Why We Should Not Tax the Rich

Here is John Edwards’ “employer” on taxes.  The last line, as they say, is “priceless.”  Griffin is an exception, since he is not interested in money, but in creating wealth for the community and the sheer joy of working.  Also, he would work less if faced with high taxes, but only as a matter of principle (or is it principal?).

“Kenneth C. Griffin, who received more than $1 billion last year as chairman of a hedge fund, the Citadel Investment Group, declared: “The money is a byproduct of a passionate endeavor.”  Mr. Griffin, 38, argued that those who focus on the money — and there is always a get-rich crowd — “soon discover that wealth is not a particularly satisfying outcome.”  His own team at Citadel, he said, “loves the problems they work on and the challenges inherent to their business.”   Mr. Griffin maintained that he has created wealth not just for himself but for many others.  “We have helped to create real social value in the U.S. economy,” he said.  “We have invested money in countless companies over the years and they have helped countless people”.”

“The income distribution has to stand,” Mr. Griffin said, adding that by trying to alter it with a more progressive income tax, “you end up in problematic circumstances. In the current world, there will be people who will move from one tax area to another. I am proud to be an American. But if the tax became too high, as a matter of principle I would not be working this hard.”

Uchitelle, Louis. “The Richest of the Rich, Proud of a New Gilded Age.” New York Times (15 July).

http://www.nytimes.com/2007/07/15/business/15gilded.html?sq=&pagewanted=print

3 comments so far

  1. Steve on

    I’m so glad we have at least one “principled” CEO in the business community!
    Griffin has been deluded by his stacks of money. His “passion” he speaks of, only goes so far… Principles, yes principles, cannot be tread upon by the great unwashed! God forbid this country which purports to be Christian actually follow in the footsteps of their leader whose birth was just celebrated and “feed the poor, care for the sick, shelter the homeless, visit the imprisoned.”
    Not to get too religious, but if we’re talkin’ principles, what of it?
    The gap between rich and poor continues to widen as these fatcats sit and talk about their “principles”!
    As you state in your book on “The Confiscation of American Prosperity”, and as David Cay Johnston writes in his book called “Free Lunch”, much of the wealth that the rich have accumulated is actually due to a TAXATION regime (begun in the Reagan administration) which benefits them unequally.

  2. Dan on

    Is it just me or does this post contradict itself? First he claims that “wealth is not a particularly satisfying outcome.” And the claims that he works because he loves the work he does. From this, he concludes that he would not work as hard if his tax rate went up?!?!?

    Personally, given his premises, I would conclude that money is a very poor motivator for the wealth and that a moderately increased tax rates would not change the work behaviors of the wealthy.

    Finally, he claims that he would stop working as a matter of principle if take rates were increased too much. hmm.. that’s interesting, because he claims to derive so much satisfaction from his work. Me thinks, he would stay out of the work force too long. Maybe he’d even apply his expertise in the non-profit arena where he’d get taxed less! Now, that sounds like a win, win, win.

  3. okokay on

    This doesn’t make much sense to me. The CEO’s logic is erroneous. Why would this CEO STOP working so hard when he starts making less money? Wouldn’t the CEO do everything he can to make more money to make up for the money he loses to taxes? It seems to me that Mr. CEO doesn’t want to lose all the money he’s making.

    Anyone ever heard of Andrew Mellon? His proposed tax rate cuts (specifically from 78% to 24% in the top margin and 4% to 1/2% in the middle to lower class) began enactment in the Revenue Acts of 1921, 1924, and 1926. Why did he do it? Well, besides the fact that Mellon himself was very rich, the idea was that the money retained by the upper class would “trickle down” to the lower class. However, this plan didn’t do anything but cause inflation. In 1929, the Great Depression afflicted the US, and Mellon’s plan is notorious for the poverty and inflation during the Great Depression. Moral of the story: let’s learn from history and not lower the taxes on the rich, please.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: