A friend sends me a biblical commentary, "Farewell to Hope", that tells stories from Revelation that show that what Madoff did was wrong. "People had become rich off his returns, and charities had been helped by the goodness of his heart," his attorneys argued. But the rebuttal was that he "merely gave his clients (and charities) money that belonged to someone else".

Kindly tell me what the difference is between what the idea that has the world in its grip is, as embodied in the taking from the currently rich to give to the currently poor, and this idea of Madoff's. Sometimes kids respond to the idea that if a robber comes up to three people and takes one's money that's bad. Now suppose instead of the robber there's a vote of the three people as to who should give the money to the others, and the two vote for the third to give his money away. Isn't that bad also?

George Parkanyi comments:

It reminds of the Monty Python sketch of highway robber Dennis Moore, who robs from the rich to give to the poor, until the poor become rich and lazy and the rich poor– then he becomes conflicted and finally ends up simply re-distributing the loot amongst the passengers and then riding away.





Speak your mind

17 Comments so far

  1. nelson on September 23, 2010 8:29 pm

    Somehow I believe that somewhere along the way the voting situation was preceded by discussion that may have entailed some dwelling on issues of higher morality. That’s one point, also he who gets outvoted today may return to win at voting another day. In other words the voting situation implies that even in being outvoted the one who has the money redistributed is in a stronger negotiating position than the individual who is robbed. That’s a good thing situationally. Further, the fact that you have two people agreeing that the third needs to give up some of their wealth suggests that they may be more correct than a single robber making the decision. May perhaps. I challenge anyone to come up with a system that is the ultimate fair one, but I think voting has an edge over violent resolution as a first means.

  2. JK on September 24, 2010 6:12 am

    Answer to “nelson”:

    Where I live(Norway), rapists in groups get higher sentences(up to 21 years in prison) than individual rapists(up to 10 years in prison), do you belive that`s wrong, after all a group of rapists “may be more correct than a single” rapist in their right to rape? Group psychology/indoctrination/manipulation/suggestion/the fact that power corrupts etc doesn`t support your idea that more people are more right?

    What about a system where nobody receives any privileges from the state/government in the first place, i.e. nothing that justifies redistribution, i.e. no market regulations?

  3. Kermit Johnson on September 24, 2010 5:47 pm

    Yes, it’s too bad that there are actually people who feel bad about others who do not have the ability to compete in this game we all play.

    Moralistic thinking - it’s just so wrong to be forced to share. Would it be more fair to allow the ’survival of the fittest’ system to proceed until there are finally enough people in the bottom group that they take what they want? Or maybe the ‘fair’ alternative at that time would be to hire enough from that bottom group to kill enough of the group to protect the property of the wealthy group.

    It is obvious that the world has a huge oversupply of unskilled and low-skilled workers. That is why the price is so cheap. So, is the solution to let the market work?

  4. Mike on September 24, 2010 10:00 pm

    I always thought on some level it is discrimination, nobody wants to take it to the supreme court.
    I think we need some big event, SSI falls apart, a bigger war, restart everything and get everybody thats on this boat paying the same fair.

    Then you’ll really see how conservative people are, when everybody knows they are affected equally.

  5. douglas roberts dimick on September 25, 2010 1:48 pm

    They Shoot Horses, Don’t They?

    The difference, as in the film, is that “[t]he eventual winners are never revealed.”


    The Chair queries how one being taxed for purposes of income redistribution is “bad also” a la one who with intent so defrauds and profits via a Ponzi scheme. In fact, this type of fraud as a “system is destined to collapse because the earnings, if any, are less than the payments to investors.”


    So distinguishing Madoff – pronounced “made off” – from progressive tax systems is the ethical notion of “distributive justice.”


    The one of three “citizens” in our example has profited from a social contract (or the nation’s constitution) which has provide legal order for an economic framework from which traditional, command, and market elements of human enterprise may fairly and orderly operate. As a result, based on the individual talents, resources, and resolve of our three tax payers, exchange systematics of financial engineering and profiteering evolve.

    In the Madoff case, there are no winners – as in the dance contest, at least from a perspective of material gain. Even for those whom Madoff paid and where cash positive at the end, such perceived winners face federal and state legal actions that “claw back” unjustly deserved profits derived from illegal activities.

