October 3 2011
Economic Freedom, Not Wealth Redistribution, Will Solve the Problem of Poverty
Check out this new video from the Center for Freedom and Prosperity Economics 101 series:
I ask and answer four questions in the video:
- Who are the poor?
- What is poverty?
- What drives poverty?
- And what can fix poverty?
Americans from across various wealth levels have experienced losses over the past few years. Tumultous markets, slow growth, and high unemployment have created hardship for employers and employees alike. But when economic times get tough, they get really tough on the poor, and the ranks of those counted as poor grow.
As I discuss in the video, the answer is more economic freedom. For many non-poor Americans, greater economic freedom from government over-taxing, over-spending, and over-regulating would allow them to expand their businesses, buy more, invest more, or save more. Clearly, economic freedom is important to this group, and would lead to the creation of jobs and wealth.
But too often we overlook the importance of economic freedom for the poor. They are the group most desperate for opportunities to improve their lives. If we freed this group from the very high implicit marginal tax rates they face, and got the government's skewing interference out of the incentive structure, Americans living in poverty would be in a better position to take advantage of the opportunities the market can offer.
Of course we care about providing for our fellow countrymen and women when they are truly unable to care for themselves. But I hope that, after watching the video, we can agree that the approach that the government is currently taking actually causes more harm than help.