The Envy and Covetousness of Progressives

Get a load of this op-ed in yesterday’s New York Times: “Give Up on the Estate Tax” by Ray D. Madoff, a professor at Boston College Law School.

Referring to the estate tax, Madoff writes: “This tax, first enacted in 1916, was never intended to be simply a device for raising revenue. Rather, it was meant to address the phenomenon of a small number of Americans controlling large amounts of the country’s wealth — which was considered a national problem.”

Considered a national problem? By whom? Why, by progressives, of course — certain Americans in the early part of the 20th century who hated the fact that some people have more when others had less. What guided the progressives was envy and covetousness, which led inevitably to their ideology of using state power to take away money from the rich, with the purported aim of “equalizing wealth” within society by giving it away to the poor.

Of course, the amount to be redistributed was always less than the amount taxed because the selfless federal politicians and bureaucrats performing this important service expected to be paid handsome salaries for doing so.

Madoff quotes Supreme Court Justice Louis Brandeis (one of the early progressives): “We can have concentrated wealth in the hands of a few or we can have democracy, but we can’t have both.”

That has got to be one of the most ludicrous statements ever uttered. Democracy is a political process by which people cast their votes in elections. Even if most of the wealth is concentrated in a small group of people in a society, how does that prevent everyone else from going to the ballot box and casting their ballots?

When the socialists — oh, excuse me, the progressives — imported their statism to the United States, their justification was based on the notion that there is an inherent conflict between rich and poor in a totally free market. The rich not only keep getting richer, said the statists, but their wealth actually ensures that the poor stay poor.

That is one ludicrous notion. Actually, in a genuinely free market system, everyone’s interests harmonize. The rich provide the businesses and industries that hire the poor. The profits they make go into capital. The savings of the workers also go into capital. That capital enables businesses and industries to purchase the tools and equipment that make the workers more productive. More production means higher revenues and profits. That means higher wages for the workers.

That’s the system that once characterized the United States. No income tax. No estate tax. No Social Security tax. No Medicare tax. No welfare programs, including Social Security, Medicare, Medicaid, education grants, community grants, bailouts, foreign aid, public housing, food stamps, farm subsidies, etcetera. That was the key to wealth, especially for those at the bottom of the economic ladder. It’s not a coincidence that the poor were flooding American shores every day, leaving the lands of statism to come to the land of free markets and unlimited accumulation of wealth.

Does everyone get wealthy in a genuinely free market? Of course not. Some businesses go out of business. Some people make bad investments. That’s the nature of life. What matters, as far as individual liberty is concerned, is: (1) that everyone have the right to become wealthy by engaging in free enterprise (that is, free of government control) and accumulating unlimited amounts of wealth in the process; and (2) a free market raises the overall standard of living for people living in that society.

The problem is that once the progressives realized that there were people getting rich, including people who had been poor before they became rich, that drove the progressives batty. The great sins of envy and covetousness took control over their minds. Their obsession became to convert America’s system to a welfare state, one by which they could use the state to “equalize” wealth.

Why is the United States besieged by economic crises today? The same reason it’s besieged by foreign-policy crises: Because Americans, following the siren song of the progressives and, for that matter, the interventionists, abandoned the principles of liberty, free markets, and a constitutional republic with their embrace of socialism, interventionism, and military empire. What better time to reverse the statist victory than now?



  1. In order for someone to become rich they need to have a good idea, make the sacrifices needed to turn the idea into a reality and turn the reality into a marketable product. Or, they need to have someone above them in the family tree who has done all the hard work for them.

    I don't agree that the results of your labour should go to the state, at the same time I don't agree that someone who has done nothing (apart from having the luck to be being born in the right family) does not need to do anything to be rich.

    I thought this was the reason immigrants flooded to America - there were no kings, no lords and ladies, everyone could achieve what they were capable of regardless of who they were born to.

    Inheritance allows that wealth to accumulate and creates a new breed of blue bloods (just without the titles). Bob Jr (son of Bob the Boilermaker) may have access to $10K to try and implement his idea, Bill Jr (son of Bill the Newspaper Magnet) is an idiot who never had an original idea in his life but can drop $500K on a new Ferrari because he doesn't like the color of the old one. Who could have made better use of that capital?

    My examples are obviously extremes (just to make the point) and I'm not condoning wealth redistribution of any sort. I *am* arguing against a system that allows wealth to accumulate regardless of ability though.

    Such a system actually defeats the free market - the biggest problem is no longer government but monopolies or oligarchies that operate alongside (or have undue influence over) the state.

    As a libertarian and a capitalist I would have thought you would like to see the capital freed up and allowed to move through the market rather than being tied up by smaller and smaller groups.

    Passing the capital to state control is not the solution (it still remains constrained) but allowing it to accumulate via inheritance and marriage seems to be recreating the situation that we tried to escape using the very method we used to escape it - we are replacing a monarchy with a plutocracy.

    I have no solution to offer - I can only agree with part of the statement by Madoff you started the article with - "the phenomenon of a small number of Americans controlling large amounts of the country’s wealth — which was considered a national problem".


  2. "apart from having the luck to be being born in the right family"

    Don't worry. They usually don't stay rich for long...


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