Plans to "soak the rich," who are not paying their "fair share," have worked politically, time and time again -- and may well work yet again in the 2016 elections.

Politicians’ Words: The Rich, Fair Share and Taxes

by | Oct 19, 2015 | Taxation

At the recent televised debate among candidates for the Democrats’ nomination for president, Hillary Clinton declared that “the wealthy pay too little” in taxes and “the middle class pays too much.”

Some people might wish to argue about whether that is true or not, but no rational argument can be made on either side of this issue, because the words used are completely undefined. Nor is Hillary Clinton the only one who talks this way.

It is one of the many signs of the mindlessness of our times that all sorts of people declare that “the rich” are not paying their “fair share” in taxes, without telling us concretely what they mean by either “the rich” or “fair share.”

Whether in politics or in the media, words are increasingly used, not to convey facts or even allegations of facts, but simply to arouse emotions. Undefined words are a big handicap in logic, but they are a big plus in politics, where the goal is not clarity but victory — and the votes of gullible people count just as much as the votes of people who have common sense.

What a “fair share” of taxes means in practice is simply “more.” No matter how high the tax rate is on people with a given income, you can always raise the tax rate further by saying that they are still not paying their “fair share.”

Advocates of higher tax rates can get very specific when they want to. A recent article in the New York Times says that raising the tax rate on the top one percent of income earners to 40 percent would generate “about $157 billion” a year in additional tax revenue for the government.

This ignores mountains of evidence, going back for generations, showing that raising tax rates does not automatically mean raising tax revenues — and has often actually led to falling tax revenues. A fantasy expressed in numbers is still a fantasy.

When the state of Maryland raised its tax rate on people with incomes of a million dollars a year or more, the number of such people living in Maryland fell from nearly 8,000 to fewer than 6,000. Although it had been projected that the tax revenue collected from such people in Maryland would rise by $106 million, instead these revenues FELL by $257 million.

There was a similar reaction in Oregon and in Britain. Rich people do not simply stand still to be sheared like sheep. They can either send their money somewhere else or they can leave themselves.

Currently, there are trillions of dollars of American money creating jobs overseas, in places where tax rates are lower. It is easy to transfer money electronically from country to country. But it is not nearly so easy for unemployed American workers to transfer themselves to where the jobs have been driven by high tax rates.

Conversely, there have been some reductions in high tax rates that brought in more tax revenues at the lower rates. This happened as far back as the Coolidge administration in the 1920s. It also happened in the Kennedy administration in the 1960s, the Reagan administration in the 1980s and most recently in the Bush 43 administration. There was a similar reaction in Iceland.

There is nothing inevitable about either a higher or a lower amount of tax revenues, whether the tax rate is raised or lowered. The government can only set tax rates. How that will affect the tax revenues actually received depends on how people react, and you can know that only after the fact. Sophisticated projections have often been laughably wrong.

Contrary to the way some people on the left conceive of the world, neither rich people nor poor people are inert blocks of wood, to be moved about like pieces on a chess board, to carry out some grand design from on high.

Even outright confiscations of people’s wealth, including whole industries in some countries, have failed to spread prosperity, and have even led to collapsing economies.

But politics is not about what happened in the past. That is left for historians. What politicians are interested in is what they can get the public to believe in the present and to vote on in the future. Plans to “soak the rich,” who are not paying their “fair share,” have worked politically, time and time again — and may well work yet again in the 2016 elections.

Thomas Sowell has published a large volume of writing. His dozen books, as well as numerous articles and essays, cover a wide range of topics, from classic economic theory to judicial activism, from civil rights to choosing the right college. Please contact your local newspaper editor if you want to read the THOMAS SOWELL column in your hometown paper.

View all articles by author >

The views expressed represent those of the author and do not necessarily represent the views of the editors and publishers of Capitalism Magazine.

40 Comments

  1. This is very good. How about also turning the tables a bit, too?

    Instead of governments just setting tax rates, how about governments not issue any debt that is not collateralized by an already existing asset? How about no more issuance of debt whose only collateral pledged is the future confiscation of the citizens’ earnings?

    What rabble in arms may come to be were the other side of the table pushed into the light?

  2. This suffers from the usual Libertarian disconnect in that the author scorns the entire concept of “fairness” on the basis that it is a subjective term. It’s the main reason why these sorts of articles never resonate with the public, who by-and-large have a strong sense of fairness.

    When all taxes (not just income tax) is taken into account, the wealthier you are, the smaller a proportion if your income is taken in taxes. So to answer the “who are the rich” question, it’s anyone earning more than you.
    “Why is it unfair?”
    Because they pay proportionally less tax than you.

  3. “”the wealthier you are, the smaller a proportion if (sic) your income is taken in taxes.”

