Sunday, March 28, 2010

I am perfectly free to tell you how much money you should make. (Also, I'm right about it.)(Also, you're full of hot air.) (Publicus Proventus)

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I am alternately proud and dismayed to live in the type of country I live in, the kind of country which has the genius and foresight to create a Snickers Fudge and then sell it to me in ready-to-eat form; imagine the prosperity of a country in which a Snickers bar can be made more declicious, less nutritious and still available for about the same amount of money that the average African earns in a day.

Imagine: a day's worth of calories for me, a day's worth of labor for them. What a country!

That is, though, dismaying to me, at the same time; the patriotic surge of pride (and hunger) I feel when I see the Snickers Fudge bars stacked six deep at the checkout counter -- surrounded by their chocolate-y, nougat-y, fatten-y brethren, also dismays me a little, because I realize that I could buy one of those candy bars -- little though I need it-- and have bought many of those candy bars -- ditto, only past tense -- without thinking about the extreme luxury that surrounds me, a level of luxury that I (mostly) take for granted.

A level of luxury I don't need -- no matter what people like Kimberly have to say. And a luxury I am free to hector not just myself about, but also you.

Back in the fall, as I was toying around here and there with doing what I'm doing now -- writing posts with an expressly political bent -- I posted one called "Shame On America Sunday: Housing Edition." In that article, I took a (selfish) lady named "Susan Saperstein" to task for being greedy and a hoarder of resources.

I won't repeat that attack here -- Susan Saperstein probably doesn't care what I think, because if greedy, selfish people cared what others thought, they wouldn't be greedy in the first place.

But that article brought a recent attack from Kimberly, who isn't willing to stand by her views publicly, and may for all I know be Susan Saperstein. Here's what Kimberly wrote:

I'm really not sure why you have such ridiculous rules regarding people's incomes and cost of homes. You do realize that Suzanne Saperstein lives in California, right? I also live in California, in a VERY modest home. My house is worth more than $500,000, and it's not excessive in any sense of the word.

America is great because people have the OPPORTUNITY to WORK for what they want. The unlucky family you mentioned in your post was swindled, but that's no one's fault except the con artist's and their own. Since when is it the Sapersteins (or any other wealthy person's) responsibility to pay for perfectly able-bodied, able-minded people's homes and necessities?

When you adopt a socialist view like your own, you neglect the reality that without reward, people cease to work hard. (By the way, are you happy now that you're being taxed so that complete strangers can have medical coverage on your dime, in the same way that welfare recipients and people under every other government-failure program have done?)

In criticizing the Sapersteins, I certainly hope that you have taken into account that their monetary donation to Cedars-Sinai Hospital in Los Angeles is the LARGEST donation the hospital has EVER received. Without their "excessive wealth," who would help medical institutions in such a significant way? The government? Keep dreaming.

I firmly disagree with your ideas about wealth caps and government-run health care. I'm not part of the problem. I'm one of the people who think clearly about the negative effects of a socialist system.

As you may guess, I disagree with Kimberly and every greedy resource hoarder who backs her up.

Kimberly says that her house isn't excessive "in any sense of the word." She's wrong: In California, the median income for a family of seven is $68,030. That means 1/2 of all the families in California make less than $68,030 per year. Kimberly's house is the equivalent of nearly 8 years' total gross income for half of the people in her state. That's excessive, and resource hoarding.

Kimberly says America is great because people can work for what they want, and it's nobody's problem but the victim's if they're swindled. That's her vision of America: You can work for what you want, and anyone can rise to the top... but if someone takes unfair advantage of you, then screw you and go home.

In America, though, you can't automatically work for what you want, because while all people have (theoretically) equal opportunity (they don't, actually) all people are not born equally, and to me one of the beautiful things about America is that we share. A great deal of America's premise, and promise, is built on the notion of sharing what we have. Kimberly, in saying that you can work for what you want may be unfamiliar with concepts like the Oklahoma Land Rush (where the government gave land away for free) and milk price supports -- whereby the government artificially controls the price of milk to keep it affordable for Kimberly to take home and put in her Subzero restaurant-quality refrigerator (I'm assuming), while also making sure that milk farmers make money and that milk prices are stable across the country.

That's all fancy-talk for giving stuff away, Kimberly (and her supporters.) You didn't work for the milk you bought and drove home in your giant SUV. You got a government-sponsored handout to cover a portion of the cost of that milk.