    However, in the case of government taking actions, there is a public purpose at hand… “A purely private taking could not withstand the scrutiny of the public use requirement; it would serve no legitimate purpose of government and would thus be void… The Court’s cases have repeatedly stated that ‘one person’s property may not be taken for the benefit of another private person without a justifying public purpose, even though compensation be paid.’ ”


    Perhaps Victor should saddle up his favored stead… “Money is like muck, not good except it be spread.” —Francis Bacon, ‘Of seditions and Troubles’, Essays, 15

    Nelson, as I have now lived for four years in a system where 95% of the citizenry is disenfranchised, I attest to the imminently fairer comparative distinctions that a democratic-based republic system offers as “ultimate” when in comparison to communism or other form of dictatorial governing.

    JK, as China is governed in absentia of rule of law, much in terms of economics and social justice remains absent of government privilege or regulation. As a result, one may see the features and benefits as well as the inequities and injustices resulting from too little regulation as much in juxtaposition to too much.

    Who are the winners with redistribution of income by the state for public purposes?

    The anthology of human slavery in the United States provides a brightline example. Consider, slaveholding in 1860…
     As of the 1860 census, enumerating slave schedules by County, 393,975 named persons held 3,950,546 unnamed slaves, for an average of about ten slaves per holder. As some large holders held slaves in multiple counties and are thus multiply counted, this slightly overestimates the number of slaveholders.
     Excluding slaves, the 1860 U.S. population was 27,167,529, yielding about 1 in 70 free persons (1.5%) being slaveholders.
     The distribution of slaveholders was very unequal: holders of 200 or more slaves, constituting less than 1% of all US slaveholders (fewer than 4,000 persons, 1 in 7,000 free persons, or 0.015% of the population) held an estimated 20–30% of all slaves (800,000 to 1,200,000 slaves).

    Based on subsequent government taking and progressive tax and civil rights laws, our nation elects its first minority president… merely some 44 years after passage of the civil rights legislation.

    Regardless of political affiliation and recent popularity polling, like it or not, we have a winner.

    Enough said…


  6. Brian on September 25, 2010 4:20 pm

    I think that such a vote is the worst way to view money redistribution.

    First, each person has a right to choose how his or her money is distributed.

    Second, forcing others to make a decision to take money from another for redistribution is challenging their moral underpinnings and relationship with money. If they make such a vote, they are just as financially challenged as the robber or else they perceive themselves as powerless and therefore will compromise their values because of fear. Either way the circumstances are based on ignorance, which can lead to fear and the erosion of a person’s moral character.

    I think that the correct way to view distribution of money is to allow each person to choose how to distribute their money as they see fit, since the right to choose how one’s money is distributed is inherently that person responsibility, not someone else’s.

    If I choose to forfeit my money to something other than what I value because that is the consensus, than I deserve to play the victim because I must value something greater than my money given the circumstances.

    However, I would think that there is a solution to this dilemma. If the victim in this circumstance proposes a better solution, that he or she would give their money to an even greater cause and if desired, would double the amount being stolen for redistribution, then all parties would see the act of courage and charity and possibly reexamine their perception of money?

    Real wealth comes from the choices we make and the consistency from which we make those choices; otherwise, the lack of consistency will be its undoing.

  7. douglas roberts dimick on September 25, 2010 9:34 pm


    Always in September

    While deliberating on weighty matters of social-economics and record-sized financial crimes, take a break… Pack up the wagon for a day or two and visit the Cumberland Fair just outside Portland, Maine.
    As the 1974 4-H Dairy Champion (cow’s name was Beth), I highly recommend it…

  8. JK on September 26, 2010 11:45 am

    Answer to “Kermit Johnson”

    If you`re refering to speculation etc(”this game we all play“), that game is rigged, we got fiat capital, lots of regulations etc.

    Nothing wrong with confiscating assets/income from people who derive it from fiat-capital income in todays society, i.e. it`s the more less centrally planned collectivist society that makes it possible/easy to attain shitloads of buying power, try doing the same in a truly free market. Ergo problem is redistribution/regulation etc in the first place, i.e. it`s the regulations etc that cause the large inequalities that justify the redistribution/regulations that are needed to fix the problems the oroginal regulation caused.

