A Response to http://www.cracked.com/blog/6-things-rich-people-need-to-stop-saying/
Liberalism is in retreat, and nowhere is this more evident than in the contrast between the Occupiers and the Tea Party. The truth is that the 99 percenters identify themselves more with Tea Partiers than with the Occupiers. There has been a massive shift to the right, and most liberals of the 1960′s have grown up and become more conservative. Those few we find who still cling to their old and tired cliches are few and far between. Occasionally, however, we can still find good writers from the left. They somehow flourish still in outlets like Huffington Post. And then there’s Cracked.com. I haven’t heard of this outlet until now, when a friend sent me a link to Mr. David Wong’s article. The article has been viewed more than a million times, which is about a million more viewers than I can claim who will view this response. Nevertheless, for every Mr. Wong there are thousands of bloggers like me.
With regards to the last two things in his list (first two here), Mr. David Wong has simply dressed up Marx’s old ideas about which is more valuable to society: labor or capital. Marx declared that labor is more valuable, and we have seen the results of that idea. The question and our answer to it presupposes both a moral(ethical) and economic dimension. Answering it from a purely economic viewpoint misses the more important ethical point, and Marx was wrong on both counts.
Marx’s mumbo-jumbo about capital exploiting labor results from his error on how the capitalist-labor relationship creates surplus value. The fact is that ANY transaction can create surplus value. When a transaction occurs, both seller and buyer benefits, and the surplus is created by the fact that before the transaction, the seller valued less the commodity being sold than the amount of money it can exchange for (its price), while the buyer valued less the amount of money than the commodity itself. At the instant an exchange occurs (a sale), surplus value is created by as much as the sum of the differences in those valuations. The commodity is now in the hands of buyer who has real use for it and therefore values it more than its pre-exchange value, while the money is now in the hands of the seller who can now use it for other exchanges that create even more value. Likewise, in the capital-labor relationship, surplus value is created when the capitalist buys a persons time and effort to build a product.
If we can agree that the wealth of a nation does not consist of tax revenues and government buildings and parks and monuments, but rather consists of the wealth of its citizens, then capital in the aggregate means people’s capital. When I deposit money in the bank, I am contributing to the wealth of our nation. That money gets used by somebody else, in a thousand possible activities I can’t even begin to fathom, including starting a business. In this sense, capital is also people as much as labor is.
Taken in the above context, an amateur writer like me can now respond to Mr. Wong’s blog point by point.
I respond in the reverse order than that presented by Mr. Wong:
#1 – Stop Asking for Handouts! I Never Got Help from Anybody!
Liberals do not like to hear this because, by simply living in society, they argue, rich people benefit from the institutions of that society. So they should give up at least part of their wealth in return for that benefit they are getting. Give up to whom? The government, of course.
Never mind the fact that wealthy people are among the most philantrophic people around, and that therefore “Stop Asking for Handouts” is something that I don’t hear much from the wealthy. It is true that the rich do not get help from anybody in the sense that nobody helps them for free. Every help that the rich person gets is paid for. What about the police that protects his properties, or the help he gets from judges who enforces the contracts he signs? He also pays for these by way of taxes.
While it is true that a rich person’s money is worthless outside of the society he lives in, he does contribute to the overall wealth of that society much more than the average person. His businesses earn him money precisely because people like his products and buy from him, and so his wealth is a measure, however imperfect, of his value to society.
If rephrased as follows, I like hearing this from the rich: “Stop Asking for Higher Taxes! I Never Got Help from Anybody for Free!”
#2 – You Shouldn’t be Punishing the Very People Who Make This Country Work!
Liberals think that
a. We don’t owe our jobs to rich people any more than we owe it to poorer members of society; and
b. Higher taxes (pitching in) does not harm the rich as much as it harms us, so the rich should pay higher taxes.