Kimberly then espouses an idea that was in vogue last year, when nutjobs like Glenn Beck were supporting the ludicrously-insane notion that they would "Go Galt," a reference to the sophomoric stylings of some character of Ayn Rand's that passes neither for good fiction nor good thinking. Someone goes Galt when they opt not to work or earn money to avoid, say, a tax on their income. Kimberly, and other muddy-headed thinkers like her, suggest that they would Go Galt if we taxed income more, showing how illogical they are and also how little they understand the economy.

In the first instance, Going Galt isn't going to be done; I'm not aware of anyone ever having done it, and the only people who could afford to do it would be people who are independently superwealthy anyway -- or, as I term them, resource hoarders like Susan Saperstein.

It's not going to be done because even an increase in taxes, even confiscation of money, will not take away the incentive to earn money that's not confiscated.

Let's say you earn $100,000, and pay no taxes: You have $100,000 a year in your pocket. I then propose to tax income at a rate of 25%. Are you going to Go Galt? That is, are you going to opt to make no money to avoid paying that tax? If so, you're dumb: Even after my tax, you're earning $75,000, which is better than nothing.

Suppose I said, instead, that I'm going to tax 50% of all earnings over $100,000. Will that take away your incentive to earn more, as Kimberly suggests? I doubt it: Every extra $1,000 you make would be $500 more in your pocket, even after my tax. Don't you want your $500? Of course you do -- you'd rather have $500 than nothing, right? (Don't answer that, Kimberly -- you won't be able to unless you abandon your own stance.)

Now, let's consider the idea that I'm going to confiscate all money over $100,000 a year. Would that take away one's incentive to work? Again, I doubt it: You might not want to work hard enough to earn more than $100,000 a year -- but you'll still want to work hard enough to earn that first $100,000.

Consider, then, what happens if I do confiscate all money over $100,000. You're selling your products-- Snickers Fudges, let's say - -and you hit $100,000 in income. You now know that everything after that you're giving to me, so you're getting no benefit if you go on working. You may well make the logical decision to stop working for that year.

If you do, will that take away demand for Snickers Fudges? Or will people like me still want them, even though you're not selling them, so we'll buy them from that guy over there, who will step in and sell us a Snickers Fudge (or a substitute) until he earns $100,000?

I think the latter is more accurate -- and shows why not only would there not be a huge dampening of the economy through a high-taxation rate, but also shows why you just might go on working even if you don't get any benefit after $100,000. Here's why: You might lose your customers.

If you're a Snickers Fudge magnate, and you start selling on January 1, and you hit the $100,000 mark on January 30, you could take the rest of the year off, because after that $100k, you'll get no direct benefit. But if you do that, and if people still want candy for the rest of the year, they're going to buy it from someone else... and then, next January 1, when you start selling your candy bars again, we may all be tired of your Snickers Fudges and want the new thing we got into buying from January 31 through the end of the year.

So there's an incentive to keep working, right, Kimberly? You want the $100,000 next year, too, and you want to keep your job. But even if you don't, some other guy will and he'll earn his $100,000, too, and the economy will keep going.

It'll keep going because people will still need stuff, even if you, Kimberly, refuse to provide it. If you Go Galt, if you opt to not do whatever it is you do to earn money, be that blogging or ranting on TV or selling Snickers Fudge, society is still going to want candy bars and nuts on TV, so someone else will happily step in and fill in for you.

That's why the threats from certain portions of society to go Galt are okay with me: please, do. If everyone on TV goes Galt, they'll need people like me to start writing TV shows and I can quit blogging and begin writing the next big sitcom hit.

And that's why the threats demonstrate such a basic misunderstanding of economics: I didn't buy that Snickers Fudge yesterday, patriotic and delicious though it might have been. I went Galt on it. I've never bought a Snickers Fudge, but plenty of other people have, and Snickers is doing just fine without my participation in their little economy.

Kimberly also asks whether I took into account the Sapersteins having made the largest donation ever to Cedars-Sinai Hospital, a donation that is unknown in amount, but which exceeded $14 million, according to Cedars-Sinai. I didn't, and I don't, and here's why: David Saperstein has a net worth of $575 million. If I assume that Saperstein's Cedar-Sinai donation was $28 million -- an assumption, only -- that amount to 4% of his net worth.