    Gotta remember that “free market” means the absence of coercion etc in the market place, i.e. it`s hard to get really rich/powerfull when the government doesn`t initiate force on your behalf, like today.

    Isn`t that something like what we have today(”Or maybe the ‘fair’ alternative at that time would be to hire enough from that bottom group to kill enough of the group to protect the property of the wealthy group“)?

  9. JK on September 26, 2010 12:03 pm

    Answer to “douglas roberts dimick”

    So if China/mankind ever gets the balance/number of regulations right, regulations are OK? What`s the purpose of the original regulations/regulations in general, are they even necessary?

    What were you trying to convey with the slaves/black president part?

  10. steve on September 26, 2010 1:58 pm

    I did not read Mr Dimick’s essay as it is too exhausting an exercise so I will shorten this commentary.

    Rich people giving their own money to the less fortunate is a noble thing to do. Nobody argues this. This is not a novel concept either.

    John Rockefeller would give away dimes to children and then set up one of the largest foundations ever after he had amassed his wealth.

    Bill Gates set up his foundation the largest in the world as many other hugely rich people have done before him and since.

    Ted Turner donated 1Billion dollars to the U.N. to sponsor many issues and causes.

    Politicians also utilize this strategy. Mayor Daley handed out Turkeys at Thanksgiving.

    John Gotti did this by having street parties in his neighborhood each year. He was highly regarded for this and revered in his community despite being a murderous thug, etc.

    I can not speak for this current administrations motivation for redistribution of wealth. They seem bent on utilizing their power in congress to further a socialistic agenda as evidenced by the many socialistic programs that they sponsor. However it does seem apparent that they want to make the decisions as to who they want to take the wealth from and to whom they want to distribute it to.

    Lawyers argue for their client. Using the tactic that Madoff did good things with money is an interesting strategy. What of course they failed to point out is that the money that way used to fund the philanthropy was stolen goods. The two are mutually exclusive.

    Let me use an illustration. Bernard Goetz committed felonies when he shot thugs on a subway train. A jury nullified the law and refused to convict Goetz of any crime. So it could be argued that Goetz did something for the public good by committing a felony and ridding the street of criminals who otherwise would terrorize a community.

    And as Don Henley said Lawyers argue small details. look me up on facebook to say hello.

  11. douglas roberts dimick on September 28, 2010 2:08 pm

    Hi JK,

    My citing slavery relative to the social and economic changes effected here in the US (since the civil war) is to connect yours and Nelson’s comments to the Chair’s original query.

    Whereby distinguishing public taking from criminal fraud. note that, while slavery was not regulated, there was also an uneven distribution among slave owners relative to measuring wealth. In that slavery was subsequently found to be unconstitutional and illegal, the history of this single market activity demonstrates the juxtaposition (that I reference in my comment) of the taking of wealth in both regulated and unregulated markets.

    As you asked Nelson about markets operating without regulation, note the correlation(s) of how such markets so operate with the absence of law (or albeit just laws). Here in China, for example, where product liability laws and consumer protection regulation is comparative to US conditions perhaps some 50-100 years ago, you can see the affect on price and quality as well as supply and choice in this comparatively unregulated market.

    If you do not mind being a consumer with little to no recourse for defective and dangerous products when suffering loss and injury, then come live here in a Communist state for a while. Point of fact, there is no “right” or any “balance” per se when understanding means testing of human rights relative to market valuation. Such comparative analytics result with different quantifications and correlations based on the actors and environment so unique to any given market and its correlating social order.

    Thus, in your example of rapists a la market regulation and redistribution, it appears to me that your are confusing (or comingling) concepts of political rights, due process, criminal procedure a la due process, and distributive justice – as I discussed relative to public taking. Rape is not a right; it is a crime, be it committed by an individual or a group and regardless of (social or market) psychology.

    Market regulation and income redistribution concern social policy relative to the state and its relationship with its citizenry. Here in China, some very wealthy, successful business individuals are “detained” by the state, denied access to their families and property, all without due process and under the authority of the state. In effect, regulation is achieved by public taking absent due process of law – which has a private sector correlation to Madoff’s criminal activities.