    Is this true? Is the 39k/year family with 2 kids who certainly IS getting EIC, with a 150k mortgage, really paying a greater proportion of their gross income in total taxes, than the family with 2 kids earning 250k / year?
    I’d like to see that calculation, as I’d estimate income tax at about 2400, ss at 2400, property at 1600, sales at about 700, and medicare/caid at about 560 for the couple making 39k/yr. Ignoring the mortgage deduction for this case, the taxable income would be about 18k, keeping the eic of about 5500 (for tax year 2015). If you do the math that’s about 5% of gross. Just from my own personal numbers, I know I pay much higher than 5% of my gross to cover my property, income, sales, ss, and medicare/caid.

    What percentage of gross income do you suppose the poorest person pays? Do you suggest that whatever that # is, it should be applied to every person at the same rate?

    Just to poke at this tentatively: If the poorest person earns no income, but subsists on charity, then he likely pays sales tax only. As then his total tax % of income would be division by zero, then this would suggest we tax everyone such that they too have no income whatsoever. This is going to be hard on civilization.
    What income level do you wish to make the benchmark, and then, looking at their total tax rate as a % of their gross income, use that rate to apply to everyone?

    To say this another way….. What is ‘rich’ and what is ‘fair’? You haven’t really moved beyond this question yet.

  4. Rest of reply is “pending” – presumably because of links

    “To say this another way….. What is ‘rich’ and what is ‘fair’? You haven’t really moved beyond this question yet”
    Yes, there is no absolute definitive for this, which is the problem. However the difficulties in defining rich and fair doesn’t mean that those concepts don’t exist – which is the cornerstone of much Libertarian theory when defending things which appear patently unfair and biased in favour of the “haves” at the expense of the “have-nots”. They smugly talk of the amorality of the market, overlooking the fact that an awful lot of people are very uncomfortable about amoral markets.

    I became tired of debating those locked in the Libertarian head-vise many years ago, but it’s surprising that an old war-horse like Sowell is still making the same sort of statements that have turned millions of normal people completely off his pet ideology.

  5. Australian Inquisitor
    They (the rich) may pay a smaller percentage than you but the top 1% pay on the average of $700,000 a year in taxes how much did you pay last year ??? How much is enough to pay for the same protection and services that the government provides to each its citizens ?? I do not find fault with anyone that leaves the country to pay less taxes. I have a feeling that the mooches and looters will someday find that the is no one left for them to pillage.

  6. The amount paid is really irrelevant. If $50 represents half of everything you own in the world, then it will seem a helluva lot of money.
    If a sytem of taxation when taken as a whole, is regressive, meaning the poor pay a greater percentage than the rich, that is perceived as unfair.

    If you want to get into discussing the ethics of taxation in general, you’re out of luck. From what you have already written, your value-set is different to mine and we will never agree.

  7. Australian Inquisitor

    During the Democrat debate Burney Sanders stated that he wanted to fashion the United States to be more like Denmark. Free Collage, Free Medical care and etcetera.
    However in Denmark those things are NOT as free as you might think.
    Yes they have free collage, but unlike your student loans that you pay off and no longer have to make payment on. Denmark’s 48% taxes are never paid off . Everyone no-mater how much they make pays the same percentage and that does not include a 25% sales tax on everything they buy. I do not know about your income, but My Federal taxes plus my health insurance is far less then 48% of my gross income and my student loans were paid off long ago. You like Denmark then go there to live.

  8. I’m not sure what you are getting at here…
    Denmark’s system of taxation is very different to the US, but so are the benefits. It is a far more collectivist society than the US. The point that Sanders is making is that Denmark is also a hugely successful country. It matches or exceeds the US in a number of important economic metrics. It hasn’t succumbed to the “inevitable” failings that critics of collectivism claim will occur. It is a “fairer” society insofar as the problems faced by the American poor – affordable healthcare, affordable housing, affordable childcare, affordable higher education, are not a problem for the poor in Denmark. You can’t tell the poor to “find a way” out of poverty whilst simultaneously having a system which makes that all but impossible.

  9. “”How much is enough to pay for the same protection and services that the government provides to each its citizens ??””

    I subscribe to Austrian economics, and support a government that follows the principles outlined in Bastiat’s “The Law.”
    I write this so you realize I’m not asking the following question from a lib / progressive position of utter misunderstanding.
    Is your quote above, really true?
    Certainly, in a society with a just government that protects life, liberty, and property equally, yes, each citizen would get the same benefits that a just government provides. But, looking at the top 1% in wealth, are they or are they not receiving special protections, special benefits, special loans, etc. from our local, state, and federal governments? If they are, then they, along with those making such legislation, are criminals, and everyone NOT receiving such special help are having their rights violated – are oppressed by a tyranny.
    It is a sick irony that when the perversion of law by government favors the very wealthy, the left can get away with BLAMING the wealthy for the injustice, and call for more legislation that simply favors their cabal at the expense of others. We continue to try to ‘remedy’ crime with more crime.

