Also, I’m paying the people who don’t use my services…

4 Oct

It is often the broadest and most generalized claims that are the most difficult to approach and analyze. Recently, Bill Maher, host of HBO’s “Real Time with Bill Maher,” decided to voice his opinions about the rich people who are whining over the threat of a 3.6 percentage point tax increase on their incomes. “Greedy assholes,” he calls them; in his mind, anyone making over $250,000 per year and complains about a tax increase should “be publicly vilified by the Obama administration.”

Maher goes on to allege that the American people bailed the wealthy out, that it is those with incomes over $250,000 who are responsible for outsourcing “all the jobs, destroyed the unions, and replaced workers with desperate immigrants and teenagers in China.” There’s a trillion dollar deficit, states Maher, so the rich should have to fill the gap! The wealthy don’t create jobs asserts Maher, “They’re much more likely to save money through mergers and outsourcing and cheap immigrant labor, and pass the unemployment along to you.” (We can ignore the fact that employment is the result of an economic transaction to trade wages for labor. Employment, or the lack of it, cannot be moved, passed on, or swapped out).

Before progressing further into the heart of Maher’s claim, this economic fallacy that the wealthy don’t create jobs must be dealt with – although I really shouldn’t have to explain this (Ch. 23). Take the greediest, most caricatured capitalist billionaire you can imagine. Suppose he saves money (even Maher agrees that this occurs) – the way in which he does it isn’t relevant. What does he do his money? Stuff it into his matteress and pillowcases? If he is a greedy money-grubbing capitalist, then he’ll either invest it or put it into a savings account where it can accrue interest. But the bank isn’t going to just sit on it either. They are going to loan it out to people. Not only that, they’ll try to get the money to people that will pay back the money with interest. The people who take out the loans invest in things – factories, businesses, homes, themselves, etc. But this money must go somewhere. People are needed to work in the factories and businesses; homes need to be built and renovated; those seeking an education need educators. Jobs are created and resources are productively employed. And the capitalist and the banks profit from this. That is, they profit from the jobs they helped to create. Not only do the wealthy create jobs, they have an incentive to make sure that people have jobs and are producing goods and services that people want.

In Maher’s mind, it doesn’t matter whether you are helping others – only that you are making much more money than others. It doesn’t matter if your income is legitimately earned – if you have more than others, then you owe it to them. The flaw in Maher’s argument is that he seems to believe that not-taking is the same as giving. More and more frequently, we are hear politicians and economic prostitutes claim that if the government refrains from taking more money from the people, it’s equivalent to paying them. Perhaps just as disturbing as the misguided notion that not-taxing=gift-giving is that these claimants mention the size of the deficit and are advocates for more government spending. They say “If you reduce taxes, how are you going to pay for that deficit you keep crying about?” Do they forget that reducing taxes isn’t the only way to make the deficit harder to pay back? Increasing spending works just as well. 

The idea that it’s greedy to keep what you’ve earned from an organization that will arrest you if you fail to obey it is as of yet unjustified. I don’t even know that Bill Maher believes that it’s greedy to keep what you’ve justly earned. If Maher really believed what he said, shouldn’t we expect him to give up all of his income to the government? We can just increase the tax rate by 3 percentage points every year until 100 percent of his income goes to our brilliant representatives. A 50 percent increase in the income tax rate is as arbitrary as 3 percent. For Maher to argue that he shouldn’t have to give up all of his income is for him to argue on the price and not the principle.

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