Repost: Phony Individualism: Why we undertax the wealthy

I think of myself as a primarily economic blogger. However, in looking back over my posts, I realize that hasn't been true for a long time, I guess because I got tired of saying some of the same things repeatedly in different ways. In the last couple of years, who is active on Our Salon has changed, and so my self-image doesn't match what current bloggers have seen of me, so I think I'l repost a few old pieces.


This was originally published on March 20, 2014, both here and on Open Salon. When I started posting here, I double-posted damned near everything.

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There's a major philosophical argument underpinning the major economic disputes in Congress, and it has to do with whom is owed what.

Why aren't we taxing the wealthy enough?

There are two justifications given. The first is that you don't overtax people who create jobs if you want them to create jobs. This argument is complete crap because it misdiagnoses the problem: The reason jobs aren't being created sufficiently in the United States is not that investors don't have enough capital, the reason is that they don't perceive enough demand for such investments to make business sense. They're right, of course: Wealth is so polarized that the United States suffers numerically from a shortage of paying customers. But putting more money in the hands of investors doesn't fix that, particularly when they already have enough money; to fix that, you need to put more money in the hands of customers, and that's exactly what Republicans seem to have religious objections to doing.

The second justification is that they don't deserve to be taxed more. They built businesses, they earned what they have, so why should we punish success? And, most particularly, why should we punish them in order to subsidize the Undeserving Poor?

To begin with, the people with this viewpoint always fail to notice that we're already subsidizing the Undeserving Rich. There are energy companies out there who pay zero in taxes but get payments from the Government - in other words, their taxes are actually Negative. There are companies that pay their employees so little that the Government has to assist those employees with programs like SNAP, meaning the Government is subsidizing labor costs for these companies (Wal-Mart is the biggest perpetrator of this). We subsidize the middle class and the wealthy with the mortgage deduction, though overall we don't subsidize the middle class enough. Taxes are far lower on investments than on labor but, given that business is more starved for demand from laborers than for investment, that's now backward from the standpoint of helping the economy, and why exactly do investors Deserve more than people who actually work? And then, of course, there's the low inheritance tax, subsidizing the great example of people who get rich but have done absolutely nothing to Earn it or deserve it.

But there's another myth attached to this viewpoint that people don't talk about:

People build businesses by themselves, without any help, and so they don't owe anyone anything,

particularly the Government, which primarily functions as an enormous bloodsucking regulatory burden.

They are, as they used to be called, Self-Made Men (and women).

So Mr. Self-Made Man gets up in the morning, grabs his coffeepot, turns on the fawcett to fill the pot with city water that's miraculously clean and potable, plugs in the coffeemaker which miraculously doesn't short out or set the house on fire as it makes coffee, takes a quick shower that drains into a city sewer system that miraculously takes away his waste water, swallows a couple of pills that miraculously work and miraculously don't make him sick or kill him, gets dressed and into his car that is miraculously not Unsafe At Any Speed, backs out of his driveway onto a road that's miraculously waiting for him, drives through intersections with traffic lights that are miraculously hung properly and that the other drivers on the road miraculously know how to interpret so they don't crash into him and kill him, drives past a policeman who's miraculously watching out for his safety, drives past a firehouse that's miraculously convenient in case his house catches fire from a faulty coffeemaker, parks at work near a streetlight that will miraculously light the way to his car if he gets out of work late, checks his e-mails over an internet that is miraculously available on his computer, reads them due to having been taught to read at public schools that were miraculously in the neighborhood and miraculously staffed with trained and certified teachers while he was growing up, writes a check to put in mail service that will miraculously take it anywhere in the country for under fifty cents, checks inventory that came in primarily on trucks driving on interstate highways that are miraculously in place, has to dash out to drop one of his employees off at the local airport to take a business flight that's miraculously safe, grabs a fast food lunch that miraculously doesn't make him sick and miraculously gives him nutritional information so he can watch his diet, then heads over to the local Chamber of Commerce for a meeting where he complains about high taxes and wonders aloud what in Hell the Government ever did for him.

I guess being rich means you're entitled to miracles,
or at least to pretend that you're self-made.

Somehow I just can't bring myself to view low taxes on the wealthy as a moral imperative. But, somehow, there are a lot of people in Congress who do.

And, somehow, that has to change.