  10. The rich are protected by the same police departments, fire departments, an medic-one, the same Army, Navy, and Air Forces and they drive on the same highways they have the same vote, as everyone else does and that protection is shared equally with everyone in this country. The only difference is that the rich are paying for the majority of those costs In the U.S. if you are making 48K a year of less you are paying little to nothing for those or any other government services. Every should have to Pay something.

  11. Are you unaware of the mountains of legislation at local, state, and national levels that favors established interests, protects some corporations from competition, allows only some people to invest in certain new businesses, gives certain corporations free loans or grants, bails SOME corporations out, etc. etc. on and on? For a real life example, do some research into the legislation and regulations that allow a company such as google to hide a great deal of its income from federal taxation. Or just look at the loan to Solyndra – do you not see how that is a violation of the rights of all other potential competitors AND of consumers in general?
    I think that until we are consistent and decry the injustice of THESE things, the common man will spit in our face (and rightly so) when we complain about the earned income tax credit, or progressive taxation, or welfare, or any of the other 120 or so ‘poor’ relief hand outs that ARE in fact injustices. From the common man’s perspective, if there is no other remedy, then damnit, he will at least get his bit from the government too. Do you see?

  12. you’ll have to put spaces in the links to hide them from disqus, otherwise it will never post…. from experience. regards.

  13. Progressive ideas and Crony Capitalism will crumble in the face of unsustainable government debts, unsustainable government wars, and unsustainable government entitlements. We are almost there now. The founding fathers created a Constitution to protect the citizens from their Government. Today most of what our government does is Unconstitutional, our government ignored the checks and balances in the constitution when they passed the 17th Amendment. They have corrupted it intent of the Constitution by misinterpreting the 14th Amendment, they have over reached their authority and enumerated powers granted them in the Constitution, they have debased or currency destroying it value. It is time for the States to take their nation back.

  14. Well yes, but you digress a bit. You suggested that the wealthy were paying MORE for the same protections that everyone gets. But the legitimate gripe is that many of ‘the wealthy’ get a whole lot more from the government, in the form of these unjust protections. The benefits of national defense, police action, fire services, etc. indeed are fairly evenly distributed while the ‘wealthy’ pay a great deal more into the government. But you can not ignore the mountains of legislation that use government force to favor or protect the businesses of the wealthy from competition or give them other forms of market advantage by force. Until we call these things CRIME, our government will remain “that great fiction by which every man tries to live at the expense of everyone else.” —- be it ‘the rich’ through forcible market advantages, or ‘the poor’ through forcible relief / handouts. Both are theft at the point of a gun. Both are perversions of law.
    I understand what you mean, but ‘ the states’ are some of the prime offenders in this regard. Look at the business courting they do for ‘non-profits’, or for Wal-mart and many other corporations, with peachy land deals, special loan rates, special property tax deals, etc, to get this business or that business into their state, and countless other forcible favors to this or that business that the myopic legislators are too DIM to realize will NOT forever be in the best interests of their constituents.

  15. Why shouldn’t those that pay for our government not get more from their government? After all if they were not paying for our government would you get your welfare check? I think not. When Abraham Lincoln said that our government was of the people for the people by the people he was proclaiming that the republic was dead and now a Democracy is organized by the people and is operated by the people for the purpose of serving the people. Do you not see “rich” people as people? Would you bite the hand that feeds you to appease those who pay no taxes? Come now you need to grow up we live in a quid pro quo world you do something for me I will do something for you. That is reality.
    Conservatives are chastened by their principle of their own imperfectability. Human nature suffers irremediably from certain grave faults, the conservatives know this. Man is and always has been imperfect, no perfect social order ever can be created by men. Because of human restlessness, mankind would soon grow rebellious under any utopian domination, and would break out once more in violent discontent (rebellion)–or else expire of boredom. That is why The Senate was established to check the desires of the peoples house to keep them from bankrupting the nation and the States. They were to serve as Ambassadors represent the State Government. They were to insure that the Constitution was preserved and protected from the imperfectability of the people. That is all gone now. The people have won the oil barons control the government the very thing muckrakers tried to prevent with the 17th amendment: or did they perhaps it was their plan all along. So we have a government that serves those who pay, the further we move to the left the greater control those who control the government will have.

