There are several economic concepts of relatively recent origin that I find fascinating. Regulatory capture is the ability of industries being regulated by the central government to influence those regulations for their own benefit. Similarly, rent seeking is the ability to increase your profit margin without providing any additional value, usually through government favoritism.

I find the ‘resource curse’ particularly intriguing. A valuable natural resource like oil enables a country to avoid developing institutions and habits that insure a more durable economy. The most valuable resource is an educated and adaptable populace with the government and institutions vigorously supporting the conditions of human flourishing.

The Middle East with all of its oil has done very little to advance industry, science, higher education, and other modern institutions compared to other countries with far less natural resources. The most glaring example is Venezuela which quickly went from one of the wealthiest countries in South America to the poorest. For a while the natural wealth from these resources can hide the failures in national policies until it’s too late.

The super wealthy in the United States may cause the same effect as the resource curse  in poorer countries. The more we depend on the wealthy to pay the majority of our taxes the less we are likely to be aware of the true costs of the benefits our government provides. The wealthy have become a scapegoat for all that is wrong in America. There is no benefit that cannot be provided if we were just tax the wealthy enough. The rhetoric applied to the wealthy from the left is no different than the rhetoric of ethnic or racial bigotry.

Scapegoaters become dependent on their scapegoat. If they kill the golden goose as they did in Venezuela, they have no one left to blame for their failures. Those who consider class warfare a legitimate political policy are usually mute when asked to define their limits. The hard fact is that there are not enough super wealthy and their money to pay for the programs they propose. The tax burden inevitably falls on the middle-class.

The myth that the super wealthy are an inexhaustible resource supports a victim mentality that refuses to acknowledge their own agency. They are dependent on the wealthy to support the government to protect them while at the same time they blame the super wealthy for requiring this protection. Paradoxically they are dependent on the super wealthy to maintain their victim status, a valued source of their political power.

Class warfare as political policy negates the need to articulate limits, acknowledge tradeoffs, understand the process of wealth creation, or do real math that measures and acknowledges real costs and revenues.