Submitted by CARPE DIEM
This CD post (about T. Boone Pickens’ rantings about oil and the “biggest transfer of wealth in history”) was read today in its entirety on the Rush Limbaugh radio show (transcript here).
Limbaugh comments: T. Boone, he knows better than this. He knows this is not a transfer of wealth. A transfer of wealth is taxing producers, taking it away from them and giving it to non-producers. Transfers of wealth are things like the estate tax when the money you take from somebody doesn’t redound to them in any way, shape, manner, or form. But this purchase of oil every year from foreign sources is not a transfer of wealth. It is an exchange of wealth.
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1 user commented in " Rush Limbaugh Quotes Carpe Diem: “Buying Foreign Oil is An Exchange of Wealth, NOT A Transfer” "
Follow-up comment rss or Leave a TrackbackI happened to be listening yesterday and hear that too. I do have one critique/comment on it though.
I think Limbaugh (iirc) said that it was an exchange of items of equal value. This misses the concept of subjective values. The two parties must have valued the items to be traded differently or the trade wouldn’t have taken place, the transaction costs would have made the transaction a net loss for both parties.
In reality I believe that auto drivers valued the oil/gas more than the dollars sent abroad, and the opposite would be true for the oil producers.
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