Wealth and Income Rights?

The Five Best Sentences (ie S1 - S4)

1. You can not legislate the poor into prosperity by legislating the wealthy out of prosperity.
2. What one person receives without working for, another person must work for without receiving.
3. The government can not give to anybody anything that the government does not first take from someone else.
4. You can not multiply wealth by dividing it.
5. When half the people get the idea that they do not half to work, because the other half is going to take care of them, and when the other half gets the idea that it does no good to work, because someone else is going to get what they work for, that is the beginning of the end for any nation.

A friend posted the above list on FB. It seemed one one of those silly overly simplistic Conservative memes, so I kept it for further thought and discussion.  So let's give it a try...

Before starting, I will pose the normal question... What is FAIR taxation? (ie T1 - T4)

1. Fair would be if we took the total cost of government, divided it by the number of adult able bodied citizens. And each adult then paid their fair share of the bill. (ie Dues concept)
2. Fair would be if total cost of government was divided by the total income of every adult able bodied citizen. And each citizen paid their fair share of the bill. (ie Percent of Winnings to the House Concept)
3. Fair would be if total cost of government was divided by the total income - some base living cost (~$25,000?) of every adult able bodied citizen. And each citizen paid their fair share of the bill for every $ they make above the base living. (ie Percent of Winnings above Base Cost to the House Concept)
4. Fair would be if taxes and credits/programs were set to reduce the net income and wealth gap between the adult able bodied citizens. This means high income and wealthy people pay significantly higher rates than other citizens in attempt to attain a fair society.(ie Equalization concept)

My view is that T3 is probably the most "FAIR" method, and the USA is close to this since wealthier people may pay higher rates, but they also shelter a lot of wealth gains from taxes by not selling the assets.  If you doubt this just checkout how families use the step up basis technique and trusts to avoid paying taxes on their gains.  Where as us working stiffs have few to no shelters available to us.  We work and almost every dollar is taxed via payroll or income taxes.  And if you make so little that you can afford to put almost nothing into a 401K or IRA... You just pay taxes...

S1. You can not legislate the poor into prosperity by legislating the wealthy out of prosperity.
This obviously seems incorrect, since welfare payments, food stamps, the medicare system and the disability system have allowed many truly poor people to live safely and humanely. Of course the problem is that some of them get comfortable and stop striving to improve, work, learn and become independent.

S2. What one person receives without working for, another person must work for without receiving.
Now if everyone worked for their income and wealth increases, this would be correct.  However citizens with a lot of capital, land, investments, etc really do not need to "work" for those income and wealth increases. Especially if they inherited it from their Parents or other family members.

So where does "luck" fit into our system, if one is born with a silver spoon and another born with a lead spoon...  How does our society want to address this? Do the silver spoon folks get to claim that they "worked" for it?  While looking down on the less fortunate folks?

S3. The government can not give to anybody anything that the government does not first take from someone else.
This is true and yet somewhat silly.  The reason I say this is because the wealth and land rights of every citizen really only exist because our government says they do.  This is why you have land titles, incorporation documents, etc that are registered with the government.  Without our governments we would be back to a time of war lords where the strong could take what they want. And the cost for this protection is that we as citizens agree to live with in the rules of our society. (ie government)

S4. You can not multiply wealth by dividing it.
Now I am not even sure what this one is trying to say. However of course a government can facilitate the multiplication of wealth by taking it and spending it wisely. Ensuring we have great highways, educated workers, clean water, healthy workers, etc do wonders for multiplying wealth.

Of course it can also waste wealth by enabling dependency, spending too much on providing services, passing pointless regulations, etc.

S5. When half the people get the idea that they do not half to work, because the other half is going to take care of them, and when the other half gets the idea that it does no good to work, because someone else is going to get what they work for, that is the beginning of the end for any nation.
This is also true and yet somewhat silly. Now I agree that there are some true dead beats out there, but I put it at maybe 1% - 3% of the population. Certainly not anywhere near 50%.  And please remember that most middle class folks are just paying their fair share of the taxes...  It is the upper 20%  who are paying more than their "fair share". And they may not be doing so depending on what you think regarding the "wealth tax avoidance" topics above.

Future
The big question is how are we going to manage wealth creation and distribution when ever more jobs become automated? Will the people holding the capital get to keep all the gains while those who lost their jobs become impoverished?  I am assuming we the people and our government will need to face this reality at some point.

Of course with the tribes refusing to collaborate it will be a bumpy road.