He kept 96%, in other words. So while it's nice that he gave away his pocket change, I'm not about to clap my hands for someone who still hoards wealth. If Saperstein gave away $28 million -- again, an assumption -- he'd be left with $547,000,000. To get an idea of how much $547 million is, consider this:



That's thirty million. Do that another 517 times and you'll see what 547 million looks like.

$547 million cannot be spent in a lifetime, even if that lifetime is selfishly devoted to haute couture, as Susan Saperstein's life is. $547 million allows you to spend $5,470,000 a year for a hundred years.

Or $10 a minute, every minute of every day, 24 hours, around the clock, for 100 years. If you spent $14,000 per day every day for 100 years, you wouldn't, at the end, have spent $547,000,000.

But the Sapersteins and Kimberlies of the world want me to believe that there's nothing wrong with hoarding that kind of money -- nothing wrong with holding on to money that cannot be spent, ever, in your lifetime, even though others could sorely use that money.

What if the Sapersteins had H1N1 vaccines? What if they had 547,000,000 doses of H1N1 vaccine and refused to give that up? And then, under pressure (and for tax purposes), they said "Okay, we'll give you 4% of our H1N1 vaccines, but we're keeping the rest!" Would you then, Kimberlies, think that was okay, that little kids and elderly women were getting swine flu and dying while the Sapersteins had all this vaccine they could never use but didn't want to give up? Would you argue that if you forced them to give up just a little more and they'd never miss it, that the Sapersteins would have no incentive to stay healthy anymore?

I doubt it -- but you don't make the connection because they don't have H1N1 vaccine, they have dollars, and people think you can't hoard money.

But you can.

And the Sapersteins, and lots of people like them, do hoard their money and prevent others from using that resource, even though they can't use it all up. Keeping something to yourself, when you can't even use it, and someone else needs it, is greedy and selfish and hoarding, and it's no different whether we're talking about vaccines or Snickers Fudges or dollars.

Kimberly finishes by saying that she's "not part of the problem," that she's a clear-thinker. Presumably, that means that Kimberly has thought through everything I've just written, and that having thought it through, Kimberly still disagrees with me. I'll take her at her word, and just explain why she's wrong.

Kimberly's big issue with me, really, is the gall I have in telling people how much money they should earn, and forcing people to share and take care of others. She doesn't call it that -- she calls it socialism, a word that gets bandied about a lot without people knowing what it really means.

Socialism in its purest sense means no ownership of private property. Kimberly thinks I'm a socialist, but I'm hardly advocating socialism. I'm fine with owning private property: I own my house and my car and my computer.

Socialism in the watered-down sense that most people mis-use it today means government control of various industries: In Canada, the government controls the health care industry. In the U.K., the government controls most of the health care system and runs a television station.

Anytime, in the U.S., the government starts to look at regulating or taking something over, people cry socialism, and fold their arms (metaphorically speaking) with a smug look, as if that rests their case. But those people have never stopped to consider first, how much socialism (by their definition) there already is -- and second, how good socialism can work, in certain instances.

Look first at how much good socialism there is already. Social Security and Medicare are wildly popular programs and show no signs of ending. They're popular even with young people who have decades before taking part in them -- as evidenced by the fact that a Republican (?) president, George "Worst President In History" W. Bush -- with a Republican Congress, couldn't even get private retirement savings off the ground, and by the fact that the same supposedly-conservative groups expanded Medicare by leaps and bounds.

But aside from those well-known programs, consider socialized highways. Drive much on the Interstate? They're socialist, as are all roads -- so if you're opposed to socialism, you'd better start cross-country hiking. (Make sure you get permission from landowners before crossing over their property.)

In the olden days, the U.S. had good, old-fashioned private turnpikes. At one point, as many as 3,200 different companies built roads for profit, and then charged people to drive on them. Toll roads and private toll bridges were big business, turning sometimes a greater than 10% profit per year. By 1830, 27% of all corporations then existing were companies which built roads and charged a fee to travel on them.

So if you're against socialism, you must want to regress to the days of the private road and private bridge -- paying whatever it is they want to charge you to get out of downtown, and hoping that there are enough bridges across the Milwaukee River to allow for healthy competition to keep the rates down, or you'll never be able to commute in from the suburbs.

That's just one of the many examples of socialism taking over private business, one that nobody on the right-hand side of the political aisle brings up when they talk about creeping socialism. I don't hear Glenn Beck advocating putting four roads through his neighborhood so that the builders can engage in free-market competition and he can pay to leave his house.

