If Unchecked The Feedback Effect Always Turns An Economic Anarchist Society Into A Plutocracy

The feedback effect always drives unbalanced systems to the extremes, never to the middle. Unless checked, the rich will always get richer.

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David Grace (Amazon PageDavid Grace Website)

Power always appears to fill a vacuum. Power always strives to acquire more money.

In every group of humans, a strong individual or group will always appear and take power. One way or another, every tribe ends up under the control of a chief.

Those with money and power will always strive to amass even more money and even more power.

Ignoring this truism, the proponents of economic anarchism claim that an economic anarchist society, a libertarian society, will automatically come into balance in a state of equilibrium in the middle of the economic extremes.

This is fundamentally false.

Put a microphone next to a speaker and the feedback effect will amplify the sound until you reach an equilibrium at the end of spectrum between loud and quiet — a horrible, ear-shattering, blasting squeal.

The feedback effect always drives every unbalanced system to the extremes, never to the middle.

The equilibrium state of an economic anarchist society is at the edges of the spectrum of money and power, a plutocracy, not in the middle.

If a society whose core principle is economic anarchism actually had an equilibrium point in the middle of the extremes between wealth and poverty a chart of the citizens’ income would resemble a normal curve, high in the middle and low at each end, something like this:

But that’s exactly the OPPOSITE of the graph of income in the United States which is increasingly pursuing tax policies of economic anarchism.

Our income curve shows the feedback effect of economic anarchism with incomes pushed toward the extremes.

2016 Chart Of Households V. Annual Income

Advantages and disadvantages always concatenate. Without a system to counter the feedback effect, the rich will always get richer, and the poor will always get poorer.

Countering the Feedback Effect

The NFL wants competitive teams. It doesn’t want the successful teams to be perpetually more successful and least successful teams to be perpetually less successful.

The NFL wants an equilibrium point in the middle of the spectrum of teams between the most and least successful teams, not at the edges.

To accomplish that, the NFL draft was specifically designed to disrupt the rich-get-richer-and-the-poor-get-poorer feedback effect by giving best draft choices to the worst teams and worst draft choices to the best teams.

The Feedback Effect Is A Rule Of Nature

A universal fact of nature is that if unchecked, the feedback effect will always move a society practicing economic anarchism to an equilibrium state at the edges of the continuum between great wealth and power on one end and massive weakness and poverty on the other — a plutocracy.

Economic Anarchy And A Meritocracy Are Mutually Exclusive Societies

Economic anarchists claim they want a society that rewards talent and hard work. But that’s not the result of economic anarchism.

The end state of economic anarchism is a plutocracy. A meritocracy and a plutocracy are mutually exclusive.

If you really want a meritocracy, then counter the feedback effect.

  • Have the government pay 90% of the cost of tuition, books, housing, and food for everyone over eighteen with the talent and desire for advanced education or training and loan them the remaining 10% of their costs of living while in school at zero interest.
  • Fund this program with at least a 50% inheritance tax on all net estates over 100 times the median household income.
  • Massively reduce the cost of housing for everyone. More on how to do that in another column.

— David Grace (Amazon PageDavid Grace Website)

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David Grace

David Grace


Graduate of Stanford University & U.C. Berkeley Law School. Author of 16 novels and over 400 Medium columns on Economics, Politics, Law, Humor & Satire.