11 March 2023

Marx Brothers Policy Debates

Who are you going to believe: Me1 or our own Eyman?2 Let's talk about taxes for a moment; such as taxes on the hyperwealthy. Consider a proposed 1% tax on not $250,000 in annual income, but $250 million in financial intangible property.3 On Thursday, there was a public hearing before the [Washington] Senate Committee on Ways and Means, at which Eyman — you did read note 2, didn't you? — spewed forth:

Successful people weren’t just lucky; they worked their butts off. They took huge risks, sacrificed a lot over many years and earned their money. And the people who didn’t earn this money don’t deserve to get it from the people who did.4

Let's take this apart and see where we end up, shall we? (Hint: It won't be where antitax activists think it will.) In the order appearing here:

  • Successful people sure as hell were lucky. They had adequate resources to be successful (even those who "drew themselves up by their bootstraps" still managed to eat). They were in an environment that allowed success (not a lot of fortunes were actually made during World War II, for example). They weren't drafted and killed in Vietnam; with extraordinarily rare exceptions, they didn't join the All Volunteer Force in the late 1980s or late 1990s and get deployed to Southwest Asia, coming back with bonus scars of all kinds. They weren't required to quit a great career at which they were successful to care for a disabled child or parent; and if they did become "caregivers," they luckily had other skills or other support in place.
  • Over the years, I've rubbed elbows (seldom by choice) with the hyperwealthy more than once. A few were golddiggers — they didn't "work their butts off."5 The only work involved in inheriting wealth is not getting caught embezzling (or worse). I attended college with a number of the extremely wealthy, including a future tobacco heiress; she worked, but that's because she had academic ambitions.
  • And speaking of "tobacco heiress," one wonders what they — or their ancestors — worked at. Consider, just about a century ago, an Italian immigrant who got very rich through a complex arbitrage scheme involving mispriced postal reply coupons… for a while, anyway. And he was far from alone. Much more recently in the news, consider the Sacklers.6 I suppose you could say that they all "worked hard" (although many of the Sacklers, to name one group, appeared to be largely along for the ride).
  • When they weren't doing outright dubious work, there's still a significant question about what kind of work it took to acquire a quarter of a billion dollars in financial intangible assets it really was — and who did it. One can readily hypothesize that a balanced portfolio based solely upon "being an index fund" was at issue. That, however, was not implemented by Joe Multimillionaire over in the den on a PC; there was a significant team of people involved in doing the dirty/clean work. Perhaps the closest one could come is a creator in the arts; leaving aside that there probably isn't one, anywhere, whose $250 million in financial intangibles were solely the result of his/her/their own creativity, commercial exploitation of creativity is definitely a team effort — Taylor Swift has session musicians and choreographers and costume designers and roadies, too. Eyman's statement (and ideology) rather ignores the reality that the real people doing the work for these fortunes are the preexisting piles of dead presidents and the minions — not the title-holders.
  • Most of the superwealthy may have taken significant risks; almost all of them, however, had backstopping that the rest of us don't have. Consider the serial entrepreneur who risks a million, goes bust; risks another million, goes bust; risks another million, goes bust; risks another million, hits the jackpot7 and becomes (in technical terms) an oligarch. One wonders, on further thought, about the source of those millions risked; even when they risked "almost everything they had," they had enough left to start over afterward. Let's just say that not an awful lot of entry-level workers do. More to the point, that rolls right back into "luck," doesn't it?

We'll leave aside, for the nonce, the immense, tax-supported infrastructures that the hyperrich exploit. The roads and police forces and trained/educated-in-public-schools workforces. The courts to enforce their contracts and nondisclosure agreements and protect their trade secrets. The military forces used to eject prior occupants of the land on which their ancestors' timber fortunes were founded. The key point is that these "fortunes" depend in large part on preexisting, peaceful civilized society; if more wealth is good, that rather implies that more civilized society — paid for through taxes8 — is rather necessary. Not less.

Meanwhile, Mr Eyman, I've seen no evidence that you've "worked" for your money; instead, it appears you've largely skimmed off contributions to your antitax organization,9 as found by six different judges after several distinct proceedings.2 So perhaps I agree with your closing remark: People who didn't earn the money don't deserve to get it from those who did.10 In particular, that means you. In reality, those with fortunes this large didn't "do their own work": They relied upon others to "do the work."11 The best way to avoid this sort of ridicule is to have a factual basis for ideological positions. Otherwise, it's just… duck soup. Canned and condensed duck soup, purchased at a big-box-store supermarket (and isn't that an interesting phenomenon), probably with artificial duck flavor… quite possibly inspired by a duck with no pants. No, the other one.

  1. With the plethora of citations, both via footnote and hyperlink, to what was actually said, ruled upon, or at issue. The title of this piece is drawn not from Fredonia, but from a line thrown away in Duck Soup (1933) and later embellished and adopted by others.
  2. See, e.g., Bankruptcy court orders Eyman to pay contempt sanctions, issues payment plan in state’s campaign finance case, MSN (09 Apr 2020) (noting that sanctions relate to systematic refusal to truthfully respond in discovery matters — particularly ironic in that the underlying lawsuit was about Eyman's alleged deceptive conduct concerning various of his antitax campaigns).
  3. [Washington] Senate Bill 5486 (2023–24 Session).
  4. As quoted in Brett Davis, Proposed Washington wealth tax debated at Senate public hearing, The Center Square (posted 10 Mar 2023).
  5. This is not gender-determined; I've run into more than a few male and same-sex golddiggers.
  6. Cf. also Leverage: Redemption (Season 1, 2021) (in particular, the chillingly on-point performance by Reed Diamond).
  7. At least three of the less than 700 persons estimated to be subject to this tax literally hit the jackpot: They're all major-lottery-prize winners. Apparently, standing in line to buy a lottery ticket is very hard work.
  8. CompaƱia General de Tabacos de Filipinas v. Collector of Internal Revenue, 275 U.S. 87, 100 (1927) (Holmes, J., dissenting).
  9. Any resemblance to the Rev. James L. White and/or other ideological political pressure groups is purely schadenfreude coincidental. Not to mention comedy worthy of the Marx Brothers.
  10. Perhaps no antihero masquerading as a hero, all the while proclaiming the merits of making things All About Him, is so on-point as Milton's protagonist.
  11. Consider, for example, a couple of Seattle-area tech behemoths. Uncle Jeff has, over the years, grown the Big Brazilian River from his "revolutionary idea" of a marketplace structure through warehouse workers, delivery drivers, overworked postal employees (and the business model took advantage of arbitrage in postal rates, cf. Mr Ponzi, at a time when shipping costs and warehousing-and-display costs had inverted their historical relationship), and invisible-to-the-public programming talent, and reaps the rewards of scale and superior initial position. Uncle Bill essentially abandoned programming by the early 1980s, instead directing teams of programmers and marketers. It's not that "management" and "vision" are meaningless; it's only that claiming that they are "the work" is dubious at best, in the same way as claiming that only the generals are war heroes.