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I do not think there is a sweet spot, or better to say you cannot stop in the sweet spot. Once you start redistribution, it never stops growing. Governments use
by afsina 11y ago
I do not think there is a sweet spot, or better to say you cannot stop in the sweet spot. Once you start redistribution, it never stops growing. Governments use social welfare as a bribe for votes. Every election new and larger benefits are introduced to overcome the overly generous competition. Taxes goes higher with different forms. Government hires more and more people. The more nationalization you make the more taxes you collect. Investment, profit and culture of entrepreneurship diminishes So you deviate from the hypothetical sweet spot quite fast. What comes sure next is economical depression.
- fsloth 11y ago"Once you start..." I don't think there is any civilized government that does not perform redistribution. Taxes are a form of redistribution. Any government functions such as free schooling, are a one way to redistribute the wealth back to society.
- afsina 11y agoMy claim is that all governments tend to grow by social means and populism. This may be slow or fast. After a point, prosperity disappears and slowly impoverishment starts.
- fsloth 11y agoThis sounds to me as an overestimatation of populism as a political force against against defenders of vested inteterests and capital. Political institutions can and do decay but not all of them so this is not a general rule. As an example, Britain, Sweden, Switzerland have quite old governmemts and they are among the most prosperous countries in the world. When speaking of redistribution of wealth sweden has taken it as far as it can in economic terms and they seem to be going strong ahead - it seems they balance social and business needs quite well.