**A FALSE DICHOTOMY OF WEALTH FLIGHT: THERE IS A THIRD CHOICE** From April 28th,

**A FALSE DICHOTOMY OF WEALTH FLIGHT: THERE IS A THIRD CHOICE**

From April 28th, 2009

The rhetoric on the flight of the wealthy is pretty thick right now. But I thought that I would correct the false dichotomy of submission to taxes or flight from taxes.

When the minority of people pay all the taxes, they form a bloc of similar interests. If those interests are similar enough, those interests become their primary interest. And it becomes more attractive for the wealthy to pay a minority of the people to side with them in producing social change, even revolutionary social change.

Revolutions are not created by the high crimes of a few. They are created by the accumulation of rudeness, administrative burden, legal propagation, and petty abuses of power by the bureaucrats who annoy the citizenry to the point of intolerance. I am not afraid of a proletariat revolution, despite my belief that we will see riots at some time in the near future. I am not afraid of a revolution by the wealthy. I am afraid of a minority proletariat revolution funded by the wealthy. And I am rapidly approaching the point at which I am both an advocate and willing to fund it. The state is attempting to pit us against each other when, in fact, it is the people who should simply be done with the abuses of the state. Fixing the centralization of wealth is not a problem. Providing social services is not a problem. Stopping the state from pitting us against each other is the issue we must face. I don’t know any wealthy person who objects to the payment of taxes. We object to the use of the tax revenue to pit different social classes against each other, rather than to help us work together toward shared goals and objectives. In this conflict, the state is actually the problem.

We must understand that there is a difference between personal wealth and political wealth. Personal wealth means that one has made enough money that he can lend it to the following generation, who will then allow him leisure in exchange for the use of his money now, so that they can live a better life more immediately, and higher cost over time. Political wealth is the possession of money at such volume that it is possible to put it to political use, and therefore subvert the market process that requires that we serve our fellow man’s needs in order to gain reward. Typically, and this is just an oversimplified way of looking at it, personal wealth requires between 10 and 50, but no more than 100 times the median annual income. Political wealth requires at least 100, but more effectively around 1000 times the median annual income.

If we simply used a tax that was HIGHLY progressive and on the balance sheet, rather than on annual income, so that the middle class of merchants and small business people could accumulate wealth and gain financial independence in exchange for their extreme personal financial risk, and where the tax rate started where the net worth was 10 times the median income, then increased rapidly at 100 times median income, there would be no use for the Republican Party. The party exists entirely on that one pillar. Without that divide we could form a middle ground, work toward common goals, and marginalize both the left and right extremes.

If we required bankers to hold 20% of all originated loans, and required that they be permanently tied to the lending “individual,” we would fix the corrupting behavior of lending that built up since deregulation. If we further stopped providing general liquidity and instead offered only targeted liquidity from the Fed, then we would put more of a halt on bubbles.

If we kept the interest on state credit money with the state, then we would both have a replacement source of revenue and would force the state to think in terms of advancing national competition rather than giving away our competitiveness. We would also be able to see who performed what good for the country and who did what harm.

The choice for the wealthy is not just between submission to taxes and flight. It’s between submission to taxes, flight, and revolution.

I’m one of the people who is rapidly beginning to call for “the Third Choice.” Because if we took the money wasted on government in this country and used it for medical and infrastructure improvements, as well as basic research, we would rapidly regain our competitive position in this world and, in doing so, drastically change the position of our working class.

I am an unrelenting advocate of noblesse oblige: If we are lucky enough to become wealthy, then we must use our wealth to the betterment of our fellow men. But only we can know what that betterment is, because only we have demonstrated by our accumulation of wealth that we know how best to serve our fellow man. Servitude to a state that pits its citizens against each other, exports jobs, makes our state uncompetitive by policy and taxation, and under-educates our people is not service to our fellow man. It is, instead, a crime against them.

I’m not there yet. But I’m getting close to thinking we need to pull out some rope and learn how to tie knots.