In Which We Are Reminded That Prosperity Is Not A Zero Sum Game

By Pejman Yousefzadeh Posted in | | | Comments (7) / Email this page » / Leave a comment »

Today's New York Times comes out with an examination of the views of Mitt Romney and John Edwards on the issue of wealth. Romney is the candidate with the biggest personal fortune and Edwards is probably only rivaled by Hillary Clinton, whose husband went on a speechmaking-for-pay spree after he left the Presidency. There views on wealth are telling and in one case--Edwards's--entirely strange:

"Some people come from nothing to being wildly successful and their response is, `I did this on my own,'" Mr. Edwards said in an interview. "I came to a different conclusion. I believe that I did work hard, and I think people should work hard, but I think my country was there for me every step of the way."

Today, he added, "the problem is all the economic growth is going to a very small group of people."

Mr. Romney, by contrast, talks about the ways that his experiences at Bain showed him how innovative and productive the American economy can be and, particularly, how free markets can make life better for everyone.

"There is a model of thought among the Democrats -- that the amount of money, the amount of wealth in a nation, is a fixed amount," he said in an interview. "And that if Bill Gates and Warren Buffett are making a lot of money, that just means somebody else is not able to make as much. That happens to be entirely false."

Readers, of course, won't be surprised to find out that I agree with Romney's views on wealth from a general philosophical standpoint. But even if we take the lives of both Edwards and Romney as case studies on the issue, we should find in favor of Romney's views on the issue of wealth acquisition.

Read on . . .

Edwards came from a relatively impoverished or struggling background and achieved his wealth both from his practice as a plaintiff's attorney and after his Senate career was over, as a member of a hedge fund making $500,000 a year for what was described as part time work (Edwards was also running his think tank on poverty issues at the University of North Carolina). His rise came from a lot of hard work, not a little talent when it came to operating in a courtroom and, as the Times article notes for both Edwards and Romney, luck. In any event, the once significantly poorer Edwards has made quite a turnaround in his financial fortunes through his career path.

Romney came from greater wealth, as his father was an executive at the American Motors Corporation. But Romney made his personal fortune on his own and did it much in the same way that Edwards made his fortune; through lots of talent, lots of hard work and again, not a little luck (as Jefferson noted, the harder one works, the luckier one tends to get). I might doubt--as I have in the past--whether Romney, a very bright man, is as intellectually engaged in politics as he was in business. But there is no doubting the fact that Romney was indeed tremendously intellectually engaged in business and that degree of intellectual engagement helped win him the wealth he now has.

These two life stories help buttress Romney's argument that wealth is not a zero sum game. Power--especially political power--may well be a zero sum game but wealth and economic prosperity is a different matter entirely. Edwards could have gotten a lot of respect by pointing to his life story and making an optimist's argument to the electorate to the effect that if he could rise to the great financial heights he has achieved, anyone could. Sure, he would probably segue from that into making claims regarding how big government would help in the effort, but at the very least, he would be speaking to people's hopes and not to their fears.

Instead, he chooses to play the class warfare game and tell the electorate "watch what I say and pay no attention whatsoever to the nature of my life story as I talk about wealth and prosperity distribution in America." His own life story belies his populist claims and enhances Romney's case.

Of course, in discussing so complicated a matter, we can and should go beyond mere life stories. But the nature of those life stories is not inconsequential. And in John Edwards's case, his life story helps undermine his very campaign.

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In Which We Are Reminded That Prosperity Is Not A Zero Sum Game 7 Comments (0 topical, 7 editorial, 0 hidden) Post a comment »

otherwise there is no American Dream.

If you have nothing to work hard for or to hope for...you know to be rich then you are just a communist/socialist nation.

Which by the way is why most of the world hates us. It is true that in America the streets are paved with gold, for those who work hard and persevere.

Freedom of Religion not Freedom from Religion

If you have nothing to work hard for or to hope for...you know to be rich then you are just a communist/socialist nation

Gold star!

America is a never ending avenue to building better products for less, consider the consequences for Gates. At the same time, how many people are working for him? How many industries flourish as a result of his success? And their employees...

As you stated, remove the incentive and eliminate the entrepreneur, knock-out progress. And business, employment, economy...

Socialism has yet to create a productive economy, not in the history books.

Carl

I think you're missing the obvious about Edwards' raising himself from poverty as a plaintiff's attorney.

Even assuming the very best in Edwards' favor--that is, that every case he ever won was a triumph of justice for the wronged over evil wrongdoers--the name of that game is redistribution, and the players do not benefit from acknowledging that wealth is not a zero-sum game.

Temper this overly charitable assumption about Edwards' plaintiff's attorney career with what has been reported about it ( http://www.nytimes.com/2004/01/31/politics/campaign/31EDWA.html?ex=11985...
), and Edwards starts looking like a parasite on society whose contributions sum to a net negative whether evaluated economically, morally, or politically.

Envy works best on people convinced that there is only one pie of only one size, else these same people can be distracted by creating on their own and becoming winners in their own right instead of by bloodsucking. Since also-rans will always outnumber the winners no matter how high a rising tide lifts the ships, there will always be an audience receptive to class warfare demagoguery. And the gifted demagogues, like Edwards, earn their 33% cut by pushing envy.

Rudy Giuliani went on a "speechmaking-for-pay spree" instead of serving on the 9/11 commission--and I think that he's wealthier than the Clintons. Personally, I don't think that there's anything wrong with making speeches for money, but I think that we should be consistent, here, when we point things out.

Secondly, I think that John Edwards' views on poverty were shaped by his life experiences, which were drastically different than those of Mitt Romney. Now, I definitely agree that Edwards goes way overboard with the fear rhetoric (anyone could be "one paycheck away" from being on the streets) when discussing poverty. And, don't even get me started on his total buzz kill of a Christmas commercial--it's just one big smorgasbord of guilt. However, I believe that Edwards is totally sincere when discussing poverty. His problem is not his lack of sincerity when discussing poverty, but rather the appearance that his rhetoric doesn't match his lifestyle (however, you shouldn't have to be poor to care about the poor). Furthermore, he is using a chainsaw when discussing poverty, when a scalpel would do.

I think his true views on poverty and the poor are best illustrated by how he treats his neighbors.

And the story I link doesn't mention that the people Mr. Johnson chased off his property were trying to plot a new right of way through Mr. Johnson's property on behalf of the Edwards's. It seem's Mr. Edwards' view of the property of those who are poorer than himself is that they should give up their property rights to him.

Socialism doesn't work. It looks nice on paper, but it's been tried and it's failed miserably every time (usually accompanied by widespread death and suffering).
Proud member of the V.R.W.C.

I'm with Fred!

then the previous generation must have been individually wealthier than this one is; and the one previous to that wealthier still; and the previous to that even wealthier still. Wow - the wealth of the average individual a century ago must have been massive, and two centuries ago nearly incalculable.

But wait! Two centuries ago, three centuries ago, the average individual was penniless. So the disparity in wealth between the haves and the have nots must have been far, far wider than it is today. So apparently, that problem is taking care of itself over time. No need, then, for wealth re-distribution programs.

The "problem" of wealth distribution refutes itself.

For a trial lawyer like John Edwards, wealth does appear to be a zero sum game. They sue to take what someone else has. If that someone else doesn't have anything, they don't bother to sue.

In any case, they don't create anything new, which is where new wealth comes from.

 
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