    I realize that you were responding to Nelson’s challenge as to “the ultimate fair” system, who was in turn addressing the Chair’s query. Nelson’s notion that elected government as opposed to violent transitions of state sovereignty presumes, of course, that social, legal, and market systematics of any given nation-state operate so as to provide and maintain justice among its citizenry.

    A recent phenomenon here in China is the online viewing of Professor Sandel’s Justice series based on his popular course offering at Harvard. Relative to your comments here, you might review the 12 episodes…

    Hope this information helps…


  12. douglas roberts dimick on September 28, 2010 2:45 pm

    Hi Steve,

    Sorry for the taxing read. I offer the TV dinner version a la the latest film version of a favorite tale of mine, Robin Hood, with its opening commentary…

    “In times of tyranny and injustice when law oppresses the people, the outlaw takes his place in history.”

    And at 4 minutes into the film…

    “… for defending the weak against the strong, he will be condemned to live outside the law.”

    These two excerpts allude to the issue at the heart of the Chair’s query. It is a matter of distributive justice as may be seen during both public and private applications of law in the markets.

    As I mentioned to JK, if you have not already done so, you might view the 12 episodes of Sandal’s Justice series… .

    Hope this information helps…


  13. JK on September 29, 2010 10:16 am

    Answer to “douglas roberts dimick on September 28, 2010 2:08 pm”

    When I refer to an unregulated market, it implies that there`s neither public/private initiation of regulation(force), i.e. I`m proposing a society where individual rights are uncompromisingly upheld.

    What I suspect is that there are the original regulations(force/coercion between people both public/private, i.e. someone has aquired an upper hand due to force/coercion, regardless if it`s regualated/unregulated market, public/private) that create the distortions/inequalities in the first place(is the root cause, i.e. the inequalities wouldn`t have been anywhere near as big if the market was left unregulated, literally of course). You could argue that people trying to control, and that they do control people through coercion is perfectly normal/natural and therefore acceptable, but even if social hierarchies are normal to humans/mammals, we as homo sapiens should have the intellectual capacity to rise above that(i.e. we should realize that the current/coming regulations will unavoidably lead to even more distortions/inequalities). So the only solution I see to the problems of the acceptance of both public/private initiation of force(public to a large extent in modern history, and private earlier, before societies), the resulting regulations that create the inequalties that justify more regulation/redistribution, is a free(unregulated) market.

    So what comes first, or what is required to improve products, consumer protection laws in the sense that they make choices on behalf of individuals, i.e. they make it impossible for the individual to make a mistake, because all the choices have been preapproved(these regulation will of course create distortions/problems/false sense of security etc); or individual rights in the sense that they have an actual choice in a truly free market, i.e. that there is no government interference(licenses/tariffs/bounties etc, i.e. regulations in general) that limit their choice between a bad product and alternatives incl. being self-sustained/live of the land, i.e. land not in actual use is often public/privately owned, and as a result of that people are forced to live within the limits of the regulations(implemented by special interest groups, for the common good, of course in a so called “unregulated” society).

    Social order is a result of earlier force, and people who are at the top as a result of that traditonal social order will of course go to great lengths to keep it that way through all sorts of regulations they can implement; I believe that that`s the only thing we achieve with todays system, and maybe som revenge(not just equaling the playing field, but oppressing the previous oppressers) if the oppressed/opposition gets the power instead, i.e. we`ll never move on, just oppressers/oppressed oppressing the other group of oppressers/oppressed and vice versa until the end of time.

