
The other day I was musing about the possibility of a 95 percent tax on earnings over $10 million, which prompted this piece of correspondence from reader J:
Ummm, a 95% tax is wrong because, ummm, it’s not the gov’ts money. The problem is that you, and probably most liberals, are not viewing this through the lens of what is moral. What right do you have to tell people they can’t make a certain amount of money? How about I put a cap on the number of hits your blog can get on a monthly basis? More hits might endanger the server. How about I put a cap on the amount of words you can type? Too many words may cause eye cramping for the poor reader. Here is the real question: why do liberals have a problem with freedom?
Personally, I would love a legal cap on the number of words a blogger is allowed to produce per day. I’m privileged to have a job that I really enjoy. But at the same time, I would prefer to write somewhat less—this pace is stressful and doesn’t leave me as much time to pursue other projects and interests. But though I would prefer to write somewhat less, I have a stronger second-order preference to produce a blog that’s competitive with other major offerings on the internet. And over the years competition between bloggers has led to escalating word-counts. The resulting situation isn’t terrible, there are lots of people you should cry for before you get to me, but basically we bloggers are engaged in a red queen’s race where we all need to keep trying harder and harder just to maintain our positions. A cap would be helpful.
March 30th, 2009 at 11:46 am
Responding to J’s point, it’s not really anybody’s money per se, not the government’s, not yours, not your employer’s. Hayek himself believes this.
Look at this way – what right do you have to demand money from your employer? It’s his or her money – why should they pay it to you?
March 30th, 2009 at 11:46 am
When I read someone equate the relationship an individual has with his mind, soul, body, or thoughts with the relationship and individual has with his money, I find myself experiencing a profound sensation of pity.
March 30th, 2009 at 11:47 am
Wouldn’t the world be better if the NBA season was only 50 games long? Or maybe it was 82 games long but each player could only play 50 games? Think of all the free time LeBron would have to explore other activities. Do you think he writes poetry? Maybe he’d take up gardening.
March 30th, 2009 at 11:49 am
“I have made this letter longer than usual, only because I have not had the time to make it shorter.” — Pascal
Really, drafting (and proofing) won’t fucking kill you. Or your blog. You are not, I hope, working on the Nick Denton pay scale.
March 30th, 2009 at 11:50 am
sorry but money does not belong to those who are deluded into thinking that they make it. Money belongs in the first instance to whomever is issuing it, authorized or not. In our nation, the government is the only bona fide issuer of money. You don’t make money, you make goods and provide services. You don’t do these things from scratch either. You piggy-back on generations of other people’s efforts, including the infrastructure of stuff paid for by the government, ie, the taxpayer. If you want to keep all of the fungible credit chips, aka money, that you think your efforts are truly worth, you should mint your own money or credit chips, but them into circulation and demand that people buy your goods and services using your credit chips. Then we can argue anew over how much of that you still owe to the government as the holder of the general citizenry’s interest in all the collective infrastructure you are using.
March 30th, 2009 at 11:52 am
Look at this way – what right do you have to demand money from your employer?
The same right you have not to work for your employer. He/she agrees to pay you; you agree to work. If you work, it’s your money. What is complicated about this?
March 30th, 2009 at 11:55 am
Some friends work in an international company in Stockholm. At 5:30 they have to leave. At 6:00 the lights are turned off.
March 30th, 2009 at 11:57 am
Re: The same right you have not to work for your employer. He/she agrees to pay you; you agree to work. If you work, it’s your money. What is complicated about this?
What’s wrong about it is that you are assuming that every deal that two people agree to engage in is thus moral or just. If a man pays a girl to f*ck a horse on stage, is that moral too? I know the Yglesian hipsters around here think that should be allowed, but I would not think that you would.
March 30th, 2009 at 11:57 am
Apples and oranges. He’s comparing production (words written) with compensation (dollars earned).
On the production side, there’s a difference between quantity and quality. Compare the most execelent maximum verbosity of a Tanta ubernerd or one of Yves Smith’s posts and the long form blatherings that you can get on any number of blogs.
March 30th, 2009 at 11:58 am
Money, work, and their exchange are all socially and culturally defined. They can be defined in any number of ways.
