Stop demeaning billionaires and you were unfair to Howard Schultz

Here is my Bloomberg column on that point.  Furthermore, that tape of Schultz is much better than what many media sources reported, here is the excerpt on that:

In an interview, Schultz was asked whether billionaires have too much power. He responded by noting that the moniker “billionaire” has become a “catchphrase” and proceeded to reframe the question: “I would rephrase that and I would say that people of means have been able to leverage their wealth and their interest in ways that are unfair.” So he didn’t necessarily disagree with the premise of the question. Nor did he say that other people shouldn’t use the term “billionaires.”

For the record, he also noted that such people have “unbelievable influence,” and that speaks to the problem of inequality. And he included corporations (not just people) and the political ideologies of the two major parties as part of the problem.

Is that such a terrible answer? Not only on the merits, but also in explaining why Schultz might want to move away from the term “billionaire” as the sole locus of blame? Then again, maybe that’s just what you would expect a billionaire to say.

You can watch the interview here, and note the rest of the column is making more general points about how we should talk about people and their wealth:

My parents taught me never to ask a person how much he or she earns. I was told that it was rude, and I still believe that. It follows that we also should not ask people about their net wealth. And, out of politeness, perhaps it is also inappropriate to openly discuss the range of their net wealth.

Comments

Of the rich using their influence in ways that is not fair to the rest of the country?

Umm... buying elections, lobbying for carried interest loophole, not taxing capital gains as income, the entirety of trust tax law, estate tax reduction, self funding campaigns...

Are the Kochs a joke to you? They now own public universities....

Of a single accusation?

And most of these are indeed fair. I don't know of any legislation that says "these laws only apply and therefore benefit the rich." Only the perverted logic of a true democrat thinks it is unfair to keep more of the money one earns.

Buying Elections: This is frequently bandied about and may have some merit. However, how does it explain Trump who raised about half of what Hillary did? How does it explain Obama's re election (in 2012) who openly opposed the Citizens United ruling (issued in 2010)?

Capital Gains Tax: The US has the 6th highest Capital Gains Tax in the world, at least according to (https://taxfoundation.org/us-taxpayers-face-6th-highest-top-marginal-capital-gains-tax-rate-oecd/)

Estate Tax Reduction: Just my personal belief, but I think these are a huge incentive to massively change behaviors and run counter to human nature. I find it hard to begrudge anyone wanting to pass on their wealth to the next generation. That doesn't necessarily justify the practice, but pairing that assertion with the fact that assessing these taxes is very difficult, makes me a skeptic about them

I don't know enough about carried interest, trust tax law, or self-funded campaigns to comment.

There is a literature here. Spending money can get votes, but only so many, and it gets really really expensive to move things more than a few percentage points (and your opponent is doing the same on their end).

You need a minimum amount of money to run a campaign and get good people running things. Once you hit that level, the returns start dropping off.

What would Hillary have done with another billion dollars?

IMHO we need more billionaires and millionaires not less. If someone breaks the law then our justice system should treat them the same as any citizen. It is foolish to denigrate people simply because they were successful.

"What would Hillary have done with another billion dollars?"

Pretty much what she did with the money she had -- she would have spent it in states like California which she had locked up, rather than in PA et al that allowed Trump to eke out his surprise narrow victory.

-dk

Asking for tax breaks and tax advantages is hardly the biggest sin of the rich and powerful. Honestly it’s probably the least socially damaging thing that rich people do.

The most sinister thing that rich and powerful people do is openly lobby for regulation that increases the capital intensity of market entry.

If there was ever an “eat the poor” “neo feudalist” aspect to modern power relations between rich and poor citizens that would be the “ne plus ultra” of all levers.

There is no bigger dupe to the American public than the idea of heavily regulated industries being socially equitable for the American public....

I would say I conceptually agree that "industry" (which may or may not include billionaires) seeks capital intensity through indirect, regulatory means.

However, I would put more of the the locus of responsibility on the median citizen. He/she is a fan of regulation, so it's an easy sell.

if they weren't so stupid...https://youtu.be/WM-DmwQ0TMQ?t=29

You can’t steal legally without political help.

The number of rich people who've blown large sums of their own money falling to get elected is vast. In 2020 not only was Trump's campaign underfunded relative to Hillary, it was also underfunded tentative to Jeb Bush (both of whom also had the family dynasty/inherited political machine advantage going for them that Trump lacked). And yet.

Trump's biggest advantages were his fame as a reality show host and his ability to generate coverage through calibrated outrage. His wealth was irrelevant.

"His wealth was irrelevant."

No, that's not really true. I agree with what Daniel Weber said above:

"You need a minimum amount of money to run a campaign and get good people running things"

Trump could easily get to that level without spending all his time fund raising.

David Koch would know about this. After running for VP on the 1980 Libertarian ticket (or, as WF Buckley called it “anarcho-totalitarian” ticket) he swore off personal involvement in electoral politics by saying the candidates are mere actors but the donors write the scripts. So he switched to funding.
And - ever heard of the Powell Memo, and its role in history?
But saying der Gropenfuhrer’s wealth was irrelevant, in this culture, well, you must know better.

Holocaust denial on MR? Interesting.

Where is there Holocaust denial?

The Powell Memo seems to be covered here - http://reclaimdemocracy.org/powell_memo_lewis/

As for Gropenführer, it seems to be a reference to Trump and what he cannot stop himself doing (assuming you believe Trump's own words are not those a lying braggart), but the term was actually used in connection with another politician. 'This tag for Arnold Schwarzenegger actually was coined by Steve Lopez, a writer for the Los Angeles Times, in a column the day after the recall election that installed Arnold as governor, in spite of his acknowledged history of breast and booty grabbing (or, as Arnold described it, "being playful"). Garry Trudeau made Lopez's term nationally famous in the "Doonesbury" cartoons. It's a pun on a German term for a group leader, "gruppenfuhrer."' https://www.urbandictionary.com/define.php?term=Gropenfuhrer

'Of the rich using their influence in ways that is not fair to the rest of the country?'