Is labor really more valuable to society than capital? Or are these two really one and the same thing? If labor is more valuable to progress and to society, then we must find ways to redistribute capital. We must tax the rich to give to the less fortunate among us. The fact is that a number of countries have done this to varying degrees, and the verdict is in: it does not work. The more you redistribute, the poorer everybody becomes. The word “punish” is apt in this sense. If you set a level by which people can be rich, beyond which taxes can be very high, it simply means you are discouraging (“punishing”) those who get to that level. The result is, naturally, you get less people striving to reach that level. That’s my response to point 2b. My response to point 2a follows from that for 2b as follows: if you discourage people from getting richer beyond a certain level, people who are already near that level, will tend to not invest their wealth to gain more wealth. Less investments from the rich means less capital for business. Less business means less people employed. Ergo, we do owe our jobs to rich people. If you force the issue and demand that wealthy people invest anyway, unless you really want to become a dictator the wealthy people will oblige, but only sparingly (because of the tax disincentive). If you really insist and turn yourself into a dictator, the wealthy will just move to another country, and your country will be much poorer, plus your sweet pretensions to “freedom” and “social justice” will sound hollow.
No problem here. I say the rich should keep saying this.
#3 – You’re Just Jealous Because I Made It and You Didn’t!
Yes it’s all about envy. All that the liberals can say about this is that it’s not true. Is it envy that drives the Occupiers? I would say that, based on their pronouncements and their placards most Occupiers do have this feeling of envy in them.
Mr. Wong then talks about how the 99 percenters feel: they only feel adoration for the rich, so therefore it is not envy that drives the 99 percenters either. Yes, I agree. The 99% of us have more common sense than the Occupiers.
In fact Mr. Wong’s tone himself reveals seething envy and hatred dressed as antagonism against those who “refuse to acknowledge that their power brings with it any responsibility” and against “bullies and dictators and supervillains”. This is crazy because a majority of the 1% probably agree with him. In fact, not just Warren Buffet, but also a large number of millionaires have come up to U.S. Congress asking to be taxed more. America is a free country: they don’t have to ask Congress to enact another law, they can simply give up their wealth and hand those to the government!
The defenders of the rich are ordinary people like me, and we do so only because it is, in fact, good for any country to welcome the rich and not punish them.
If you are rich, please keep saying this, specially to liberals. It hurts because it’s true.
#4 – If I Can Do It, So Can You!
This one I agree that rich people should do away with. Of course, it is NOT true that whatever rich people do we can all do. It’s obvious: people have different skills, personal qualities, habits, and virtues. Even looks can be different 
. This is just a form of encouragement, usually given by successful sales people to fellow sales people. It doesn’t really mean much as written, and people who say this usually qualify the words of encouragement. So yes, Mr. Wong, I agree with you that rich people should stop saying this.
#5 – Hey I Worked Hard to Get What I Have!
We understand what this means: you’ll never get to where you want to be unless you work hard. However, although working hard is a requirement, it is not sufficient to be successful. In other words, you can work really hard, even harder than Manny Pacquiao himself, to be a champion boxer; but if you are missing an arm, chances are you’ll never be one. However, you can work hard to excel in something else, say a symphony conductor.
I therefore urge the wealthy to keep saying this because it’s true.
#6 – Well, $500,000 a Year Might Sound Like a Lot, but I’m Hardly Rich
Another way of saying this: no matter how high you’ve climbed the wealth ladder there’s always somebody wealthier than you are. Unless you are at the very top, which only very very people aspire for anyway.
If there is such a thing as a theory of relativity of wealth, even that person at the top will only feel the richest if those right below him are too far below to reach him. So he struggles to get higher still. The only way he can do this in a free market system is to invest and take risks, activities that only makes life easier for everybody else.
At what level does it make sense for society to impose a limit? A trillion? A billion maybe? How about a million? Well, we know what happens when we impose a limit: the market gets distorted like a car race that imposes a speed limit, and capital becomes poorly allocated. Everybody is worse off.
In America, the Alternative Minimum Tax law was enacted in the early 1970′s that originally targeted the very rich. It has since evolved and now affects practically all the middle class. When liberals cry “Tax the Rich!” they actually mean you and I, in more senses than one.
#1:
“He does contribute to the overall wealth of that society much more than the average person”
But his business would still be utterly useless without his clients/customers and those beneath him to help keep it running, and his value to society would be zero. In fact, that’s entirely the point Wong is making, so when someone says “I never got a job from a poor person”, where that may be true, they wouldn’t have been able to get a job at all without the people who keep it running.
