Thomas Alva Edision

"Results!  Why, man, I have gotten a lot of results.  I know several thousand things that won't work."

How Does This Make You Feel?

In today's Austin American-Statesman, there is an article entitled "Romney says his tax rate only about 15 percent."

Now, we know that while Mitt Romney worked for Bain Capital, he worked on projects where Bain made a profit by investing in companies that succeeded, but we also know, for good or ill, that he also worked on projects where Bain invested in companies that eventually went bankrupt, leaving the employees without jobs or pensions, and Bain still made a profit.  One may like that or not, or one may not like it but excuse it, but however one feels about it, it's true.

The newspaper article mentioned the following additional truths.

1.  Governor Romney said that "[h]is effective tax rate was 'probably closer to the 15 percent rate than anything.'" (The lowest Federal income tax rate is 10%.  Anyone who works and makes $17,000 or more pays at least 15% on everything over $17,000.  The highest tax rate, due on income over $379,150, is 35%.)

2.  Governor Romney earned $374,327 in speaking fees last year, which he characterized as "not very much."  ("[T]hat sum would, by itself, very nearly catapult most families into the top 1 percent of American earners.")

3.  "During 2010 and the first nine months of 2011, the Romney family had at least $9,600,000 in income ... ."  That's 9 million dollars.

4.  Romney acknowledged that most of his income comes from investments.  (The highest federal tax rate on long term capital gains is 15%.  So, theoretically, if you earn $400,000 in income, you'd be in the 35% bracket, but if you earn 9 million dollars in investments, you're only in the 15% tax bracket.)

5.  "President Barack Obama ... reported paying an effective federal tax rate of 26 percent on his 2010 family income."

Don't get me wrong.  I'm not in any way suggesting that Governor Romney or his family have earned even one penny through illegal or unethical means.  I'm not saying that and I have no reason to think that even might be true.  Nor do I begrudge him and his family the fact that they make a lot of money.  I wish I made that kind of money.  I have always said, and it has always been true, that my secret (now not so secret) ambition has always been to be a filthy capitalist pig.

But, I know how these facts make me feel.  First, they reinforce my belief that the rich in America really aren't paying too much in taxes.  As a percentage of income, they often pay a lot less than the rest of us.

Second, I can't help but feel like it's mean-spirited to make anything in the range of $5,000,000 a year (or 9.6 million in less than two years), pay a smaller percentage of that in taxes than most folk, and still want to balance the federal budget by reducing benefits for poor people instead of raising taxes, even a little bit, on rich people.

So, how does it make you feel?

The Land of Opportunity?

Yesterday, Tuesday, January 17, 2012, the Austin American-Statesman published an opinion article entitled "America's unlevel playing field won't get flattened by Romney," written by Paul Krugman.  It contained some interesting assertions.

1.  "Americans are much more likely than citizens of other nations to believe that they live in a meritocracy."

2.  "[T]his self-image is a fantasy."

Mr. Krugman supported this second assertion with an equally interesting assertion.

"America actually stands out as the advanced country in which it matters most who your parents were, the country in which those born on one of society's lower rungs have the least chance of climbing to the top or even to the middle."

While I find these assertions interesting in and of themselves, I find them particularly interesting because they are things I have been saying for some time now.  I did not make the assertions up.  They are based on hard statistical facts.  In America, it is much less likely that you will die at a higher socio-economic level than the one you were born into than it is in most European countries.

Now, to be clear, I am not saying that America is bad.  Hardly.  As someone long ago once told me, the test is:  Are they trying to get out, or are they trying to get in?  While not so much as they used to, they are still trying to get into America, not out.

But, we are not the "Land of Opportunity" that we tell ourselves we are.  And it is interesting to hear a Nobel-Prize-winning economist agree with me.

Not long ago, I was having dinner with some friends.  All three of them were naturalized U.S. citizens.  They are Americans now, but they had all been born citizens of other countries.