  16. Wow. What happened to a government of laws, not of men? What happened to ‘Liberty and Justice for all?” What happened to “in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity” ?
    So you see free government backedloans to Solyndra as quid pro quo? What, exactly, did the humans who either were competing for those loans, or competing in the same market get? What did all consumers of such products get? (besides worse stuff forcibly at higher prices). And Solyndra is one tiny example of government force used to violate the rights of one group of people for the material benefit of another group. This is exactly the thing our founders were attempting to prevent as they wrote the constitution. You are WAY off course, and frankly, I have empathy for the common man who looks in on all these protections and tariffs and free loans and subsidies and bailouts etc. and says “You criminal Bast*rds! I will grab the reigns of government and get MINE too!”
    From Bastiat:

    “This question of legal plunder must be settled once and for all, and there are only three ways to settle it:

    The few plunder the many.

    Everybody plunders everybody.

    Nobody plunders anybody.

    We must make our choice among limited plunder, universal plunder, and no plunder. The law can follow only one of these three.

    Limited legal plunder: This system prevailed when the right to vote was restricted. One would turn back to this system to prevent the invasion of socialism.

    Universal legal plunder: We have been threatened with this system since the franchise was made universal. The newly enfranchised majority has decided to formulate law on the same principle of legal plunder that was used by their predecessors when the vote was limited.

    No legal plunder: This is the principle of justice, peace, order, stability, harmony, and logic. Until the day of my death, I shall proclaim this principle with all the force of my lungs (which alas! is all too inadequate).” (died of tuberculosis)

  17. “Our twentieth century world has experienced the hideous consequences of the
    collapse of belief in a moral order. Like the atrocities and disasters of Greece
    in the fifth century before Christ, the ruin of great nations in our century
    shows us the pit into which fall societies that mistake clever self-interest,
    or ingenious social controls, for pleasing alternatives to an oldfangled moral
    order.

    It has been said by liberal intellectuals that the conservative believes all
    social questions, at heart, to be questions of private morality. Properly
    understood, this statement is quite true. A society in which men and women are
    governed by belief in an enduring moral order, by a strong sense of right and
    wrong, by personal convictions about justice and honor, will be a good
    society–whatever political machinery it may utilize; while a society in which
    men and women are morally adrift, ignorant of norms, and intent chiefly upon
    gratification of appetites, will be a bad society–no matter how many people
    vote and no matter how liberal its formal constitution may be. For confirmation
    of the latter argument, we have merely to glance about us in the District of
    Columbia. “

    Russell Kirk
    The Heritage Foundation on March 20, 1986

  18. Plunder and looting of our national treasury is the norm today 50 billion here 50 billion there is considered background noise. A Trillion dollar annual budget does not even get the attention on the most Conservative voter, and what have we bought? I say nothing, is the nation weather I say no. Will someone have to pay? Yes perhaps not us the spoiled little brats of the baby boomer generation. But someone will eventually have to pay. I think of all the work that our fathers sacrificed for us so that we would have a better life, so that we would not have to face the hardships that they had to endure, all gone because of our greed, or was it our generosity, so easy given away so long as we could spend someone else’s money. Not caring if its our children’s money or the money of the “rich” just as long as its not our money. Am I angry at todays Progressives? Dam right I am angry. I am angry as hell.

  19. Threnody

    If it is your desire to stop the plundering of our country you must join to repeal the 17 Amendment, and The 14th Amendment. Enact Law to force all political contributions no matter its size be placed into a blind trust for that politician. Our Politicians must never know who is supporting their office. Their term in office should be limited. The function of the Federal Government should be likewise limited to enumerated powers as literally stated in the Constitution. All other powers is and shall be reserved to the States and the People. Federal spending should be limited to the revenue received through taxes.

  20. Please review the nature of Capitalism. The nature is that its “fairness” comes not from compulsion but instead freedom from compulsion. “It” is unfair because you have accepted the false premise of “taxes.”

    Go read Aristotle’s First Philosophy (Metaphysics) and cower back to the Institute, please.

  21. ‘”To say this another way….. What is ‘rich’ and what is ‘fair’? You haven’t really moved beyond this question yet”‘
    Yes, there is no absolute definitive for this, which is the problem.”

    ARISTOTLE addressed this problem correctly in his Nichomachean Ethics Book V, part 5, regarding his discussion on Justice.

    Justice, then, is a sort of equalization. With respect to Money, the Rich and the Poor, the equalization is determined by what each producer of value presents as their representation that they have produced any value to bring to the exchange. In other words, the purpose of money is to equalize the value of disproportionate productive work.

    Therefore, what is fair, IS to say what value has one performed.

    Money is Justice!

    Don’t understand that? Please allow Ayn Rand to escort you into Hank Reardon’s ball and listen to everyone’s best friend, Fancisco – http:// capitalismmagazine. com/2002/08 /franciscos-money -speech/

  22. Except you are making a number of assumptions:
    1. That those with wealth have produced something of value – an awful lot of super wealthy people have simply inherited their fortunes. They have done literally nothing to deserve it and are wealthy purely through an accident of birth.
    2. That all wealth is equally meritorious – that a doctor or nurse who saves lives every day is of less value than a hedge fund manager who simply gambles with other people’s money.

