You invested in an ant hill

I hope they get this division of work thing down soon.

John McCain was reportedly shocked that the University of Arizona had received stimulus money to study the division of labor in ant colonies.  With over ten thousand earmarks added to spending bills in Congress in the last year, I am not so shocked at all.  Stimulus money is being used to pave bike paths, build swimming pools and a whole host of other “necessities”.  Hey, I have nothing against ants (unless they are swimming in my new pool), but what is nice to have and what we can afford are two different things, at least they were before the new Congressional math came into vogue. 

I find it most curious that as members of Congress conduct a full press against the banks and Wall Street for their financial shenanigans, even dictate their pay and pass laws to hold them in check Congress is putting the American economy at long term risk more than any Citigroup or AIG.  Every conceivable rationale is used to justify more and more spending and eventually greater wealth distribution as if the accumulation of wealth is a bad thing.  Beyond that, our debt is growing, our lenders are anxious and the accountability that seems so critical for bankers is lacking for Congress whose spending habits are indescribably irresponsible. 

Let’s hope the American people do not let this go unnoticed, there are consequences and sooner or later scapegoating Wall Street will not longer hold sway as it now does.  The danger of course is that we all like a free ride and as Congress spreads the goodies around without explaining how they will be paid for, the beneficiaries will come to enjoy their largess.  After all, the rich are paying for it aren’t they?  The same logic is used in the health care reform effort and many people still think that a public option will save money.  You can  have it all America, we can expand coverage, control costs and improve the quality of health care and nobody has to give up a thing, except a few people via higher taxes. 

It doesn’t work that way in health care or in running the Country, sooner or later it all has to be paid for and yet we following the logic of the family who really needs a vacation, a 60″ TV and with such pressures facing them simply charges it.  We’ll just pay it off (if you don’t lose your job, get a cut in pay, unless interest rates go up or you suddenly realize you don’t have enough money left for the true necessities like food).

Today the recession is used to justify spending and the recession is blamed on the banks and Wall Street and the financial burden can be absorbed by the rich.  Sounds nice and simple doesn’t it?  In order to make us feel good, in order to deny responsibility or face hard choices, there is always the handy scapegoat.  This is especially true if you are an elected official who can walk away from years of decisions never knowing or caring about the consequences of your actions.

I'll have the lobster with a side of caviare

Lobster sales are down in restaurants because no one wants to be seen as wealthy.  That’s a shame because wealthy is a good thing,  as we strive to redistribute wealth in America we should be mindful of gifts the wealthy have provided; libraries, hospitals, museums, institutions for the arts, research centers and countless more socially beneficial giving, not to mention millions of jobs and new industries in the process of becoming wealthy.

Wealth is a good thing and so is the opportunity for anyone to accumulate wealth.  Sadly that opportunity is declining because it appears today that we are more interested is holding back than encouraging achievement, we would rather see a nation of mediocrity than one of  unbridled opportunity.  There are people in this society who have not gotten out of life what they wished, some unfairly so but far more because they simply did not strive to achieve all they could, they made poor decisions or they concluded that they were happy with what they had.  That will always be so, but dragging down the achievers to become a nation of average certainly should not be our goal. 

The only thing I have against wealth is that I was never clever enough to achieve it.    I’ll take six Powerball and two Mega Million tickets please.

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6 comments

  1. So, by your reply I have to assume you think that there is merit to picking the right parents.

    I believe that we should each be provided with the opportunity to succeed (or fail) based on our merits. Most of us, including me, want to help our children succeed and are willing to bend that rule for them. I do not believe that this bias toward our offspring should be institutionalized. An estate tax should be progressive, and should be very high for larger estates. Perhaps it should be called an inheritance tax instead since it should be based on what one recieves.

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    1. I guess we are going to disagree. If a person works all their life, pays their taxes along the way and accumulates some wealth it is beyond my comprehension that society believes upon that persons death it is entitled to a substantial portion of that accumulated wealth. Like you, my goal is to provide for my children and perhaps gradchildren.

      my view is that each generation has an obligation to help raise the next even a little. While I don’t have to worry about hitting the proposed limits, I believe those who do, have a right to use all their wealth any way they see fit and that neither I nor anyone else is entitled to any of that wealth.

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  2. Thanks for the reply RD.
    Would you consider high estate taxes to be tearing others down?
    What about progressive income taxes with simpler rules regarding what income is?
    One idea has been to tax consumption (specifically carbon tax) and rebate some or all of that on a per capita basis.

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    1. I do think the estate tears others down. That tax was designed over the years for specific purposes going back to colonial days and each time except the last it was allowed to expire when the need passed. Taxes are paid many times along the way, I see no need to tax them upon death especially at such high rates as are being proposed. The heirs could put that money to far better use in the economy than the government.

      We have progressive income tax, but I certainly agree there is much room for reform and simplification and less maneuvering with deductions and such.

      Not sure about the carbon tax, don’t know enough about it, but overall the tax structure should encourage investment, innovation and risk taking at all levels in the economy.

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  3. Hello RD,
    I think that while it is inevitable that our society has uneven distribution of wealth I also think that there are limits to how much is benificial to us. Just google distribution of wealth and see what comes up. It appears to me we have far to much concentration of wealth. Efforts to even out that out would be good. What makes you think that merit has much to do with achievement in our society today?
    Dean

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    1. Efforts to even that out would be good. Raise the education and training and skills levels, help people rise rather than tear others down. Make sure there are no barriers to opportunity. Teach children basic life and money management skills.

      We need a solid middle class to survive, but today we play the scapegoat game and that is dangerous.

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