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THE RICH
So Donald Trump has more money than you - it’s not fair!
Bill Gates is richer than 99.9% of all Americans – he must be an evil robber baron!
The richest 10% in the United States only pay 70% of all taxes – how dare they?
Let’s make them pay their fair share! My father was a janitor – that makes me
the best qualified to be a United States Senator! He’s rich – that should
disqualify him to be the president of the United States!
A common theme seen in the more liberal media outlets is populist anger against
“the rich.” Just who are these rich, anyway? Why are “the rich” such bad people?
By and large, “the rich” drive Fords and Toyotas while owning houses
valued around $500,000 or less. Their money is smartly invested and they also regularly donate a sizable
sum to charity. They often shop at discount stores and they do not own expensive watches.
They work long hours and may hold multiple graduate degrees. Some never finished college.
Simply put, most millionaires are smart, industrious, and decent people. Most millionaires use much of
their wealth for investment and charity while maintaining modest lifestyles and while working harder
than most of us.
What we can conclude from this description of ”the rich” is that the
populist anger against them is misdirected at a false image. The media often reinforces this stereotype
of the affluent. Yes, there are some bad apples in the barrel, but let’s not tar and feather the vast
majority for the indiscretions, thievery and bad behavior of the few. It’s all too easy to scapegoat
“the rich” to hide the real populist and liberal agendas, or to misdirect attention away from
the real failures of the politicians who advocate the populist and liberal themes that pander to the
masses at the expense of everyone.
One of the misconceptions foisted upon the American public by the political
demagogues is the canard that “the rich don’t pay their fair share.” What is a “fair share”
and who gets to decide how much is fair? The answers to these two questions are:
1) A “fair share” is always more than “the rich” are currently paying. And
2) Those who decide how much is fair are always the ones who will benefit the most from the robbery of
“the rich.” Those who urge the taking of more and more from “the rich” may not be
the individuals that benefit the most financially, but they may instead be the ones to benefit the
most from deflecting their own failures to a convenient scapegoat, or they may be populist dreamers
who are in continual search for that unattainable socialist Utopia where greed, envy and every other
bad aspect of human behavior is nonexistent. For these dreamers in their ivory towers, everyone is
supposed to share equally in the wealth of the community; everyone is supposed to contribute equally
in the creation of the wealth of the community; and no one needs or wants any more than his neighbor.
Dream on – if only we lived in this heaven on earth!
“On average, the wealthiest people in America pay a lot more taxes than the middle
class or the poor, according to private and government data. They pay at a higher rate, and as a group, they
contribute a much larger share of the overall taxes collected by the federal government.
“The 10% of households with the highest incomes pay . . . more than 70% of
federal income taxes, according to the Congressional Budget Office.” (Ref. 1)
On the other hand, the Tax
Policy Center estimated that nearly 50% of households, mostly low- and medium-income households, pay no
federal income taxes whatsoever!
But what about the claim that the wealthy are taxed at lower rates than the average
taxpayer? Well, that’s just another urban myth! Households making more than $1 million pay an average 29.1%
of their income in federal taxes. On the other hand, households making between $50,000 and $75,000 pay an
average of 15% of their income in federal taxes, while households making between $40,000 and $50,000 pay an
average of 12.5% of their income in federal taxes and households making between $20,000 and $30,000 pay
only 5.7%. (Ref. 1)
“The Tax Policy Center states that the top 0.1% . . . of federal taxpayers pay federal
income taxes equal to the bottom 80% of federal taxpayers! In dollar terms, the bottom 80% take in 6 times the
income that the top 0.1% takes in, yet the top 0.1% pay equal federal taxes. I guess that’s the fair share for
the wealthy as some see it.” Do those screaming for the rich to pay their 'fair share' believe that
“most of America is too ignorant concerning economics or is it that the demonization of the wealthy is just
such a populist message?