    Capitalism, by its very nature, is grossly unfair. The line which you seem to be taking – that umfairness is fair, is Orwellian nonsense whistled up by the rich who want to keep the status quo and applauded by sycophants who are too stupid to see that they are the ones being milked.

  23. The nature of capitalism is that it rewards those with capital disproportionally. Capitalists reap the rewards if other people’s labour simply because they possess money and power – which are winning combinations in almost any scenario.
    Re-distribution via taxation ameliorates this highly slanted playing field. The whole “taxes are theft” line is fantasist guff. It pretends that success in your profession or business has nothing to do with our teachers and parents, nor with the commons in the shape of natural endowments, nor with means of production, infrastructure, public education, services like waste collection, fire and police departments, the legal system, inherited scientific, cultural and practical knowledge and so on. It pretends it has nothing to do with all the other people who maintain and develop the commons. It is based on the myth of the self-sufficient individual. Far from being self-reliant individuals, those who use this sort of sillynesd are the would-be free-riders.

  24. the VMI decided that they don’t like to hear anything which challenges their doctrine and barred me.
    Not much loss really. Debunking its hordes of self entitled, angry young men was a bit like shooting fish in a barrel.

  25. Australian Inquisitor
    How much of the “Capitalists” money do you want? All of the support professions from Teachers and Trash collectors, to Scientist and Engineers profit from the “Capitalists” production of product. From the Capitalists comes the “Capital” that provides the “pay” in all of their paychecks. Who do you think pays for Police and Fire protection? Unless you are a government employee or a welfare recipient, you are a “Capitalists” You have the freedom to establish the value of your labor, and you have the freedom to say no to your employer and move on to more gainful employment. Just because you covet the wealth that someone else has does not give you the right to use the force of government to put a gun to head of the “Capitalist” and rob him of his success. WHAT YOU ARE ASKING THE GOVERNMENT TO DO IS ROBBERY. If that is what you want then have the guts to do it yourself.

  26. “How much of the “Capitalists” money do you want?”

    I don’t want any of the capitalists’ money. I just want to limit the amount of wealth that they are able to extract from other people’s work.

    “All of the support professions from Teachers and Trash collectors, to Scientist and Engineers profit from the “Capitalists” production of product”

    But that’s the whole point – the capitalists don’t produce, the teachers and trash collectors and scientists and engineers do. Yet the capitalist reaps a reward from what those other people produce.

    “From the Capitalists comes the “Capital” that provides the “pay” in all of their paychecks”
    Capital is not money for paychecks, but I understand your point.
    Would a capitalist ever employ a workforce that generated less wealth than the cost of their paychecks?
    No.
    Would a capitalist employ a workforce that generated more wealth than the cost if theur paychecks?
    Of course. The greater the difference, the more attractive this is to a capitalist as all that extra wealth, created by other people, goes into his pocket.

    “Who do you think pays for Police and Fire protection?”

    Taxpayers.

    “Unless you are a government employee or a welfare recipient, you are a “Capitalists”
    Not true. If you are a worker on a wage and have no capital in tbat business, then you are simply a worker whose labour benefits someone else.

    “You have the freedom to establish the value of your labor”
    Also not true. The capitalist establishes your monetary value. If you ask for more than he thinks you will make, you won’t get the job. If you are in competition with a lot of others, the capitalist can play you off against each other to drive the agreed wage down. This should’t be news to you.

    “and you have the freedom to say no to your employer and move on to more gainful employment”

    You are assuming that more gainful employment is easily obtainable, or obtainable at all For some it is, but if you have any life experience at all, getting a new job has always been much harder than keeping an existing one. Unless you have the capital to spare to become a worker capitalist, changing jobs just means that someone different is extracting the wealth you produce.

    “Just because you covet the wealth that someone else has does not give you the right to use the force of government to put a gun to head of the “Capitalist” and rob him of his success”

    When the capitalist’s success is predicated on taking wealth from others, you might want to reevaluate quite how much that capitalist is entitled to keep and what should reasonably be redestributed in the form if taxes. A common “libertarian” argument is to equate the government’s tax to a mafia extortion racket, but the analogy can work just as well for capitalism: Let these people take the wealth that you create…or starve.
    If your beef is with the use of government power to take tax, how is this different from the capitalist’s power to extract wealth from others?
    Why, by your definition, is a worker free to seek alternatives but a capitalist not?

