“Our country’s policies overseas are falling apart, while at home our society stagnates and turns tribal – with a growing and embittered underclass, a shrinking and angry middle class, and a plutocratic and apartheid elite…” Victor Davis Hanson, NRO, 5/26/15.
Our government is now directing more than 40% of the economy’s resources, the largest portion since WWII. State resource allocation is not a group of thoughtful economists directing investment and spending, it’s a very large number of voting consumers arrayed against a very small number of investors. Fortunately, investors will always win in the end.
Despite the size of government and its “coercive power” (i.e. law – the ability to imprison people and seize assets), the reality is that the economy is shaped by the private sector. The richest citizens have enormous “persuasive power” because they are able, one way or another, to direct those with the “coercive” capabilities – government. The Supreme Court decided in the case Citizens United v. FEC (2010) that government cannot restrict campaign spending by organizations. Even if that case was decided differently or is overturned, elite wealthy individuals have all the power, not government. And they’ll keep it because private property rights and free speech are guaranteed by the U.S. Constitution.
You are probably in the middle tribe between those fighting to redistribute wealth and those who have a lot of it. Among others, Edward Conard (Bain Capital) in his 2012 book Unintended Consequences, makes a convincing argument against wealth redistribution policies. Be happy you’re in the tribe you’re in. The big War is elite wealthy versus politicians who represent low skilled workers seeking perpetual pay raises, special interest groups, labor unions seeking to preserve generous pensions and moralists, hell bent on helping the poor without regard to the costs or consequences. Pack your family’s war chest with this awareness, save up some money and get an estate plan. You may not need it now, but in an economically violent and uncertain world, it’s nice to have a War Chest.