MARK W. HENDRICKSON
Those who believe in individual rights and liberty always have tended to reject the Marxian paradigm that pits the rich against the poor. Today, we hear all about this alleged class warfare: President Obama harps on income inequality. So does the IMF . French economist Thomas Piketty’s current bestseller, “Capital in the 21st Century,” echoes the same theme.
Well, I have bad news for both those on the right and those on the left: Yes, there is class warfare in America, but it’s not between the rich and poor, but between the political class and the rest of the citizenry who bear the brunt of political power and pay the price in lost liberty, property, and opportunity.
In a truly free market, the fortunes are made by those who deliver value to others, quite often to millions of others. Those who think it’s fair to impose discriminatory and punitive higher tax rates on society’s economic benefactors have a warped sense of justice. (How dare those capitalists improve so many lives!) Of course, many of today’s upper-income Americans obtain much, if not all, of their income through cronyism. Their cronies, of course, are those who wield political power in Washington. Such cronyism is the antithesis of true capitalism; rather, it is the age-old story of political elites rigging the system to their financial benefit at the expense of the majority of the population. This typifies the corruption of the political class.
Signs abound of the economic unfairness perpetrated by the political class:
Various economists have pointed out that if all the money spent on federal antipoverty programs were given to those below the official poverty line, a poor family of four would have an annual income near $70,000. As it is, the poor get less than half the money appropriated in their name; most of it goes to fund the bureaucracies that administer those programs.
President Obama instituted a policy whereby monthly payments to retire college-related debt are capped and the balance forgiven if someone works for the government for 10 years. If you work in the private sector, however, and pay the taxes that fund the salaries of public sector workers, you have to keep repaying college loans for a decade longer.
Don’t get me started on government pensions. Many are the state and municipal governments and local school districts with gigantic pension liabilities that hover as a crushing burden over private sector taxpayers.
Why do you think seven of the 10 richest counties surround Washington, DC? Actually, they held five of the top 10 places before the Great Recession, but apparently President Obama’s “stimulus” plan and subsequent actions benefited the political class more than the average American. Yet, brazen political demagogues living in glass houses dare to throw rocks at Americans who get rich in the marketplace of voluntary exchange, and not in the political marketplace of legalized plunder and redistribution.
In his 1944 book, “Bureaucracy,” besides a superb economic analysis of the bureaucratic structure, Ludwig von Mises reminds us of a salient feature of bureaucracies: it has been the mechanism of tyranny for ancient pharaohs and emperors to modern socialist and progressive would-be totalitarians (pp. 15, 17, and 4). We have seen this playing out with the IRS sabotaging conservative groups and the EPA waging jihad against coal. More recently the Bureau of Land Management let its power go to its head, sending SWAT teams, snipers, and (as one commentator wryly put it) far more firepower than the president sent to help the four Americans killed in Benghazi against a man who is, at worst, a squatter or a scofflaw, but whom Harry Reid demonized as a “domestic terrorist” for daring to challenge the political class’ power.
There definitely is class warfare in America today, but not enough Americans perceive the battle lines. Those of us who go about our lives earning a living and leaving others alone are the targets of an aggressive progressive political class that is erecting a formidable mechanism of bureaucratic domination. At this point in time, “we the people” of the private, taxpaying sector are losing the war.
The Moral Liberal Contributing Editor, Mark Hendrickson, is Adjunct Professor of Economics at Grove City College, where he has taught since 2004. He is also a Fellow for Economic and Social Policy with The Center for Vision & Values, for which he writes regular commentaries. He is a contributing editor of The St. Croix Review, sits on the Council of Scholars of the Commonwealth Foundation, and writes the weekly “No Panaceas” column in the Op/Ed section of Forbes.com.
Mark’s published books include: America’s March Toward Communism (1987); The Morality of Capitalism (editor, 1992); Famous But Nameless: Inspiration and Lessons from the Bible’s Anonymous Characters (2011); and God and Man on Wall Street: The Conscience of Capitalism (with Craig Columbus, 2012).
Mark Hendrickson’s Archives at The Moral Liberal.