  27. You say “the capitalists don’t produce, the teachers and trash collectors and scientists and engineers do.” This is the Marxist view that all profits rightly belong to the workers – management and investors have no right to the profits. Whenever companies have been nationalized by socialists, and the profits (typically 8%) removed, productivity dropped a lot more than 8%. The profit gave companies the incentive to be efficient and innovative. That is, it doesn’t pay to rob management and investors.
    God gave you your hour in the sun. The communists had half of Europe (including the hard working East Germans) for 45 years, and you failed miserably. You had your chance and you failed, failed failed. Your intellectualizing mumbo jumbo (‘crazy making’ more precisely) clashes with reality. Learn to live in the real world comrade – trade, self interest, profit motive. It is what God created and He thought it “good”. You obviously disagree comrade. Why don’t you move to North Korea. I will pay for your ticket.

  28. “This is the Marxist view that all profits rightly belong to the workers – management and investors have no right to the profits”
    Where did I write that??
    A manager is also a worker. The wealth he creates is also syphoned from him, although his pay packet may be big enough for him not to really care.
    An invester should have a return on his investment. But a system under which he hoovers up ALL of the profit which others have generated is not a “right” that makes sense.

    If you think it does, please try to defend it in a logical, polite manner.

    “Whenever companies have been nationalized by socialists, and the profits (typically 8%) removed, productivity dropped a lot more than 8%”
    I’d like to see a source for this before discussing it further.

    “The profit gave companies the incentive to be efficient and innovative”

    Explain why non-profit companies are also able to be efficient and innovative.

    “it doesn’t pay to rob management and investors.”
    If something doesn’t rightfully belong to you, it isn’t robbery. The validity of a capitalist’s self professed right to all profit is what is being scrutinized.

    “Your intellectualizing mumbo jumbo (‘crazy making’ more precisely) clashes with reality. Learn to live in the real world comrade”

    That’s an emotive argument, not a logical one. It’s the same argument that the British Government used when America began to question its supremacy. “That’s just how it is” is not a valid defense. Never has been. You need to do better than that.

  29. Australian Inquisitor
    You have expressed your view of Capitalism as a communist would. I see that you ether slept during economics 101 or you have not taken the course. First of all you said that you have no choice when it comes to your pay. Your employer dictates what he is willing to pay. Ether you have over valued what you are capable of producing for your employer or you have applied for a job that you are way over qualified for. In ether case you still have the freedom to say no to that employer. What you apparently fail to realize is whatever employment you have, you have to produce enough to justify your entire paycheck, and all of cost that your employer has to pay to employ you, and make a profit for the company. Now that profit for the company may not be not profit at all.

    It typically is reinvested back into the company otherwise the life expectancy of that company will be short lived. If there is cash reserves exceeding all other costs then more often than not that money is invested in which case it is providing capitol for many other companies. Even if the owner takes all of the profit for himself. His money does not sit idle in some big vault. Money looses its value over time if it is not working. If you are talking about corporations then profits are divided among the many investors who have a reasonable expectation of receiving a gain on their investment as does the owner of any business. Being wealthy in America is not difficult if you are willing to work for it.
    Who do you think Taxpayers are? They are Capitalist who have working Capitol to invest in their communities for the safety and protection of their capitol and their lives. The Capitalist system of economics has in the last two hundred years lifted more people out of poverty than any other economic system devised by men. Socialism leads to poverty, despair, and short life expectancy.
    Nothing is free someone has to pay for everything. My kids have been out of primary school K-12 for ten to fifteen years yet I am still paying for their public education and will do so for the rest of my life. Their collage education and mine is paid for by us We no longer have to make payments, we are no longer taxed, and we had many choices.
    I have no ownership of my property, It belongs to the State. If I fail to pay my rent (taxes) the state they will take if from me. As I said nothing is free. If the Democrats offer to provide “a Free Collage Education to everyone” you can bet that you will be paying for that education all of your life. You see socialism offers no choices no options no freedom no liberty you have to take the one size fits all option that the government offers or suffer the consequences of government force.

  30. “Whenever companies have been nationalized by socialists, and the
    profits (typically 8%) removed, productivity dropped a lot more than 8%”
    I’d like to see a source for this before discussing it further.

    My source (including the 8% figure) is from Thomas Sowells book ‘Basic economics’, roughly in the middle of his 700 page book.

    You “Explain why non-profit companies are also able to be efficient and innovative.” is laughable. That charities are 10- 20 efficient is a common figure. Thomas’s book has a section ‘non-profit organizations’ (P578) that explains how inefficient they are since their income is assured irregardless of efficiency Eg fancy grounds, fancy buildings.. Plus the common lawsuits from donors who complain of the charity deviating from its stated goal.
    You say ” But a system under which he hoovers up ALL of the profit which others have generated is not a “right” that makes sense.” So what percentage of profits do owners have a right to? 10%? 50%? When I physically exercise, I “hoover up ALL of the profit” When i read/study/develop a skill, I “hoover up ALL of the profit” etc etc. Nature disagrees with you
    Tell me that your point of view isn’t at the very least, watered down Marxism.
    PS you say ” please try to defend it in a logical, polite manner.’ I read a book on ‘crazy making.’ Your style of writing easily qualifies. Crazy making is hardly logical or polite.