Well, Romney illustrates a certain tax framework that did not just magically appear on its (especially considering how few Americans are paid in this fashion - without mentioning the offshoring at all) - 'How does a private-equity kingpin worth at least $250 million pay a lower tax rate – just 14 percent – than many teachers and firemen? By exploiting tax loopholes that favor the rich and hiding his money in the world’s most notorious havens for tax cheats. That’s what Mitt Romney has done, according to his 2010 and 2011 tax returns, a trove of secret Bain Capital documents unearthed by Gawker, and exposés by Bloomberg and Vanity Fair. “The bottom line,” says Rebecca Wilkins, senior counsel at Citizens for Tax Justice, “is that these are ways to reduce your taxes that are only available to rich people.”' https://www.rollingstone.com/politics/politics-news/mitt-romneys-tax-dodge-126974/

And this is just cute - 'Romney has stockpiled as much as $87 million in his IRA – even though contributions to such retirement accounts are limited to just $30,000 a year. “Congress never intended IRAs to be used to accumulate that kind of wealth,” says Wilkins. To get around the limits, Romney appears to have directed his IRA to invest in a special class of Bain stock. By assigning an artificially low value to the shares, Bain ensured that any returns would be wildly inflated – as much as 30 times the initial investment. By buying rigged stock with his limited IRA dollars, Romney got to reap the bonanza tax-free.'

Do read the article to see how avoiding taxes, at least as revealed by two years of tax returns, through taking advantage of laws that have zero application to most of the American voting public, is the sort of thing that marks one as wealthy. As noted by a despised billionaire a generation ago, taxes are only for the little people.

A subject which Senator Romney has a lot of experience of. And is in an excellent position to ensure that such an observation remains as applicable as possible.

"a private-equity kingpin worth at least $250 million" is rather a good illustration why it's daft to bang on about "billionaires".

The quote I was responding to uses the term 'rich' - which Romney would seem to be in all honesty - not 'billionaires.'

And Senator Romney is well placed to continue to use influence to make sure that that tax legislation continues to favor people such as himself.

And Senator Romney is well placed to continue to use influence to make sure that that tax legislation continues to favor people such as himself.

Do you think he will?
We'll have to keep an eye on him. Some of us are rule makers and some rule takers.

I hate it that our tax system encourages such behavior the politicians should fix this. But here goes.

I thought of a scheme to avoid taxes, I think it is legal but maybe not ethical. If your children give to charity but not enough to itemize, you can have them give the money to you (up to $14,500) and you give to the charity this combined with giving 2x as much in year 1 and nothing in year 2 can save thousands of dollars in income taxes depending on your tax bracket.

BTW do you know that you are supposed to keep track of your out of state purchases (like from amazon) and pay sales taxes on it at the end of the year? The politicians need to fix that too by replacing the sales tax with some tax that does not put instate retailers at a disadvantage.

'Do you think he will?'

Of course - why should he not do the best to make America a place where capitalists such as himself can not continue to enjoy the fruits of their efforts?

And Romney is way ahead of you when it comes to avoiding taxes on gifts (and really, who cares about ethics in such cases) - 'Romney has shifted enormous wealth – as much as $100 million – into a family trust, a fortune he doesn’t include in the $250 million estimate of his net worth. His campaign admits he paid no gift taxes in transferring assets to the trust, even though individual gifts above $13,000 are subject to taxation. A direct gift of $100 million would have incurred a tax hit of at least $29 million, according to Michael Graetz, a former Treasury official under George H.W. Bush.

How did Romney skirt the limits on gifts? Tax experts believe that he made his contributions to the trust in the form of the carried interest he received from his Bain funds. For income-tax purposes, the assets were technically valued at zero, because the gains would not be taxed until the fund’s investments were cashed out years later. In reality, though, Romney could have sold his carried interest to a third party for millions – making it absurd for him to pretend that his gift had no market value. Yet even if the move was illegal, Romney has nothing to fear: Tax returns on gifts are almost never audited, and they can’t be challenged at all after three years.

Romney also used a scheme called an “intentionally defective grantor trust” to dodge the gift tax. Instead of having the trust pay taxes on its profits, Romney pays the tax bill himself. That keeps more money in the trust – amounting to another massive transfer of wealth that evades the gift tax. Even worse, the trust is exempt from the estate tax – meaning Romney’s heirs will eventually pocket some $31 million they would have owed in taxes had he not siphoned off his fortune into the trust, tax-free.'

Not daft, just a start. People have to deal with the demotic style of communication in this world.

IRA income tax "deductions" defer income taxes PERIOD.

He deducted $30,000 in a year, which to a quarter billionaire is "small potatoes."

When Willard (Hillary in a Brooks Brothers suit) hits 70 and 1/2 years of age (only the good die young) he will begin paying federal and state income taxes on the required minimum distribution, beginning at about 4% and rising each year.

And using that special math, his $30,000 a year manages to end up being a tax deferred 87 million dollars. I considered that cute, since the rich seem to be able to use a different set of rules concerning their arithmetic,

And here is the second paragraph - 'Romney also padded his IRA by investing in “blocker funds” that Bain has set up in the Caymans. Such funds attract tax-exempt investors – like college endowments or Romney’s IRA – that want to avoid paying the Unrelated Business Income Tax, a 35 percent penalty designed to prevent tax-exempt investors from having an unfair advantage over for-profit businesses in private-equity deals. But by buying shares in offshore blocker funds that then invest in Bain and other takeover artists, investors like Romney bilk the Treasury out of $100 million a year. “It’s an absurdly easy escape,” says Shaviro.'

Wouldn't that money be tax deferred in any case? It's just shares in his business. Or is he selling the shares (to who?) and then investing in something else?

Where did Rolling Stone get $30,000 per year? IRA contributions were limited for the longest time to $2,000 per year. For 2018, the maximum is $5500 and $6,000 for 2019.

https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-ira-contribution-limits

SEP IRAs are limited to like $50k. not sure what the $30k is referencing but it could be accurate to Romney

It seems unlikely that many teachers or firemen have more than a 14% effective tax rate

People who make this claim get to higher effective tax rates on the middle class by including the FICA payroll tax [Social Security tax]. They conveniently ignore the fact that people earning incomes near the median get fantastic returns on their FICA "contributions".

