“Income redistribution through noncash payments to lower-income households are funded with taxpayer dollars- mostly from wealthier households, since they pay a majority of overall taxes. One research report estimates that the share of total income earned by the lowest income quintile increases roughly 50 percent- whereas the share of total income earned by the highest income quintile drops roughly 7 percent- when transfer payments and taxes are considered. The census statistics also do not account for the fact that the households in each quintile contain different numbers of people; it is differences in income across people, rather than differences in income by household, that provide a clearer measure of inequality. Lower-income households tend to consist of single people with low earnings, whereas higher-income households tend to include married couples with multiple earners. The fact that lower-income households have fewer people than higher-income households skews the income distribution by person. When considering household size along with transfers received and taxes paid, the income share of the lowest quintile nearly triples and the income share of the highest quintile falls by 25 percent. Redistribution of wealth increases the costs of entrepreneurship and innovation, with the result being lower overall economic growth for everyone. Sound economic policy to reduce poverty would lift people out of poverty (increase their productivity) while not reducing the well-being of wealthier individuals.”
What ever happened to pulling yourself up on your own?
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