The New Republic

To help measure Mr. Donahue's pain, someone earning $100,000 per year pays a marginal federal tax rate of almost 50%; Mr. Donahue, with annual income of at least $250,000, pays a marginal federal tax rate of no more than 39.6%. So who's headed to Galt's Gulch?

- rayward

April 15, 2010 at 9:12am

Disincentivizing people from becoming commissioned financial advisers is a feature, not a bug. P.S. I just used the word "disincentivizing" in a sentence; now I need to go take a shower.

- ratnerstar

April 15, 2010 at 9:39am

And not only an income of $250,000, but a *taxable* income of $250,000. So unless Mr Donahue lives in a cardboard box (or possible owns his residence outright) and does not utilize any tax shelters (and thus qualifies only for the standard deduction) he needs to be earning somewhere north of a quarter-mil before that onerous tax bracket kicks in.

- Nari224

April 15, 2010 at 9:42am

I have a very good imagination, so I can conceive of an anti-tax activist willing to somehow drop himself into welfare to try to prove a point. The catch-22 is that anyone who cares this much about money isn't going to willingly sacrifice so much of it. If there were such a John Galt, we would almost necessarily never hear of him.

- ackyri

April 15, 2010 at 9:58am

If I had seen these extracts on this board, rather than quoted from the WSJ Op-Ed page, I would have thought it a brilliant parody. "Maybe I will quit and live on the dole for awhile." To follow on Ratty's shower-inducing comment, it seems to me coming from a "financial advisor", this is more of a public service announcement than a threat. "Why then does the government feel so entitled to take my money and give it to others?" Actually, it is not so much the "government" feeling entitled, but rather, those "others" - where are Foucault, Derida, Duncan Kennedy and Camus when we need them? The ever-present, threatening, awful, nasty "others"- in exercising their democratic rights, elected a Congress and a President to, well, take from you and to give to themselves. Bummer that, you know, democracy, voting, majorities ... Of course, there is another option. Why don't we abolish all taxes, but in the meantime, ALSO abolish such lovely things as, say, police, property and contract laws, the courts, the laws against tarring and feathering and lynching and the Wheel and the Gibbet, and then see how long this Master of the Universe will last. Each of these assholes is, in essence, a tax cut/police cutback away from the pitchfork; well, let them have it.

- icarusr

April 15, 2010 at 11:05am

Here's my suggestion to the John Galt-wannabes: Go for it. Stop talking about it and do it already. All we ever hear is talk about the coming wave of John Galts, but it never seems to appear. Nobody ever does anything. Hey, John Galt-wannabes: How can we miss you if you won't go away?

- DC Spence

April 15, 2010 at 11:14am

Icky, you save the day again. Your final paragraph is especially delicious. I just prefer to offer these over-taxed/over-regulated souls the option to move to their nirvana, where there are no taxes, no government interference, no regulation: Somalia. It is a Randian paradise I tell you, paradise. So when are our oppressed brethren leaving? My guess when the CEOs who love to offshore their workforces decide to move to the same sweatshops they covet so much. Or when Rushbaugh will be moving to Costa Rica. Say, when did hell freeze over?

- tnmats

April 15, 2010 at 11:27am

So the guy was in straight commission sales which means he sold the products or services that other people created, he didn't actually create anything himself. Sounds like a parasite to me. And if he quits, imagine a world without pesky salesmen. Customer service agents don't work on commission and don't earn anywhere as much, but when I was in purchasing I much preferred to deal with Customer service.

- blackton

April 15, 2010 at 11:34am

I don't think it's even possible for Donahue to quit working and go on the dole. The best he could hope for is unemployment, and you don't get that unless you're fired. I'm just as tempted as the next guy to trade a bi-weekly paycheck of $7,000 or so for unemployment benefits that are a fraction of that, but unfortunately the people who designed the system were aware of the temptation, so they foreclosed that option. Of course, you can get food stamps and Medicaid, but, as miserable as I am paying taxes to pay for freeloaders' lunches, I still find that my food and medical options are much better if I pay for them myself (with a generous assist from all those taxpayers subsidize the tax break for health insurance and my mortgage interest deduction).

- Geoff G

April 15, 2010 at 11:43am

Back in the '30's this bastard would have been the subject of a great movie. Some tycoon muses "I wish I could live in a Hooverville, but I'm responsible, so I work my ass off for a Park Avenue apartment." Clarence comes down and poof - "It's a Shit Covered Life."

- Geoff G

April 15, 2010 at 11:46am

Geoff - Sweet posts. Tnmats: Thanks. I spent a good chunk of my professional like preaching "rule of law" to other countries and teaching it to budding Galts. Nothing is stupider than the people who benefit most from the apparatuses of the state - the police and property laws - as well as the trappings of a civilised community (social peace, minimal street violence, open lawns and picket fences rather than eight-foot high walls) complaining about having to pay to keep it all together.