Socialism -- public ownership of enterprises and property -- also works a lot better than the free market and competition, at times. Like if you're trying to build a rocket and go to the Moon. NASA got their space program going in about 9 years; the "X-Prize" Foundation has been going for at least six years, if not longer, and has yet to orbit... anything.

So socialism isn't all bad -- in fact, it's pretty good, if you like getting places via roads (or if you like Tang.) But beyond that, what I was proposing in the article Kimberly took issue with, was not socialism, not in that sense.

What I was proposing was a limitation on what you can own and what you can earn. I was proposing that nobody should own a house worth more than $500,000, and no adult should be allowed to earn more than $200,000 per year (and universal health care.) Kimberly, and people who think like Kimberly, take issue with that and complain that I can't tell you how much you can earn, nobody can. That's the basic point of the anti-socialism crowd: you can't tell me how much to earn!

But I can -- and do, and everyone can, and does, and Kimberly and her ilk are okay with that, even though they're intellectually dishonest and pretend not to be.

See, Kimberly, and people who think like her, pretend that no limits on income exist, and specifically, that no government-imposed, societal limits on income exist -- or, if they acknowledge the truth, then they go on to pretend that they hate government-imposed societal limits, even though they don't. They're intellectually dishonest that way. (Or dumb, but I'm trying to give them some credit, and so I'm assuming they're smart, but lying.)

The government, which is society, which is me and you and even people like Kimberly and Sarah Palin, already limits your income by taxing it. You can never ever ever earn your "full" income.

The top marginal tax rate for 2009 was 35% on any income over about $372,000. That means that if you are super-wealthy -- and $372,000 per year is superwealthy in every single community in the U.S. -- you earn at most 65% of your income above $372,000.

That is to say: Society limits you to keeping 65% of what you earn. We do that : society. Us. Me. You. Kimberly. Sarah Palin. We all say You can only keep 65% of what you earn. When Kimberly and her cohort say you can't tell me how much to earn, they're lying. They, we, you, already do that. We already impose income limits on you, via taxes.

Kimberly and her kind, though, then pretend that they don't like societally-imposed income limits, which is to say, taxes. They argue that taxes are wrong and punitive and unjust: listen to Kimberly again:

By the way, are you happy now that you're being taxed so that complete strangers can have medical coverage on your dime, in the same way that welfare recipients and people under every other government-failure program have done?

I am, in fact, happy, Kimberly. As the originator of the One Percent movement, I understand that small amounts of my money can make a large impact on someone else's life. And I'm happy that I also don't make disingenuous, dishonest arguments against taxes, like you and your kind do.

Kimberly says that health care is like "every other government-failure program" (I'm not sure what programs she's saying have failed) and uses that to (implicitly) argue against taxes -- societal limits on income, or societal wealth-redistribution -- even though Kimberly is emphatically in favor of taxing in general. Kimberly is saying that taxes are wrong if the governmental program is a failure or going to fail -- but that's an argument against a program, not against an income limitation or taxation. And when it comes to taxes, Kimberly is wholeheartedly for them. She loves taxes. Loves them like they're her own kids.

I can say that because I know for certain that Kimberly enjoys having a military to protect her country. She enjoys having those politicians whom she likes get paid for being in office. She enjoys having paved roads. She loves having clean water and non-irradiated meat. She is enthralled with having flu vaccines. Whoever Kimberly is, and wherever her $500,000+ house is located, Kimberly enjoys the fruits of government labor and the fruits of government labor are paid for by taxes.

Kimberly is not against socialism, not against societal limits on wealth, and not against government. The Kimberlies of the world are all for taxing, and all for government control... they're just for it when it benefits them. When they like what the government does, whether that be paving a public road or monitoring imports to make sure pet food doesn't kill their pet, the Kimberlies of the world think socialism and taxes and government are A-OK. They don't think that taxing me to pay for a National Highway Transportation Safety Board to investigate Kimberly's expensive Toyota's failure -- let alone to pay for a judge to hear her case when she sues -- they don't think that is socialism. They think that's just good public policy.

Kind of puts a different spin on the socialist argument, doesn't it? Since they're for socialism when it benefits them, that puts a different spin on their arguments, right? They're lying, cloaking their arguments in socialist this and how-dare-you that because they don't want to say the truth, the truth being I don't want to use my money to help you.

