Enrich the Poor by Impoverishing the Rich?

“The poor will always be with you”, a friend of mine quoted Jesus in my face when I told him I was turning down a lucrative job offer to work with the poor. His understanding is that the poor are necessary for the economies of the world to make sense. My friend is not alone. His opinion is shared by economist Thomas A. Garrett (see publication at http://www.stlouisfed.org/publications/re/default.html). Garrett believes that an individual’s ability to largely determine his level of economic well-being encourages innovation and entrepreneurship. He ads that economic studies have documented a positive correlation between entrepreneurship/innovation and overall economic growth. Garrett’s analysis suggests that a redistribution of wealth would increase the cost of entrepreneurship and innovation -- the result being lower overall economic growth for everyone, regardless of income.

The truth is that the rich are getting richer and the poor are getting poorer. Income statistics show that the real income of the wealthiest five percent of households in America rose by 14 percent between 1996 and 2006, and the poorest 20 percent rose by 6 percent. This curve is bound to continue for a long time. And the big question is: should
Governments put in place political policies to even out the amount of income individuals are permitted to earn? In other words, should money be redistributed to benefit the poorer members of society, and should the rich be obliged to assist the poor? Is financial egalitarianism the ideal for human existence, or is income inequality a necessary evil? Did the rich become rich by exploiting the poor or gaining unfair benefits? Are redistributive practices justified?

What do you think?