Sowell points out that there is often confusion between wealth and income. He claims that rich people may have insignificant income as its their wealth that makes them rich. He would have you conclude that discussions about taxing the rich are misplaced because rich people are wealthy and don’t necessarily have high incomes. Futhermore, when you ‘unfairly’ tax high income earners, you’re punishing folks that are making high contributions to the economy. You punish those folks, you punish the economy. Which means you punish us all.
I suppose this is correct in terms of income derived from labor, but what about investment income… I agree that there should be low(ish) taxes on income derived from labor, but this is not an argument for low taxes on investment income or on wealth in general.
It doesn’t seem fair to tax income based on work performed. A virtuous tax policy would have low tax on income from salary. It does seem just to tax wealth and income derived from wealth.
On a completely different note: why are there no aggregate wealth statistics that are widely reported? I mean you hear about GDP everyday it seems in one article or another. It seems that the health of the economy, as businesses, can be judged by looking at income AND the balance sheet (which I take to mean wealth).