The fact is that both labour and capitol are important, and Wong implies it is that it isn’t JUST riches that keep society running, not that labour has higher value. Unfortunately, rich people imply otherwise when they say that people “shouldn’t be punishing those who run the country”. That’s why Wong calls them out.
“Never mind the fact that wealthy people are among the most philantrophic people around, and that therefore “Stop Asking for Handouts” is something that I don’t hear much from the wealthy.”
But there are some who are corrupt, and there are some make these statements. Though it may be a minority, there are enough saying this stupid shit to justify calling them out on it. And by “rich people”, of course he means “some rich people”. It’s hardly the point.
#2:
It’s not about forcing the rich to give to the poor. It’s about those who are asked to chip in with projects when they are the ONLY ONES WHO HAVE THE RESOURCES (and still end up wealthy after their contribution), and yes, it’s VERY lame when you complain and accuse the people asking for the resources of punishing you. As the article says, it reads “I have to pay more taxes than my gardener baaawwww!”. It’s painfully lame.
I thought that point was made clear so I don’t know how you missed it.
#3:
“Mr. Wong then talks about how the 99 percenters feel: they only feel adoration for the rich, so therefore it is not envy that drives the 99 percenters either”
No, he says that a lot of the “99 percenters” worship heroes, many who could only become heroes because they were rich (Batman, Sir Charles Xavier to name a couple). How did you conflate that to worshipping all rich people?
“This is crazy because a majority of the 1% probably agree with him.”
Unfortunately, there are genuine assholes (as well as some who don’t realise it) who don’t agree with him, and do get away with doing bad things due to their riches (which obviously gives them power), and we have to show our outrage because it’s the only thing that keeps them in check. The very fact that Mitt Romney’s campaign (or a part of it) is based on these stupid statements and that he has many supporters makes it all the more important to call them out.
So when we are angry at the rich who are genuinely shitty, it’s because they are shitty, NOT because we’re jealous.
“It hurts because it’s true.”
No, it’s infuriating because it is absolutely not true, and says to me that it’s just an excuse to justify your own shittiness and dismiss those who criticise you, when in reality, they are keeping you in check with good reason.
By now, I’m getting the impression that you didn’t read the article propertly.
#5:
Unfortunately, there are many people under the delusion that the only reason those in poverty are in their position is exclusively because they don’t work hard enough, so when the rich say “I worked hard to get where I am”, it DOES imply that the poor people don’t, which is why it’s insulting. It’s the nuance of what they say, even if it’s true that there are many wealthy folks who DO work their arses off.
#6:
At risk if making it sound like I’m just repeating Wong by now, I’ll provide a quick pointer to “What we hear when a rich person says that”, because though these people are probably being ignorant as they become less aware of their conveniences, it’s still infuriating. Yes, these people end up with less money BECAUSE THEY SPEND IT and have the means to do so.
Garrett, sorry it has taken me some time to respond to you. Thanks for giving this a thought. The only point I want to make in this response is that, in any society, there are those who end at the top, and those who end at the bottom. Any system conceived to remedy this is a solution that is worse than the “problem”, and it may not even be a problem. Intellectuals like you focus too much on the measure of inequality of results. I think we should rather look at upward mobility. Systems that exhibit good measures of upward mobility are the good systems. Systems that focus on equality of outcome are bad.
From this standpoint, disparaging the accomplishments of the wealthy is like complaining that somebody is a better vocalist and being resentful of the rewards that go along with that. We each have our own talents, and wealth accumulation is only one of them. A system that allows the wealthy to accumulate money because they are good at allocating capital, is a system that puts the right people at the top, and with the right talent and lots of hard work, those at the bottom have a good shot at the top. Nobody is barred from reaching the top. Your only limit is your abilities.
” A system that allows the wealthy to accumulate money because they are good at allocating capital, is a system that puts the right people at the top, and with the right talent and lots of hard work, those at the bottom have a good shot at the top. Nobody is barred from reaching the top. Your only limit is your abilities.”
