Redistribution and Future Wealth

The incomparable Dr. Thomas Sowell recently hit it out of the park with an article on redistribution of wealth, occasioned by the release of a 1998 video clearly demonstrating Barack Obama's stance favoring such redistribution.  Among other things, Sowell correctly points out what so many people fail to comprehend about this topic, namely, that a government can only confiscate present wealth, not future wealth.  Once the state grabs present wealth for redistribution, it is no longer available for re-investment to produce future wealth.  It is gone for good.

This explains to a significant extent why centrally-planned, collectivist redistribution attempts in the 20th century failed miserably in places like the Soviet Union, Cuba, China and North Korea.

The Soviets demonstrated the disastrous consequences of redistribution as part of central planning in their experimentation with collective farming.  The Ukraine learned first hand through the starvation of nearly 10 million people what can happen when political correctness takes over free markets.

Barack Obama's government takeover of GM is laughably small and relatively innocuous when compared with Joseph Stalin's takeover of Ukrainian agriculture in the 1930s.  But the thinking and approach are similar, albeit on hugely different scales.  In the case of GM, Obama desired to rescue the politically correct class of UAW stakeholders at the expense of ordinary bondholders.  This was because the UAW is a big donor to Obama's party.  In the case of the Ukraine, Stalin exploited the Ukrainian farmers and stole their agricultural products to feed his own party bosses in Moscow -- and build up his Red Army -- while telling the relatively free kulaks of the Ukraine to go pound sand.  When the latter didn't follow his advice and instead started protesting and refusing to work, Stalin responded with sealing the borders of the Ukraine and shipping out all farm products, and declaring the kulak class enemies of the state. He confiscated all of their property and food, resulting in mass starvation in the Ukraine, otherwise the breadbasket of Europe at the time.  It is estimated that at least 10,000,000 people in the Ukraine died as a result of Stalin's policies.