Barry Ritholtz: Hurting the Rich Won't Help the Poor

Barry Ritholz writes that Hurting the Rich Won't Help the Poor.

The bottom line is simply this: There are enormous problems facing the nation, and as long as we keep electing the same people, and allowing the same influencers to fund their campaigns, there is unlikely to be any significant change from the status quo anytime soon. This paralysis seems to have made some billionaires very nervous. But the last thing we should do is delude ourselves into thinking that making the rich less rich does a lot for the poor in the absence of better government. 

Emphasis Mine

Socialism is not about taking wealth from the rich—it is about taking control of the generation of wealth away from the Capitalists and giving it to the workers.

Let those who sweat earn the wealth!

Ritholtz is correct in that the transfer of wealth solves nothing. He is wrong in that changing the complexion of the political system can fix things.

The State exists to protect the ruling class and their interests. The structure of the economy determines who comprises the ruling class. In a Capitalist economy, it is the Capitalists. In a Socialist economy, it is the workers.

However, transferring control directly to the workers will result in failure because the workers have not developed themselves sufficiently politically and ideologically. Workers have to work through Marxism to understand how Capitalism works, and they have to work through Leninism to understand how political change comes about.

And they have to review history to understand the mistakes of the past.