-dk

Also unlikely: teachers and firemen donating 30% of their income to charity.

People who make this claim may be considering union dues as a deduction, rather than considering it to be a cost of doing business and therefore "above the line".

-dk

The problem is too much power in the government- the idea that we can stop people from trying to influence policy is absurd. Better to make it of little use to do so. Why does the left always bring up the Koch brothers but forget Soros, Steyer etc. who favor more intrusions by the government & hence make the danger greater.

+10!

I'm also concerned about the not-billionaire that gets elected and ten years later walks away from the White House, Congress, etc. as a multi-millionaire.

You can make millions sucking dick if you’re as good as me!

Here is a book full of Data explaining in plain English how the rich use their influence (campaign contributions) to gain UNFAIR over the rest of the country and it's Citizens.
Free Lunch: How the Wealthiest Americans Enrich Themselves at Government Expense (and Stick You with the Bill) https://www.amazon.com/dp/1591842484/ref=cm_sw_r_cp_apa_i_wefxCbQ35JJJM

Rich guys dick up my ass hurts more than the truth but it’s the kind of pain I like!

The banks writing legislation for their own bailouts is probably the most obvious one. Socialism is wrong for regular people but if banks ask for it it must be good.

Coveting things of others was decried in the Hebrew Bible, written several thousand years ago. Envy is a pathetic human emotion. It is dubious that a Bloomberg column will add much to what is already known about this matter

Envy is foul.

I don't mind being beaten fairly. But the suspicion enters my mind that at least some winners are cheating.

"in the Hebrew Bible, written several thousand years ago": more likely a little more than two and a half thousand years ago. But I agree that its inveighing against coveting is a very fine passage.

Envy is a common vice that religious defenders of the rich decry.

These rich-defenders are always silent on the subject of Greed, Jesus' and Paul's own words notwithstanding.

In the Christian bible, Jesus puts the smackdown on moneychangers, rich people, and greed in general. Greed is a pathetic emotion. For a New Testament guy, Big J goes all Old Testament on greed.

Wait, transparency in the labour market is somehow bad now? How can you have a well-functioning market without common knowledge of the prices being offered and/or paid?

How does his salary help you coordinate your economic activity with others?

This is aimed at Tyler's personal opinion "My parents taught me never to ask a person how much he or she earns."

So, it begs the question of how can labor markets can work well without transparency?

If you understand his parents' advice as being that you shouldn't ask friends or acquaintances what they earn then there's no problem with the labour market. But you should feel free to ask colleagues - that is so obviously to the advantage of the employee that some employers try to ban it, don't they?

I don't think most billionaires got wealthy through salaried employment, so that's a bit of a red herring.

You might not reach a billion but you can reach a few million by saving and investing your middle class wages. The more millionaires we produce the less the need for class warfare. Otherwise expect more populism, far right or far left, for years to come.

Denigration/jealousy of the rich/successful has been a common human trait forever.

Karl Marx elevated it to a formal ideology. AOC concurs.

Private Billionaires command no armies or police to violently force public submission to their will.

Real, personal & arbitrary power over your life always resides in the politicians/bureaucrats controlling the levers of government.

Ambitious Billionaires buy some of the coercive power of government officials, but the core threat to the public does not exist in private wealth itself.

Shorter version: money doesnt corrupt politicians, people corrupt politicians.

Money just makes it easier

And they say we (moderates) are not tethered to reality.

As if all those billionaires are handing out checks for no reason...

The government’s not the Clinton foundation curing AIDs and handing out malaria nets in Africa. It has regulatory power and billionaires want to decide how those laws are written.

A million dollars isn’t what it once was; the millionaire term implied both rarity and wealth well beyond ordinary experience. Now it might denote a successful dentist or just a lucky coastal homeowner.

There are reportedly about 11 million millionaires in the US, but only about 585 billionaires. I’d say billionaire is useful shorthand.

It’s worth noting that politically important concentrations of wealth are not limited to individuals; the Ford Foundation for example has about $15 billion in assets and is actively political.

Well if a million dollars isn't what it used to be what to say about the ordinary person earning 50K a year?

That his human capital is worth a little more than a million bucks?

There is a confusion as to whether a millionaire one who has a million dollars in ASSETS or in INCOME per year.

-dk

Typical usage (for both millionaire and billionaire) is assets. That appears to be the dictionary definition as well, originating about 200 years ago.

This won't go well for you. It's as if you have lost all understanding of America.

Above all, we reserve the right to drag our elites. How do you not know this? Standing athwart this tendency (all the Wall Street Dems are losing their shit over this loose billionaire talk too) beclowns you.

So many have fanned the flames of envy and resentment for decades, only to now panic that they are losing control.

Better to stand aside and let the spasm of rage burn itself out. If all the world was a stage 400 years ago, it's moreso now.

Tyler is a public commentator and writer. Standing aside and being quiet isn't in his nature.

He picks his battles. This was a bad pick.

The place to make the stand was letting the "40 years of middle class stagnation" bullshit become an accepted part of the narrative.

Or perhaps not allowing complaints about where the economic gains have "gone to" without once asking where these gains "came from".

Russ Roberts is a public commentator and writer who picks his battles more judiciously.

Elites closing ranks in defense of billionaires - again, I chuckle at Wall Street Dems scrambling here - is not a good look right now.

He might end up just like the scorpion.

I have to live on this spasm of rage, so I’m motivated to keep it contained as a curled lip sneer and not a PC maenad fest. Which, also, can damage the institutions that have made our nation great, worthy and successful.

Your take is getting ratio'd on Twitter. I told you Tyler!

Fair is a difficult term here I think. That said, given the political structure of the country -- independent and supposedly reasonable separate states in a federal structure -- all the PACs and corporations funding candidates with funds from people not living in those jurisdictions seems inappropriate.

Since when has anyone cared about being fair to a candidate for public office?