Actually, I wouldn’t be quick to agree with that, especially on using the word “right”. “The right people” is a very relative term. How can we decide whether or not the people at the top are the right ones? Simply because they got at the top? Often times, success in life is less about skill and more about conjuncture i.e “being the right person at the right place at the right time”. Warren Buffet said it himself in Wong’s article. There is no knowing that there wasn’t someone at least as equally good at allocating capital but, due to unfortunate circumstances, didn’t have the same chances. Life isn’t fair, and neither is society. Not everybody has equal opportunities. Does everyone have the same access to education? The same chances of getting a degree? How can you be so certain that the offspring of someone at the bottom wouldn’t have been better at allocating capital? Even within the system you speak of? Granted, you can retort that if they were that good, they would have received a scholarship. But there have already been many famous cases of great scientists (like Einstein) who were under-appreciated and thought to never amount to much, and who knows how many other similar, yet unsuccessful cases there have been?
Also, what are the “right talents”? Right talents as in what? This is exactly what it said in the article: that how useful a talent is is very time and place dependent. Let’s take playing StarCraft, for instance: in my country (as in many others), this skill is only useful for self-entertainment, and it’s useless for anything else; in South Korea, it is a highly valued skill, almost like a sport. Think of Ronaldinho’s football skills: had he been born in another country like Afghanistan, chances are he never would have been noticed and given the chance to reach such a high level. For each talented football player sighted by scouts, there may well be five others like him who didn’t get the same chance or had a bad day. The value of an asset is never the same and depends on historical and geographical circumstances. I tend to believe the same about people’s abilities. Moreover, there are people who simply appear on magazine covers and earn more than doctors, professors or firefighters. Surely, the skills of the latter three categories – healing, teaching and saving lives – are more beneficent for society than those of the former.
As per the article itself, Wong makes a few interesting points. #6 is simply him pointing out rich people’s ignorance towards the hardship of others. Agreed on the relativity of wealth, but the fact is that $500,000 a years ensures a superior living standard compared to an income of $30,000/year. Furthermore, people who earn low incomes tend to struggle with needs at the bottom layer of Maslow’s pyramid of needs, while people with higher incomes have already moved higher up the scale. #5 is a point I’ve addressed in the paragraph above, and I don’t agree that you could train yourself to become a symphony conductor (especially at age 25 or 30, unless you have solid training in music, and it’s still too late), or any other profession that easily. It’s not that simple. Could you see Manny Pacquiao putting the gloves and jersey away in exchange for a wand and a suit? Things would be so much easier if labor was perfectly mobile, but it isn’t. The more dramatic situations are those when you train to perform a certain job, and then there’s a crash on that market or it simply fades out of the grid, and you find yourself with a set of skills that you can’t now put to great use. So, even if Pacquiao could train himself in the ways of a conductor, he’d never be as successful as a boxer. Like you said yourself at #4 (with which I also agree), people are different. I doubt Mozart, for all his genius, would have been a great financier.
#3 Isn’t about Wong’s envy. It’s about the fact that wealth brings about power: social power, political power, economic power, which can very easily be used to skew the rules of the game against others, as people and institutions are easily corrupted, which is why people pay close attention to those who wield such power. In Wong’s example, more wealth means better lawyers, but there’s also the fact that a lawsuit is time and money-consuming: a wealthy person has the resources to go through a lengthy trial or even influence its outcome, compared to a person earning less money. Also, a group of rich people can influence the laws themselves via political lobby, laws that affect not only them, but the rest of society as well, which is why people keep a closer eye on them.
#2 and #1 are related to the very reason why there exist societies and economic systems: the fact that, whether we like it or not, we depend upon each other, and we need each other. This is the very reason of economic trade: that you can’t get everything on you own, and even if you can, there’s someone who can give it to you for a lower cost. Tying it in with the above points of the relative value of skills and assets, whatever you can do or own won’t bring you anything if it weren’t for people to offer something in exchange. So, our prosperity depends on other people. Employees depend on employers for their salaries, the latter depend on the former in order to maintain their positions on the market and their prosperity, and both ultimately depend on their clients – average Joes to purchase the results of their labor and keep them in business.
