wealth redistributionAmerica is a country founded on equality yet capitalism is a system based on inequality. Is there a contradiction? Should America equalize every adult's wealth and material...

wealth redistribution

America is a country founded on equality yet capitalism is a system based on inequality. Is there a contradiction? Should America equalize every adult's wealth and material prosperity? What are the pros and cons of this wealth redistribution? Would most Americans welcome or oppose this change and why?

Asked on by kateew

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vangoghfan's profile pic

vangoghfan | College Teacher | (Level 2) Educator Emeritus

Posted on

# 8 is correct that the U. S. system does not assume equality of results but rather equality of opportunity.  Systems based on equality of results have been tried repeatedly, especially in the past hundred years, and have not worked especially well.  China, having abandoned that theory, is now enormously richer than it was even thirty or forty years ago.  It is also freer: not a coincidence.

boblawrence's profile pic

boblawrence | (Level 1) Associate Educator

Posted on

Equality refers to equal opportunity and the rights of life, liberty and the pursuit of happiness.  It doesn't mean that everyone should have the same income or assets.  In 1776 there was the same inequality of wealth that there is today.  George Washington and Thomas Jefferson were wealthy men, and there were plenty of poor people and slaves.

Redistribution of wealth as you suggest is something that might occur in a Communist or Socialist country, but not in a democracy.

I do not believe that there is any contradiction involving our system of capitalism.

larrygates's profile pic

larrygates | College Teacher | (Level 1) Educator Emeritus

Posted on

America is indeed a land based on equality; but that means equality of opportunity and equality before the law. Capitalism by its very nature favors some individuals more than others; yet the U.S. was not founded on the basis of economic equality. It is noteworthy that Thomas Jefferson used the phrase "pursuit of happiness" in the Declaration of Independence, when John Locke, from whom he borrowed much of his language, had used the term "estate." It is a reach to say that equality means economic and monetary equality.

pohnpei397's profile pic

pohnpei397 | College Teacher | (Level 3) Distinguished Educator

Posted on

There's not a contradiction there because capitalism is based on inequality of wealth while democracy is based on legal and political equality.  It is true that having more money gives you the chance to "speak" more loudly in the political arena.  However, money can never simply "buy" an election and defeat strongly held popular opinion.

We can simultaneously have wealth inequality and legal and political equality.  As long as the wealth inequality does not get to be too great, the two need not come into serious conflict.

brettd's profile pic

brettd | High School Teacher | (Level 2) Educator Emeritus

Posted on

We still debate capitalism as though it is an absolute system, a purity or a surrender.  The debate is often framed in terms of any regulation or tax structure that is progressive--taxes being heavier on the wealthy and lighter on the poor--as being socialist or "class warfare", and any regulation on banks and corporations as "anti-business".

I don't think capitalism itself is a contradiction, it's just that as a society we have accepted the dogma that anything capitalist is good, ignoring the economic realities of unemployment and unequal wealth distribution that go with capitalism.  On the business side, there is absolute reliance on lobbying and manipulating government, as well as benefiting from large, sometimes no-bid government contracts, which are, incidentally, not capitalist.

"Equalizing" America's wealth is another extreme, and unnecessary.  But it's become painfully clear to economists and the public that tax cuts for the rich do nothing to create jobs, and a more stable government budget and fiscal house will help the middle class, and the wealthy too in the long run.

I think often times what is described and decried as socialist or as regulation is merely the reasonable balance point between pure capitalism and sensible harnessing and regulation of that system so that a society can function in the center of it.

readerofbooks's profile pic

readerofbooks | College Teacher | (Level 2) Educator Emeritus

Posted on

This is a good question. While I do not think that the idea of wealth distribution will work, not to mention completely fair, but I do think that there needs to be some renegotiation. David Graebel, a professor in London, has recently wrote a book entitled, Debt the First Five Thousand Years. One of the main points of the book is that throughout history debts have been renegotiated. Now seems like such a time. I do not know how this will look, but it does appear that many people will never be able to pay back their debts. Something has to be done. Capitalism our way is on the verge of collapsing.

bullgatortail's profile pic

bullgatortail | High School Teacher | (Level 1) Distinguished Educator

Posted on

Since the "redistribution of wealth" is a basis for communism and socialism, I don't think the average American will go along with this type of change. The idea of capitalism is that if a person is willing to educate himself and work hard, financial opportunities and rewards will follow. It may not seem that way in our present economic downturn, but socialist states also suffer similarly from a bad economy.

kateew's profile pic

kateew | Student, Undergraduate | (Level 2) Honors

Posted on

This is a good question. While I do not think that the idea of wealth distribution will work, not to mention completely fair, but I do think that there needs to be some renegotiation. David Graebel, a professor in London, has recently wrote a book entitled, Debt the First Five Thousand Years. One of the main points of the book is that throughout history debts have been renegotiated. Now seems like such a time. I do not know how this will look, but it does appear that many people will never be able to pay back their debts. Something has to be done. Capitalism our way is on the verge of collapsing.

Interesting. I may check out that book when I finish this semester and am less busy.

kateew's profile pic

kateew | Student, Undergraduate | (Level 2) Honors

Posted on

wealth redistribution

America is a country founded on equality yet capitalism is a system based on inequality. Is there a contradiction? Should America equalize every adult's wealth and material prosperity? What are the pros and cons of this wealth redistribution? Would most Americans welcome or oppose this change and why?

I found this question on another person's discussion but it wasn't completely answered. I was curious and decided to re-ask the question.

 

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