Or does that only apply to billionaire candidates?

First, Mr. Schultz wants to become a public figure. It's a bit ridicule to call for the media and then complain about being under the spotlight.

Humans are tribal, if all your peers refer to billionaires as billionaires and then someone out of your tribe comes and say "let's call billionaires people of means" the natural reaction will be call this outsider someone who is not in touch with reality anymore. Of course, those words make sense to Mr. Schultz but make no sense at all for the other 99.9%.

Finally, being despised is part of being a public figure. Celebrities and sportsmen deal with this everyday. Just look at all the hate Tom Brady attracts for being good at a ball game.

I have nothing against Howard Schultz. But, given his position, I suspect that he is used to being treated with considerable deference on a daily basis, so being exposed to the rudeness and invective of social media may be a useful corrective. Of course, given that rudeness and invective are now baked in features of platforms like Twitter, it doesn’t have much punch anymore.

On a related note, I read a profile of the show runner Pamela Adlon last night, and one of her habits is interrogating waiters about plastic straws and the materials used in their food containers. It’s a very obnoxious way to talk to people who are making less money than you are, but perhaps such behavior will contribute to greater sustainability in the future as restaurants try to satisfy their customers. In other words, while good manners should be the default, bad manners may have occasional social value.

https://www.google.com/amp/s/www.newyorker.com/magazine/2019/02/11/pamela-adlon-the-tv-auteur-hiding-in-plain-sight/amp

Finally, as a long time reader of this blog, I find it striking that “objectifying billionaires” is a concern worthy of a Bloomberg piece, but I cannot recall a post or authored article in which the habit of “objectifying women” was identified as an important social problem.

Re: that first paragraph, I think the flipside here is that the rudeness and invective are unfortunately why we wind up with narcissistic mediocrities like Hillary Clinton and Donald Trump as major party candidates: most sane people don't want to subject themselves to that.

THIS. The gauntlet one must run to become president is ridiculous and precludes any truly worthy people from doing so. This has only gotten worse with social media.

It was already bad enough in the mid-90s that Colin Powell refused to do so when he was practically being begged to. I wrote him in on my ballot in 1996 for just that reason: his refusal proved he was the best man for the job.

Typical Republican: only billionaires can run, woe is me. John Kerry, middle class Vietnam War Hero ran and was destroyed by right wing propaganda. They doctored his records to make it look like he only served 90 days in Vietnam and that his horrible war injuries never required medical treatment or even gauze.

Hillary Clinton, middle class child welfare advocate ran and was destroyed by the great right wing conspiracy twice. They never understood the family was bankrupt in 2000 and had to live in a shack in Weschester. They even photoshopped her kissing a Klansman as propoganda!

Joe Biden, who’s never even held a job ran as a middle class candidate and was hammered by right wing media multiple times. They even photoshopped pictures where he was inappropriate with young girls.

All a huge right wing Kochspiracy to discredit public servants. It even has a name now, Swiftboating.

Plastic straws and food containers in the U.S. are totally meaningless from a sustainability standpoint. We have efficient waste management and abundant landfills.

The article is missing the forest for the trees. If Mr.Shultz wasn't a billionaire he wouldn't be running for President. Being that wealthy instantly gives access to power and visibility, even if you're as incompetent as oh, I don't know, Donald Trump. The rest of us plebs have to actually do the work.

There are many unfair ways of gaining unearned visibly and access to power, family and marriage connections being the most common. And then there's Kamala Harris with her Willie Brown 'special connection'.

May I take it that such a keen exploiter of the casting couch has claimed sympathy with the MeToo women?

"There are many unfair ways of gaining unearned visibly and access to power"

Thanks for that rousing bit of whataboutism.

Running a large business is not one of them, I think

The perception of today's billionaires is not positive: America has become a kleptocracy. https://www.theatlantic.com/magazine/archive/2019/03/how-kleptocracy-came-to-america/580471/

The wealthy have created this problem for themselves...this was easy to see coming. If you want to maintain such a privileged position in society you should be on the forefront of policing the system: make sure white collar crime is dealt with firmly, make sure policies have the median voter in mind, not some amorphous notion of aggregate wealth, make sure the tax system is as fair to someone using turbotax as it is to someone who can afford a $1m accounting firm. This is just common sense. If you neglect a problem long enough it'll come back to bite you.

In the case of Timothy Geithner make sure the tax system is as fair to someone incapable of using turbotax.

I am a late arrival, a lagging member of the anonymous collective.

My prevailing thought is that Schultz should try to come up through one of the two main parties and their primaries. He would both get his ideas out there and have his chance to move the center of opinion where it matters. Maybe I would vote for him that way.

The problem with him doing it this way, even if he is a good billionaire, is that he demonstrates the problems of billionaires even so.

Instant national attention, huge television air time, and this editorial itself, for one reason only.

And without a national party organization, no actual path to victory. Only an ego exercise for himself and his voters, to feel good about themselves as someone else wins.

The most likely outcome is that he'll spend a bunch of his money, fall to gain traction, and drop out. Wouldn't that be yet another demonstration that rich people spending their own money on vanity campaigns really isn't a problem?

If he dropped out early that would be fine, but that's not the way I think the psychology of these things work. As soon as he's running he has supporters. He and his supporters develop mutually loyalty. It becomes very hard to break the cycle. To drop out is to disappoint supporters and abandon the group. It is much easier to run it through to conclusion and say "There, we did our best. We got our message across."

Real cynics might also fear that Schultz's run as an "independent Democrat" is calculated to pull more votes from one side than the other, preserving the 2017 tax cuts (useful to people like Schultz) that much longer.

Perot could easily have won and he was a complete crank

Easily?

He was leading the polls before he dropped out (temporarily) right?

"that tape is Schultz is much better than what many media sources reported, here is the excerpt on that": oh dear, you are evidently taking on too much, Mr C. This would be better:

that tape of Schultz is much better than many media sources reported; here is an excerpt from that:

You're afraid that these natural libertarian Hispanics you let in like AOC might want to tax your billionaire donors, toady.

