Last week a longtime net acquaintance lamented on his Facebook page that 65% of the wealth in the United States was now controlled by 10% of its people. (I think that was it. It was a large percentage and a small percentage. You get the gist.)
I’m immediately suspicious when I hear such a claim, because it requires so much qualification. Naturally, said qualification would diminish the punch of the soundbite, so it’s almost always absent.
But after suspicion, my next reaction is “so?”
A different friend made a similar claim several weeks ago, only I think his numbers were 95% and 1%. (Hmm.) He asked “why do we tolerate it?” I commented “what are we (tolerating), exactly?” He never answered me.
Now this friend has a good job working for The Man, and he’s also a business owner. He’s in a fine position to reap the benefits of hard work. I’m confident he wants for nothing in the sense of any reasonable definition of “middle class,” and he’ll likely get to a few unambiguous luxuries in life too.
And good for him. More power to him. Why not?
That I can recall, no one—not my parents, not my teachers, not my friends, not my church, not anyone—ever taught me that material wealth was bad. Mind, I received ample cautions about exactly how I valued it. But I was taught that for the most part, it came from hard work. Certainly, you can find ill-gotten spoils, but they are rare exceptions. For the most part, the “rich” do an awful lot of sweating to get there.
If we are ever to make any real progress toward sloughing off the stink of entitlement in our sociopolitical culture, we’ve got to get over demonizing wealth. Sadly, it’s an all-too-easy go-to for far too many on the left. Why take a couple of minutes to encourage aspiration, when you can stoke resentment in ten seconds?
Moreover, far too few on the right make any real effort to counter it. Is a sustained and candid conversation on this too much to hope for?
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Hey Bo,
You and I will never see eye-to-eye on what constitutes a reasonable share for the wealthy to pay in taxes. But… My comments are about what they currently pay versus what they used to pay. I don’t resent anyone for what they have or what they’ve earned. You know me better than that.
What has happened in the past 30 years is that we have allowed the very well off to stack the rules in favor of them becoming increasingly more well off while much of the rest of the population in the U.S. doesn’t benefit from a rsing economy.
You are correct that there is a better than average chance that I will eventually have a luxury or two, at the same time, I honestly don’t mind contributing back. Again, I think our differences of opinion on this topic are more philisophical, so debate is nearly futile.
I do read your blog to get a different point of view from mine because I do know and trust you as a smart guy.
Carey
People have a vested interest in bringing others down, it’s a whole lot easier than rising to a higher level themselves. We are blessed that Mister C has the job he has today. But looking at only where he’s at today diminishes how he got there. I can recall way too many nights where he was up working on some computer problem until almost dawn because it needed to get done for the company to stay on track. Way too many twelve hour phone calls because something blew up and it had to get fixed. He put in huge hours for years to get to where he’s at today. It seems like the old saying about the harder you work, the luckier you get holds true. But it’s much easier to whine about it not being fair than to make the effort to accomplish the same.
Carey, what is enough for the rich to pay? Are you aware that the top 1% of wage earners pay more than a third of federal income taxes? That the top 5% pay more than half? Do you really believe they should pay more?
I think it’s fair to say that you and I make good livings. Do we have the jobs we have now more because of rich people, or more because of poor people? Do you really believe rich people don’t benefit the economy?
I applaud your sense of charity. I try to give a little more every year myself. I want to give it, though; I don’t want it confiscated.
I appreciate your kind words, and you know I think much of your intellect as well. You’re just a frustrated libertarian, is all. 🙂
Mirth, I applaud your husband and everyone like him. Substantial risk for substantial gain is a critical component of economic growth, and I think we dissuade that behavior at our considerable peril.
Mirth,
People do not have a vested interest in bringing others down unless they are in direct competition over some resource.
Bo,
Yes, I do believe they should pay more. Not just a little more either. A lot more.
The topic deserves more attention than a comment on my friend’s blog – and to fully respresent, defend and document my position, I probably should spend more than a few minutes one morning scattering a few words at the topic but I’ll attempt to summarize my opinion. Forgive me, if I have the occassional wandering thought or tangent. Here goes…
It’s debateable that the most productive years for the U.S. were just after WWII up through about 1965 or so… At that time tax rates for the very wealthy were 85%+, even after that “oppressive” tax rate they were still very wealthy. With that tax money the country did things like build roads, hydro-electric facilities, large public works projects, etc. You know… Useful stuff. All those projects then employed working-class folks. Most American families were sustained on a single income and one parent at home. We were a world economic force in the private sector as well and it was clear that pure capitalism was the only way to go. Of course, it’s not too hard to be number one when all your competion is laying in ruins from WWII. Those countries eventually rebuilt and began competing with us.