March 30th, 2009 at 11:59 am
It is the governments money. They create it or allow its creation. You poster is free to live his life without the governments money if he so chooses.
March 30th, 2009 at 12:02 pm
Hector: you appear not to realize that ultra-capitalism is what you’re critiquing. Wingnuts seem not to appreciate the contradiction between their worship of the almighty market (anything for a buck) and their religious fanaticism (only things approved by their religion).
It is very much in the interests of the broader society to tilt the table between “give most of the money to the CEO” and “give most of the money to the workers and shareholders” via the tax code.
March 30th, 2009 at 12:08 pm
Marc,
No, I’m criticizing capitalism as a whole, not ‘ultra-capitalism’.
March 30th, 2009 at 12:10 pm
That’s why group blogs make sense. You should either be the diva of the ThinkProgress blog or they should be the Blowfish to your Hootie on your blog. What Henry Abbott on TrueHoop is doing makes a lot of sense. He keeps his voice yet adds content with the TrueHoop network or whatever.
I like reading Ezra Klein’s own blog but it’s almost exactly the same experience reading him when he was part of TAPPED. I get that Ezra Klein is developing a good reputation on an important topic (health policy) which helps both Ezra and his employer but I’m not sure the same thing couldn’t be achieved leading and editing a group blog on health policy, just like Henry Abbott leads and edits a group blog on the NBA.
Blogs are like little magazines. That’s fun but at places like CAP and TAP the goal isn’t to develop a bunch of mini-Anna Wintours. That’s self-indulgence. Readers are smart enough to figure out your byline without you being the sole author on a blog. You don’t accidently link to Henry Farrell when you are trying to link to John Quiggin, do you? Neither does anybody else.
March 30th, 2009 at 12:11 pm
If you work, it’s your money. What is complicated about this?
Did you print the money? The government puts the money into circulation as a way to facilitate economic transactions. Why can’t the government say, as a condition of its offering the money for use, that if you take more than $10mm a year then you have to return a large percentage so as to prevent hoarding?
March 30th, 2009 at 12:11 pm
In my experience, the tendency to reduce complicated issues to simple, moralistic questions of principle is most common among those who lack the necessary knowledge/mental initiative to actually consider the real-world consequences of real policies.
“It’s my money,” for example, is a principle that could be understood by a four-year-old. It doesn’t, however, provide much insight into the question of the optimal level of taxation (unless you think that level should be 0% for all brackets).
March 30th, 2009 at 12:17 pm
But isn’t the fact that blogs are getting longer a product of better arguments and debate? In order to adequately respond to what the other person says, you need to write progressively longer posts. The quality is improved by this, and the reader benefits by getting more intellectual arguments.
Individuals are obtaining larger incomes because they are producing more economic value. Such a severe cap on income will only prohibit this value from being produce, in the same way that a cap on your word count would prevent you from presenting your strongest arguments. Sure, it may make your job easier, but society as a whole is hurt by the diminution of intellectual debate.
Yes, there’s something to be said for brevity, but at the same time, many intellectual arguments cannot be summarized or glossed over.
More importantly, it’s a question of freedom: you are no more entitled to limit someone else’s income than we are entitled to limit the number of words you may produce. It doesn’t matter how much society may benefit by taking that extra income or by reducing your windbaggedness. We are guaranteed liberties that ought not be infringed upon by the government.
(That insult was purely in jest, of course.)
March 30th, 2009 at 12:18 pm
Did you print the money?
This is why I demand all payment in Ron Paul Certified Gold Dubloons.
March 30th, 2009 at 12:21 pm
Freedom is related to other social conditions. In fact, when you pursue it narrowly, to the exclusion of other values, like commitment to public goods, you run the risk of achieving less of it than you could if you used a broader calculus.
March 30th, 2009 at 12:23 pm
Remember, kids:
–Bailing out reckless, mismanaged financial companies with hundreds of billions of public dollars: Not Socialism. (Let freedom ring!)
–Seeking to curtail or claw back seven-figure bonuses being paid out to executives of those same companies, who would have been out of work (and with such a lovely resume!) absent public bailouts: Socialism. (Get off of my back, Government!)