I guess the thing to ask yourself Tyler, is will you spend fewer column inches on people like Pete Buttigieg, than Howard Schultz this cycle?

If so, doesn't that demonstrate a magnetic and anti-democratic attraction to large amounts of money? Concentrations of wealth?

That or Schultz is planning on running as an independent. And has name recognition through Starbucks. Everyone knows Starbucks, love it or hate it.

A mayor in Indiana with zero name recognition running in the Democrat primary with zero support in the polls...why would anyone bother writing anything ?

People name fame as a whatabout, but it's more a secondary problem than a solution, isn't it?

If you do want the best people at the political and administrative job of being president, you should search for them, and not say "we have to take these rich or famous because that's the way of the world."

So the press should only cover candidates that fit their ideological profile?

CSU Longbeach weeps.

Who said that, or *only*?

And in fact doesn't the *almost always* run toward the rich and already famous?

A polite aristocrat is not going to work. He should realize he is not suited for the task, he would be a Macron in a sea of yellow vesters.

FFS, if billionaire's wanted to run around without anyone knowing their massive net worth I doubt anyone would be talking about this issue. It's the billionaire's who are making sure their net worth is enabling lavish personal consumption and, much more importantly, providing massive political influence. You don't get that power without everyone knowing just how much money you have, and your willingness to spend it.

Amazing how TC just keeps doubling down on the cluelessness. Is the straussian reading here that TC is secretly doing his best to prove the anti-billionaire case by showing how easily it is for the billionaire's to buy off academic elites by default (ie, just the threat hanging in the air makes doing anything explicit unnecessary)? I have to admit that while a wealth tax sounds like an accounting nightmare, Schultz has greatly impressed upon me the value of a punitive one for net worth greater than $1B. Maybe we can drop the $50M threshold to avoid the accounting headache.

Warren Buffet?

I wonder why Democrats panic that a white billionaire former CEO of Starbucks would end up siphoning Democrat votes?

Aren't they worried that he will siphon up enough never-Trumpers to first, swing the House back to the Republicans, and possibly, with the help of white working class voters in the mid-west voting for Trump, swing the presidency to Trump as well?

Now I know the PC police on campus is getting out of hand

This whole billionaire debacle is a red herring. How many takes do I need about the fragile ego of billionaires? Seriously. Our press has glossed over the second part of AOC’s critique. Communities in Alabama with high incidence of hookworm (which she misstated as ringworm). How many of us know about a common practice in poor communities known as straight piping raw sewage into streams and rivers? I get it. Hand wringing over billionaires is sexier than talking about poverty, disease, and the failure to provide basic living standards in the United States. What these communities need is more taxes and less philanthropy (Rob Reich, Stanford).

I sure didn't know that. Looking it up now,

Failing septic systems and “straight pipe” (raw sewage discharges) are common in rural Alabama. One detailed study of unsewered homes in Bibb County found that 35% of septic systems were failing and 15% of homes had a straight pipe.

https://cfpub.epa.gov/ncer_abstracts/index.cfm/fuseaction/display.highlight/abstract/10779

Why is it Howard Schultz's job to cure hookworm, though? At what point did he accept the position of Alabama Hookworm Fixer? Besides that, hookworm isn't liver cancer; it's pretty cheap to treat. How much money would it really take to fix the problem? Probably not that much, so why the rhetoric of "hookworm + billionaires = AOC indignancy?" Don't tell me; I know why. Because as Marshal McLuhan noted, "moral indignation is a standard strategy for endowing the idiot with dignity."

Um, maybe it is the job of the 70% top marginal tax rate to cure hookworm.

As I noted, you don't need a 70% tax rate to treat hookworm; it's not expensive. Here's a treatment on ebay for $14.99: https://www.ebay.com/p/Benda-Suspension-Kills-All-Worms-Parasite-Deworming-Liquid-for-Human-30ml/13026782424?iid=123589912018&chn=ps

You could buy one of those for every person in the state of Alabama for less than $75 million.

You would do that rather than stop the flow of raw sewage into public streams, wetlands, the food web?

They probably should change the law, but forcing a bunch of poor mostly blacks living in trailers to upgrade to using septic tanks (a non trivial cost) is going to generate a lot of PR. So instead, new construction has to use proper sewage disposal but existing homes are grandfathered in.

Your racial expectations aside, most of the country would indeed condemn a property with open pipe sewage as unfit for habitation, and would ideally move those people to a shelter, and then perhaps to a assisted rent (and up to code) apartment.

So I can see why you are bucking this. That's a lot more state assistance than you want, isn't it?

" most of the country would indeed condemn a property with open pipe sewage as unfit for habitation"

You live in a bubble. A dry bubble.

I'm guessing you don't realize that it's common for sewage treatment plants across the US to release billions of gallons of untreated sewage into rivers, lakes and the oceans during heavy rains. NYC and Philadelphia for example.

NYC
"When this happens, “relief structures” allow a gruesome mixture of polluted urban runoff and raw sewage to bypass the water treatment plants and discharge directly into local waterways at up to 460 locations throughout the five boroughs.

Approximately 20 billion gallons of sewage and runoff make it into the Bronx River, East River, Hudson River, Harlem River, Flushing Bay, Flushing Creek, Alley Creek, Westchester Creek, Coney Island Creek, Newtown Creek, Hutchinson River, Gowanus Canal, and Jamaica Bay every year."

https://www.nrdc.org/stories/when-it-rains-it-pours-raw-sewage-new-york-citys-waterways

Perhaps the Billionaire Mayor of NYC ought to do something about it, eh?

"During heavy rains" is obviously both a corner case and a failure.

But it's good to hear that the open sewer party approves!

"In 2016, there were 100 days with such overflows; the 2017 count stood at 95 at the end of October."

Just for the record NYC is spending billions a year on upgrading their sewer, and certainly Alabama could do more. But of the two, the situation in Alabama is the corner case.

