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In a functioning society, most people earn their livelihood by putting their skills, time, and labor to productive use. You may be a factory worker assembling cars, a software engineer creating digital solutions, a farmer growing food, or a cashier at a grocery store distributing that food to the community. In each case, money is earned as compensation for value delivered through effort, innovation, or risk-taking. This is the basis of wealth creation in a market economy: individuals producing goods or services and receiving payment in return.

But when we shift our focus from individuals and businesses to governments, the dynamic changes drastically. Unlike you or your employer, the government doesn’t produce goods or services for profit. Instead, it funds its activities by taking a portion of what others have created. This article explores the core differences between how wealth is created by individuals versus how it is acquired and spent by governments, particularly the U.S. federal government.

The Myth of Government Productivity

Many people assume the government plays an active role in producing wealth or contributing to economic output. However, federal departments such as the Department of Commerce, the Department of Transportation, and the Food and Drug Administration are not manufacturers or commercial enterprises. They don’t sell electronics, design cars, or cultivate crops. And truthfully, we wouldn’t want them to. Imagine if the U.S. government were responsible for building your smartphone or growing your groceries—clunky, inefficient, and probably unreliable.

These departments serve regulatory or administrative functions, not economic ones. This distinction is important because it underlines the fact that the government does not generate wealth—it manages, regulates, and redistributes it.

Government Revenue: It Doesn’t Make, It Takes

Where, then, does the government get its money? The answer is simple: it takes it from the people. Unlike private businesses, which compete in the market and earn revenue by offering value, the government imposes taxes. Nearly 95% of all federal revenue comes from taxes, including income taxes, corporate taxes, Social Security taxes, Medicare taxes, and more.

The government collects this money not through voluntary exchange but through mandatory compliance. It does not ask you whether you want to pay taxes—it demands payment and penalizes those who do not comply. This fundamentally separates government finance from personal or business finance.

Types of Taxes That Fund the Government

The U.S. tax system is complex and multilayered. At the federal level, the bulk of revenues come from individual income taxes and payroll taxes. Social Security and Medicare taxes are deducted directly from wages. Businesses are subject to corporate income taxes, and capital gains taxes apply to investments. On top of that, states and municipalities impose their own taxes, including sales taxes, property taxes, and local income taxes.

Every time money changes hands—when you get paid, make a purchase, or invest—there’s a tax applied. It’s like a toll booth at every economic intersection, and the government is always collecting.

Redistribution Without Growth

Some people argue that redistributing wealth helps balance inequality and support the disadvantaged. However, redistribution alone does not create new wealth. Let’s say Lisa pays $10,000 in taxes, and the government gives that money to John. Lisa now has $10,000 less to spend or invest. John has more money to spend, but nothing new was created in the process. Economic growth occurs when more goods or services are produced—not when money is simply moved around.

This is a key issue with wealth redistribution: while it may be politically appealing, it does not expand the economic pie. It merely slices the existing pie differently.

Taxation at Every Turn

When productive individuals and businesses are heavily taxed, it discourages economic activity. High tax rates can reduce the incentive to work, invest, or innovate. A dollar paid in tax is a dollar not spent on new equipment, employee wages, or entrepreneurial ventures.

Moreover, the layers of taxation compound. You pay income tax on your salary, sales tax when you spend it, property tax on your home, and capital gains tax on your investments. State and local taxes add further burden. With so many hands in your pockets, it’s no surprise that many hardworking citizens feel squeezed.

A Government That Always Wants More

Despite collecting an estimated $5 trillion annually, the U.S. federal government consistently spends more than it earns. Like a friend who asks for money every month yet still can’t balance a budget, the government seems perpetually in debt. But unlike a friend, you can’t simply cut them off. You’re required by law to fund their spending habits—under threat of legal penalty.

This insatiable appetite for revenue doesn’t stop with taxes. When taxes aren’t enough, the government borrows money, adding to the national debt. And when borrowing becomes politically inconvenient, it turns to the printing press.

Inflation: The Hidden Tax

Printing money may seem like an easy fix, but it carries a heavy cost: inflation. As the money supply increases, the value of each dollar decreases. Your paycheck doesn’t stretch as far. Groceries become more expensive. Rent and healthcare costs climb. In effect, inflation is a hidden tax that erodes your purchasing power.

So even if the government isn’t raising your taxes directly, it’s still taking from you indirectly. You work the same job, but your money buys less. The result is the same: you are poorer, and the government has more control over resources.

The Path to Prosperity

A truly prosperous society is one in which individuals are free to keep more of what they earn. This incentivizes productivity, savings, and investment—all of which contribute to economic growth. When the government demands less, citizens can do more. They can start businesses, hire workers, and support their families without being weighed down by excessive taxation or inflation.

Of course, some level of government is necessary. We need national defense, a legal system, and basic infrastructure. But there must be a limit. If $2 or $3 trillion isn’t enough to run the country, then perhaps we need leaders who can do more with less.

A Turning Tide? EBLM’s Stance on Economic Empowerment

We, as Every Black Life Matters and similar organizations, have strongly criticized governmental overreach, asserting that systemic wealth redistribution, high taxation, and central planning disproportionately disadvantage Black families by stifling entrepreneurship and fostering reliance. Instead, they champion policies fostering family empowerment, parental rights protection, and economic freedom as the true path to self-sufficiency and dignity. The shift from President Biden to President Trump offers fiscal conservatives renewed optimism for altered federal taxation and spending approaches. Historically, Trump has advocated for lower taxes, deregulation, and a leaner government—policies seen as fostering individual liberty, economic growth, and curbing governmental overreach, presenting an opportunity to reassess national priorities and potentially reverse recent trends of unchecked spending and wealth redistribution.

Conclusion

The government does not—and cannot—create wealth in the same way individuals and businesses do. It operates by taking a share of the value that others have created and reallocating it based on political priorities. While taxes are necessary to fund essential services, unchecked government expansion ultimately stifles the very engine of economic growth: the productive individual.

If we want a stronger economy and a freer society, we must insist on accountability, efficiency, and restraint from those in power. Because every dollar the government spends is a dollar taken from someone who earned it—and they deserve a say in how it’s used.