March 30th, 2009 at 12:29 pm
I, for one, appreciate that Matt saves up all his worst posts for the last Friday of the month. A disclaimer would be nice though, comrade.
March 30th, 2009 at 12:30 pm
Well that picture of MY’s work processor probably explains his poor editing and why his job actually seems like work to him. I say toughen up.
March 30th, 2009 at 12:36 pm
Well, its not the Government’s money only in the technical sense that the Federal Reserve Banks are private not for profit institutions owned by member banks and operating under the effective control of an external board with a majority government appointed members and a minority of FRB Presidents.
But in a pragmatic sense, of course its the government’s money.
March 30th, 2009 at 12:38 pm
It always comes back to the horse-fucking with you, doesn’t it, Hector?
But seriously, no one cares whether it’s “moral” to pay somebody $100 million a year. The question is whether it’s appropriate to use the coercive power of the state to stop it. I might think it’s immoral for a company to pay someone that much, but that doesn’t mean I, or anybody else, should have the power to stop it. Along with the number of words Matthew Yglesias writes, it’s one of those things that just isn’t any of my damn business.
The world would be a much better place if people were taught from a young age that there are a whole lot of things that are none of their damn business.
As far at the specific word-count problem: if bloggers really would be happier writing fewer words, we wouldn’t need a legal cap. They could all sing a binding agreement to limit their word counts.
March 30th, 2009 at 12:38 pm
Commenter “J”, like most conservatives, has a refreshingly childlike understanding of “earnings,” as some of your more knowledgeable commenters have pointed out. In addition I would point out that there’s not a single economic activity in this country that isn’t affected by gov’t policy, some positively some negatively.
For instance: giving tax breaks to garment industry to offshore jobs to places like China & the Marianas — great for Calvin Klein, not so great for tens of thousands of US garment workers, etc.
It’s unfortunate that the US educational system has failed these childlike rugged individualists of the RW who yap about “it’s MY money,” nonetheless someone should help them try to understand that vast concentrations of wealth are fundamentally undemocratic, engender gaming of the economic system & regulations, and ultimately create very expensive disasters like the one we’re confronted with right now.
The framers understood this 200 years ago; it’s hard to fathom why RW’ers still don’t.
March 30th, 2009 at 12:39 pm
There is a difference between cash (created and owned by the government) and value. Value is attached to dollars through law and custom and scarcity and so on but they are different. I’m in favor of steeply progressive tax rates but if you’re going to essentially confiscate everything over a certain level, it’s better to deal with the legitimate concerns than to say, well,I love blogging so much there should be a law against it.
March 30th, 2009 at 12:40 pm
who said anything about a cap?
no one is preventing people from earning more than 10 million as long as it comes with the understanding that it will be heavily taxed.
Just like Yglesias understand that I don’t read all his blog posts because he writes too much. That’s an attention tax. If he only wrote 2 posts per day I’d read all of them and if someone made less money they’d be taxed less.
duh
March 30th, 2009 at 12:42 pm
@right (#7), it seems to me that curious sampler (#6), as well as 11, 12, and 16 have given pretty cogent explanations of why it ain’t so simple.
Now, I’m not going to say “show us your money”, but there is no formal limit here to the number of comments you can post, nor the number of words or characters you can put in them.
And if J is reading the comment thread, I’d like to see if he has any decent explanation about all this money someone can make is all theirs and daggummit keep the gummints’ filthy paws off it. Of course we liberals believe in Freedom, just ask Janis Joplin.
This will probably date me, but I remember when my dad was working hard and pulling down a decent salary, but it seemed that we always had to worry about one bill or another, Pat Sajak was raking it in on Wheel of Fortune based on working (or so it seemed to me at the time) 30 minutes a day. And Vanna White was just turning letters and pulling in boatloads of money.
And if you haven’t seen it, I recommend taking a look at the interview Bill Gates did at the TED conference earlier this year: http://blog.ted.com/2009/02/bill_gates_qa_w.php where he basically agrees that, as Malcolm Gladwell wrote in Outliers, he had to be lucky as well as good and hard working in order to get where he is.