    When it comes to rape one can argue that the affirmative action/income equality we have beetween sexes here in Norway(“The Female Factor Getting Women Into Boardrooms, by Law”/“NVP Presentation by Norway”) has made women financially independent of men and therefore they no longer have to exchange sex for the fruits of mens labor, now they just get it redistributed by the government without having to provide anything in exchange. Of course you could claim/argue that women would`ve been able(or not) to create what men has done(engineering etc) if it wasn`t for the fact that they`ve been oppressed/prevented in trying in earlier times. Point is that the balance of power(bargaining, not through physical force, but through innate capabilities, i.e. child bearing vs no child bearing etc, i.e. if a woman has a problem with being born as a potential mother, the problems she has with that should be between her and a potential mate, not society as a whole, i.e. the government/state should be left out of the equation) between the sexes has been distorted due to regulations, ergo the group of male rapists are just reacting to the regulation distorting the natural balance of power, i.e. they`re just trying to balance out the distortions created by the affirmative action/income equality between the sexes, but of course there`s no due process, but was it really any due process when the affirmative action/income redistribution was implememted(the whole system is based on threats/violence/coercion/punishment/extortion etc, i.e. if the violence is initiated by the government or not, doesn`t really make any difference, i.e. it`s initiation of force for gods sake!).

    I believe that the possibility of becoming extremely wealthy in a society is due to and can only be achieved with the aid of regulations(public/private), therefore I don`t have a problem with governments who crack down on people who get a little arrogant when they`re lucky enough to become very rich thanks to the society/it`s citizens/regulations etc. But that`s of course just one of the many distortions/problems that regulations produce, i.e. take away the root cause, i.e. a regulated society that increase income inequality, and not the other way around which is often said to be the reason, i.e. regulations aren`t meant to help the poor/weak etc, but give/sustain priviliges to the rich/resourceful. So when we have this system that enables a few to become extremely rich, how do you suggest we deal with the problem of inequality(leveling out income distribution), when the law makers aren`t able/willing to see the consequences that will occur(some become very rich at the expense of others) as a result of their laws/regulations? What about the rest of the citizens, have they accepted the system that make a few people very rich at the expense of the mojority, what about due process in their situation? Ergo what else are they supposed to do, implement reactive laws, or just deal with it, i.e. the very rich should have enough sense as to understand/accept that they`re not actually entitled to their vast riches, and give it back voluntary, in conclusion there is no way anyone can ever get the balance of regulations right, due process or not, the regulation of markets can never become a success, or not be followed by an abundance of distortions/problems/inequality.

    But nation states/governments etc aren`t run by unselfish/incorruptible/all-knowing/unbribable/super humans etc, i.e. give people power and they will be corrupted and give priviliges to some people(themselves/family/friends atc) at the expense of others. I believe it`s very naive to believe that it becomes any more fair if you create a system based on violence which legitimizes the initiation of violence because that are the rules that apply to everyone, i.e. everyone can take part(let themselves be corrupted), i.e. it`s an equal playing field, i.e. everyone has a shot at taking control of the government, and thereby the “right” to redistribute to special interest(oneself/familiy/friends etc) and make laws etc that benfit the same people, but of course it`s for the common good/the poor etc.

    So my question is when are we going to stop creating distortions/inequalities, i.e. trying to leviate previous regulations that has resulted in distortions/inequalities by implementing more regulations that create even more distortions/inequalities, i.e. is that the/a perpetual solution?

  14. nelson on September 29, 2010 10:49 am
  15. JK on September 29, 2010 3:14 pm

    Response to “nelson on September 29, 2010 10:49 am”

    So you think crowds should elect an “expert” to find solutions to problems? Or that crowds should vote on how the produce of society should be distributed?

  16. douglas roberts dimick on September 30, 2010 5:18 am

    Hi JK,

    Albeit your analysis of the rapists, to which I do not agree based on moral and legal codifications embodying human rights and personal safety, your general observations regarding taking a la redistribution – via government regulation contra that which would be characterized as criminal to include private and public takings that involve violence without due process – appear to rely on two assumptions: (1) the nature of social order and (2) the distinction between natural and legal rights.

    (1) Social Order. With Atlas Shrugged sitting beside me on the bedstand at present, I read your comment as “proposing a society where individual rights are uncompromisingly upheld.”

    Just how exactly do you establish and maintain a society that does so?

    The Untied States Bill of Right, as the first ten amendments to the US Constitution, is an example of such a declaration, is it not?

    See .

    If so, then we are left with a matter of enforcement. Again, as a real world example, consider the Civil Rights Act of 1964.


