The Rich Man's Tax Burden
The best read of the day is Brad DeLong's merciless shredding of yet another rich's guy lament about how taxes are ruining the lifestyle he so richly deserves. Start with Michael O'Hare's opening salvo and read them both in full, but here's the crux.
Professor Henderson's problem is that he thinks that he ought to be able to pay off student loans, contribute to retirement savings vehicles, build equity, drive new cars, live in a big expensive house, send his children to private school, and still have plenty of cash at the end of the month for the $200 restaurant meals, the $1000 a night resort hotel rooms, and the $75,000 automobiles. And even half a million dollars a year cannot be you all of that. [...]Yes, income inequality has even hit that top 1% of earners. But he's not mad at the people above him on the ladder who padded their pockets at his expense. No, he blames the "lazy people" at the bottom who expect to live on such "undeserved" entitlements as Social Security that "his" tax dollars have to pay for. Break my heart.
And here is the dirty secret: Professor Henderson thinks that that is the way things should be because he knows people for whom that is the way it is.[...]
Instead, Mr. Henderson looks up. Of the 100 people richer than he is, fully ten have more than four times his income. And he knows of one person with 20 times his income. He knows who the really rich are, and they have ten times his income: They have not $450,000 a year. They have $4.5 million a year. And, to him, they are in a different world.
And so he is sad. He and his wife deserve to be successful. And he knows people who are successful. But he is not one of them--widening income inequality over the past generation has excluded him from the rich who truly have money.