Saturday, October 23, 2010
The Truth About Wealth Creation
You hear arguments that the rich are getting rich, while the poor are getting poorer. Is that really true? Not according to some researchers who have tracked average income per capita of various countries for the past 200 years. They have even animated the graph so you can see how the wealth of the world grows over that time. You will also notice that countries where they restrict free trade and personal property ownership are held back. Notice the countries where free trade and personal property ownership are highly supported by the rule of law become the wealthiest in the world. Capitalism isn't evil, and it isn't greed. Capitalism isn't perfect, but it creates an environment where wealth is created. Socialism and Communism on the other hand are shown historically to destroy wealth.
Under free markets and well supported private property ownership, the poor get richer and the rich even richer. There may be an increasing gap between the (relative) poor and the rich, but everyone is better off. The problem isn't the wealthy, it is the less wealthy (the poor) not creating enough new wealth.