As far as taxing goes, it is evil indeed, but a necessary evil, the result of us agreeing to live together in a society (though not to the extent of charging an income tax of 70%, as is the case in France). Without taxes, how could we fund public institutions supplying us with public goods like security, health or education? The alternative would be to massively privatize these sectors, but with what results? Privatizing the army would lead to it becoming no longer a force to protect a nation, but a collection of PMCs acting as either bodyguards or mercenaries. Health would become a commodity for people who can afford it leaving those who can’t out, education would suffer a similar fate, justice would turn into a more refined form of extortion and so on. An alternative would be a unique income tax. The result would be that society would become even further polarized, there would be no middle class or if there were, it would be very thin, leading to vulnerabilities similar to those that triggered the crisis in Eastern European Countries, as well as many social convulsions.
To conclude, these are just my opinions. I just wanted to point out that, while the points David Wong makes aren’t perfect, he’s not entirely wrong either. I entirely concur that people don’t have to bash the rich just for being rich, but I believe that the wealthy mustn’t ignore issues outside their own lives and underestimate or oversimplify the dynamics of society (after all, this is what Wong’s article was about).
Thanks for your very thoughtful comments, Ady. I agree that capitalism is not perfect, and any general statement we make can have exceptions. But all else being equal, I am comfortable with the statement that says people who have abilities and who USE those abilities can be successful in a capitalist society. The key for me is freedom: we have more freedom in a capitalist society than in any other system invented so far. I am free to make agreements or sign contracts, and such contract is enforced by government itself. If I make a mistake and sign a contract or buy something that turned out to be not what I need, then tough luck. However, if I buy something and it is defective, then I have the right to complain. Or if I sign a contract and the other party did not follow the terms of the contract, then I can also complain.
Mr. Wong has written another article about our personal struggles in the system, and I agree with it wholeheartedly. You should also read it (if you haven’t yet) because it is enlightening.
“As far as taxing goes, it is evil indeed, but a necessary evil, the result of us agreeing to live together in a society”
Evil is never ever necessary. That’s just a pathetically lame excuse used by the evil psychopaths and their masses of foolish followers to justify their unjust actions.
Oh yeah, I’m an evil psychopath. Please, don’t flatter me. I really hate blushing; it ruins the evil dictator face I’ve been working on for when I take over the world. By the way, have you tried reading the rest of the comment before flinging adjectives like “pathetically lame”?
If you really want to go more in depth with the discussion, we can renounce any usage of “good” and “evil” since they are indeed relative terms and we can then use wordplay to twist morality all we want and easily reach some very interesting conclusions that would shatter previously held beliefs on rather sensitive societal topics that aren’t necessarily related to wealth.
That said, I used the term “necessary evil” to highlight that it is something none of us likes to do, but has to. We are a society, which necessarily implies a compromise; there’s goods which all of us are entitled to like health, security, justice or education (do I still sound like an evil psychopath?) and they can’t be (completely) carried over to the private sector, which is why we pay taxes in order to fund the institutions that provide them and make sure we all have the right to it.
And as long as there’s more than one of us living on this planet, there’s always going to be a compromise, however small. For instance, in some of his books, Isaac Asimov describes a society on a planet called “Solaria” where everyone ruled over vast estates and keenly avoided contact with each other, even being physically in close proximity, preferring to “view” each other via holograms, all in order to maximize and preserve their freedom while eliminating the risk of disputes. With strict population control, no central government, and robots handling all the manual labor, the Solarians were free to do whatever they pleased. Or so they liked to claim, as in the end they admitted that contact with foreign travelers was completely forbidden among them. So, even with nigh-absolute freedom, there’s still going to be issues that call for compromise.
As for why taxation is a “necessary evil”, as I called it, please reread the 7th paragraph of my original comment, as I’m fairly certain you haven’t.
Thank you for your quick reply
. Indeed, I agree that freedom is essential to make a society work, and capitalism has proven to be more effective; the whole point is to make sure everyone benefits from the same freedom and that nobody uses theirs to limit the freedom of others.
Also, a big thanks for the article linked! It is perhaps one of the best articles on Cracked.com, and it instantly became one of my personal favorites (it’s odd, though, to find such thoughtful articles on a comedy site).