Bernie Sanders and the Fixed Pie Fallacy

More for some does not mean less for others

Combat Shooter's Handbook No point in forwarding this to your libtard friends. They are not going to believe it no matter what. The same goes for any Keynesian Economist friends you might have. — jtl, 419

via Foundation for Economic Education

“The rich are getting richer and the poor are getting poorer.” Senator Bernie Sanders first said those words in 1974 and has been repeating them ever since.

Reconnaissance Marine MCI 03.32f: Marine Corps Institute Senator Sanders is not alone in his belief. Three out of four Americans agree with the statement, “Today it’s really true that the rich just get richer while the poor get poorer.”

Senator Sanders is half right: the rich are getting richer. However, his assertion that the poor are becoming poorer is incorrect. The poor are becoming richer as well.

The Betrayed: On Warriors, Cowboys and Other MisfitsEconomist Gary Burtless of the Brookings Institute showed that between 1979 and 2010, the real (inflation-adjusted) after-tax income of the top 1% of U.S. income-earners grew by an impressive 202%.

He also showed that the real after-tax income of the bottom fifth of income-earners grew by 49%. All groups made real income gains. While the rich are making gains at a faster pace, both the rich and the poor are in fact becoming richer.

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The Essence of Liberty: Volume I: Liberty and History: The Rise and Fall of the Noble Experiment with Constitutionally Limited Government (Liberty and ... Limited Government) (Volume 1) The Essence of Liberty: Volume II: The Economics of Liberty (Volume 2) The Essence of Liberty: Volume III: A Universal Philosophy of Political Economy (Liberty: A Universal Political Ethic) (Volume 3)In addition to these measurable real income gains, decreases in prices have given the poor increased purchasing power, helping to raise living standards for the worst off in society. As a result of falling prices such as for groceries and material goods, along with gains in real income, Americans have more income left after basic expenses.

A Handbook for Ranch Managers Planned Grazing: A Study Guide and Reference Manual Environmental & Natural Resource Economics: The Austrian ViewTechnology has also become cheaper, improving our lives in unexpected ways. For example, consider the spread of cell phones. There was a time when only the wealthiest Americans could afford one. Today, over 98% of Americans have a cellular subscription, and the rise of smart phones has made these devices more useful than ever.

Unfortunately, progress has been uneven. In those areas of the economy where competition is hobbled, such as education, housing, and healthcare, prices continue to increase.

Still, the percentage of the population classified as living in relative poverty has decreased over time. Why then do three quarters of Americans, including Senator Sanders, believe that the poor are “getting poorer?”

A simple logical error underlies Sanders’ belief. If we assume that wealth is a fixed pie, then the more slices the rich get, the fewer are left over for the poor. In other words, people can only better themselves at the expense of others. In the world of the fixed pie, if we observe the rich becoming richer, then it must be because other people are becoming poorer.

Fortunately, in the real world, the pie is not fixed. US GDP is growing, and it’s growing faster than the population.

Poverty remains a pressing issue, but Senator Sanders is incorrect when he says that the poor are becoming poorer. In the words of HumanProgress.org advisory board member Professor Deirdre McCloskey,

The rich got richer, true. But millions more have gas heating, cars, smallpox vaccinations, indoor plumbing, cheap travelrights for womenlower child mortalityadequate nutrition, taller bodies, doubled life expectancyschooling for their kids, newspapers, a vote, a shot at university, and respect.

This post first appeared at HumanProgress.org.

Reconnaissance Marine MCI 03.32f: Marine Corps InstituteAll unclassified Army and Marine Cops manuals and correspondence courses are products of the US Federal Government. They are NOT subject to copyright and can be freely copied and redistributed.

The Marine Corps Institute (MCI) develops correspondence courses for Marines with all kinds of Military Occupational Specialties (MOS) on all manner of subjects. This is one of those courses.

The print is relatively small because that is the way it was in the original and this is an exact reproduction. Also, as a tribute to the individual (and a touch of reality), you will notice that the editorial pencil marks and underlined passages that were put there by the Marine that took this course. They were intentionally left in the reproduction.

This version of the course was authorized in September of 1984. With the exception the development of Infrared technology, it contains information and techniques that have changed very little since the Vietnam war. These battle proven tactics are as valid today as they were in Quang Nam province in 1968.

They will maintain their validity during the upcoming inevitable event of total economic, political and social collapse. Yours for freedom in our lifetimes. jtl, 419

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About Land & Livestock Interntional, Inc.

Land and Livestock International, Inc. is a leading agribusiness management firm providing a complete line of services to the range livestock industry. We believe that private property is the foundation of America. Private property and free markets go hand in hand—without property there is no freedom. We also believe that free markets, not government intervention, hold the key to natural resource conservation and environmental preservation. No government bureaucrat can (or will) understand and treat the land with as much respect as its owner. The bureaucrat simply does not have the same motives as does the owner of a capital interest in the property. Our specialty is the working livestock ranch simply because there are so many very good reasons for owning such a property. We provide educational, management and consulting services with a focus on ecologically and financially sustainable land management that will enhance natural processes (water and mineral cycles, energy flow and community dynamics) while enhancing profits and steadily building wealth.
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