Sunday, December 12, 2010

I LOVE Millionaires and Billionaires!! And you do too, but don't really know it...

Here is a thought experiment for you...When you wake up in the morning and until you go to sleep at night, keep a diary (or mental note) of ALL the goods/services you touch, feel, smell, hear, see, consume or otherwise employ to help you get through the day. Think about how these things, in a tangible or intangible way, make your life better or at least easier. There are likely many millionaires, and even a billionaire or two (or 10), behind the production or delivery of these goods or services to you. Got your list? How many items did you count--1, 10, 100, 1,000...?

Do you know who any of these people are? Maybe one or two (Bill Gates, Steve Jobs, etc) but in general these millionaires are nameless, faceless people (to us) who got to where they are by producing goods or services  most of us use on a daily basis and improve our lives in a relatively seamless way. Their profit is not at our expense but adds to our surplus! I have no idea who the owner of Jiffy Lube is, but I am glad he is rich and I am glad I don't have to change my oil. I consider that an even exchange!

I think this gets lost in the debate over taxes and tax rates. We are not doing a good enough job in discerning who is rich, but more importantly, how they got that way. Listening to politicians/media one would think only Wall Street bankers, insurance and oil executives are millionaires. If you really think about it, the only rich people vilified publicly are people who profit GREATLY because of bailouts, subsidies, and an other-wise cozy relationship with politicians and bureaucracies. In economics we call these "rent-seekers", private citizens/industries that use political access to profit and limit competition. Let me say this as clearly as possible: I ABHOR rent-seekers! They are worst kind of "millionaires" because they got that way at the expense of the public (that means YOU).

Go back to your personal results from the first paragraph. How many of these goods/services were the result of rent-seekers or businesses/entrepreneurs, who only got "rich" providing you something that enhanced your life without you thinking much about it? It probably did not even cost you that much either (relative to the benefit you received). The rent-seekers good/service probably cost you the most and gave you the least satisfaction.  I am guessing a vast majority of the items came from the "silent majority" of millionaires who risked capital to bring that good or service to the market place.

In a purely non-partisan fashion, ask yourself: "How much more do these people owe society than what they have already given?". Is it not useful to consider this before you lump all rich people together? I am not saying the rich pay nothing in taxes, but should some consideration be taken to assess the benefits they endow on society before we decide how much "we" should take from them? Have they not already proven to be good stewards of societal resources, in general?  Just askin'...What do you think?

Note: I am not a "rich guy" (well, not monetarily anyway). I only recognize the value of the PROPER millionaire/billionaire...We hover in the mid-range of the 28% tax bracket. Hey, I have a productive wife whose skills are valued more in society than mine as a teacher....but that is ANOTHER debate! :)
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