Month: January 2004

The death of Horatio Alger

When Business Week, hardly a bastion of leftist thought, runs a piece exploring the the shrinking middle class, concluding that “America looks more and more like a class-ridden society,” you have to wonder . . . .

Suppose that you actually liked a caste society, and you were seeking ways to use your control of the government to further entrench the advantages of the haves against the have-nots. What would you do?

One thing you would definitely do is get rid of the estate tax, so that large fortunes can be passed on to the next generation. More broadly, you would seek to reduce tax rates both on corporate profits and on unearned income such as dividends and capital gains, so that those with large accumulated or inherited wealth could more easily accumulate even more. You’d also try to create tax shelters mainly useful for the rich. And more broadly still, you’d try to reduce tax rates on people with high incomes, shifting the burden to the payroll tax and other revenue sources that bear most heavily on people with lower incomes.

Meanwhile, on the spending side, you’d cut back on healthcare for the poor, on the quality of public education and on state aid for higher education. This would make it more difficult for people with low incomes to climb out of their difficulties and acquire the education essential to upward mobility in the modern economy.

And just to close off as many routes to upward mobility as possible, you’d do everything possible to break the power of unions, and you’d privatize government functions so that well-paid civil servants could be replaced with poorly paid private employees.

It all sounds sort of familiar, doesn’t it?

What amazes me about this is the self-deception that goes on: people who yearn for the kind of life-changing wealth their heroes flaunt will fight against any redistribution that will equalize the playing field for them. They hope to be at the top of the heap themselves one day and so argue against redistribution of wealth from the folks at the top, but they don’t realize they’ll never get there themselves if they keep paying a disproportionate share of the tab.