Tax The Rich!
The call to tax the rich has never been louder, and according to all indicators, the rich in America are doing quite well while the average person is not. I don’t know enough about economics to know exactly how that’s possible but I can wager a guess:
Rich people with capital (Capitalists) are good at investing their money, which makes them more money. Even in poor economies there are great opportunities, often based on the poor economy itself. A few simple examples might be investing in Top Ramen’s parent company. Oil to power the poor’s inefficient cars and to build their worthless trinkets. Short term lending (Payday advance companies,etc). Beer and Liquor. Tobacco. Poor people stuff.
Again, these are probably simplistic examples but you get the idea.
The above is, to my thinking, as it should be. If our rich also became poor we’d all be in the same boat, but it’d be a pretty shitty boat that would grow increasingly shitty and desperate. I have to imagine that these rich will build upon these opportunities and continue building until there are no more opportunities like it. Diminishing returns. Then they can go back investing in things that average poor people don’t understand like stocks, bonds, futures and commodities.
I think that the rich should be taxed more or less at the same rate I am (all said, I make very low six figures this year), but not more, and even if they are taxed a little less i’m ok with that. The reason I err on the side of not dragging the rich down with the commonest of us is threefold:
- Despite what you hear, the rich do invest in new industries and companies. There is no denying this. If they take big risks on the performance of the nation’s economy and people, then you should be afforded some benefits for doing so.
- Taxing the rich seems like a primer to raising taxes for everyone, it is just the first path of least resistance. I can imagine after taxing the rich all of the politicians in Washington coming on TV acting like they didn’t want it to happen, but now everyone must pay their part. We’ve already stuck it to the rich, let us stick it to you just a little bit.
- It’d be very easy for them to pack up and leave, if it came to that. Seems like nonsense but any legislation that made corporations and the rich uncomfortable would sprout cottage industries abroad. Take a look at some bonus and trading rules in England a decade ago to learn more about this: anyone with any capital or talent went to New York City or Hong Kong.
Nobody should be shouting for higher taxes for anyone, unless you truly believe that the government will or can help you somehow. Has the government ever helped me? Not for free, that’s for sure. But let’s assume that the government can help me, someone who perennially wants and needs help, let’s say. When does it end? At what point will the help i’m receiving be enough help to lift me off, and where is the floor and where is the ceiling?
What if the help i’m receiving (the floor) is only a few hundred dollars per month apart from what I can earn (ceiling)? What if this money is to pay for education and training for the people, who is to say this artificial influx of cheap funding won’t create yet another bubble, an education bubble? Maybe a renters bubble?
The government does not produce wealth, it only spends it, and does so inefficiently and with political bias (read: rich people).
Example:
The Automobile club charges me $2o per year for access to all of their services. They have too many to list but I will only compare the ones that overlap with those of the Department Of Motor Vehicles: vehicle registration, and title transfer. These are two core services of the DMV, and it costs the state far more than $20 per driving citizen, yet AAA throws in free towing and roadside assistance. And free maps. And free travel planning. And you never wait longer than 15 minutes, in a nice environment, with free water and coffee.
Who is to say that all of this government monies wont be redistributed back up to the same rich people that it sought to weaken, and instead made them stronger while making the poor even more reliant upon the rich? In my example above, I feel far more empowered by AAA than I do by the DMV. At the DMV I feel helpless and without options. At AAA i’m treated like a paying customer.
If you believe that the rich control the media, which they probably do, do you suppose you’d hear a peep from them if they were able to funnel all of this redistribution money back into their own pockets, thus actually making money on a steep tax increase? You’d probably see a lot more Warren Buffetts arguing for higher taxes on the rich in order to increase the redistribution and subsequent fleecing of the poor.
Remember folks, these rich are capitalists. If the government starts handing out cheese again capitalists will get into the processed cheese business. They know where the money is, and how it flows.
You might say, well we need big changes in this country. Our country is falling apart. 15% of Americans are on food stamps!
I’d respond, take a look at these supermarket stocks since the report that 15% of Americans are on food stamps:
Or..
It would seem that the capitalists know about this.
What would the government do with more tax money? Take money from AAA’s to build more DMV’s? Sorry, I don’t support it.