- icarusr

April 15, 2010 at 11:58am

Where did these guys get the idea that an attitude of "Let them eat cake" produces good results for the upper class, let alone the lower class? As long as I'm pondering revolutions, though, it is strange that the greatest revolutionary-type fervor in this country currently comes from a segment of the lower class with this upper-class sensibility. It's like they're saying, "Let us eat cake." Or rather, "Let everyone like me eat cake. Me excluded."

- Fishpeddler

April 15, 2010 at 12:56pm

"Why then does the government feel so entitled to take my money and give it to others?" There's something delicious about people who ask rhetorical questions for which they they think there's no answer but in fact there are a number of good answers out there. Conservatives are particularly prone to this as they seem to live in echo-chambers in which they just affirm each others core beliefs. The best response to this nonsense is the boring one: that governments have multiple responsibilities that involve both collecting and disbursing money. Those responsibilities are defined both constitutionally and legally, and revenue systems are set up according to collect funds. Those funds are then collected and centrally held, and then distributed. As there are no squiggles from a felt tip marker on a particular dollar bill that can be tracked to make sure that that dollar goes to fund a bullet in a rifle in Afghanistan or a millimeter of highway in Wyoming as opposed to a food stamp handed out to an unemployed Hispanic woman in Los Angeles, the only realistic way to regard taxation is that the government is taking money and giving it back to YOU! As the teabaggers who travel to their events on the federally funded interstate highway system never seem to grasp.

- ironyroad

April 15, 2010 at 1:05pm

There's more to it than money. George H.W. Bush, to name but one example, felt duty-bound to enlist in the Navy upon his graduation from Philipps Academy early in WWII. According to Larry Leamer's recent history of Palm Beach, 514 Yale men died in service in the Second World War. Have 514 Yale men even been in service in the years we have been at war in Iraq and Afghanistan? As late as the mid-1970s all young men were liable to be drafted, exposing even the children of the rich to at least the possibility of death in combat. Now we have not only done away with conscription but have abandoned the notion that military service is a duty even in a time of war. This change in culture and expectation amounts to the biggest tax cut of them all. Whenever I hear anyone arguing in favor of wars, actual or, in the case of Iran, hoped for, I am tempted to say, "Put your sonny where your mouth is."

- glade52

April 15, 2010 at 2:34pm

Fishy, there's a certain class of white people who are quite willing to let themselves be screwed over (i.e., vote and agitate against their own economic interests), so long as this prevents some even poorer Black person somewhere from getting something for free. It's a noble sacrifice, I suppose, if you subscribe to the white man's burden. The upper class people who are lying to them are easier to figure out, but no less stupid and more evil. Like I said, I know of someone with an advanced degree whose principle objection to health care reform was that "if we give poor people free health care, they won't have any reason to find jobs."

- miceelf

April 15, 2010 at 3:02pm

Conservatives these days are such pansies. "[A]ny government," said Lord Curzon, Her Majesty's Viceroy of India in 1898, "which by indiscriminate alms-giving weakened the fibre and demoralized the self-reliance of the population, would be guilty of a public crime." This served as a perfectly sensible explanation for not doing anything to alleviate the Indian famine of 1898. Accordingly, any wealthy conservative or economic libertarians who *really* want to prove the moral superiority of the rich should give up their money AND the nanny-state's safety net, and then show us how to bounce back from starvation on the streets. That'd be putting us big-government liberals in our place.

- frippo

April 15, 2010 at 6:39pm

"Nothing is stupider than the people who benefit most from the apparatuses of the state - the police and property laws - as well as the trappings of a civilised community (social peace, minimal street violence, open lawns and picket fences rather than eight-foot high walls) complaining about having to pay to keep it all together." You do understand that establishing a minimum framework to ensure commerce can work requires the smallest of government. Our state and local government today is around 30% of GDP. Establishing law and order, fire departments, roads, airports, etc, would take a few % of GDP at most. All the rest is pissed away on the other things you love. I've always wondered why the left is so drawn to to the fantasy that Steve Jobs benefits from more government than anyone else. If that were true, he'd be begging to pay more taxes. And yet, when offered the chance he and Gates and Buffet pay only the minimum Why is that?

- seattleeng

April 16, 2010 at 10:14am

Seattle Eng, putting aside the enormous moral arguments for progressive taxation (which is another set of premises entirely) and focusing solely on your rebuttal to Icarusr's claim that wealthy people depend more from apparatuses of the state: This may not be quite true, but it is much more so than you claim. For starters, your estimation of the cost of government leaves out many programs that are arguably necessary for a healthy, sustainable economy. This includes an educated, protected population that isn't hamstrung by caring for the elderly and injured, and enjoys a clean, healthy environment. To the extent that the wealthy derive their wealth from the productivity of said population, they have a proportionate claim to its benefits. So yes, if Steve Jobs makes a gazillion bucks off the ipad, he will have done so because he has had access not only to a market capable of entertaining his trifles, but a workforce able to build them for him. And yet what may be the greatest way in which he benefits from a thriving society is his own emotional and intellectual development. He would not have existed 1000 years ago, or even in North Korea today. He is a direct product of the society that is able to produce him. For this, he owes everything.