Oddly, it was during the Johnson administration when the top tax rates really began to fall. They continued to fall until Regan when they were pushed down more rapidly. Deregulation was thrown in there for good measure too. Of course the theory (trickle down economics) was the very wealthy and corporations would use that money to create jobs, hence the tax-base would grow.
The economy surged! That “surge” was expressed in our economy through the growing stock market. Those that get to particpate heavily in the stock market also highly influence public policy through lobbying so, they get shelters from taxes. It was a fantastic time to be a yuppie! Still is now that I get to particpate a little. 😉
Wasn’t such a great time to live in my neighborhood though (rural Kentucky was my neighborhood). I watched as factory workers like my Dad and his co-workers struggled to keep jobs. My Mom worked outside our home. It was the same for my wife’s familly except her Mom was able to stay home but took babysitting and other odd jobs. In my family, we needed public assistance several times (food stamps, government cheese, etc. You know… welfare becasue we were lazy). This wasn’t anecdotal. This was the trend across the nation.
By the time I graduated high school, my parents could not afford to pay my tuition to college so I got to start at a local community college while I worked. I worked all the way through my Master’s Degree. But if not for the federal government through GSL and grants, I’d have not made it. Same for my wife. At the risk of spraining my arm to pat my own back, I’m proud of myself for what I’ve achieved and my family is very proud of my wife and me as the first generation in either of our families to graduate from college. Both families, via hard work AND the assitance of the federal government, got their first generation of college graduate. But economic conditions created by many policies that I oppose, made it more difficult. Which of my highschool classmates didn’t make it? I wonder sometimes.
About 3 years ago, Dad discovered he was sick, in the year and a half it took his disease to kill him, his retirment (and part of mine) got wiped out via medical expenses. So, yes… I do believe a public option for all Americans to have medical care should exist. Granted, you and I can disagree on the details, perceived quality, etc. But I’ve stated before and still maintain that for a country this wealthy to allow its citizens to suffer medically due to lack of money is criminal.
Working class jobs keep disappearing and those that remain don’t really sustain an American family without a second income. Each time I’m “home” in Kentucky now, the talk is constant about where to find a job… Will anything new be available? Are they hiring where you work? Can you get me on at such-and-so? How many applications is such-and-so accepting? Off the books, farm labor jobs are still valuable to them. (Many of us out here in blogsphere are fourtunate. Those aren’t common topics of discussion for us. We get to have philisophical discussions on politics.)
The business you refer to me having in the main article is a poolroom. Many of my customers are working-class laborers and the discussions I hear in my poolroom are very much like what I hear around the living room and dinner tables in Kentucky with my family. Since my customers can’t find work in labor class jobs, they don’t have much money to spend in my poolroom.
So, the theory that the “rich” create jobs hasn’t been born out. One common fallacy is that the “rich” are individuals. Much of this wealth created in our economy was absorbed into corporations as representatives of the “rich”. Those corporations were supposed to create the jobs, they haven’t done so at the rates most conservatives believe. There’s been a marked outflow of jobs (I don’t know exact percentages) from the U.S. as these corporations just can’t bring themselves to pay the minimum wage mandated in the U.S. I think that’s up to a staggering $7.25 and hour now. I’m not sure I could provide for my family on $290 a week.
Even the jobs you and I have are not created by the private sector. We work for the federal government. As private contractors, sure, but make no mistake, without government spending we would not work here.
You and I do share common ground though. It’s clear that the stewardship of the tax funds collected needs to be “fixed” (I wish I knew how to fix it but I’m simply not that bright). There are large sums of funds that need to be spent in other areas. For instance, I’d be willing to be displaced from my job and look for another if we were to cut defense spending by, oh, lets say 50% so that we only spent as much as the next 10 countries in the world combined on defense. Obviously, entitlements and social secuity need attention too but the BIG money is stuck in defense.
I think the big difference I see between my viewpoint and those of many of my colleagues is that I came from what most of my colleagues would describe as a “poor” family and area. Therefore, I have a different history and very different philisophical view. I don’t think that anyone who grew up middle-class and is still middle-class can understand that poor people aren’t lazy. Hence, any public policy that appears like a “residtribution of wealth” is absurd to them.
So that I can be flamed properly by your readership: 1) I do not think unfettered capitialism works, 2) I do not think socialism is a bad word, 3) I do not think unfettered socialism works.
I do think there is a workable blend of capitalist and social values somewhere to be found.
