Graph to illustrate Thatcher’s comment that socialists want the poor poorer provided the rich were less rich – Part 2

Previously mentioned a graph that illustrates the idea that socialists

would rather the poor were poorer provided the rich were less rich.

Here is a revised graph:

inequality graph 2

This is a much busier graph. Like the earlier graph, it is from Dave Poling and is used with his permission. Here are a thousand words to describe his graph.

It shows the same relationships –

In a generation, the poor become as well off as the middle were a generation earlier. The middle gains a lot and is as well off as the rich a generation earlier. And yes, the rich become really rich.

Under socialism, the rich, middle, and poor all get worse off.

An addition to this graph is the government and cronies. I call the latter group the crony capitalists, those companies and individuals who make their business thrive by lobbying the government and getting special treatment. They do quite nicely under socialism, thank you very much.

Since there is so much going on here, let’s look at the graphs in more detail.

Inequality under capitalism.

 inequality graph 2a capitalism

Look at the purple and red arrows pointing to the left. Those highlight that in one generation, the middle has achieved the level of the rich earlier.

The poor, now with quotations to be considered the so-called “poor”, are living in the conditions and with the wealth that the middle had a generation earlier.

Don’t believe me? Practically all the poor today have air conditioning, heating, television, telephones (if not cell phones), and medicines & medical treatment unimaginable to the middle class when my parents were born.

We can debate social policies and welfare policies another day if you wish. Today I will rejoice and celebrate that as a society we are so well-off that we can provide so much material goods to people who are at the bottom of the income scale.

Notice all those vertical lines in red and green and purple that are pointing up and down?

What are those?

The vertical lines tell us that you are not locked into “poor”, “middle”, or “rich” categories at birth. The circumstances of your life, your drive, your effort, your skills, and a small measure of good/bad breaks can move you into a different category.

You can move up or down. It is happening at all points in time.  To a very large degree, that mobility is a result of your choice and your effort.

Even without the movement between levels, the poor and middle will gain tremendously and be as well off as the next level up was in the previous generation.

If you wish to quibble, you could say that the time from when my parents were born to today is two generations. Okay. If you wish to make that argument, then I’ll concede it takes two generations for the poor to be as rich as the middle were before and two generations for the middle to be as rich as the rich were at the start of the graph.

Now let’s look at the other side of the graph.

Equality under socialism

 inequality graph 2a socialism

 

As before, the middle and poor lose ground quickly. The rich hold on for a while but decline with time.

In this graph, the rich and middle lose so much ground they become indistinguishable from the poor. Thus the notation “Rich Middle Poor”. That takes a generation.

There is a new line, that of the government and their cronies. People in government and the businesses attached to the government do well.

If you have good connections and do what the government bids you do, your business can do well. Thrive even.

And the government? They do well, at least those at the upper level.

Many stories come to mind.

In the Soviet Union, the mid-level and senior government officials did quite well, with special stores for grocery and other shopping.  Often with a dacha in the woods for vacation. Officers in the military were privileged also.

A long time ago, I saw the ‘equality’ of communism. I was traveling by air (something inconceivable for anyone in the middle category 60 years ago). This would have been shortly after graduating from college, I think on a visit to my parents. Walking to my seat in the coach section obviously required walking through first class. Seated near the window in first class was a man who, shall we say, hadn’t missed any meals lately. He was wearing a Mao jacket. At the time, this was the official uniform of officials in the People’s Republic of China.

He was able to travel in first class, something I can’t dream of today (except for one time getting an uninvited upgrade to first). Livin’ high on the hog, as some people say.

Yes, life is good when you work for the government in a socialist or communist system.

In socialism you find the government and cronies replacing the rich in capitalism.

You see a few vertical lines showing some people jump from the rich, middle, and poor categories into the government or crony class. After a short while, only the rich can still make that jump. After a while longer, it is not possible to move into the government or crony category. At some point, that is a closed system, unlike capitalism.

That’s my interpretation of Dave’s graphs.

So I close with repeating Lady Thatcher’s comment and my recurring question.

The former Prime Minister said

All levels of income are better off than they were in 1979. But what the honorable member is saying is that he would rather the poor were poorer provided the rich were less rich. That way you will never create the wealth for better social services as we have. And what a policy. Yes. He would rather have the poor poorer provided the rich were less rich. That is the Liberal (British Socialists) policy. Yes it came out. He didn’t intend it to but it did.

Here’s my question:

Which one of those two systems is moral?

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