Conservatives are not alone in opportunistically forgetting what they supposedly believe in -- their TARP bailouts and resorts-to-the-courts to stop health care reform are not the only, but are the latest, in a string of hypocritical moves by government officials who are willing to espouse whatever side of the issue will support their own self-interest. But conservatives, like Kimberly, deserve special scorn for their dishonesty and flipflopping. They deserve extra shame for the terrible way they frame their argument and dishonest way they push it forward.

When a liberal flip-flops and becomes more conservative, when Bill Clinton moved to the center to get re-elected and helped enact welfare reform, the net result is an equilibrium: liberals tend to push the envelope on government power, perhaps a bit too far at times, and retrenchment can help keep a healthy balance.

Also, liberals are less-often deceitful and less-often have the inherent disconnect between what they say they believe and how they live their actual lives. A liberal proponent of big government is free to drive on the highways without a guilty conscience, and, if he or she then re-thinks and tries to rein in governmental (societal) power, that's not the worst thing in the world. It's not inherently dishonest to say, sometimes, maybe we are going a bit too far.

But when a conservative flip-flops, the same cannot be said. George "Worst President Ever" W. Bush theoretically espoused, as a conservative, a limited governmental power, stocking his cabinet with other small-governmental types like former Wisconsin Governor Tommy "G." Thompson. Then, throughout their tenure, those small-governmental types engage in deceitful, undermining actions that grow government, increasing its power: The Tommy "G" Thompson Health Department used federal money to urge people to take the stairs. (How's that for an individual mandate?) That is dishonest: telling people that you're for small government and then expanding governmental power is a lie. (Right, Paul Ryan?)

When a conservative then changes that thinking, however momentarily and/or opportunistically, the results are even more dramatic, and worse for the country in many cases: the governmental intervention spawned in the last few months of the Worst Presidential Administration Ever was far more massive an interruption in the private economy than the Health Care Reform bill is. Ronald Reagan made a career out of arguing that the government should step out of the way of business, and claimed that Reaganomics turned the 1980s economy around... but he also expanded defense spending to a peak of 43% more than had been spent at the high point of the Vietnam war. In the name of a "smaller government" that wouldn't interfere with business, Reagan authorized the government to spend hundreds of billions per year on defense.

Under Reagn, almost $500 billion per year in government money went to private businesses.

You can argue that's a good, or bad, thing -- you can say the government should, or should not, spend $500 billion a year in a given industry and argue about what industry that should be. And there's no right or wrong answer to that; it's a matter of societal priorities: do you want kids to die of cancer but soldiers to have high-tech tanks?

But you can't say, honestly, that a government spending $500 billion per year to pay private industries to build tanks or bail out GM is okay, but that a government spending $500 billion per year to make sure Mom gets chemotherapy is socialism, and that's why conservatives deserve special scorn, for the dishonesty they display when they make stupid arguments like that.

I live in a country so rich that it can produce billions of Snickers Fudge bars on spec, stocking them six-deep in hopes that someone, somewhere, will buy them, and knowing that someone, somewhere, will. In that country, we already have made the societal decision that it's okay to tell people how much they can earn, and have already made the societal decision that when something is important enough to society, we're all going to have to pitch in and pay for it. Society decided that when we all got together and made the interstate highways, and the Apollo program, and World Wars I and II, and now society has decided that we're going to pay for almost everyone to have health care, too, and I'm okay with that.

I'm okay with that, even if it means I might not have quite as much ability to just buy a Snickers Fudge, willy-nilly, the next time the opportunity presents itself. Because I understand, first, that if I'm not using it, if I don't need it, someone else might -- and I'm willing to share, unlike some people.

And I'm okay with that, second, because I understand that it's up to me, and other good people, to make up for those other people, the Kimberlies and Sapersteins of the world, hoarding resources and trying to hold others down. But I'm only okay with it to an extent, because there's only so long society should let people make selfish choices that hurt others, especially when those selfish choices hurt others while presenting no benefit to the person making the choice.

I could have bought that Snickers Fudge yesterday; I could have, in fact, have bought all the Snickers Fudge bars that were there on the rack, and then I could have kept them -- even though I'd never be able to eat them all and even though eating them all would be a terrible, unhealthy idea. And if I were Kimberly, or someone like her, like the Sapersteins, I might have done just that.

Instead, I left them there: I didn't need a Snickers Fudge bar at the moment (or ever, in my case). And today, the money that I would have spent on that candy I donated to a local charity.

That made me more proud than my original pride about thinking what a great country we live in, vis a vis candy bars... and there was none of that guilty, dismaying feeling mixed in.

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