Monday, February 1, 2010

Mr. Hood

Your employer pays you because you create more value in working than you use up in resources.  You buy stuff that gives you more value than you have to sacrifice to get that stuff.

Now Robin Hood takes $1 from you (who earned that dollar by providing more than $1 in value) and buys a geegaw for me (you would have spent the dollar on a doodad that gave you more value than $1).  Robin Hood does not know me well, so the geegaw he bought for me is only worth only 50 cents to me.  So Mr. Hood destroyed your more than $1 worth of value to give me 50 cents worth of value.  Mr. Hood made life worse, overall.

And if Robin Hood keeps visiting you, you may end up spending money on hiding your money from Hood.  But hiding your money gives you no direct satisfaction--the doodads you would have bought if there were no Mr. Hood do give you satisfaction.  So more value is destroyed.

Of course, Robin Hood is a government that redistributes income.

This is all too optimistic, though.  Robin Hood knows where the money is coming from and where it's going.  Government is so big, it has no idea.

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