Monday, November 10, 2008

A Robin Hood recovery? Blame game? Palin-tology?

Question: We live in a democracy, right? "Majority rule," "one man, one vote"* and the like. If that's the case, and we're serious about it, then why is the issue of overtaxing the top 1 percent of Americans an issue at all? Their interests don't they? What matters is what best serves the interests of the super-super-super-majority "bottom" 99 percent (or 90 percent, or however you want to break it down). Or, if you want to be more equitable about it, maybe we eliminate the marginsthe top 10 percent, who are the richest, and the bottom 10 percent, who are the poorestand reconfigure American fiscal policies to focus tightly on the needs of the 80 percent in the middle.

In that framework, so what if we're taking "more money from the rich"? Why not take all their money and divvy it up between everyone else? In theory, that shouldn't be unconstitutional. To my read, the Constitution protects the minority from the tyranny of the majority only in certain well-defined areas: matters of race, age, gender, and religious affiliation. Nowhere in the Constitution are the affluent protected from the tyranny of the proletariat.
What's more, the rich shouldn't have a damn thing to say about it (beyond the scope of their own individual participation in the democratic process, that is).

In practice, of course, it's not as simple as that. That's because we don't know for sure that taking all the money from the rich would benefit the middle class and/or "median America." In fact, we do know that it's possible (if not likely) that disenfranchising the wealthy would have serious repercussions for everyone else by discouraging enterprise, innovation and basic investment in business infrastructure. My rough 80/20 model is also flawed, for it assumes homogeneity among that middling 80 percent. The reality is, though their economic interests may coincide (or at least intersect/overlap), there are myriad other criteria for organizing society in which those 80 percent will fracture into subgroups whose respective interests plainly clash (as well as subgroups whose interests in some cases will be more aligned with the top 10 percent). And, there will always be people like my late father and other men from his generation, whose pride and sense of rugged individualism cause them to shun handouts in any form.

That's a topic for another day, however. Today I'm talking merely about the overarching principle of the thing: the question of so-called "fairness" and the seemingly natural assumption that the richest and most powerful Americans will have the majority say in charting the course for the nation. I'm talking about the squeamishness that so many of us have about putting forth ideas that benefit the poor at the expense of the rich. That's precisely ass-backwards. The so-called rich and powerful should have almost no say at all. They shouldn't be powerful in the first place, i
n a democracy that's faithful to its mission.

Just a thought.


Next time you're confronted by someone who doesn't see the harm in self-help in general and Sportsthink in particular, remember Jamal Lewis. This past Thursday, Lewis, a running back for the lowly Cleveland Browns, called out his teammates for "quitting" in the fourth quarter of that night's game against the Denver Broncos. It was the second lead his team had blown that week, having lost the previous Sunday's game when the Baltimore Ravens also staged a late comeback. Though Lewis didn't mention anyone by name, beat writers felt he was taking aim particularly at young cornerback Brandon McDonald, who played poorly in both games.

I understand the frustration of a competitive player like Lewis, who was a true force during his own years with the Ravens. But what he's doing here is one of the things I try to caution people about, because I see it increasingly bleeding over from sports into mainstream life, and I don't like its implications or consequences: He's assuming that when you lose games, especially when you were on the verge of winning, it's
because of a breakdown in character or dedication. To Lewis, it's not just "one of those things": It's not because of random events or better talent prevailing in the end or even just "the breaks." Uh-uh. You didn't want it enough. Lewis is from the Tommy Lasorda/Mike Ditka school of motivation, which, in praising athletes (and others) for winning, also stigmatizes them for losing. If you loseor, by extension, fail at some aspect of your job or lifeit's your fault...not just because you didn't perform well enough, but because you didn't care enough. If it meant enough to you, this line of pseudo-reasoning goes, you wouldn't have "allowed" that to happen.

There is no reason for Lewis or anyone else to assume that failure = bad character. In fact, people with manifestly bad character win/succeed all the time, in sports and elsewhere.


Finally for today, I'm one of the last folks to defend Sarah Palin on any grounds. But I knew that something vaguely bothered me about that whole Palin/witch doctor thingapart from the fact that she did it. And I realize now that what bothered me was this: Was that so different from what, say, Catholics routinely do when they go to confession** or receive communion ("body of Christ")? And you know, the Church does still perform exorcisms on rare occasion. Is one evil spirit really that different from the next? Again, just a thought.

