There’s been a lot of hype about how the richest 1% own so and so percentage of the world’s wealth. It’s been portrayed as if it’s a crime to earn too much, something that must be fixed.
All problems relating to poverty are blamed upon the greed of these billionaires. Greed is portrayed as a negative thing, but is it really so?
Greed is merely ambition, the striving to attain more. Is it evil to want more, even if you’re willing to put in honest effort for it? The problem which arises is that most people associate greed, and often incorrectly so, with a desire to earn more through any means possible. This is not the case.
According to humanist psychologists such as Carl Rogers and Abraham Maslow, humans have a desire to strive and unfold their inner potential. This will involve achieving the most you can, and to consider a craving for increment, for improvement a negative thing is quite absurd.
There’s nothing wrong if another person earns a lot more than you do. They produce things that are of value and are paid for it. It’s as simple as that. Income equality shouldn’t be a sort of ideal goal. A desirable goal would be to ensure that nobody is poor, as opposed to ensuring nobody is poorer.
In a capitalist economy, everyone is paid according to the value of the good or service they contribute to the economy. If there is a huge surplus of labor available in the market, then the value of labor will fall down. Similarly, if there’s a deficit, the value of labor will increase. The value of something in an economy is not determined by the work put in to achieve it, and this is something with which I’ve observed people having an issue.
You could work for a year at McDonald’s and will earn less than what a famous singer would make in a single night. The value of what you provide is determined by the demand of what you’re contributing. There are two aspects involved in being rich. Work hard, and work smart. If you’re doing a job that’s contributing nothing new to the market, then you won’t be paid a lot. The more irreplaceable you are, the higher you tend to earn. That is why CEOs earn more than the workers do, and why CEOs can easily increase their own salaries without a problem. It’s because they are necessary for the growth of the enterprise. In this sense, capitalism compels one to be different, to provide something unique.
Often I’ve encountered arguments about why the rich should be paying more taxes. These arguments tend to centre on the reasoning that since the rich have a lot of money they won’t be adversely affected by paying a bit more in taxes. This seems to be a repulsive and lazy solution. Can’t earn more? Tax those who do.
Currently, in Unites States, the rich (earning $250,000 and above) paid 55% of the net income tax burden, although their share of adjusted gross income (AGI) was only 28%. And many still believe that the rich aren’t paying their “fair” share.
I argue against taxing the rich from two standpoints: the moral one and the objective one.
From the moral standpoint, it is a most repelling notion that simply because a person has more, s/he should pay more. The percentage one pays in taxes should be the same. For every dollar you earn, the number of cents you pay to taxes should be the same for everyone. There should be a minimum level of earning after which your income can be taxed, to ensure that the extremely poor are a bit easier off, but after that the tax rate must be the same for all.
The argument that the rich can afford to pay more is redundant. Simply because you can afford to pay more doesn’t mean you have to. Taxing is not a polite email request for money. It’s pointing a gun at your head and saying that if you don’t hand over the cash, you’re going to be thrown into a cell. And simply put, you have no right to that money.
As long as you’re charging the same amount from everyone, it’s fair. They’re all giving the same portion of their income. But when you tax the rich more, it’s simply bullying. It’s the large portion of people who contribute things barely of value ganging up on those who do provide things of value, and asking them to cough up more money.
People talk all the time about how if we tax the rich enough, we’ll be able to pay for all healthcare and free education and everything else. Here’s the deal. In the United States, the blacks, who comprise about 12% of the population, are responsible for about 52% of the homicides. Killing all blacks would cut down homicides by 52%, but that’s a morally hideous solution, so no one will waste time discussing it. A milder form of the same logic applies to taxing the rich. Despite whatever it might pay for, it is not acceptable to tax them more. I could say, hey, if all the poor people rob everyone, they won’t remain poor. I’m not very certain that the government would be eager to pass a bill decriminalizing robbery for poor income families so that they can improve their lifestyle. Rather than making education and healthcare free, encourage the people to work hard, work smart and be able to afford to pay for these things themselves.
From the objective standpoint, taxing the rich more is contradictory to the goals of a country. A country would aim at providing employment for all, and the largest job creators are the rich. They are the ones who create and expand businesses, and these businesses hire people. The more you tax them, the less they expand their businesses and the employment reduces.
It’ll discourage investors from investing in the economy, which would further kill possible job opportunities. High tax rates also mean increase in tax evasion. In fact, one of the first things that happened in my country after we opened up our markets to the world was cutting down of the tax rates to decrease tax evasion.
Unlike what most presume, rich are highly unlikely to be lazy people, and being rich isn’t impossible. In fact, Bill Gates, Eminem, Dwayne ‘The Rock’ Johnson, Eminem, Shah Rukh Khan and a huge number of other rich celebrities started from poor backgrounds and went on to be extremely rich and famous.
I personally am not rich. I’m a teenager in a middle class family in a developing country. But I do plan to be rich one day, and even if I’m not, I still stand by the views I expressed in this article, until someone presents reasonable arguments to persuade me otherwise.