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You stupid asshole– construction for the interstate highway system began in 1956 and concluded in 1991— twenty years ago. So let’s see if I got your argument right:
1. Government regulations.. no thanks
2. Police… No thanks
3. Roads… Already built a long time ago.
Can’t really say much about this except that it was educational. I’m only lightly versed in economics which is something I plan to change in the next year. That and my guitar playing.
Chris,
IF you’re from the USA you’re a fucking moron. American idiot comes to mind. I’m in no way anti-american, there’s problems in america but you guys do a lot right. For that I cannot fault the USA.
If however you’re not an american, check your facts.
A,
It’s nice to read something of yours, it’s been a while. Educational to say the least. As you know I’m planning my trip bought my ticket. If I get enough we’ll have ourselves a desert session and maybe that match we talked about. Anyway A best of luck with everything and I’ll catch you soon. Keep up the good work.
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I’m an American who lives in Los Angeles.
My big gripe with the “Tax the rich” battle cry is that it is just a proxy for “Make someone else pay for it.”
You can argue all day that the rich have more means and that they ought to pay more. Well, the do pay more and even pay more in proportion to their income than the rest of us.
I’m sure you will see people dragging out that Warren Buffet article in no time, but if you look at the IRS publications there is no doubt the high-income earners are paying more than their fair share(note: Not saying the rich here because we have an INCOME tax system, not a WEALTH tax system).
This whole things smacks of a teenager whining about their parents not giving them more money after they blew their whole allowance. Clearly they should because they could AFFORD to. As if somehow having something implies that you automatically owe it to someone else by the sheer virtue that they do not.
I got a good chuckle from the commenters that drag out the old highway/police straw-man argument. On the whole the poor receive FAR more ROI on their tax dollars than rich people. Sure we all benefit from police and roads, but the poor people have equal access to those things and pay a LOT less for the privilege.
Also, you aren’t going to see rich people collecting unemployment/WIC, enrolling their kids in public school, etc. And of course, the lower income workers pay a smaller PERCENTAGE of their income in taxes giving them a leg up even. Both sides of the ROI equation (in terms of Government influence) favor the non-rich.
Okay, here it comes. “But the Government obviously set up an environment where the rich were able to build their fortunes so they benefit way more!”
Not exactly. The rich just took greater advantage of that environment. They don’t have a secret club card that gives them access to our capitalist system that helps business. You don’t have to be rich to get a SBA loan. You have to have a good pitch and turn that loan into a successful business, but anyone can get in the gate. Sure, people that start out with more money (or smarts, or enthusiasm, or connections) have a leg up on making it big, but none of those things are provided by the Govt in exchange for tax money. Well, maybe smarts, but then again is it the rich or poor that are more likely to get student loans from the Government?
In the end, you and I all had the chance to be Bill Gates or Warren Buffet. Those guys just worked harder, were smarter, or brought something else to the table that you and I didn’t. Or maybe we did but just didn’t live up to our potential. Either way, those things weren’t advantages provided by the Government in exchange for tax dollars.
I think a lot of this is about cognitive dissonance. We just don’t want to admit that we aren’t among the rich because we are either not smart enough, didn’t work hard enough, or simply didn’t live up to our potential. It is much more comfortable to assume we aren’t rich because we have some virtue that prevented it that the rich obviously did not (e.g. ethics).
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THIS.
And it’s hard to make it clear that we aren’t arguing for rich domination or even on behalf of the rich– just on fairness and against simpleminded envy.
You’re right, there does seem to be an idea that the rich are rich at the expense of the poor, which is not the case.
Further, look where the “Tax the rich” line of thinking goes.. it’s many steps away from China and Russia’s Cultural Revolution and Great Leap Forward but it’s certainly a beginning step. Then what happens after that? All of the “Tax the rich” envious people become rich and decide they were wrong about the rich, once they’re also rich.
Alot of what you say has truth in it.Tell me how a corporation that is publicly tied to the president and known publicly to have paid no income taxes last year is equal to me who paid about 33% of my gross income?I know I’m just poor and stupid because I couldn’t hire myself a good tax attorney and beat the gov’t of of their well earned dollars…but….even a communist government raises more money per capita than (U.S.)with a flat tax.Imagine how many POOR tax lawyer’s incomes that would affect.Goes right back to being poor and stupid doesn’t it.Shoulda been a tax lawyer…LMAO
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I have neither the time not the will to argue comprehensively against this fawning over the rich and mindless government-bashing, but will say a couple of things.
