I just submitted this as a letter to the editor at the Herald:
I have complaints with the 4/3/07 article entitled "Upward mobility halted by social inequality." The assumption made is that the presence of someone with more wealth somehow prevents an individual from gaining wealth themselves. This is based primarily on the "fixed pie" fallacy; the myth that there is a limited amount of wealth and that in this zero-sum game if one has more it is at the expense of all others. This is incorrect. Wealth creation is not zero-sum.
Consider this analogy: my neighbor buys a brand new car. Her car is really nice, far better than mine. Does her having a nicer car than mine prevent me from buying a nice car too? Does it make my car any worse than it currently is? Does the existence of someone having a nicer car affect my car at all? This analogy fits perfectly with the rationale in the article: the false idea that someone being better off makes you worse off.
When someone becomes wealthy, take Bill Gates for instance, their wealth is not taken from others, but rather created. Windows has revolutionized the business world, allowing people to become more productive, to have their lives enriched and simplified, and many other bonuses. People benefit by owning it, Gates benefits by selling it, and both parties are marginally better off than before. Wealth is created, not taken at another’s expense, as in the case of taxation. The article complains about how "we pay more to corporate executives then we do to those who work to better our communities." However, are these mutually exclusive? I’d like to think Bill Gates has done more to improve our lives, creating more jobs, more opportunity, and more economic growth than almost anyone alive. How is this not working to better our community?
It is also argued that wealth should be "distributed among every race and class." This does not consider the unintended consequences of wealth redistribution. Free economies consistently outperform those regulated by government: simply compare Hong Kong and Singapore with China over the past 25 years. This is because of the distortion of incentives and deadweight loss taxation and wealth redistribution put on an economy.
What we need to do is not focus on making sure everyone is equal, but making sure that everyone is free to succeed. Equality of opportunity should be the goal, not equality of result.