Views: 194

Comment by J.P. Hart on October 7, 2017 at 10:22am

Just sayin' that in an era when (WE-NOT-THEY) are #3D printin' genomes, why are our primal instincts of self-preservation wrecked asunder? E g somewhere in the backroads of my mind I recollect M. Twain points out that at least 13 steamboats blew up catastrophically on-under-upon-above-&and-on the Mississippi River BEFORE the Federal Gloverment stepped in and regulated common-sensical safety standards.  Over a period of about a dozen years! All this during antebellum. Well before CD radios. 147 years ago. You'd at least cautiously suppose we'd wade our way out of this preposterous mire of tax/wedged whirlwind of reckless sound bites, info-tainment, and boomerrang-like incapability to think through and CHANGE our conduct of elections into only PBS type debates and Q&A forums. Oh well. At least MSNBC has started with bra commercials. Finally a step above all-kinda 'harmful side effect below the belt' covenants for the two-three new weekly pharmas. Intertwixed what with exploding airbags news, missing passenger planes with more people than Jamestown, News of breaching the speed of sound. You know. 'Napoleon in rags seen hitchhiking' 'Gun Stores Now Outnumber Grocery Stores' 'Golf & Feast with your Congressman' 'Student Loan Bubble Surpasses GNP of South Africa'

Where was I? At first blush I am all for postcard tax forms for incomes under high-five figures. You never know when that 99 cents may be needed to prove you are not a bum.

Free Velveeta!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!Cracker barrels on every porch! 

Comment by koshersalaami on October 7, 2017 at 10:37am

As long as some are profiting off the status quo - unlike the exploding steamboats - change is difficult

Comment by J.P. Hart on October 7, 2017 at 11:37am

K:

In particular whence 'preemptive strike' madly is an oxymoron.

VTY,

J.P.Hart (:signing out. In need of some dream time with a particular non-blonde:)

Comment by J.P. Hart on October 7, 2017 at 12:05pm

Now I'm on some bizarre compunction to posit that as far as we know President4Life Vladimir Putin might be Ian Fleming for all I know. And that it would be counter-productive to 'coin' an acronym (POTUS) Problem of the United States.

Rather, a ted-talk on positive thinking: precision laser-beam defense weapons on my security cameras.  You know, koshersalaami, what earthly good are silencers? Sundry spuds serve the same purpose.

I'll be screening that Senator John Edwards stump-speech regarding Two Americas.

Maybe lexus/nexus gerrymandering.

Maybe grant loud kudos to Senator Herb Kohl (retired) for having had sent busloads of urban kids to the inaugural.    

Comment by koshersalaami on October 7, 2017 at 12:48pm

Glad you brought up Edwards. In 2008, he was the candidate saying what I was already thinking. 

Comment by nanatehay on October 7, 2017 at 1:01pm

Didn't catch this the first time 'round cos in 2014 I was over-seeing the utter ruination of my life, so thanks for re-posting it. Phony individualism, phony capitalism, phony world view, phony president, phony democracy - phonies r us, eh?

Comment by koshersalaami on October 7, 2017 at 1:22pm

You're right

All if those are phony versions

You're one of the people I had in mind. So few of the people here now were reading me a lot then, or I them, because of who has left or died. Really, mainly Jon. And my old stuff usually had Tr ig comments. Depending on when, maybe AKA - I don't remember when we started talking. JMac. I knew some others here now but we didn't interact all that often, though I think some knew my Tales of J stuff. I didn't know Rodney. Amy and I knew each other but she wasn't following my economic stuff that I remember. 

Comment by nanatehay on October 7, 2017 at 1:37pm

You write about the topic very well. Or, that's not what I mean exactly - you think very well, and are able to express that thought with clarity and precision via writing. The two things don't necessarily go together, so it's always a pleasure to read your posts. 

Comment by J.P. Hart on October 7, 2017 at 1:57pm

Maybe we should all decompress and read the Magna Carta aloud. 

I'm sure enjoying those GE 'Molly' commercials.  I'll prolly cold call the agency. 

Maybe pick up an audio of Finnegan's Wake and 'studio' the play I'm composing.

Pouring rain here.  Coupla strong geese struggled NE off skelter of their SE predilection.

Comment by koshersalaami on October 7, 2017 at 1:59pm

Thank you 

I appreciate that

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