I am poor because you are rich. This must be the single most destructive thought on this planet.
It is not an attitude that is found amongst successful peoples and countries.
They see rich people as an asset, and admire those who have created wealth by their own efforts.
Even if rich people have inherited wealth, they pay taxes and their spending is good for the economy.
In America, the top 1% of taxpayers pay 40 percent of all federal income taxes, and the top 20% pay about 86 percent.
South Africa has only 5.3 million taxpayers, of whom the top 7% who earn over R300 000 a year pay more than 45% of all income taxes.
You can't take it for granted that rich people will always be around to pay taxes and provide jobs.
If you tax too high, they will cut back on investment, find tax shelters or simply leave.
You will lose not only businessmen, but people of high-earning talent.
British soccer has recently been devastated by the rise in the top income tax rate from 40% to 50% as top stars have relocated to play for Spain where they pay only 24 percent.
The problem is envy and a misunderstanding of how wealth is created.
There isn't a set amount of wealth that can be divided up, so that if some people get more than their fair share, others get less.
In a free market, wealth tends to expand as enterprising individuals create new products and industries.
They will prosper, but others will benefit too.
It's not a win-lose situation, but a win-win for everyone.
Bill Gates is the world's richest man after creating a product with immense spin-off benefits.
If he had been heavily taxed from the start, he would likely have failed or moved elsewhere to succeed.
The win-lose situation is most likely where there is coercion and a lack of competition to ensure best value.
It is worst when the state is in control and little new wealth is created.
When politicians can give licenses or permits to friends corruption flourishes. This happens in much of Africa, where the elite take what they can from the productive sector as part of what has been called the "vampire state".
Those who advocate "soak the rich" policies for radical wealth redistribution risk a lose-lose situation as the incentive for new wealth creation is diminished.
Everyone then ends up fighting over a smaller economic pie.
It is ironic that class warriors like the SA Communist Party's Blade Nzimande splash out at taxpayers' expense on luxuries like a R1.1 million car.
This really is money that should go directly to assist the poor.
I favour redistributing government extravagance to better finance its core functions, which should include expanding opportunities so that fewer people depend on state handouts.
The late American Baptist preacher Adrian Rogers observed: "What one person receives without working for, another person must work for without receiving. The government cannot give to anybody anything that the government does not first take from somebody else."
He concludes: "You cannot multiply wealth by dividing it".
We're lucky to have rich people. Instead of persecuting them, allow them to assist the rest of us to get rich.
This article by Jack Bloom MPL, DA Member of the Gauteng Legislature, first appeared in the Citizen, September 15 2009
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