The Destruction of Wealth 

The destruction of wealth is due to bad government policies interfering with the free market and destroying the creation of wealth.

When government (that had nothing to do with creating the wealth), takes wealth (resources) away from the wealth creators in the name of "fairness", in the form of government business assessments, fees, compliance costs and taxes; the wealth creators (businesses) have fewer resources left for creating jobs, giving pay increases, making needed repairs, upgrading equipment, doing product research, lowering prices or creating new wealth.

Business (wealth creators), have had their costs of creating wealth artificially pushed up by government costs. The higher costs for doing business means higher costs of goods and services for the consumer. When the retail costs are above the means of the consumer base, "what the market will bear" there are fewer goods or services purchased.

A business's viability is its profit margin. Profit is not made until the consumer buys. When there are fewer goods and services being purchased, the creators of wealth (businesses, entrepreneurs) cut back on the production of wealth. When the creators of wealth cut back on creating wealth, they have less need for labor. Less need for labor translates to a loss of jobs, which translates to less goods and services being purchased. The downward spiral of the destruction of wealth is engaged.


Wealth is created by producing goods or services that are needed or wanted by the consumer.

The value of a material is a measure of its worth. When someone takes material of one value and creates a product worth a much higher value to someone else, it is a creation of wealth.

The production of goods or services from raw goods to a valuable commodity to the consumer is a creation of wealth. The added value IS the creation of wealth.

Money is the convenient tool used as payment for the wealth created. Getting paid for the added value is money earned, (wealth created); for the service of producing the goods or services.

It is the money earned from the creation of wealth that pays the people responsible for creating the wealth. That is where the wealth comes from to pay the workers, management, investors and all those responsible for the creation of those goods or services.


The massive trade inequality of imports to exports are unreasonable competition to US businesses. It drives more businesses out of business or out of the country. That reduces supplies and drives up the prices also. That reduces jobs which drive down the purchase of goods and services.

The high cost of production of goods and services prices most US businesses out of the worldwide market. That is a loss of potential jobs that would have fueled the purchase of goods and services and created jobs.


More and more borrowed money means there is less value on the dollar. If the value of the dollar is worth less, it takes more money to buy the same goods or services (inflation). If you are not getting a pay raise, there will be less goods and services that you are able to buy with the same income. This translates to less demand for goods or services and fewer job opportunities.

(Remember the housing bubble crash... Another massive destruction of wealth is yet to come due to the reckless, out-of-control massive deficit spending and impending U.S. debt crises.)

With the fiscal burden of the US debt; a more massive destruction of wealth is inevitable.


Raising taxes; taking production resources away from the wealth creators; is not a recovery plan to create wealth. Doubling or tripling tax rates does nothing to help create wealth. It only expands the very government that is stifling the creation of wealth in the first place.

Government's source of revenue is taxes. Taxes are collected when goods or services are traded for money. When the trade of goods or services is reduced, government revenue is reduced. When the government revenue is reduced, do they cut back on expenditures? When the government revenue is reduced, do they reduce the size of government to cut back on expenses? No, they raise the debt ceiling. Is this a plan for recovery? Is a colossal influx of barrowed money, an economy in recovery? Could a colossal influx of barrowed money create some false statistics of a recovery?

Who is responsible for paying for the out of control government spending? It is the tax payers. Did the tax payers that have to pay for this out of control spending, authorize this expenditure? Is this an unauthorized expenditure?

With the destruction of wealth there are fewer and fewer tax payers, so the tax burden falls on the backs of the dwindling base of tax payers.

(It is the wealth creators that are targeted by unscrupulous politicians as the "greedy" ones when government needs MORE money; to turn the majority voting bloc against the minority wealth creators to get a majority vote to raise higher taxes on the minority).


"Wealth is the economic value of a person, household, community, region or country minus debt liabilities." (What is Wealth) Government borrowing money does not create economic value. Borrowed money is not wealth. Government borrowing money can prop up key statistics, but it does nothing for the creation of wealth.

The out of control expansion of government and its cost is the source of the destruction of wealth.

The solution is to get government off the backs and out of the way of businesses, and let the free market function. A rational government policy would be to immediately slash the cost of government on the production of goods and services so the wealth creators can get on with the business of creating wealth at market value prices.

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The Coming American debt crisis; the most predictable crisis in American history.
Posted By: Roger Dufur

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