March 30th, 2009 at 12:43 pm
MY: Talk to your editor if your fingers are cramping.
Personally, I am in awe at the volume you manage to turn out; even more so at the range of topics and levels of policy analysis and current events you cover.
I am exceedingly glad you finally found a comfortable home for your musings.
As to the content to which you are responding in this post: too silly for words, I’m surprised you bit on it.
March 30th, 2009 at 12:47 pm
The MY blog does have a quantity/quality problem . . . The solution is obvious, more posts by co-blogger Jennifer Palmieri.
March 30th, 2009 at 12:51 pm
Matt, why do you hate freedom?
(I thought that the post-bush world wouldn’t allow for such idiotic questions)
March 30th, 2009 at 12:51 pm
And if you haven’t seen it, I recommend taking a look at the interview Bill Gates did at the TED conference earlier this year: http://blog.ted.com/2009/02/bill_gates_qa_w.php where he basically agrees that, as Malcolm Gladwell wrote in Outliers, he had to be lucky as well as good and hard working in order to get where he is.
As well as lucky, smart, and hard working (aka workaholic) you have to be cutthroat in regards to your competitors (Microsoft was notoriously merciless). And be able to bullshit well, as in excel in kissing ass, spin, etc.
Regarding Matt’s output, I’ve aways believed he’s a Japanese robot and part of some experiment they’re conducting.
March 30th, 2009 at 12:53 pm
The Beatles etc faced a top UK tax rate of 95% back in the day, and it made them unhappy. http://en.wikipedia.org/wiki/Taxman
yet they kept plugging away…
March 30th, 2009 at 12:58 pm
who said anything about a cap?
no one is preventing people from earning more than 10 million as long as it comes with the understanding that it will be heavily taxed.
Matthew’s proposal was for a 95% tax on incomes above $10 million. That’s not tax policy, that’s a salary cap. The only reason he didn’t propose a 100% tax was because a 95% one is more feasible. The headline of his blog post was, “Why not arbitrary limits on executive pay?”
Just because some CEO doesn’t deserve a $20 million dollar salary doesn’t mean the federal government does deserve that money.
March 30th, 2009 at 1:02 pm
Should five percent appear too small,
I dare you all to go John Galt
March 30th, 2009 at 1:03 pm
Al, note the Self-Indulgence tag; this is not a policy proposal, clearly.
March 30th, 2009 at 1:05 pm
as in excel in kissing ass, spin, etc.
Don’t forget having the right outlook, using the best words, and making your points powerfully.
March 30th, 2009 at 1:06 pm
String of shitty posts = Red Queen’s race
Got it.
March 30th, 2009 at 1:15 pm
You are so full of shit…90% of andrew sullivan’s blog is no more than 5-10 lines and he gets way more hits than you.
March 30th, 2009 at 1:17 pm
Why is it that individuals take a statement out of context and twist it into a more meaningless context? In your case, fewer words would have been better and the number I was looking for was ZERO!
March 30th, 2009 at 1:17 pm
I’ve been thinking for a while that the competitive logic of update-frequency on blogs ought to be fostering more collaborative blogs.
And actually, a lot of the more successful blogs that come to mind are effectively collaborative enterprises. TPM, I guess, isn’t a blog per se — but things like Balloon Juice, et al.
I suppose the countervailing pressure is that as long as you do the whole thing by your lonesome you own the whole brand. Which gives you a huge advantage if you ever need to pull up stakes.
March 30th, 2009 at 1:19 pm
@41: the competitive variable isn’t actually word count — it’s update frequency
Also, correct me if I’m wrong, but I believe Sullivan has a staff of interns, and I don’t think Matt does. I could be totally wrong. For all I know, “Matt Yglesias” could be merely a front for a small Canadian corporation fully owned by GE’s Entertainment Division.
March 30th, 2009 at 1:27 pm
I assume Reader J has never taken an exemption for charitible giving on a tax return. Because if he has, he stole from me, you and everyone. By putting upward pressure on all our tax rates, bundling his money with ours, and giving it to an organization whose goals may be diametrically opposed to our own.