Despite how I may sound here, I do have respect for a great many conservative thinkers and politicians (especially you, Bo – clearly in the thinker category). I know and respect many people who now count themselves part of the Tea Party movement. I wonder though if they’d be so staunchly positioned if they’d ever experienced poverty themselves.
Carey
@Carey – You make an eloquent case for your point of view. However, I do not agree that my beliefs are due to not growing up in poverty. I believe they might be based on my own experience. I did not grow up with money. My mom was on welfare for two years after she and my biological father divorced. She spent those two years getting her CNA. Yes, the state paid for her education. Yes, they supplemented the day care for my sister & I while she went to school. But at the end of the two years, she got a job working in a health center that worked primarily with people at the poverty level and she never went back on welfare again. We lived in a trailer, conveniently located in the same trailer park as my grandmother and one of my aunts. When my mom eventually married my dad, he was working as a mechanic. He decided to go to school to get a degree in engineering and since he had been in the Marines for four years he was able to offset some of the cost of tuition. He studied while my mom supported us with her job. I remember him studying in the far corner of our unfinished basement for hours after he came home from work because it was the only room in the house where he could be undisturbed. Over time things got better and certainly my younger sister had a “nicer” upbringing than my older sister or I. But what I saw, and what has stuck with me, is how hard they both worked and that it (eventually) paid off. I don’t think poor people are lazy. I certainly didn’t think of my folks being lazy. Nor did I think I was lazy when my ex left me and suddenly I was having to figure out how to pay my utilities, put gas in my car to get to work and still keep a roof over my head. I figured out how to do without things I’d previously thought were necessary. I did most of my laundry by hand and hung it to dry throughout my apartment. I bought day old bread at the discount store. I walked everywhere I could. So poor does not equal lazy to me. But I do think sometimes people make really poor choices that lead to negative experiences. And I’m not talking about having to choose between eating and paying the utilities. I’m talking about buying cigarettes and lottery tickets at the corner store every day. I’m talking about dropping out of high school or worse yet, letting your kids drop out of high school because it’s easier. Sadly, I’m talking about my own 17 year old niece who will be continuing the cycle of poverty when she has her baby in April. I’m not hard hearted, I have absolute compassion for people who just got handed a bad lot in life and people who are struggling just to get by. But I also don’t want to continue to support people who won’t even try to improve their own lives. A hand up, not a hand out. Wasn’t that the saying? From what I’ve experienced, that’s what works. And we do give back. Monetarily through our church as well as with our time through volunteering on a regular, weekly basis. While poor doesn’t equal lazy, neither does rich equal selfish.
Carey, there is quite a lot to respond to here. You’re right; you need to blog more.
You say a few things that are not in evidence, as far as my beliefs and writings are concerned anyway. I’ve not ever impugned “the poor” as lazy, for example, nor have I ever advocated “unfettered” capitalism. I believe it is a legitimate function of government to protect its citizens’ rights, and part of that function is the regulation of free markets. Moreover, I’m practically minded when it comes to the existence of any social welfare at all. I’ve never advocated for the elimination of such, though I do strongly believe we need much tighter oversight than exists today.
I do want to point out several things about the high tax rates during the times you talk about that I believe illustrate you’re not making an apples-to-apples comparison. For one thing, I think you’re badly understating the impact of the U.S. being the only real game in town during that time. When literally no one else has the labor, the skills, and the wealth to be an industrial superpower, all of the significant obstacles to unambiguous world leadership are eliminated.
For another, I’m very skeptical that any meaningful number of people ever actually paid the rates you list. It was much easier to hide income then. We’ve not had those brackets since Reagan’s cuts, and he’s rightfully remembered for those, but lots of shelters and breaks perished with those cuts as well.
More importantly, just about everyone was paying taxes then, which is certainly not the case today. I’ve already quoted you the obscene numbers paid by the wealthiest, but do you realize just how deep the disparity goes? How about the bottom half paying only 4%? The top 50% pay 96% of federal income taxes today.
I think some cultural differences between now and then are important too. We weren’t continuously inundated with attractively-packaged opportunities to incur debt, for example. Perhaps there was more of an emphasis, and from a younger age, on the advantages of delayed gratification (“saving for a rainy day”). Certainly I think more was expected from young people in general.
I also notice that your stated time period coincides precisely with LBJ’s declaration of a “war on poverty.” You and I can have all of the philosophical differences in the world about a government’s proper social role, but that’s a massive (and practically illustrated) failure. $3,000,000,000,000 in federal spending, is it? How’s that working out? Are there fewer poor?
Thoughts so far. Maybe more later.