  31. Capitalism may be unequal in its blessings, but socialism spreads misery equally upon everyone.

  32. a bumper sticker is not an argument.

  33. “self entitled, angry young men”??? What happened to the ‘logical and polite’ thingy? Oh, I just remembered, you lefties believe you’re entitled to moral double standard. Naughty, naughty!

  34. Simple observation. Both logical and polite

    “you lefties”….

    Faulty generalization. Logic and politeness please – or you lose the debate by default.

  35. I don’t have Sowell’s book. Could you provide the source he used for the 8% figure from the appendix?

    ” laughable” / “common figure”

    Usually shorthand for “I don’t have any hard data to prove what I have claimed”
    Here are 100 non-profits that are most definitely efficient, innovative and highly popular:

    topnonprofits dot com/list…

    Please explain how they manage to be so without the profit motive which you claim is essential.

    “So what percentage of profits do owners have a right to? 10%? 50%?”

    That really depends on how much they have contributed. Do you think it should be less than 100%? If not, I’d like to see your justification

  36. “You have expressed your view of Capitalism as a communist would. I see that you ether slept during economics 101 or you have not taken the course”

    As a point of fact, I gained formal qualifications in Economics at college and have started and run two successful businesses, so without getting into a pissing contest I almost certainly know a lot more about the nuts and bolts of the dismal science than you do.

    If you want to to throw around insults instead of actually engaging in a debate, I’ll leave you to it.

    If you feel that you can defend the capitalist standpoint in a rational and logical manner, then you’ll need a bit more than falling back on Ipse Dixit.

    “you said that you have no choice when it comes to your pay. Your employer dictates what he is willing to pay….

    …you have to produce enough to justify your entire paycheck”

    You seem to have contradicted yourself here.

    You concede that a worker’s pay cannot rise above the level of wealth he generates but seem to claim that a worker somehow can set whatever wage he likes provided that he values himself highly enough.

    You also overlook the fact that there is almost always a labor surplus, creating competition between workers for limited jobs, which can drive a wage down to a fraction of its wealth-generation ceiling. You cannot wish a job into existence and your required wage must be competitive with the other workers who also want your job. In situations of labor surplus, jobs are a seller’s market. The idea that employers and employees are somehow on an equal footing is a myth. The claim that they benefit equally is a bald-faced lie.

    “It typically is reinvested back into the company otherwise the life expectancy of that company will be short lived”

    I’d like to see some evidence from you of how typical this is. In my experience it’s extremely rare. It is, however, a legitimate expense, just as an employer’s other running costs are legitimate. I’m arguing about the profit which is left-over AFTER these expenses and who has moral ownership of it. Capitalists claim to have 100% ownership, but so far I haven’t seen a compelling argument why this should be so. If you have one, put it forward.

    “If there is cash reserves exceeding all other costs then more often than not that money is invested in which case it is providing capitol for many other companies. Even if the owner takes all of the profit for himself. His money does not sit idle in some big vault”

    In order for a capitalist to have the authority to do anything with the excess wealth his workers have created for him, you first need to demonstrate how a capitalist is entitled to 100% ownership of those funds.
    You haven’t done that yet.

    “Being wealthy in America is not difficult if you are willing to work for it.”

    Once again, I’d like to see some hard evidence for this which goes beyond an apocryphal tale. How are you defining “wealthy” and how are you defining “work”?

    Fast food workers typically earn minimum wage. Ever worked in McDonalds? I have. It’s hard work. Farm work is back-breaking but it’s one of the lowest paid jobs around.

    A huge percentage of poor people work full time, sometimes 60 hours a week and are barely above the poverty line.

    By contrast, six of the ten wealthiest Americans inherited their wealth. It was handed to them on a plate.

    alternet dot org/econom…

    According to this study, the majority of the Forbes 400 were born into wealth or privilege of some form. Self-made wealth is rarer than you might think

    toomuchonline dot org/the-s…

    “Who do you think Taxpayers are? They are Capitalist who have working Capitol to invest in their communities for the safety and protection of their capitol and their lives”

    Everyone pays taxes, workers and capitalists included. Even a desperately poor unemployed person pay sales tax of some kind. This is fairly common knowledge. However as I’ve already explained, taxation is regressive. The richer you are, the smaller a percentage of your pay packet goes in taxes.