As an immediate first step, that'd be the place to start, would it not? I mean, I assume having hookworm isn't the most fun thing in the world. Again, though, if you want to push the goalposts to some major sewage and septic system reform, I'm not sure that really changes the equation. 49 other states, along with, ya know...the rest of the developed world, were able to master this whole 'waste disposal' thing without punitive or confiscatory levels of taxation. Why now, in 2019, do we need to make an exception?

I think open sewage in the US in the 21st century was the original shock item, and hookworm is just one immediate negative externality. If you read my link you know there are more:

"These straight pipes alone would discharge >60,000 gallons of raw sewage containing billions of pathogens, including >300 million Cryptosporidium oocysts and >1 billion Giardia cysts, each day in Bibb County."

Okay, but that doesn't answer my question.

A 70% tax rate is such an absurdly greedy move, I cannot fathom how anyone could think its okay.

Greed and avarice seem to be incredibly popular in the political sphere right now, AOC and Warren are extreme versions of this what with their clamoring for tax raises.

Good thing no one is proposing 70% as the effective tax rate then.

Good thing the person you are responded to didn't say 70% effective tax rate then.

Bad faith, bad faith, bad faith.

I am sorry, Anonymous, maybe you aren't aware of the literature on this. Many people, mostly Republicans, don't understand what a marginal tax rate is, and interpret it as the effective rate. When our friend goes off above, I assume that's what he's doing. Fitting the mold.

https://today.yougov.com/topics/politics/articles-reports/2013/01/08/understanding-how-marginal-taxes-work-its-all-part

Exactly, in bad faith you just assumed he was making an incorrect strawman argument

That is the way I still read "A 70% tax rate is such an absurdly greedy move."

Because who who actually understood marginal rates would even care?

Literally everyone

"Communities in Alabama with high incidence of hookworm ..."

8 years of the Obama administration and they did nothing about this! And where is the Clinton Foundation? Billions in donations, and yet not a single dollar spent on Hookworm in Alabama?

I'm just terribly shocked about it all.

Of course their response might well be this is a small and local problem. But hey can we afford to let the plutocrats off that easy?

Ah yes, I remember you supporting more tax and more transfers for public health, every step of the way.

It would have been a great job for the stimulus package too. Remind us where you were on the stimulus package?

It's amusing how quick you are to move the Goal Posts.

I just knocked down a strawman. You were all "why didn't the Democrats fix all problems?" while forgetting "oh yeah, I was opposed to just these kinds of fixes at the time!"

I mean, right now, what is your program to fix sewage infrastructure in Alabama? Do you have one, or is it "poor person local responsibility?"

Probably step 1 would be understanding the problem instead of just assuming that "billionaires" should fix it. I find it hard to believe that Alabama, with a GDP per capita higher than France or Germany, can't fix this local problem on its own.

Alabama could fix it and it's purely a local problem. It's not the fault of "billionaires" nor even is it the fault of Barack Obama nor Hillary Clinton.

I think "the billionaires" have trained you well. First, reject high taxes on high earners as morally wrong. Second, say how can we fix this without any money? Third, how is this the billionaires fault?

Maybe, just maybe, you set no open pipe sewage handling as a national priority, maybe even a higher priority than a trip to Mars.

Or do the billionaires still have you pinin' for Mars instead? A clean start without open sewer pipes?

To be honest, shitty things have happened all over the world for millions (or billions) of years. Man traveling to Mars is something new and that might save life from total extinction.

Even with some open sewage flowing, it would be about a million times easier to "terraform" Alabama than Mars.

And that sir is how you actually avoid extinction.

Yeah, I mean there is no need to "terraform" Alabama at all. A Mars colony would be a momentous achievement. Eliminating open sewage would be nice but I don't think it's even remotely close to being an equal achievement.

again, more bad faith. We're not asking them to solve the problem without any money, we're asking them to solve the problem with the huge amounts of money they already have, or with however much additional money they would like to collect.

Taking money away from productive people (yes by force) and giving it to the dysfunctional government of Alabama to fix a problem they could trivially solve themselves is just bad incentives. Really bad.

But no, keep going.

I love how you guys are defining yourselves as the open sewer party.

You are the open sewer party, because your position is apparently that Alabama is hopeless and incapable of solving its own problems, adn that it will have open sewage forever unless we can put a new tax on billionaires to fund a very expensive and wasteful solution to the open sewers that will hurt everyone. This defeatism and apology for bad governance is extremely harmful and is what results in failures like open sewers.

"I just knocked down a strawman. "

Why is it a strawman argument to point out that the former Democratic President of the US is far more responsible for a local problem in southern Alabama than a liberal billionaire from Seattle?

Alabama is run by Republicans and I have been informed here many times that Republican-run polities are just terrific. So you shitlibs should stop running down Alabama.

Indeed. But the Left wingers have fixed on billionaires and Schultz as the enemy of the people currently. It's absurd to try to link a Seattle billionaire to a problem in southern Alabama.

Alabama is certainly not a paradise and the Republican's running the state aren't noticeably better than the Democrats who ran it 8 years ago. The state Legislature was run by Democrats for 136 years. But they finally lost their majority in 2010.

I'm pretty sure that the state won't drastically change just because a different party nominally took charge.

So Schultz can buy another 1,000 Mercedes. That’s the moral Pareto optimal point in the Plutocrat party.

Better 1,000 Mercedes sitting in a garage than 70% MARGINAL tax rate and a 3% wealth tax on the tippy top to prevent children from getting ringworm.

Maybe instead of a useless wall we could build $5 billion worth of septic tanks so children don’t get ringworm

You don't need those things to prevent children from getting ringworm. There is way more money than is needed to do that already. What you are proposing is to destroy the economy and make things worse for everyone just so you can enable shitty local government. Shultz is not buying 1,000 Mercedes that's just BS that makes no sense. He's probably going to give that money away to causes that are actually effective, i.e. not the local government in Alabama.

"Linguistic objectification is often a preliminary step toward making others seem less human or less deserving of respect."

Indeed. And according to the standards Twitter applies to conservatives "dehumanizing" tweets are cause for a lifetime ban. Let's start banning anyone who tweets about "billionaires."