    Note that this law was passed by the elected representatives of the citizenry constituting the nation’s society. Henceforth, there is the establishment of due process in the absence of violence, intimidation, etc., contra to your claims.

    In my estimation, herein lies where Rand and her devotees fail in their argument for the type of society that you advocate. Perhaps the Chair can enlighten us here with regard to the ecclesiastics of their belief system as well as the pros and cons of the doctrine itself to which you espouse.

    Your use of the word “uncompromisingly” would indicate a notion that some form of body politic (yet to be realized by mankind) may achieve and state of unified consciousness regarding human behavior concerning money, sex, and violence. Although you articulate several rationales, what is your proposed model of governance in accordance with such an absolute standard of law and order?

    Rand herself appears to have failed to do so during her own, personal life concerning at least the two former of three categories. Again, I defer to Victor here as to the accuracy of this observation.

    Regardless, your choice of the word “uphold” corresponds to codification of a legally sanctioned, governing system of enforcement, adjudication, and (correct me here if I am wrong but) regulation. Such a governmental structure could not be fully automated; therefore, people would be involved in that process. Thus, we return to the issue of human frailties and their inclinations for derivation from social order and justice for purpose of personal benefit – look at any communist state for brightline examples.

    (2) Distinguishing natural and legal rights. Again, see how a communist state has all rights emanating from the state, which in turn is controlled by one political party. Here in China, that system translates into some 70 million members of the CPC dictating the lives of 1.4 billion citizens. I cite this example as I have not lived nor presume to comprehend the system there in Norway.

    Regardless, the point here is that such systems do not recognize what the US Declaration recognizes in the second sentence:

    “ that all men are created equal, that they are endowed by their Creator with certain unalienable Rights,…”


    Moreover, as may be inferred in my prior commentary here, such a state that your propose may be devised by social contract. Victor’s initial query here indicates that there are three citizens, whereby two vote to progressively tax (take more money from) the richest one of the three so franchised to govern their state de trios. His query implies a social contract from which one prospered more than the other two.

    The flaw in the Chair’s query is failing to delineate the time of the allegedly “bad” taking. Point of fact, to the extent that his example is referencing progressive taxation, the taking (or taxing) is occurring de facto of the law. The rich one of the three knew, so being one of the three franchised citizens, that majority rule could translate into his/her state of affairs (e.g., being wealthy) constituting minority status; ipso facto, the other two could get together and vote to indirectly benefit from the fortunate developments of the one.

    Do not like it?

    It would seem that the argument being applied by those who seek to eradicate illegal immigration in the US would so apply here… being to move to another country if you do like how the government treats you. Right, move to either Communist China or Socialist Norway. Now in my fourth year of my Communist China Tour of Duty, all I can say is… “have a nice life,” as I shall not be moving with you.

    Otherwise, so that argument goes, then exercise your constitutional rights to vote, petition your grievances, run for office, or take up arms against what the one would consider to be the unjust, oppressive government.

    Rand’s novel, the assumption underlying the Chair’s query, and your proposal… all share an elemental flaw contrary to human endeavors. It is reflected by the wisdom of the Framers, who so recognized the ere of tyranny that lies in darkness of men’s hearts whose minds and ambitions remained unrestrained with the accumulation of wealth and political power; accordingly, the 9th Amendment to the Constitution was penned and ratified…

    “The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.”


    It is the failure to recognize that rights may be of nature or law yet also not enumerated. In fact, it is the right of two, franchised citizens to vote to progressively tax a third, wealthy one.

    Would your state and Rand’s entrepreneurial utopia so “uncompromisingly” uphold such a right, particularly had such an excise of a majority not occurred to the founding members?

    When pondering these issues, if you are interested in pursuing formation of your rights-centric state (so enumerated or otherwise), I recommend that you read the 77 essays of the Federal Papers, published now more than 200 years ago.


    Hope this information helps…


  17. nelson on September 30, 2010 2:12 pm

    response to JK on September 29, 2010 3:14 pm

    I’m saying there is evidence that a crowd frequently has more information than a single individual…In that my original post I was saying it is more likely that two people can arrive at truth about what is to be done than one. I don’t hold it up as a trump card. In a random selection of people it may be that more think the sun goes around the earth than not.


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