

A dangerous obsession: Part V By Thomas Sowell Townhall.com Columnist Monday, January 1, 2007 Perhaps it is one of the fruits of the "self-esteem" emphasis in our schools that so many people feel confident to voice strong convictions about things they know little or nothing about -- or, worse yet, are misinformed about. One of the hardest things for anyone to be informed about is the value of someone else's productivity. Yet there are cries from all directions that some people are being paid "too much" and others "too little." Who can possibly be better informed about the value of what someone else produces than those who use the goods or services that the person provides and pay for it with their own money? Things are worth it or not worth it to particular individuals. What these things might be worth to somebody else is irrelevant. People who think that they, or the government, ought to be deciding how much income people make are in effect saying that they know the value of people's output better than those who use that output and pay for it with their own money. How did Bill Gates get his fortune? Not by someone deciding how much Bill Gates was worth to "society," but by innumerable people around the world deciding whether what Microsoft offered them was worth what Microsoft charged. What all those sales added up to -- Microsoft's income and Gates' fortune -- nobody decided. Nor is there any reason why they should have, even aside from the fact that nobody is qualified to make such a decision. We can each decide for ourselves whether what Microsoft offers is worth it to us. That is all we are competent to decide -- and only for ourselves individually, when spending our own money. The idea that we should pool our collective ignorance and then decide how much it is "fair" for Gates or anybody else to earn in total income is as ridiculous as it is dangerous, for it means arming politicians with the arbitrary power to decide everyone's economic fate. Do we want our own family's living standards to be at the mercy of politicians? Are we so eaten up with envy that we will risk that, in order to keep Gates from having "too much" money, paid by people who voluntarily bought Microsoft's products? A recent campaign in California to sock the oil companies with bigger taxes hyped the fact that oil company profits were $78 billion. That sounds like a lot of money. For that matter, $78 million would sound like a lot of money. If the truth be known, there was a time when just $78 would have seemed like a lot of money to me. But so what? What do we know about the economics of the oil industry? How many billions did they invest to get that $78 billion in profits? And how many billions did they lose in their bad years? Utter ignorance of all these things has not been enough to discourage people from loudly demanding that the government "do something" about "Big Oil" and its profits. The same reliance on ignorance applies at the other end of the economic scale. People who know nothing about retailing, nothing about labor markets and nothing about economics are loudly demanding that the local, state or federal government "do something" about the low pay of Wal-Mart's employees. Those employees know what their alternative job opportunities are and other employers know what their productivity would be worth to them. If the workers themselves choose Wal-Mart as their best option, what qualifies us to say that either their choice or Wal-Mart's choice was wrong? Most low-income people, whether at Wal-Mart or elsewhere, do not stay low-income forever -- or for more than a few years. Most Americans in the bottom 20 percent at a given time are later in the top half of the income distribution, after they have acquired some more job experience. Are individual decisions made by people deciding what is best for themselves to be over-ruled by ignorant busybodies, obsessed by things they do not understand? Is the whole economic system of supply and demand, on which the nation's prosperity is based, to be disrupted whenever moral exhibitionists have a need to feel puffed up about themselves? Thomas Sowell is a senior fellow at the Hoover Institute and author of Basic Economics: A Citizen's Guide to the Economy. townhall.com