* That's a famous expression, of course. It is not intended as a slight against women.
** now more commonly called reconciliation, in hopes of making it sound less threatening.


sassy sasha said...

never mind all those well thought-out ideas steve, who's the hot robin hood with the crooked smile?!?!?



Steve Salerno said...

Ahh, my dear Sasha, that is none other than the immortal Errol Flynn, pulsing heartthrob to an entire generation of young women when you were not yet even the slightest trace of a gleam in your dad's eye. Flynn claimed in his autobio that thousands of women had fallen on his sword, including most of Hollywood's top young starlets.

Stever Robbins said...

First of all, the rich can afford lobbyists, and I can't. Even as an individual, to get into the fund-raising events where you might be able to talk to a candidate requires the $500 ticket, not the $20 ticket. So the rich already have a vastly disproportionate voice.

The rich also disproportionately use the country's resources. The bulk of the justice department is for corporate law, which benefits those who own corporations.

(And don't think for a moment that granny, with her 2,000 shares of IBM, is even a footnote of a footnote of a footnote in terms of ownership. Equity ownership is highly concentrated, and if you don't know that, you're not one of the people it's concentrated in.)

Even at higher tax brackets, the rich get a great deal.

Before you scream that higher tax brackets aren't "fair," (whatever that means), consider that the rich are taxed far LESS on each marginal dollar of income. Taxes have several components. Only the marginal federal tax rate is progressive. FICA--which is 14%--is REGRESSIVE. It doesn't apply once income passes ($160K?). And capital gains tax rate, which is where the rich make most of their money, is half the income tax rate.

In short, we live in an economy that's vastly tilted in favor of the rich. It has been getting more and more that way for the last 30 years, under both parties, though the last eight years have really accelerated the imbalance.

I know enough really rich people to be skeptical that giving them lots of money translates into any economic benefit except a bunch of rich people having a lot of money.

They have NOT shown (to my satisfaction) that as a group, they allocate money particularly wisely or better than some other group would. Some do, some don't. Some $50K earners allocate money wisely, some don't. It has everything to do with decision-making abilities and very little to do with net worth or income.

That said, I want to be rich, buy influence, and reshape the world in a way that would be a lot more comfortable for me and my system of values, and live in blissful ignorance of any adverse impact my policies might have on those around me. After all, if someone isn't doing as well as I am, doesn't that just mean they deserve less?

Steve Salerno said...

Stever, well, as you know, we all "attract" our given standing in life, as per The Secret, etc.

Anonymous said...

Stever, except that the 50K earners do not have that much choice in allocating. After rent or mortgage, food and other bills, you're lucky if you have a discretionary buck left. There is no comparison of "choices" here, nor the impact an even modest increase in taxes has on both group, the rich and the not-rich.

roger o'keefe said...

Steve: I think I had you going over the edge once before, so I don't know if I can use that expression again here. I'll simply say that however far over the edge you were earlier, you've now eclipsed that by a good margin with this column. Are you channeling Marx lately? I can't get over the difference in perspective between your positions of late and the material from early on in SHAMblog, and especially your book! You're not having a breakdown or something that we need to know about, are you? Because these kinds of viewpoints are just so far beyond the pale that I don't even know what to say anymore.

Chad Hogg said...

It seems to me that you are confusing two things here. The rich should not have influence over politics beyond their one vote per person. (That their money does, in fact, buy quite a lot of influence is an unfortunate reality, but irrelevant.) But you are conflating the idea that the rich should not have undue influence with the idea that this somehow means that their interests do not matter.

Fairness does not mean that the government should serve the interests of the wealthy, but nor does it mean that everything they have should be taken from them. I think most Americans want to see a system that is fair rather than one that benefits them at the expense of others.

On the other hand, I've been thinking recently about how almost all of the candidates' advertising is targeted to the "middle class". This makes sense: There are too few rich people for their votes to be significant, and they have probably already decided whom they will support financially. Poor people are less likely to be informed and to vote, and most will vote Democratic regardless of the campaigns. Thus, I would imagine that most undecided voters belong to the middle class, and I suppose the campaigns have hard data showing that pandering to the interests of the voter to the detriment of others is effective.

Steve Salerno said...

Chad, but I think you're overthinking this for the purposes of this post, taken purely on its own terms. All I'm really proposing is this: If indeed a democracy is supposed to serve the wishes of the majority*--as is certainly true on election day, when the person who receives the most votes wins--then what is inherently "wrong" or "undemocratic" about a scenario wherein Americans voted overwhelmingly to redo the tax code such that it took almost all of the money rich people earn away from them, and redistributed it to less-rich people? If we simply put that up for referendum, and that was the result, then democracy has been served. Right?

