Although it doesn’t show up on balance sheets I’m sure there is intellectual capital that is headed for Gault’s Gulch as well as the financial capital:
Spain saw close to a 40 percent rise in capital outflow in June, Bank of Spain data showed on Friday, as investor confidence in a country struggling to balance its public accounts eroded further.
The central bank reported that net capital outflow, not including central bank operations, was 56.6 billion euros ($71 billion) in June, after an outflow of 41.3 billion euros in May.
A total of 315.6 billion euros of capital has left the country in the year to end-June, equivalent to nearly one-third of the country’s economic output. In the first half of 2012 capital outflow was 220 billion euros.
This is one of the Achilles Heels of the “tax the rich” schemes. Those that demand “tax the rich, feed the poor, until there are rich no more” can succeed, but the success is achieved in an unintended manner. The rich, in essence, evaporate. They either leave the country and take both their intellectual and financial wealth with them or they say, “It’s not worth it” and just stop producing wealth. In either case the looters run out of places to loot. The end result is that everyone is worse off than if the looters had produced wealth on their own rather than demanded they be given the wealth of others.
Socialism is like a herd of hogs turned loose in a corn field. They feed extraordinarily well for a few days but destroy the crop that should have lasted through the winter and provided seed for the following year.