Un-Liberaled Woman

During this recession we’re frequently lectured about helping the unfortunate, the misdistribution of wealth, and people who are victims of a capitalistic system that only benefits the rich. What’s really unfortunate is that you don’t hear the truth, which is that despite capitalism’s faults everybody living in America still has the very same freedom to create as much wealth as he chooses.  To quote Milton Friedman,

“A society that puts equality before freedom will get neither. A society that puts freedom before equality will get a high degree of both.”

Having grown up in a lower-middle class, blue-collar family, I can testify that being poor is not an excuse for continued choices which result in lower economic returns.

The American dream is that you will raise children to be more successful than yourself. Individuals are responsible for the choices they make in life that determines the result of their economic standing. At frequent points in my childhood my parents were on temporary assistance when my dad was unemployed. However, due to working since age 13, my parents teaching me about saving, and them engraving (sometimes literally) a persistent focus on my education, I now earn more than both my parents. The income I started out of graduate school at was more than what my mom was earning at her job. This wasn’t because of some evil capitalistic conspiracy to keep her down, but an attribute to the results of choices – choices in career, choices in education, choices in risk to build wealth.

I could continue to have more wealth when I‘m my parents‘ age, but I could also choose to go on a spending bender like I’m Chicago’s Lindsay Lohan. I’m not hear to say that building wealth is easy for anyone – it wasn‘t for me. And your wealth can be flushed down the drain quicker then you earned it.

But the argument that the rich remain rich because they were born into an environment of more opportunities is an egregious fallacy. The reality is that 80% of millionaires in this country are first generation millionaires and nearly 85% went to public schools. In fact, most of “the rich” in America are not corrupt executives, but are small business owners who earn an average of less than $250,000. One of the biggest characteristics of the wealthy is that they follow the behavioral cycle you’ll hear on any financial advisor show – earn, save, reinvest, then repeat. Millionaires on average work around 60 hours a week. After they’ve spent the majority of their life either working or sleeping, they then save at least 15% of their income. They also reinvest another 20% of their remaining income. 97% own their homes, half of which have lived an average of 20 years in their homes, which provides time for the values of their homes to appreciate greatly. The common denominator among the wealthy is not the amount of income they earn (or liberals will say – their tax bracket), but the choices they make once the paycheck hits their bank account.

Free market principles enable us all to obtain long-term wealth. But when has a government bureaucratic program or redistribution of income made anyone wealthy?

Let’s talk facts about the myths of income inequality. According to the Census Bureau, income gaps grew more under President Clinton’s final seven years than all of President (GW) Bush’s first seven. To be specific about it, income inequality was 8 times greater under Clinton as compared to Bush, after factoring for inflation. Yet, in the media all you hear is how great the economy was under Clinton and how under Bush only the rich benefited. I don’t know about you, but I think I’d prefer an economic environment where the poor are making 8x closer to the income of the rich – wouldn’t you want the same?

The problem we have in America is that when it comes to the myth of income disparity and stagnation, we have silver-tongued politicians who base their RichHunt pitchforks, I mean arguments, on a skewed statistical category rather than actual human beings earning their own income. If you look at the last 30 years, household income only rose by 6% but income per capita (or individual) rose by 51%. It’s clear that people are actually earning more than previous generations. So why is this truth not mentioned when tossing the income gap political football? Because using the 6% income by household figure is better for a pseudo-crusader politician to mentally manipulate voters into electing him.

The larger crime against the poor is that people are more apt to hear out a conniving politician tell them what they don’t have than listening to their inner self tell them what they could have. I look at someone’s wealth and am not jealous or think it’s unfair. I think about how can I get to that point. I strategize about what I can do to get there. I’m tired of the materialistic nature that plays into our political process – using our government system as a piggy bank to buy votes for those who can get the biggest score out of the Treasury. It is shameful when a lady is screaming that a presidential candidate’s biggest asset is in his ability to take care of her mortgage and gas bills. That’s a huge red flag not only with our political process but also to the underlying definition of individual responsibility in this country.

The post above is an excerpt from a column I have with another writer: Talking and Tackling (TNT) – The Issues. I’ll be linking to that blog here in the next few days. But in the meantime, I’ll be posting my parts of the column on the issues we’ll be tackling through friendly debates. I’ll then link to the column’s blog where you can read more articles and the other side of the debated issues.