Making a product, or providing a service that adds value, are the only capital generators in the world. All other transactions are just trading on the wealth that was created in these first capital-generating transactions. If you destroy the incentive of those who would be producers, you destroy the capacity to create wealth.
There are a million ways to destroy that incentive, but only one to build it and that is, to allow producers the opportunity to enjoy the fruits of their labor.
America became the leader of the world by being the best at not destroying the incentive to generate wealth. Is that record spotless? Heck no. In many cases monopolistic control of markets led to horrific excesses, but we put checks in place to change that. America became an icon around the world of a standard of living and of workplace conditions that were second to none.
We were the preeminent leaders in manufacturing, innovation, and science. We had the best standard of living and the lowest poverty levels in the world. Not surprisingly, other nations took notice and tried to emulate our successes. Money flocks to where there is opportunity to generate wealth.
Government services, other than the building of infrastructure, do not generate wealth, they simply redistribute it. Not that there isn't a place for police, fire fighters, the military, teachers regulators, tax collectors, politicians, and social benefit administrators, and the tax money they redistribute, but one must ask: How much can we afford?
Simple truth: We can afford whatever we can collect in taxes without jeopardizing the incentive of those who are pulling the train, (the producers). The simple truth is there are too many disincentives right now, in the way of taxes, and regulation of US producers, to allow them to want to risk where they are, to produce more. You can't dictate or guilt people or businesses into working efficiently without a share of a profit. The fall of the Soviet Communist empire illiterates that. You can't make folks put capital at risk to expand or launch new ventures. There has to be a chance for a payback.
All you can do is get out of the way and allow producers to enjoy the fruits of their labor. The corollary is also true: If you want to encourage folks to become better producers it would be best not to reward them so much for being non-producers. How this is fleshed out in policy is up for debate, but this simple truth is not.
Geoff Turner is a fifth-generation industrial entrepreneur with deep roots in Chautauqua County. He owns Crown Hill Stone Inc., a decorative cast stone manufacturer of Westfield, and Sky Sail Balloon Inc., a hot air balloon ride company in Ashville.