The Real Problem on Creating Wealth

By | December 15, 2013

carlin-rich-poor

On a recent Facebook post by a liberal friend, he posted this Carlin quote with the caption “Most things that conservatives say contradict other things that conservatives say.”  At first glance, it looks like yet another example of spending time fighting with the opposition rather than solving our nation’s problems.  But let’s dig a bit deeper.

I have always loved George Carlin.  He had a great sense of humor and was very good at making us look at things in a new light.  While this Carlin quote is a great humorous counterpoint to trickle down economics arguments, it too does not fully address what is really going on in the economy.

One side argues that the rich have worked hard to earn their money and deserve it, and that the rich create jobs for the poor and middle class.  The other side argues that it is not fair that a small percentage of the population should have a majority of the country’s wealth, and that it is the duty of the wealthy to take care of the less fortunate.

While I see the merits and truths of both sides, I also see there is a deeper systematic problem we are not addressing.

“Conservatives say if you don’t give the rich more money, they will lose their incentive to invest.  Then they say as for the poor, they’ve lost all incentive because we’ve given them too much money.” – George Carlin

The problem is that if we give a poor person $10 million (let’s say from the lottery), they are usually bankrupt in less than 5 years, whereas a rich man will usually make investments and try to make even more money. 

The problem is not as simple as shuffling money around people’s pockets. We need to teach the masses how to invest their money so that they too can build wealth. That is the real solution. 

Social welfare programs are just band-aids on wounds that will never heal without financial education. We need to solve the greater problem, if we want to get rid of the symptoms of income equality.

I see both sides of the issue. The wealthy do deserve to keep their wealth, just as much as the less fortunate have the right to become wealthy, and should be encouraged to do so. The problem is not the distribution of wealth, but rather the distribution of opportunity. Fix the distribution of opportunity, and the distribution of wealth fixes itself.


 

Scott M. Stolz

Entrepreneur, Educator, Author.
Helping people embrace life's opportunities.™