The socialists are beating the drum for wealth transfers again, this time using the development of AI to justify government extortion:
Life is not zero-sum. There is not a fixed pie of wealth; human ingenuity creates it. Both my neighbor and I can grow in wealth simultaneously. My neighbor’s wealth does not come at my expense.
Suppose my neighbor starts a business that makes a popular product. Suppose that, as a result, he earns 10X more than I do. What grounds do I have for complaint?
It seems to me that as long as he earns his money via voluntary trade, and not via coercion or fraud, then I have no basis—aside from envy—to complain.
In a free society, income inequality is inevitable because people have differing values.
For example, I value low stress and abundant leisure time for my own pursuits, so I have chosen careers that allow for that.
The tradeoff is that I do not make as much as those who choose to work long hours at high-stress jobs serving other people.
Nor should I!
I have chosen to satisfy my own idiosyncratic desires rather than provide value to other people.
Attempts to eliminate inequality via coercive wealth transfers result in:
1. Rising taxes to feed a parasitic class as more people decide that it is easier to feed off others rather than produce themselves.
2. Increasingly draconian regulations to prevent productive people from fleeing, such as capital controls, AML/KYC surveillance laws, and exit taxes.
3. Dwindling wealth, as fewer entrepreneurs make the sacrifices necessary to start companies since most of the profit will be extorted from them.
Eventually, the government collapses when it runs out of other people’s money. This is why so many socialist countries become impoverished, totalitarian nightmares.
All of the above remains true even if AI’s reach and surpass human level intelligence.
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