I don't know, in the past many people considered Musk's tweeting entertaining. Seems like he should be as free to use twitter as any other billionaire, such as our president.

Though if you honestly think billionaires talking about themselves should be banned by twitter because it is 'dehumanizing,' well, this is the MR comment section

I think the issue being missed here with billionaires is this the end point of democratic politics? The only people who will / can run are billionaires who have the 'f you money' to do it as a vanity project?

Isn't the answer obviously not? We had dozens of legitimate candidates last cycle and I'm sure we'll have plenty this cycle.

But both finalists were billionaires: Trump and Clinton.

The Clintons are not billionaires, although they are quite rich, though mainly from being President already, 20+ years ago

Philanthropist: a misanthrope with discretionary income or disposable wealth.

Wealth: the ornamental mask in which poverty makes all of its starring roles.

Money: in worlds of two dimensions, the cure for every ill and the solution to every problem. The efficacy of money in curing ills and solving problems in two-dimensional circumstances owes to the perfectly realized forms of currency and coin in obverse and reverse.

Senator Romney need not sell himself to anyone so as to ensure that tax legislation is as friendly to his wealth as he can possibly make it.

See? Just cut out the middleman, and let the wealthy run things completely.

Not that many will be so obvious about it, as noted in the Firefly TV series, 'About 50% of the human race is middlemen and they don't take kindly to being eliminated.'

I wonder how many new readers this site will pick up and how many comments this thread will generate. Hmm....

IMO the famous are worse than the rich. (Yes I'm talking about you Bernie Sanders.) We are lucky to have the rich to compete with the famous.

We do get the modest treat today of seeing enormously overinflated cults of celebrity tearing each other apart as part of our new "public entertainment" fare.

Our grotesque cults of celebrity are "enormously overinflated" in terms both of economic valuation as compensation for actual talent (most of all that money today pays simply for the thin veneer of "image", which is the cost of conspicuous celebrity consumption) and "enormously inflated" in terms of most of the cultural significance imputed to them, no matter what role they play in our vast entertainment empires--sports, music, film, theatre, journalism, academia, business itself, governance itself, the judiciary itself, et cetera et cetera et cetera, ad absurdum).

"I was told that it was rude, and I still believe that. It follows that we also should not ask people about their net wealth..."

No, it follows that you should not do so. Though you are entitled to your opinion on how the rest of us ought to behave, it hardly holds the status of a moral imperative.

"it is natural to describe him as “the billionaire entrepreneur,” to set the context for readers. And Branson, as a public figure to some extent, cannot expect complete privacy in this regard..."

Does that not also apply to someone considering self-funding a campaign for the Presidency ?

Why do we not ask whether actors or journalists or prominent media personalities get too much influence? Oprah Winfrey got outside influence because of her talk show and THAT is mostly what made her a billionaire.

Further: Schultz and that Gates fellow (and his wife, who jointly run their philanthropic foundation) do seem to have failed the Seattle region and Washington state generally with their philanthropic and public concerns, according to recent news accounts.

If the Bill and Melinda Gates Foundation can push for ambitious medical delivery in the world's remote regions, why can't either one of the two address public vaccination programs across Seattle and Washington state, instead of letting mooing herds of people shy away from vaccinations.

Schultz for his part may well be responsible for Starbucks' baristas earning whatever generous salaries they earn for serving coffee and snacks, but he himself equally has failed the public of Seattle and that of Washington state if he has never been more vocal about public vaccination programs on a planet swarming with more respirating people today than ever.

Sympathy for billionaires, TC? Awww: the poor poor billionaires!

Who can save us now from our hordes of misanthropic philanthropists?

Yeah, I'm pretty shocked that a couple of people have not managed to solve literally every problem in the world yet

I am not shocked at all that two ambitious billionaire philanthropists are so detached from their immediate surroundings and actual localities that they could succeed in doing next to nothing on behalf of their localities (the Gates, at least, maintain residency in the Seattle area, last I heard, I think their gargantuan mansion is somewhere thereabouts).

Why would they do anything on behalf of their localities if there is more good to be done elsewhere? They should be more evil, in your opinion?

Helping to alert their local publics to the marvels of immunology and vaccination (emblems of the mighty god Science itself) wouldn't make them "more evil", it would make them pious.

Saving lives is pious. Wasting time and money on problems way down the list because they happen to be near you is not.

This is satire right? We obviously don't expect a private individual, no matter how wealthy, to take on responsibility for other private individuals personal choices in the face of nearly infinite evidence against their choices.... you want Schultz to what fund child protection services to abduct these individuals' children? Or maybe buy some special chairs that they can strap the kids in and force vaccinate them?

You're right: I am surprised that Starbucks doesn't offer its own "vaccination-option" kiosks in every Starbucks location across the Seattle region and all of Washington state (fully funded, of course, by the Bill and Melinda Gates Foundation).

Is the problem in WA that there wasn't enough access to vaccines, or did too many anti-vaxxers finally cause a tipping point problem?

The measles outbreak (epidemic?) has been so spontaneous I have not followed all the reports, those I've seen suggest anti-vax populations were entrenched across the topography prior to the outbreak and presumably made themselves conspicuous through properly heralded public protests.

A public health menace is a public health menace. The public health menaces that the Gates Foundation folks have addressed around the globe, well and good: but unless we see fresh accounts of how responsive this global pioneer in medical delivery philanthropy has been to this spontaneous local outbreak (epidemic?), legitimate wonder may persist concerning how localities get overlooked in an internet era in which locality is supposed to present no barrier to a full and complete and fulfilled existence. (That is: I impute an anti-somatic intent to our beloved internet era, devoted as it is to reducing our sensory capabilities and capacities to sight and sound alone.)

A billionaire has a thousand times as much money as a millionaire and yet both would accurately be described "people of means". The 1000x multiplier, however, is a fraction of the actual difference (on average) they have in the economy, politics and culture.

A millionaire actually needs to keep most of their money to live on while a billionaire really only needs to keep a small fraction. A billionaire also is much more likely to be able to have the relationships in the media, among top corporate and political leadership. They are also sufficiently unique that anything this wished to get noticed will get noticed.

