Monday, February 24, 2014

Public Policy and the Middle Class

The point I wish to make in this post is that public policy not only killed the middle class, but has "killed" everything in the economy. The reason for this is simple: any public policy necessarily enforces a mandate which would otherwise not be necessary between two consenting individuals regarding trade.

Firstly, I suppose that voluntary trade will necessarily increase the wealth of both parties involved. Otherwise, why would either party agree to the trade? The only reason a person might engage in conducting a trade that was not to his immediate benefit is if some other person will make it worse for them if they don not.

Public policy, in whatever name it comes, will halt that voluntary trade. For whatever reason, public policy is implemented because the rest of the public decides that the trade between the individuals is unacceptable for the society, and thus they force it to stop. The only instance in which this is not true, is when public policy is implemented to make up for what private trade cannot provide. However, in these cases, private trade is only unable to provide because of some other public policy in the first place.

Essentially, private trade cannot create a decrease in wealth, while public policies only create a decrease in wealth, for at least one party. While on the while this may increase wealth, as one party loses less wealth than another gains, it ultimately leads to a decrease in wealth as by the process of decreasing wealth in one party to increase the wealth of another, you decrease the production capacity of both.

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