- elirector

April 16, 2010 at 11:35am

I've always wondered why the left is so drawn to to the fantasy that Steve Jobs benefits from more government than anyone else. If that were true, he'd be begging to pay more taxes. And yet, when offered the chance he and Gates and Buffet pay only the minimum.

I have a high opinion of engineers, so I'm going to assume you don't actually believe this, because it's ridiculous. But in case you do, here's a thought experiment for you. Suppose you really want a BMW. A BMW will add greatly to your quality of life, make you happy, help you pick up chicks, whatever. Furthermore, you know that you'd like to acquire additional BMWs in the future, and that paying more for one will marginally increase the firm's success and therefore its ability to produce more cars. I think this accurately describes most if not all people who purchase BMWs. Now, given all this, when you go down to the dealership, do you beg to pay more? I'll leave it to someone smarter to address your assumption that the trappings of civilized society depend only on fire departments and roads, and not, say, medicare (not to mention defense). I'm a low hanging fruit kinda guy.

- ratnerstar

April 16, 2010 at 11:38am

"If that were true, he'd be begging to pay more taxes" Seattleeng: If the private sector *really* created goods and services that benefited the American people, we'd all be clamoring to pay more for them. Instead, people look for discounts and the lowest price. Why is that, do you think?

- frippo

April 16, 2010 at 11:40am

If Mr. Donahue's first 20 years were "tough" (and really, how many of us, especially small business owners like me, who didn't inherit wealth can't make the same self-pitying claim? Especially as compared to our currently much improved financial circumstances?) then he should perhaps have noticed that progressive taxation allowed him to mostly defer his tax burden until his high earning years. He's just, stupidly, pissed off now because the bill for supporting the social, cultural, judicial, security, education, transportation and energy infrastructure on which his (and everyone else's) success relys -- a bill older, more established earners have been paying while he built the wealth and assets he now enjoys -- is now his responsibility. Plus, the fool is a financial advisor, a "salesman" as he says. Really, he's probably writing off most of his life as a tax deduction (in ways that no young, entry level school teacher, for instance, can). Here is really what is wrong with this country -- the nation's business and financial elite have had their heads filled with so many economic fairy tales that they simply have not only lost all ability to make sensible political decisions, they no longer even have an ability to make sensible business decisions. Hence the frauds, economic catastrophe's and bailouts. Mr. Donahue's failure to acknowledge his own free ride is typical.

- esmense

April 16, 2010 at 12:06pm

Seattle Eng -- it in no way diminishes Jobs' achievements to point out that those achievements were made in a sector of the economy, consumer technology, that developed out massive, earlier government investment in technology for military and space exploration purposes. Plus, as an engineer in Seattle, you are reaping the benefit of decades of federal government investment in Washington state. After the collapse of Seattle's aerospace dependent (which was also a military spending dependent) economy in the late 60s/early 70s, Washington's two powerful Senators, Jackson and Magneson, two of the most successful pork barrel politicians in the nation's history, secured billions of federal dollars, distributed through the Department of Commerce, for investment in modernizing the state's ports (improving our ability to trade with the Pacific Rim) and supporting the development of the region's high tech industry. It is those investments, and many more that followed, that paid off in the thriving, more diversified, high technology, high trade economy the Puget Sound enjoys today. Without those investments, it is possible you wouldn't have a job, or, at least, you might not have one in Seattle.

- esmense

April 16, 2010 at 1:08pm

The Gov doesn't invest. It re-distributes taxes and borrowed money to its most favored constituents -- public sector parasites and their cousins in the defense industry. And the denizens of this blog. And victim is a liberal term entirely. As I have stated many times -- the private sector pays for the public sector. The private sector has already paid for the roads, infrastructure, etc. Economically they are known as assets, paid for by the private sector. Just because the public sector built a road with private sector money doesn't imply all commerce traveling down the road was created by the Gov. [Its like I am debating with kids]. Just because the public sector hired a police chief with private sector money doesn't mean they deserve credit for reducing crime. Without private sector economic value creation - none of this is possible. But no one here can even define economic value add. Probably because they have never created any.

- mr_rationale

April 16, 2010 at 5:23pm

"Just because the public sector built a road with private sector money doesn't imply all commerce traveling down the road was created by the Gov. [Its like I am debating with kids]." Only someone who believes he is, in fact, arguing with gullible children could think that the straw-man argument you have presented has any merit. My last comment above was meant to mock seattleeng's weird logic. Unless you took it seriously, no one on this blog is suggesting that the private sector creates no economic value. Your favorite word "parasites" -- do you have a keyboard shortcut to paste it in? -- should suggest that the government gives nothing back to the private sector in return for the taxes it pays. But since you acknowledge the existence of public roads and the police, and since (presumably) you realize you aren't living in a country that has been conquered by a foreign invader, and since the economic value the private sector creates is measured in a currency which is printed, regulated, and guaranteed by a centralized federal government, rather than in, say, potatoes, slaves, or head of cattle, that CAN'T be what you mean by "parasites." So, yeah, I guess you've stumped us.

- frippo

April 17, 2010 at 7:22pm