Understand, I'm not saying that we should actually do this. I'm just saying, it would hardly be a violation of democratic process to do it...and indeed it would be a more democratic way of handling national finances than the one we have now, which is set up largely to serve the wealthy.

* with certain constraints, as described in my post.

Cosmic Connie said...

Chad may be "over-thinking" in this case, but I agree with what he said. I resent the fact that in many ways America is a plutocracy (and I hate that so many people, including the New-Wage hustledorks, have earned money in such questionable ways) -- but I absolutely abhor the idea of forcible redistribution of wealth.

While this is probably not directly relevant to the point you're trying to make, Steve, I can't help thinking of my ex-boss, Charlie Ergen, founder and CEO of the telecommunications firm Echostar. Back when I was working for him, some of those close to him said that he'd told them one of his ambitions was to one day be able to influence US Presidential elections, presumably with money and media ownership. Well, he has tons of money -- besides Dish Network, he owns several communications satellites, not to mention sizable chunks of Colorado and possibly Wyoming and Montana. And he was one of those mentioned in the Rolling Stone article about McCain; he threw a lavish fundraising bash for "his" candidate (who was instrumental in passing some beneficial telecommunications bills).

But even all of Charlie's money, and that of others who thew in money for the cause, couldn't get McCain into the White House. The thing is, though, without tons of money, Obama wouldn't be there either.

Stever Robbins said...

Connie, even though all that money couldn't get McCain elected, I suspect if he remains in Congress, that money will still produce a return here or there...

(And that would also apply to Barack, if he had been willing to take lobbyist and PAC money, which he wasn't.)

There's a ridiculously well-documented social psychology effect called "reciprocity." It basically says: I scratch your back, you'll scratch mine. Interestingly, it's also a disproportionate exchange. I scratch your back to the tune of 10 cents and you may scratch mine to the tune of 10,000 dollars.

By the way, the reciprocity effect works, even when you're aware of it.

Any politician who claims to be uninfluenced by money that comes to them from a known source is indulging in pure fantasy.

Money does buy power and influence. That's just the way it is. What's sad is that we don't do more to minimize that effect.

Dimension Skipper said...

Not all that many years ago there seemed to be some halfway prominent folks pushing for a very simplified flat tax system. At this point it sure seems like it's never gonna happen, but how would that fit into your views, Steve? Would it fit well, or at least better, with your concept of "fair"? Wouldn't it pretty much eliminate a key talking point from all campaigns wherein the candidates speak of tax breaks for certain voter demographics vs. raising taxes on others?

Beyond the effect it would have on the IRS and CPAs, I don't know why the concept of a flat tax seems to have disappeared of late. Or perhaps it hasn't disappeared, I just haven't been paying attention?

On the face of it it seems like it would be an ideal starting point for anyone who talks of smaller government, less regulation.

Dimension Skipper said...

Just to clarify somewhat, I think the whole flat tax proposal was in re to FEDERAL INCOME TAX, wasn't it?

I don't know if there could be such a thing as a flat property tax 'cause any structures would have to be taken into account, I assume, what they are and to what purpose, as well as general location.

I guess no matter what would be implemented there would always be someone somewhere crying "Unfair!" for some reason.

RevRon's Rants said...

"Beyond the effect it would have on the IRS and CPAs, I don't know why the concept of a flat tax seems to have disappeared of late."

Dimension - It is a hard and fast rule of government that bureaucracies, once established, never go away. Sometimes, their initials get changed (NSA to CIA, for example), but they pretty much continue to function as they always did, and frequently view elected leaders as mere transients, to be humored, but fundamentally ignored.

I certainly don't agree with the notion of redistributing a wealthy person's entire income, but feel it only appropriate that they pay the same percentage in taxes as do the less wealthy.

As to the influence upon our governance, the only way we'll ever make it clean is to re-establish the long-gone requirement that media outlets commit to a certain percentage of "public-service" content, and limiting our campaign communications to equal-time broadcasts within the realm of that content. No more privately-funded campaigns, no more political donations. And while we're at it, remove the campaigns from the equation when establishing debate and public announcement formats.

Yeah... like that's gonna happen!

And Roger - I guess you missed Steve's repeated disclaimers that he wasn't advocating such forced redistribution, and was merely asking if it would be more consistent with "democratic" principles. Hell... I could see his tongue firmly implanted in his cheek from here! :-)

Steve Salerno said...

Rev: What he said...

