All that's really needed is a little critical thinking. I'm reluctant to invest the time, because I really have other things I'd rather be doing, but I hope that by walking through (some of) it, I can help you to see this isn't a situation where you should - or responsibly can - just throw up your hands and assume that both sides have a point.
The first paragraph sets up a strawman, reducing all the policy arguments one might make (and that people are making) about appropriate tax policy and welfare programs to attacking some class of people described as "the undeserving rich" (who uses that term, but people setting up strawmen?) and wanting to "redistribute income" (again, invoking inflammatory, question-begging language that no one uses to describe their own preferred policy).
What's behind these policies? Well, Piereson claims there's at least three basic claims: One is that the wealthy are mostly Wall Street bankers benefitting from rising stock and real estate prices, or executives who pay themselves extravagant salaries. What does this have to do with even the strawman he'd set up? Nothing about the rich being "undeserving" requires them to be Wall Street bankers or executives. Anyway, the meme about the rich being "undeserving" isn't just about their having the benefit of accumulated, self-perpetuating wealth; it's about being handsomely rewarded for producing little of social value, or for manipulating markets and regulators, or for voting themselves and their friends uncompetitive salary, benefit, and equity compensation (and severance) packages. And again, that's accepting that the rich have to be "undeserving," when the point is more often made not that the rich fail to deserve to be rich, but that the rich are rich only because they have the benefit of a well-functioning economy that relies extensively on having a strong and employed class of domestic consumers.
Second basic point: Another claim is that such people unfairly benefit from a system that taxes capital gains at half the highest marginal rate paid by those who earn salaries and wages. It's true that the differential treatment of capital gains vs. earned income is a prominent target of progressive tax reformers. But the issue doesn't turn so much on its being "unfair" as it does on whether the difference makes any sense or has the kind of impact on behavior that we want it to. I'm actually not sure how the differential tax rates do in this respect, but certainly Piereson's red-herring response to this point - "Look how little the rich actually derive from capital gains!" without saying anything about how much less everyone else does - does not contribute meaningfully to the debate.
Third basic point: Then there is the assertion that the "super rich" have abundant funds that can be taxed to improve the living standards of everyone else. Again, just coding in a conclusion when setting up the claims to refute. Certainly, people who think that the "rich" should be taxed more likely believe that the "rich" can deal with the increased tax burden. That doesn't require holding that they have "abundant funds" that can be mined at will, or that it's just about improving the living standards of "everyone else." Again, part of the point of those arguing for a more progressive tax system is not just to "redistribute income" to improve "the living standards of everyone else." It's about improving and sustaining the conditions of economic health and wealth production for everyone. No one's going to get rich in manufacturing if they don't have rivers, roads, and rails they can use to move their products to markets; no one's going to get rich in finance if they don't have telecommunications and electricity infrastructure that they can rely on; no one's going to get rich in the service industry if they don't have people who can show up to work healthy and able to work.
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timeasmymeasure
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Date: 2014-02-19 03:41 am (UTC)The first paragraph sets up a strawman, reducing all the policy arguments one might make (and that people are making) about appropriate tax policy and welfare programs to attacking some class of people described as "the undeserving rich" (who uses that term, but people setting up strawmen?) and wanting to "redistribute income" (again, invoking inflammatory, question-begging language that no one uses to describe their own preferred policy).
What's behind these policies? Well, Piereson claims there's at least three basic claims: One is that the wealthy are mostly Wall Street bankers benefitting from rising stock and real estate prices, or executives who pay themselves extravagant salaries. What does this have to do with even the strawman he'd set up? Nothing about the rich being "undeserving" requires them to be Wall Street bankers or executives. Anyway, the meme about the rich being "undeserving" isn't just about their having the benefit of accumulated, self-perpetuating wealth; it's about being handsomely rewarded for producing little of social value, or for manipulating markets and regulators, or for voting themselves and their friends uncompetitive salary, benefit, and equity compensation (and severance) packages. And again, that's accepting that the rich have to be "undeserving," when the point is more often made not that the rich fail to deserve to be rich, but that the rich are rich only because they have the benefit of a well-functioning economy that relies extensively on having a strong and employed class of domestic consumers.
Second basic point: Another claim is that such people unfairly benefit from a system that taxes capital gains at half the highest marginal rate paid by those who earn salaries and wages. It's true that the differential treatment of capital gains vs. earned income is a prominent target of progressive tax reformers. But the issue doesn't turn so much on its being "unfair" as it does on whether the difference makes any sense or has the kind of impact on behavior that we want it to. I'm actually not sure how the differential tax rates do in this respect, but certainly Piereson's red-herring response to this point - "Look how little the rich actually derive from capital gains!" without saying anything about how much less everyone else does - does not contribute meaningfully to the debate.
Third basic point: Then there is the assertion that the "super rich" have abundant funds that can be taxed to improve the living standards of everyone else. Again, just coding in a conclusion when setting up the claims to refute. Certainly, people who think that the "rich" should be taxed more likely believe that the "rich" can deal with the increased tax burden. That doesn't require holding that they have "abundant funds" that can be mined at will, or that it's just about improving the living standards of "everyone else." Again, part of the point of those arguing for a more progressive tax system is not just to "redistribute income" to improve "the living standards of everyone else." It's about improving and sustaining the conditions of economic health and wealth production for everyone. No one's going to get rich in manufacturing if they don't have rivers, roads, and rails they can use to move their products to markets; no one's going to get rich in finance if they don't have telecommunications and electricity infrastructure that they can rely on; no one's going to get rich in the service industry if they don't have people who can show up to work healthy and able to work.
And that's just - ugh - the first two paragraphs.