    “The Capitalist system of economics has in the last two hundred years lifted more people out of poverty than any other economic system devised by men”

    That’s not really a defense though. Slavery also lasted 200 years and slaves saw their standard of living increase dramatically over that time.
    Communism lasted 70-odd years and also lifted millions of people out of poverty.
    By your metric, both slavery and communism are therefore virtuous?
    What if I could prove to you, for example, that something like National Socialism or radical Islam would lift people out of poverty better and quicker than capitalism? I doubt you’d be happy to live under the yoke of Nazis or extremist Mullahs on the basis that they told you it was in your best interest, would you?

    Again, you need to show a logical, morally consistent explanation of how all the excess wealth created by a worker belongs to a capitalist. So far you’ve just produced post-hoc justifications.

  37. Have you read your site> It say:
    HOW THE LIST IS COMPUTED

    “Data is collected for each nonprofit from all 7 measured criteria (i.e., Facebook Likes, Twitter Followers, Moz Page Rank (homepage), Moz Linking Root Domains, Alexa Rank, Google PageRank, and Charity Navigator Rating).”
    So these companies are efficient based on Facebook likes? Ha ha ha.
    If I rent out a house, I am deprived of my property, others are ‘consuming’ it. Or like renting a car.That is why i deserve all of the rent money (profits) – all 100%. You by contrast did not answer what percentage of profit people should be entitled to or why. This is typical left wing/collectivism behavior, show me yous but I will not show you mine.I have over the years, heard many times that relief charities are 10% efficient. You want source/appendix references, yet you write in a vague, fuzzy, crazing making style. You are not entitled to a double standard.

  38. I can tell the difference between a verbal attack (ie “self entitled, angry young men”) and a so called simply “Simple observation.”
    You say ” Logic and politeness please – or you lose the debate by default.” Note how you sound like a master talking to a slave – which is the typical collectivistic mindset. As a trader I talk TO, not down to people. And yes, we feel entitled, ie entitled to be treated as free men rather than your personal slave.

  39. Ha ha ha.

    That’s because it’s a list of websites. You can also use it as a handy list for 100 well-known non-profits though (geddit?)
    Did you look at the companies?

    Metropolitan Museum of Art

    New York Public Library

    American Red Cross

    Alzheimers Association

    Smithsonian Institute

    Boy Scouts of America

    WikiLeaks

    Amnesy International

    etc etc etc.

    Can you explain why these non-profit organisations, many of whom have provided massive benefits to millions of people and are literally the leaders in their field, are not efficient or innovative and by what metrics you are choosing to fail them.

    “I have over the years, heard many times that relief charities are 10% efficient”

    Hearing about something does not make it true, however often it is repeated. If you have hard data, then share it. If not, then admit that you’re not basing your beliefs on fact.
    Here is a compilation of how much a number of prominent UK charities spent on admin an non-core activities

    www smallcharitydirectory dot co dot uk/what-percentage-of-donations-go-to-charity

    Did you find the source that Sowell used in the book that so impressed you?

    “You by contrast did not answer what percentage of profit people should be entitled to or why.”

    I said that the amount of surplus wealth that a capitalist is entitled to is dependent on the amount of their contribution to the creation of that wealth. He certainly has no moral right to siphon off all the wealth created by other workers, yet this is what happens under capitalism. This is what drives the ever-increasing percentage of total wealth owned by the 1% – they are taking something which they did not create and have no moral claim on.

    Again, if you think think differently, please state your case.

    “If I rent out a house, I am deprived of my property”

    No. Your house is remains your property. You are, however, using your existing wealth (your house) to garner additional wealth (rent) which is unearned. You have not created wealth yourself, you have simply found a convenient way to get others who have created it to pass it on to you with no effort on your part. That’s not to say you shouldn’t rent your house or that people won’t be happy to pay you for it, but it highlights an important difference between unearned income and earned income – or rather the capitalist insistence that they are one and the same and that taking other people’s wealth simply because you have the power to do so is both right and proper.

  40. The VMI forum is populated by Objectivists, Libertarians and Anarcho-Capitalists who would probably be proud to be called self-entitled.

    Almost all were men and most were young(ish).

    All of them became very angry when their doctrine was challenged.

    Simple observation

    “Note how you sound like a master talking to a slave”

    Well if you feel enslaved if someone insists that you be polite in discussion and don’t resort to insult and ad-hominem, that’s your problem, not mine.
    Reading some of your other posts, I assume you are a teenager or young adult, so I’m more inclined to overlook your aggressive tone but when people start to trot out the “lefty, libtard and commie” lines, they’re on their own.

Submit a Comment

Your email address will not be published.

Pin It on Pinterest

Share This

If you found this useful please share it.