“Federal income taxes are not the only taxes paid by the payers of taxes. The wealthy
typically spend more on consumer products and therefore pay more sales tax. They also pay the highest rates
of state and local income taxes. They also pay more in property tax since they generally own more expensive
houses in the higher tax rate areas of the country.” (Ref. 2)
“Those who spew wealth envy and pit the so called ‘have’s’ against the
‘have not’s’ simply have a basic lack of knowledge of economics. Do we want to discourage the Bill Gates
and the late Stephen Jobs of the world by saddling them with more burdensome taxes all in the name of
wealth envy? These creative leaders and developers of new ideas, that have benefited the entire
world, should not be fearful or hesitant to develop their creativity because of legislators who wish to
control their income and assets. How de-stimulating.” (Ref. 2)
The messages that are constantly being drummed into us these days is that it’s
evil to be wealthy; the rich aren’t paying their fair share of taxes; we need to “redistribute the
wealth”; coming from a poor background is some sort of holy grail; and, unless you’re one of the
common people you have no right to run for public office. If wishes would come true, we’d all be
financially equal, there would be no rich and no poor, everyone would be paying their “fair share”
of taxes which, in the Utopian world of the idealists, would be zero, and we’d all be receiving the same
entitlements from the government so we wouldn’t need to work hard to make a decent living. We would then
be living in that modern socialist Utopia where everyone would be the equal of everyone else –
no rich / no poor, no overachievers / no underachievers, no skilled / no unskilled, and
no givers / all takers.
We Americans seem to forget that it is/was the wealthy that helped in no small
measure to create the America in which we live and prosper and which is the envy of the rest of the world.
People become rich by creating wealth not just for themselves but: for the people who work for the enterprises
that they create; for the people who invest in their creations; for the people who work for and own the
companies that supply and support the enterprises created by the wealthy; for the government workers that
regulate and suck money from the rich and the wealth creators; and, for the senior citizens of this country
that depend upon the income from the dividends paid by the companies created by the wealthy and the interest
these companies pay out on their indebtedness. In America, everyone ultimately benefits when people get rich.
The results of prohibiting or inhibiting the creation of wealth are only too obvious in the failed results
of every socialistic and communistic system that has been tried. So why do we keep hearing that wealth and
wealth creations are bad? Perhaps the answer is that the less creative, the less ambitious, the less competent,
and the less fortunate among us are jealous and envious of the successful risk takers and
the more fortunate (by birth).
WEALTH AND POLITICS
In recent presidential and other political campaigns it has become politically correct
and required to stigmatize an opponent’s wealth and to examine and question the amount of taxes paid by the
opponent. To be a wealthy candidate is to be seen as un-American and immoral. It has not always been so.
These days, running for public office seems to be a contest of who can appear to be
the most common of the candidates. A successful candidate should be seen having a beer with Joe Average,
he/she should come from poor parents, wealth is regarded as something of which to be ashamed,
and heaven help the poor candidate that is found to be paying the minimum amount of federal taxes allowed
under the laws of the United States and the incomprehensible rules of the IRS.
But rich people running for public office isn’t exactly a new trend. President
Herbert Hoover earned his wealth in mining and investments and, in today’s terms, was worth more than
$285 million before he reached the age of 40. “Andrew Jackson . . .was not born into wealth and this is a
fact that he often exploited as a way to connect with the ‘common man.’ It's a bit ironic then that he
became one of the wealthiest people to ever hold the office of the presidency. Jackson's humble beginnings
improved greatly when he married his wife Rachel who came from a wealthy Virginia plantation-holding family.
Then, after moving to Tennessee, he amassed an enormous fortune on the backs of his slaves, eventually owning
more than 300 who worked on his enormous estate in Nashville.” (Ref. 3).
Lyndon Johnson was one of the wealthy president who earned their millions all by themselves. “Who was the
richest president? Historians think that America’s first president, George Washington, also may have been
its wealthiest. Washington, who owned a plantation in Virginia, made his money off of farming, but his wife,
Mary Washington, also had substantial fortune from her first marriage.” (Ref. 4)
”George Washington was worth over half a billion in today’s dollars.” (Ref. 5)
Mitt Romney spent time working for a private equity fund and is worth somewhere around
$200 million, give or take a few million. This makes him worth more than 99.9% of all Americans. Is his wealth
a detriment to his candidacy or should it make him less qualified to be president? Did George Washington’s wealth
make him less successful as America’s first Commander in Chief and first President?
