Inflationomics

What You, the Rich,
Owe to the Poor

Your first obligation to the poor people of the world is to not become one of them.  It’s harder to help poor people if you’re one of them.  As a rich person, you have a choice:  you can give people fish to eat, or you can employ them and teach them how to catch their own fish; i.e., how to be productive human beings.

Which brings us to your second obligation; i.e., teach people how to help themselves, starting with your own children.  They will be more productive, helpful, appreciative, and less likely to steal from you or hurt you if you help them become better people.  We’re all on the same planet (with no way to leave—alive), so we’re all facing the same problems of how best to allocate the scarce resources among the ever-expanding wants (there are almost 7 billion people here now!).  There are two ways to allocate resources:  1. force; i.e., through government edict and enforcement, or 2. voluntarily through the market pricing mechanism.

The second approach is longer lasting and thus preferable for a larger number of people.  In short, you should explain to people about the benefits of a market system and the disadvantages of a socialistic system of (government) resource rationing and allocation.

Your third obligation to the poor people of the world is to set a good example so they (the poor) will want to emulate your success.  Don’t lie, steal, or cheat people out of their money or force them to pay it to you by getting your money from government service or handouts.  Don’t accept government money if at all possible—it always has strings attached to it and it has been acquired through force (and against its rightful owner’s will in most cases), thus building resentment among taxpayers.

In the near future, it will become ever more difficult to preserve one’s wealthBankrupt governments around the world will be on witch hunts seizing assets in an attempt to secure their own futures (in the name of the “public good”).  Individuals’ rights will fall by the wayside and laws will be passed to make hiding one’s assets illegal—and then the real witch hunt will begin!

Some people believe they can avoid problems by giving their money away (or asking to have it taxed away), but during the hyperinflation in France in the 1790s, the rich who didn't flee were beheaded. Perhaps France was an extreme, but wherever the rich are pilloried by rich-bashing politicians, the results won’t be good.

Your fourth obligation to the poor is to secure some of your wealth for future generations; i.e., keep it out of harm’s way from government confiscation and waste.  This is where you will have bigger problems, although close-knit families have traditionally done the best job of keeping wealth for the long run. Your wealth is probably in the form of productive assets that are difficult to move.  This makes it harder to move it/protect it from your domestic government, which may want to confiscate your wealth when they need more money (Don’t forget, governments don’t produce wealth…they consume it and they get it from productive people.)  Bottom line…you may have to diversify your assets around the world so that if one country becomes too greedy, you will have another base of operations from which to operate.   This will assure that you can abide by your first obligation to the poor.

Your fifth, and last, obligation to the poor is to give or bequeath your wealth to someone (or a group of people) who will carry on in your footsteps, making this world a better place to live through efficient productivity and asset allocation. This could be the toughest task of all! Good luck!

NOTE: I did not say you should pay more taxes to spendthrift governments or give away 50% of your wealth to charities that give people fish to eat.

Robert Jackson Smith

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