Ben Stein's Diary

The Real Economic Problem

It goes far beyond the Federal Reserve’s purview.

By 6.10.14

I see that the high muckety-mucks of monetary and fiscal policy are in an uproar about Federal Reserve policy. Is there too much money being shoveled into the economy? Is there too little? If the Fed decides to reverse course and tighten money, what is the best means to do it? Interest rate rises? Reverse repurchase agreements with banks? (I won’t bore you with what those are. I’m not sure myself anyway.)

But as to me, I don’t see a lot of inflation except in luxury goods and groceries, and who needs groceries, so let’s not worry about that.

And I am not wildly concerned about unemployment. As far as I can tell, almost anyone with minimal skills and a willingness to pick up and move to North Dakota or Midland, Texas, can get a job. The real problem is an acute shortage of skilled, energetic workers except in very rare cases.

I am really not concerned with income inequality. I wish I could invent a web app and become a billionaire overnight and I am envious of those who can. But the truth that this economy is producing an abundance of billionaires does not worry me at all. The fact that there are a lot of rich people does not in any sense compel that there be a lot of poor people. One man starting a business, one woman inheriting a business, does not make anyone poor.

I am extremely concerned about the wicked envy that endless talk about income inequality creates. People are not created equal in ability and willpower. Some will be rich and some will be poor. Far worse results come from the state trying to enforce equality than from naturally occurring inequality. The phrase “equality” sounds great, but it leads to the guillotine. 

What worries me even more, and what I do not know what to do about, is the poor child living in a miserable dwelling with a single mother who is high all of the time, a father he has never known, grandparents who work two shifts. These kids do not go hungry because of food stamps. They are not homeless because of other assistance. But they are living in endless fear of gang bullets. They live in an atmosphere where they do not learn and are bullied and teased if they do try to learn. They grow up with horribly warped ideas about violence and about how to treat women. And, of course, when they leave school, they do not work. Then they create more like them.

What can the Federal Reserve do about them? What can tax policy do about them? What can anything do about them? I frankly don’t know, but they truly are equal in the eyes of God to me or to Warren Buffett and their miserable lives shame them and shame us. These people and their terrifying lives are the real economic problem.

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About the Author

Ben Stein is a writer, actor, economist, and lawyer living in Beverly Hills and Malibu. He writes "Ben Stein's Diary" for every issue of The American Spectator.