How Government Policy Turns Generations and Classes Against Each Other

In a limping and heavily distorted economy, it’s easy to blame one group or demographic for “ruining the economy.” Caste analysis, in the tradition of the Austrian school, shows us that it’s not one specific demographic or class that’s to blame. Rather, the economy’s woes result from those who seize political power for selfish gain.

The following article was originally published by the Mises Institute. The opinions expressed do not necessarily reflect those of Peter Schiff or SchiffGold.

While there exists the beautiful and productive possibility of cooperation between individuals and groups, there is also the opportunity for and reality of conflict. Interpersonal conflict is intensified when hegemony and intervention, especially via the political state, disrupt peaceful cooperation and instead create a caste system—stratifying those “privileged or burdened by the state.”

Distinguished from dishonest Marxian “class” analysis, which suffers from the ideological fallacy, caste analysis—which has a rich tradition in libertarianism—coherently examines how certain castes are privileged or burdened by the state, namely, by dividing them into the net tax-paying caste and the net tax-consuming caste. One of the most evident—though not only—ways to determine the societal castes is the net transfer of revenue or production between groups achieved via the state. In other words, on net, who pays the taxes and who consumes the taxes?