The end result is higher rates for all of us. Theft. Pure and simple. And yet it’s written right into our tax code. Some conservatives even support the idea, because it allows them to leverage their own money with ours and increase contributions to e.g. fundamentalist religious organizations.
Don’t look to the tax code for morality.
March 30th, 2009 at 1:45 pm
I don’t understand the felt pressure to produce more. If we go just by numbers, TPM Cafe has fewer posts than this, and it’s a popular site with many contributors, and this is just Matt’s blog. But competition aside, I’d just rather read fewer, better posts. The Washington Monthly was more interesting when Kevin Drum ran it, and I enjoy Matt’s blog only for his skill at phrasing concisely something worth hearing where I haven’t got the words. Instead, there are too many casual link posts or silly ones, not to mention the ones that would be better if he read them over before posting. And others seem to agree, based on the comments dismissing so many posts here.
March 30th, 2009 at 1:47 pm
I hope you are joking.
March 30th, 2009 at 1:52 pm
Words are protected by the First Amendment. Money is not.
March 30th, 2009 at 2:53 pm
If you want to keep all of the fungible credit chips, aka money, that you think your efforts are truly worth, you should mint your own money or credit chips, but them into circulation and demand that people buy your goods and services using your credit chips. Then we can argue anew over how much of that you still owe to the government as the holder of the general citizenry’s interest in all the collective infrastructure you are using.
You do realize that it is ILLEGAL to print ones own money? Libertarians have been complaining about this for the better part of 100 years. What justification is there for the government to stop me from printing some unique bills and backing their value with some gold I have in my basement. In fact, this is how money worked in a America for some time including the “long depression” in which productivity increased four fold while prices continued to fall in every market.
March 30th, 2009 at 2:59 pm
Of course we liberals believe in Freedom, just ask Janis Joplin.
“Synonym’s just another word for the word you want to use”?
March 30th, 2009 at 3:02 pm
It might surprise J to know that some web services do put limits on your bandwidth unless you pay them more money. Sounds like theft to me. Git ‘em!
Seriously though, all of this is easily resolved if instead of treating taxation as theft you treat it as the cost of getting to live and work in the United States. All those opportunities for free expression and free enterprise aren’t free, my friend.
March 30th, 2009 at 3:08 pm
Indeed. The idea of a ‘right’ or ‘entitlement’ to property is a figment of many a wingnut’s imagination. All it means is that your ancestors got to the pot o’ gold before everyone else’s.
March 30th, 2009 at 3:43 pm
“Synonym’s just another word for the word you want to use”
“Freedom ain’t nothin’ but liberty”
March 30th, 2009 at 4:40 pm
A 95% tax rate on anyone would be insane. Like it or not, rich people are going to be rich and keep a lot of their money. People may hate CEOs that make that much, but some of them actually are as skilled as they claim and would leave the country under a tax rate that high.
March 30th, 2009 at 5:16 pm
Dear Matt:
Thanks for posting this.
Having an instant opinion on everything is an old man’s job. A young man should do some specializing, explore some topics in tremendous depths, while he still can.
Why don’t you just try for a week writing fewer but better posts, then you and your bosses can see how it went and make a decision whether you’ll go back to the old high quantity-mediocre quality grind, or keep with the new mediocre quantity-high quality path?
Steve
March 30th, 2009 at 5:18 pm
Among the immigrants who come to the US and do well, there are two kinds of views.
The first is – my success is mine and mine alone. If it had anything to do with factors external to me in America, then look at all those Americans who didn’t make it like I did.
The second is – if my success was solely mine, then surely I could have achieved it in my native land.
Presumably some part of why Bill Gates made his billions is because he wasn’t born in the Soviet Union, and the other part is due to his own efforts. His money is not entirely his, but nor is it to be casually taxed away from him. The balance is found presumably at the taxation point which sustains the society that nourished Bill Gates.
March 30th, 2009 at 5:22 pm
Just because some CEO doesn’t deserve a $20 million dollar salary doesn’t mean the federal government does deserve that money.
The money belongs to the shareholders, and if you think that shareholders have a say in executive compensation, read Carl Icahn in the weekend’s NYT, where he writes that the laws of incorporation make it very difficult for shareholders to exercise control over management.