Many of our richest presidents inherited their fortunes, while some, like George W. Bush,
added to their personal wealth by expanding into new fields. President George W. Bush started out in the oil
business like his father and also bought a part interest in the Texas Rangers baseball team. Others, such as
Zachary Taylor, who served in the early 1850s, did little to advance their personal wealth, instead focusing
solely on public service. (Ref. 4)
President John F. Kennedy never actually inherited his father's wealth but he
certainly lived the good life as a result of it and never wanted for money. The Kennedys were wealthy because
of the financial empire built by their father, Joseph Kennedy. The fortunes of Presidents Theodore Roosevelt
and Franklin D. Roosevelt were also inherited. Did their wealth keep them from being successful presidents?
(Ref. 5)
JEALOUSY AND ENVY
Socialists and populists contend that we need to tax the rich out of creation – wealth
is evil! But, the truth beneath the pile of manure is that raising taxes on the rich is a tax increase on
job creation! The rich tend to be the achievers in our society. Are they the ones that are dragging down
the economy? What drags down our entire economy is the growing number of “takers” that receive the
entitlements and other perks handed out through government largesse. But, it’s the successful, the innovative,
and the hard-working entrepreneurs - the so-called wealthy - that provide the jobs, the money and the taxes
that ultimately support the economy. The populist concept is that if you are not in the top 1% of the wealth
scale, the government will provide what you need by taking it from the top 1%. If you are in the top 1%,
it is the government’s purpose to take your wealth and redistribute it to the other 99%. After all,
according to the populists, those evil people in the top 1% don’t “need” to keep their ill-gotten wealth.
A lack of perspective know no bounds!
“Economic envy, once seen as a European vice, is now rife.
The rich appear in Barack Obama’s speeches not as entrepreneurial role models but as modern versions of
the ‘malefactors of great wealth’ denounced by Teddy Roosevelt a century ago: this lot, rather than building
trusts, avoid taxes and ship jobs to Mexico.” (Ref. 6)
To put things in perspective, here’s a blog from a worker in Missouri who has gotten
the message:
“Why do people have such a problem with rich people? My boss is a multimillionaire,
and I'm proud he is and so are hundreds of others who work for him nationwide. He is the largest employer in
Washington County, Mo.
“I'm sure he has a large group of tax experts on the payroll to find every loophole
they can. That keeps more money in his pocket for more expansion and to hire more people across the country.
“These wealth-envy people need to quit their jobs and go find a homeless or poor
person and apply for a job with them. It isn't going to happen. Deal with it.”
(Ref. 7)
Let’s stop acting like children! Let’s stop being jealous
of little Johnny because he has a newer bike than the rest of us. Wealth is not a disease to be avoided,
shunned and condemned. Being rich is not being evil. One’s wealth has not been and never should a qualification
or a disqualification for public office in America. It should not even be a subject for discussion in an election.
What should be the only criteria in determining which candidate to vote for are the candidate’s qualifications,
experience and the conformity of the candidate’s political philosophy with that of the voter.
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References:
- Fact check: The wealthy already pay more taxes, Stephen Ohlemacher, The Associated Press,
USA Today; http://www.usatoday.com/money/perfi/taxes/story/2011-09-20/buffett-tax-millionaires/50480226/1,
20 September 2011 {Accessed 30 May 2012}.
- Wealth Envy, Brad Kocher, Voice of NC; http://voiceofmoorecounty.com/2011/10/20/wealth-envy/,
30 May 2012 {Accessed 30 May 2012}.
- How Rich Were Some Past Presidents?, Greg Houle, Yahoo news!;
http://news.yahoo.com/rich-were-past-presidents-005700467.html, 20 January 2012 {Accessed 30 May 2012}.
- Who are the richest past presidents?, Leah Nylen, Medill Reports Washington, 17 May 2007
{Accessed 30 May 2012}.
- The Ten Richest U.S. Presidents, Leah Nylen, 24/7 Wall Street:
http://247wallst.com/2012/02/17/the-ten-richest-u-s-presidents/, 17 February 2011 {Accessed 30 May 2012}.
- Does America Have a Case of Wealth Envy?, Robert Frank, The Wall Street Journal,
31 July 2008.
- Wealth envy and Obama, Todd Beussink, Southeast Missourian;
http://www.semissourian.com/story/1803593.html, 12 January 2012 {Accessed 30 May 2012}.
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