DS: Yes, the flat-tax would've covered income only--and earned income only, as I understood the proposal. My larger point is that "fairness" is a somewhat malleable concept, and inasmuch as we're all going to have our own perception(s) of what's "fair," then why not let the democratic process handle that? "Everybody who wants a flax-tax, raise your hand. OK, now everybody who wants a graduated tax system, more or less like we have now, raise your hand. OK, now everybody who wants the rich to pay 90% of their income in taxes and the rest of us to pay nothing, raise your hand. Motion carries!" Something like that.

Anonymous said...

What prevents this from happening? Seriously. Why don't all Americans just vote their own self-interest, in which case eventually you'd think something like would happen, no? If what you're saying Steve is that the majority votes in the majority's benefit, then how is it that such a small segment of rich people get whatever they want. Or so it seems.

Steve Salerno said...

Anon 4:15, a comprehensive answer to that question would probably require a book of considerable length and scope, if not several books (on democracy/a constitutional republic, economics, mass psychology, American history, lobbying/influence-pedding and God knows what else). And I'm going to assume that you're relatively young. (Please forgive me if that's not the case. I intend no offense.) But I'm thinking that in today's society, where--as Obama has shown us--it is possible to marshal a considerable social movement through the internet and other "viral" capabilities, you'd think that now is the time for getting the mass of us to shake off our preconceptions of what constitutes "government" and "fairness" and maybe start the whole thing over, or take a good stab at it.

You know... Change and all that.

RevRon's Rants said...

"a book of considerable length and scope, if not several books (on democracy/a constitutional republic, economics, mass psychology, American history, lobbying/influence-pedding and God knows what else)."

P.J. O'Rourke's "A Parliament of Whores" would be a good place to start, with Vonnegut's "Breakfast of Champions" thrown in for perspective.

Unfortunately, the big bucks buy our attention, and most of us are ever so willing to swallow whatever they feed us. Change is possible, but it takes more than chanted slogans... It takes reasoned, objective thought. And in a country that elected W... TWICE ...

Steve Salerno said...

Ron: Great point about Po'Whores, which I read when it first came out and somehow forgot about. Yes, it's highly relevant here.

Connie: I also forgot to acknowledge your wise and typically nuanced take on the matter. Yes, I, like you, hate the forcible redistribution of wealth, in concept...but dammit, why don't more of these people think to do it unforcibly! I say again, I don't care where you live or what you do, you do not need a Pay-nose or a $30,000 purse. You simply don't. Certainly not before someone else needs a place to live or school clothes for the kids.

RevRon's Rants said...

Steve, there are obviously some people who do feel the need for a Pay-nose... or two (Would that be Paynoses or Payni? Sounds a bit too phallic to be mere coincidence, doesn't it?)

I look at it this way: I don't have enough wealth to buy a Pay-nose. I might have that much one day, but I doubt it... just not on my bucket list. But the integrity so many of these hustlers sold, just to get bigger pay-noses (hehe) is gone for good, and they'll never be able to buy it back at any price.

Key word is weepine... there is synchronicity in the universe!!!

Anonymous said...


Wealth is created by people, not governments. Wealth and income redistribution plans just keep people from lower economic classes from advancing; the rich will stay static.

Americans give more to charity than any other nation by a long shot, (Vice President-elect to the contrary). The concentration of wealth in the US has never been more spread out that is is today - it's no longer a few railroad barons controlling everything.

Show me a few examples of countries where wealth redistribution really worked. Cuba? South Africa?

Anonymous said...

"Wealth and income redistribution plans just keep people from lower economic classes from advancing"

Show us some evidence, Anon, any evidence, that this is true and not just a figment of your ideology.

Anonymous said...

Anon, what does South Africa have to do with "wealth redistribution"?

Cuba cannot be a good example because the country has been effectively cut off from the world and international trade, thanks to the US inhumane politics.

If you want good examples of how this (erroneously called) "wealth redistribution" works for the benefit of the whole society, see the Western European countries. Or Venezuela, for that matter. Look at the indexes of well-being there, health statistics, educational opportunities and levels, upward mobility which is directly related to educational advancement, etc. That should give you a clue.

Anonymous said...

