Safety nets have negative effects

Jim Reid, San Diego

Saturday, Nov. 26, 2011 | 2:01 a.m.

Don’t get too excited if the wage or wealth gap begins to shrink. This happening could be the harbinger of the end of the United States as we have known it. It all depends what the impetus is for this happening.

We have always rewarded productive work with wages. The amount is subject to complex reasons and methodology. The problems begin when we decide to reward nonproductive existence with what is euphemistically called a “safety net” that evolves into an entitlement with no economic foundation.

We now need a transfer of payment from the productive to the nonproductive. As the nonproductive grows bigger and bigger, that transfer also grows, further reducing the reward for productive employment. At some point business must look for safe havens to survive.

Since we live in an ever-shrinking world, moving processes and production overseas is the logical answer.

The jealousy, fear and outrage at that happening leads to a more authoritarian government to satisfy the electorate. The final stage is socialism or the social welfare state that is currently collapsing in Europe and has always done so for economic if not political reasons. Our future is up to us. Listen to the siren call of jealousy and envy and follow the occupiers or think of economic and practical solutions that will allow continued growth and prosperity.