In short, while it may or may not be fair to blame billionaire for all that ails us, but it certainly wouldn't be meaningful or accurate to lump them in with mere millionaires.

God forbid we’re rude to a billionaire! Let’s see the outrage about victim signaling from Tyler/Sam Harris etc etc

It's been incredibly disheartening to realize that Tyler is simply another shrill for the billionaire class. Between the strawman arguments vs. a higher tax rate and this defense of Schultz it's clear to see where you stand.

All you had to do was read his book

All that bookish, erudite sophistication is but a facade for incumbent power. Say it ain't so.

The rich are so powerful they pay most of the taxes. Weird.

Those poor babies. I bet they wish they paid no taxes like the dude I gave $1 to outside of my bagel shop this morning.

Or, you know, the 50% of people who pay no federal income tax.

Yes them too. Those poor rich folks, who aren't the lucky 50% who pay no federal income tax.

I wish I had Bill Gates's tax bill, and you do too.

Not enough to develop the stuff that gets you that bill, tho. Hm.

Sure anyone would prefer more money to less, all else being equal. But as China Cat says, all else isn't equal.

This is Tyler's leave Brittany alone moment.

It's tempting to jump in to the outrage du jour, but I'm saving all my hate for when the first trillionaire comes along.

Eliminate the estate tax and factor in inflation and it wouldn't be that long...

I was also taught that it was impolite to talk about weath or income. I've come to believe that is a politeness that only helps employers and people in power. Competition requires information. The strong social pressure to not discuss these issues reduces information and allows discriminatory practices to thrive.

Yeah but that income info had better be anonymized or aggregated or resentful people will be at each other's throats like the Enterprise crew in those "space sickness" episodes.

This is exactly the kind of politeness that is gamed by the institutions we have today. Strange that Tyler as a classical liberal and an economist would be against the most basic premise of the price system. Perfect information plus perfect competition should lead to a decent and most fair equilibrium for all.

Damn, this is some hyper autistic Bloomberg contrarian hot-take/clickbait here!

But your Bloomberg colleagues one up'd you though:

"Americans Are Dying Younger, Saving Corporations Billions"

https://www.bloomberg.com/news/articles/2017-08-08/americans-are-dying-younger-saving-corporations-billions

Day after, first of all congratulations to Tyler for what was clearly an objectively successful column. I observed higher rank, including on the front page of memeorandum, than I have seen before.

But I am afraid we have a secondary event that reinforces our concerns. I am talking Bezos of course, and his (good guy) billionaire ability to laugh off (bad guy) millionaire blackmail.

When the news in an American democracy becomes essentially about battles of oligarchs, and indeed the rumor that government agencies were involved, it's bad.

Genuinely surprised to see such unabashedly PC whining here about how billionaires fee-fees are hurt when they get called billionaires, and pleading for the use of a horseshoe euphemism like “people of wealth”.

In other news, John Gotti, hugging his blanket, has asked to be referred to as a “person of affiliation” instead of a “gangster”; Idi Amin, holding hands with his dolly, has asked that people stop using the word “dictator” and instead call him a “stern statesman”; Genghis Khan, sucking on a pacifier made from the bones of children and openly sobbing, says that the word “warlord” constitutes actual violence against people like him; and Lucretia Borgia is tweeting that “Calling me and my family degenerate inbred aristocratic monsters is hate speech.”

Bezos is using his propaganda machine to attack Trump and anyone else who disagrees with him. Right out of Thomas Jefferson’s play book.

I disagree with you, I think we should all talk more openly about how much we are paid. I think everyone would learn a lot from it.

I think people fear it will breed resentment, and maybe in the short term it will. But I think in the long term it could help diffuse people's wildly incorrect perceptions of fairness in the world, and I think cuts both ways. That is, to large extent we have differences in wages because of differences in opportunities (e.g. support from family, availability of education, aptitude), and being more mindful of the impact of these things might make us more sympathetic to the less fortunate and encourage us to develop better socialized solutions. But also, to large extent we have differences in wages because of the choices people make (e.g. whether to become a teacher or a software engineer, whether to work longer hours to lead a project or defer to a colleague), and more awareness about the impact of these decisions might create a greater sense of accountability to them which erodes the sense of entitlement to feel resentment and encourages people to take more ownership of their decisions.

I feel I can sorta see this play out based on experience in my workplace. Our compensation is semi-transparent because it is formulaic based on function+level+rating and enough people have publicly shared their compensation for everyone to infer the formula. However, people do not necessarily know the level+rating of their peers.

As this information came out, we did see some resentment over the differences in pay across functions (e.g. software engineers vs designers). Resentment has dissolved as leadership explained that function pay bands are set by the market, not by the value of the function to the company. This is sorta like saying, "hey, if you think it's unfair that software engineers get paid so much then you should become one." That rings a bit hollow insofar as people are committed to career paths by their education and experience but if all of this information was much more public from the beginning then that is no longer the case. (And presumably a person decides to be a designer instead of a software engineer despite the lower pay because of psychological benefits; I think it would be good to force people to acknowledge these factors.)

I put the designer and the software engineer in the same category because I think both of them require about the same level of family support and education to achieve. The janitor might be in a different category; I wouldn't necessarily say if they think it is unfair they should have become a software engineer; I react by striving for better social welfare so that it could have been a more realistic opportunity for them.

There is also the issue of differences in pay within function, e.g. why is this designer paid so much more than that one. This is less transparent in my company but as a manager myself I would welcome transparency: my decisions to set different levels and ratings among my team are deliberated carefully and I think it would only help me to motivate members of my team to be able to compare them to each other when speaking to performance gaps with reference to the resulting compensation gaps.

Measles with mocha, anyone?

Pumpkin bread with mumps?

So I guess "fuck your feelings" still only applies to the little people.

I suppose it makes instrumental sense for some people to kiss rich ass, and I don't judge people for what they have to do to get by. But listening to wealthy, secure academics scold about manners on this topic brings guillotines to mind.

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