Wealth is not simply numbers in a bank account or your passive cash flow or your equity.

Wealth really means being able to access the resources, services, leisure, social relationships, spiritual connectedness that make us human.

The question for all of us is how to go about creating wealth? I suggest it is created through a healthy mix of education, hard work, play, love, kinship, spirituality, compassion, investment. When the lack of financial resources undermines a large part of society’s ability to succeed in all those areas, then some forced redistribution from haves to have nots is in order.

I think the quote is really meant to be a high level comment on the inability to create wealth via forced redistribution. To that point, the issue we face right now is that, given the reduction in capital and market volumes we see around the world, we face a much slower growth future as the speculative sector deflates and the real economy eventually recovers. The whole story of modern financial economics is about spinning straw into gold in the speculative sector, which eventually grew to an order of magnitude larger than the real economy basis. As the bezel shrinks and the froth we mistook for growth evaporates, the living standard supported by the real economy is going to be quite a rude shock for people around the globe.

Unfortunately the rest of the quote seems to apply to tax paying people vs people receiving benefits. In this case the logic breaks down rather quickly IMO. Society is like a family or should be. The old, the weak, the young and the unfortunate are looked after by the rest. Of course good social policy needs to have a strong emphasis on systemic risk mitigation. It needs to try to avoid dependency. There is systemic risk where ever you look. Some systemic risk is probably unavoidable. Even the designer of natural systems could not avoid it. The benefit of “a system” however outweighed the problems of “going it alone”.

In any case with regards to tax it seems that, beyond wages, governments are not very good a gathering tax. Wages earners are usually not where the really big money is.

Any economist should know… transactions are not zero sum. A transaction takes place in a free market when it makes both the buyer and seller better off. And it’s positive sum for the government to put up a traffic light even when it has to tax users to do it. As Orwell said, the first duty of intelligent men is the restatement of the obvious.

Question — In your example, how does this “government” get paid for it’s equal rights consulting services to humanity? Probably by taking money from someone. And, it’s easy to see that Dr. Rogers was talking about taxation and wealth redistribution, not firemen and morality.

Now Obama wants to reward irresponsible borrowers who bought too much house relative to their income by allowing them to dishonor their obligations. Taxpayer money will be used to make their mortgage payments less burdensome.

These policies make people who have behaved responsbily by saving and who honored mortgage terms look like suckers.

Santelli may have been joking about a taxpayer revolt on CNBC today, but I think it may be pretty close to the truth.

Ask the folks from Iceland if there was no systematic risk in the way they rules their banks.

And the USA? Financial sector only has about 17 trillion US$ debt on herself, that is over 100% of USA GDP and it grows much faster then the GDP.

(Source: http://www.federalreserve.gov/releases/z1/current/accessible/d3.htm )

Ha, 17 trillion of debt and even the interest obligations / coupon payments can only be done by ‘refi’ or issuing new bonds? And no quantum of systematic risk in the air?

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This article falls into the category of ‘worshipping the rich’, what is against extra taxes for the rich?
The rich have proven to be able to get rich, so why don’t they repeat the trick a few times more?

And when it comes to stuff like fighting crime, all these folks that worship the rich are looking at the government for a solution. US military costs? Same package; the govenment has to do it.
But with a government comes it’s costs, you accept that or live in anarchy without taxes (very often you need to pay ‘protection money’ to the local mob in such a case).