WITH the Occupy Wall Street movement still in full swing, we have to stop and think for a moment about the distribution of wealth in the world.
One of the slogans of the Occupy Wall Street movement is “we are the 99%”, which is a reference to the fact that the top 1% of households in the USA hold more than 40% of the wealth.
This sounds incredibly unfair. How could they be so selfish?
Well, as Milton Friedman pointed out, people are often selfish out of a concern for their families (albeit perhaps subconsciously). And this concern for family is the same for both the rich and the poor.
As you will see in the video, one solution that could be proposed to the income disparity is an inheritance tax. People would be allowed to earn as much money as they want while here, but would be forced to give it all back to society (read: the government) when they check out. This may sound reasonable, but as Friedman pointed out this would undermine one of the key incentives that encourage people to work hard and save for the future, a concern for family.
Clearly many poor families are hurting financially as a result of the ongoing financial crisis, and things look set to get worse before they get better. However, it is not clear that camping out in Zuccotti Park and vilifying the wealthy is a productive answer to the problem.
At the same time, those in the top 1% (or even the top 10%) hold a privileged position in society. The current sentiment of the Occupy Wall Street movement is that the wealthy have not held up their end of the societal bargain to justify their privileged position. While this may or may not be the case, it would seem incumbent, or at least highly prudent, for wealthy families in the States and elsewhere to consider how they might use their privileged positions to create opportunities for those who have none.
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