More than high taxes, a revision of the laws of incorporation are needed. In the meantime, the Federal Government has as much right to the money as the CEO.
March 30th, 2009 at 5:25 pm
It always comes back to the horse-fucking with you, doesn’t it, Hector?
Win.
March 30th, 2009 at 5:58 pm
Just because some CEO doesn’t deserve a $20 million dollar salary doesn’t mean the federal government does deserve that money.
Gives them some incentive to re-invest in their company.
Something that’s been noticably lacking the last 30 years.
2 birds=1 stone.
March 30th, 2009 at 6:02 pm
I see what you means and it’s a shame. IMHO you should throttle back until you are comfortable. I don’t understand why folks would stop reading if you reduced your volume–I guess it depends upon how much is read through agregators.
March 30th, 2009 at 6:12 pm
Is MY being deliberately obtuse? The question was obviously about freedom and totalitarianism, i.e. let’s apply the principle of taking someone else’s labor and income for the good of society to yourself. People have the right not to have their labor and/or income taken away from them at punitive levels by a “tyranny of the majority”. If you violate this principle don’t be surprised when 51% of us vote to put 49% of you into work camps because we think its better for society.
March 30th, 2009 at 7:40 pm
“People have the right not to have their labor and/or income taken away from them at punitive levels by a “tyranny of the majority”. If you violate this principle don’t be surprised when 51% of us vote to put 49% of you into work camps because we think its better for society.”
And people are digging at Matt for an inappropriate analogy?
March 30th, 2009 at 9:02 pm
Lately I’ve actually been eliminating blogs from my RSS feed that produce more than I want to read. I tend to like light but insightful posters. With you and to a greater extent Andrew Sullivan I skip lots of stuff. It is nice, though, to see people take their job seriously.
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March 31st, 2009 at 9:22 am
95% tax is silly. No employer would bother to pay anyone over the limit. It would effectively be a salary cap and no additional revenue would be raised. What would be the purpose of that?
March 31st, 2009 at 9:52 am
95% tax is silly. No employer would bother to pay anyone over the limit. It would effectively be a salary cap and no additional revenue would be raised. What would be the purpose of that?
All income is not necessarily salary paid by an employer. Madonna and Oprah, for example, both earn well above that a year and yet have no salary.
March 31st, 2009 at 1:13 pm
The money belongs to the shareholders, and if you think that shareholders have a say in executive compensation, read Carl Icahn in the weekend’s NYT, where he writes that the laws of incorporation make it very difficult for shareholders to exercise control over management.
Last I checked, people weren’t born shareholders. Shareholding is a voluntary activity and if a shareholder is miffed about their lack of control in a company they can choose another company, create their own, or piss it away at the track. Google, the poster child of the new age sleek ultra productive company has a shareholder structure that is insane to anyone who thinks shareholders should control a company. Larry Page and Sergey Brin own special stock in Google that has 10 times the voting rights of public stock, yet people still buy the public stock because they trust their leadership.
March 31st, 2009 at 1:35 pm
Incentive is a strange and wondrous thing. Incentives are what drives us to perform better. For instance fear of death gives me incentive to run faster then average when approached by a bear.
Likewise incentives exist in the business world. Money being the big dog of incentives in this world. Now let suppose that you are a incredibly successful CEO for a large dishwasher manufacturer making, ohh somewhere around 10 million a year. Your Talent is evident and you far outclass your current position.
So of course its no surprise when Exxon Mobil comes along and offers you double your current salary to come in and help them sort out all of the issues they are having. But the position will require twice as much work. Huge increase in exposure and criticism. And make you and your family a target of international terrorism and kidnapping.
But there is this crazy 95% tax that all of a sudden exists. So for all of this added trouble you only earn an extra $500,000 a year. After careful consideration you turn the position down because there is not enough incentive to make you exert that much more effort. Thus Exxon Mobile continues to experience wholesale issues and are unable to attract the kind of talent needed for that sort of operation. Not to mention the dramatic drought of skilled CEO’s that have suddenly migrated out of the United States.
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