Black Man Given Nation's Worst Job

November 5, 2008

WASHINGTON—African-American man Barack Obama, 47, was given the least-desirable job in the entire country Tuesday when he was elected president of the United States of America. In his new high-stress, low-reward position, Obama will be charged with such tasks as completely overhauling the nation's broken-down economy, repairing the crumbling infrastructure, and generally having to please more than 300 million Americans and cater to their every whim on a daily basis. As part of his duties, the black man will have to spend four to eight years cleaning up the messes other people left behind. The job comes with such intense scrutiny and so certain a guarantee of failure that only one other person even bothered applying for it. Said scholar and activist Mark L. Denton, "It just goes to show you that, in this country, a black man still can't catch a break."

Anonymous said...

Maybe I'm missing something but shouldn't we just bring back the concept of the "tithe" ie everyone pays 10% of what they have to charity - which is now the government and that way we are all paying in proportion of what we earn.

Also, giving charity and this new volunteering concept they have here in Britain always has more benefit to the donor/volunteer then the recipient. The donors get a wonderful feeling of being a good person while the recipient feels crap about themselves.

The majority of people on benefits here in England balk at he idea of working for free - its just the students, pensioners and wealthy hippies that volunteer to get relevant work experience and that "I'm a wonderful person" feeling.


Steve Salerno said...

Londoner, it's a nice idea, which of course comes out of a religious framework. But I guess my point is that why should somebody who's struggling to meet the rent or buy basic household staples have to tithe 10% of income that's insufficient in the first place, while a guy like Richard Branson, who has plenty to spare, just gives his 10%, too? Or let's take our motivational pal Tony Robbins. I don't know if he still rakes in $90 million per year, as once estimated, but do you realize that he could give away 99% of what he makes--and still bring home just under $1 million this year? The skew just seems increasingly unwarranted to me, all the more so if you look at life through a deterministic lens, as I tend to.

Anonymous said...


Thats the point - that the poor have the same need to give as the rich and gain the same benefit.

Forcing the rich to pay more of a percentage then anyone else would be just as unfair.

I think we just have to accept that the world is not fair, was never meant to be fair and will never be fair. Iguess thats as deterministic as I get.


Steve Salerno said...

Londoner, I don't have the time today to give this the attention it deserves, but I'm always skeptical of arguments rooted in "That's just the way things are and you might as well accept it." That argument could be used to justify almost anything, and is. And in principle as well as in fact, it's an argument for perpetual stagnation. Is it not?

Let's face it: Not that many years ago (maybe even not that many months ago), wouldn't we have all agreed that "a black person isn't going to get elected president of the United States, and that's just how it is"?

Dimension Skipper said...

The flat tax thingie that I mentioned before... I assume that most proposed variations had some minimum income threshold included, some amount below which someone would be excluded from paying any tax. But I don't know.

I often say (or think) when I see or hear of some obviously ridiculous one-person consumer excess... "How much money does one person need?"

If I won a billion dollar lottery, I'm 98.3% certain that beyond a new car (say, a modest Chevy/Ford/Chrysler of some kind) and maybe springing for cable HD (not necessarily the top of the line everything package) and definitely hispeed internet, there really wouldn't be all that much I would change in my life. Maybe I'd travel a little more, but I'm not a flyer, so I'd just drive here and there across the country).

I'm sure I'd also give a lot of gifts to friends and family and then try to see where the bulk of the rest could potentially do some good for certain downtrodden segments of the population.

I'm just not one of those people who, when given tons-o-cash would find ways to spend 90% of it essentially on myself.

And to anyone who feeds me the line "Life isn't fair" I usually respond with "Well, maybe it's part of humanity's Purpose to try to make life a little more fair as often as we can." Just a thought.

People might point to nature and the animal kingdom to illustrate unfairness and survival of the fittest and all that. But on the other hand we're not animals. Or are we? I prefer to think not. For the most part, anyway.

...Just my nickel's worth of opinion with maybe a little food for thought there.

Steve Salerno said...

And to anyone who feeds me the line "Life isn't fair" I usually respond with "Well, maybe it's part of humanity's Purpose to try to make life a little more fair as often as we can." Just a thought.

There ya go. And said much better than I've struggled to say it here, so far.

Anonymous said...

I used to think like that Steve ie its our job on Earth to make things fairer and therefore better however since reading one of your posts - I can't remember which - on the concept of right and wrong and the fact that with our limited human capabilities we will never really know which is which - so maybe us striving for fairness isn't as good as we think its is.

Its like the west trying to bring democracy to Africa - it makes things even worse.

As for the black American president
- it really was just a matter of time Steve... the proportion of minority groups within the American population are changing the face of America and my guess is that's whats is upsetting most McCain supporters.

To reiterate, I think its essential that everyone in society is made to give something back otherwise they will feel worthless, they can't demand anything and have no rights.