John Fuex on the rich: ‘Those guys just worked harder, were smarter, or brought something else to the table that you and I didn’t.’
- this is an extraordinarily stupid and servile view: that all the super-rich deserve to be so. Let’s be clear: in general, there likely is a loose correlation between talent and becoming relatively rich. As always, chance, vindictiveness and past fortunes will have at least equal weight in the equation, however. I sincerely doubt, further, that those that go a step further to become the richest 1% tend to have any laudable advantage over the rest of the rich.
One simple example is enough to dismiss this moronic worship of the rich. Do you seriously believe that every member of the Kennedy dynasty has been hard-working, intelligent and worthy of the riches they have inherited? Another: do you believe you would have become as rich as you are today if you had grown up black and parentless in the ghettos of Baltimore?
Please snap out of this simplistic and juvenile American Dream. As George Carlin noted, it is so-called because you have to be asleep to believe it.
———
Misanthropy today on progressive taxation: ‘Further, look where the “Tax the rich” line of thinking goes.. it’s many steps away from China and Russia’s Cultural Revolution and Great Leap Forward but it’s certainly a beginning step.’
I respectively doubt you really know what you’re talking about. Firstly, Russia had no Cultural Revolution and no Great Leap Forward. Instead of the former, it had the Red Terror. Instead of the latter, it had collectivisation and five-year-plans. It might interest to you know that despite the appalling death tolls of both of these, the latter was lauded in America as an example of what central planning could achieve: heavy industrialisation in ten years, where it had taken a hundred in the depression-stricken US.
Anyway, progressive taxation is not a step towards publicly gutting the ‘bourgeoisie’. Without a richest top percent, there would be noone to progressively tax, so forced wealth equality would undermine the very premise of progressive taxation. QED, bitches.
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One more point: I’d like to see how much you’d miss government regulation were it removed. Do you think it’s profitable for airlines to include lifejackets and oxygen masks? For car manufacturers to withdraw a model with a 1% fatal malfunction per lifetime rate? For drug companies to perform the costly trials necessary to ensure safety and prove efficacy?
If you hold some neoliberal dream that people are smart enough to find which companies are screwing them over, so the system would self-correct, I suggest you look at the vibrant market in cosmetics, or in homeopathy, or in religious texts. People are dumb and lazy and, even if they weren’t, don’t have time to check most of these things for themselves.
Please read up more before you spew this predictable, simplistic conservative rubbish.
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[...] this has put the pen back in my hand. This is the logical illogical progression to the previous Tax The Rich! movement of a few months [...]
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The “tax the rich” mentality is sriously flawed. If you did tax the rich and feed the poor till there are no rich no more, who would then pay for everything? Take the campaign against tobacco. All these stupid unconstitutional taxes(it is illegal to punish OR reward behaviour via the tax code, thus ALL deductions, exemptions, subsidies, etc, shoukd be removedfrom the tax code. A falt tax for instance) designed to compel people to cease smoking (as if it is any business of the government if I smoke. I hate cigarettes having quit over 20 years ago. But that is MY CHOICE, not to be compelled by government do-gooders)These tobacco taxes FUND health programs for children. Where will the revenue come from when all the smokers are COMPELLED to quit smoking? Wake up, if you want a fair society, eliminate ALL special treatments, exemptions based on ANY reason (no matter how good intentioned) it is these very things that create the”loopholes” used by the richto limit their tax liability. Treat all people the same (yes TAX THE POOR and the RICH the same. Then all have a stake in the government that each funds proportionately at the same rate.
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“I don’t know enough about economics”
Understatement of the year. Stop writing.
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I have never, never heard any politicians pulling for higher taxation for the rich. What I have heard is the call to end tax BREAKS for the very rich. The tax rates of the very rich are lower than that of the average problem, which is the problem that people are fighting against. With the end of tax breaks for the very rich, which is the only thing that I’ve heard mentioned, it would attempt to equalize the tax rates for people of all classes, which is what you agree with (“I think that the rich should be taxed more or less at the same rate I am (all said, I make very low six figures this year), but not more, and even if they are taxed a little less i’m ok with that”). The call is to keep them from being taxed less than other people, not to make them pay higher taxes. You make some good points, but your argument seems to be based upon a misunderstanding.
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