One of them asserted that America was the "Land of Opportunity."  When I disagreed and tried to explain that the facts showed that the assertion simply was not true, that many countries offered more opportunity to their citizens than did America, he refused to be dissuaded.  When I asked him how he could continue to believe the "Land of Opportunity" motto in the face of rather stark facts, he replied, "I don't believe the facts."

At that point, the only thing to be said, if anything, is what Senator Moynihan is reputed to have said:  "You are entitled to your own opinion, but not to your own facts."  Rational conversation is over.

Later, I was castigated by one of those at the table for disagreeing with the one who asserted that America was the "Land of Opportunity."  "He was just trying to compliment your country."

I thought about the implications inherent in the idea that it was my country, not the country of all those seated at the table, but I passed that over.  But, what I thought about was:  Why did I dispute him when he said something apparently complimentary about America?

One thing I can promise is that it was not because I am anti-American.  I do not hate America.  On the contrary, I love my country, and I consider myself to be among the most fortunate men on the planet for the single reason that I was born in America.

But, because I love my country, I want her to be as good as we can possibly make her.  As good as she is now, I want her to be better, if that can possibly occur.

It cannot occur if we lie to ourselves.  This is as true of a nation of people as it is of an individual.  If we are convinced, or convince ourselves, that we are perfect, we are never motivated to improve.  Thoughtful, accurate self-criticism is not bad.  Thoughtful, accurate self-criticism is good.

Consider the difference between looking in the mirror and saying to yourself, "Ah, I'm not that overweight.  In fact, a little girth looks good on me.  I don't need to be careful about what I eat or whether I exercise," and "Hmmm.  I think I'm gaining too much weight.  That won't be healthy.  I think I'll be a little more careful about what I eat and I'll start getting some more exercise."  One is self-delusion which allows us to continue our bad habits uncontrolled, and the other is thoughtful self-criticism which allows us to recognize where we need to improve and start taking steps to be better.

Our nation is exactly like that.  When we tell ourselves that we are the "Land of Opportunity," it may sound like a compliment, but actually we are self-deluding and we won't be motivated to actually improve opportunity for Americans.

We need to speak truth to ourselves so that we can be even better than we are.  If we truly love America, we will tell the truth about her, and we'll be happy when others do the same.

Henry Ford

"One of the greatest discoveries a man makes, one of his surprise, is to find he can do what he was afraid he couldn't do."

Thomas Alva Edison

"I am proud of the fact that I never invented weapons to kill."

Henry Ford

"If there is any one secret of success, it lies in the ability to get the other person's point of view and see things from that person's angle as well as from your own."

Thomas Alva Edison

"The brain can be developed just the same as the muscles can be developed, if one will only take the pains to train the mind to think.  Why do so many men never amount to anything?  Because they don't think."

The Social Contract v. Class Warfare

I believe the social contract for modern day America is "I am my brother's keeper."  I may be wrong.  Others may disagree.  But, I believe that is our social contract in America today.

If I'm right, then each American has an obligation to help care for his or her fellow Americans.  They are his or her "brothers" and he or she is their keeper.  This obligation is not a choice.  It is an obligation which arises from the fact that the social contract exists and from the terms of that contract.

Likewise, each American has a right to be cared for by his or her fellow Americans.  He or she is the "brother" of every other American and they are his or her keeper.  This right is not earned.  It is a right which arises from the fact that the social contract exists and from the terms of that contract.

So, let us examine this notion with an eye to determining how the application of this obligation and this right relate to the concept of "class warfare."

I'm going to pick some easy numbers to work with.  Of course, these numbers are not real.  They are intended only to be illustrative.

Suppose there are ten members of our society.  Suppose that each of them makes 100 economic units a year.  I'm going to call those "Units."  Suppose that each of them needs 90 Units to survive.  All is well.  Everyone has a little more than he or she needs and no one has to take care of anyone else or be cared for by anyone else.  No class warfare there.

However, assume that person number 1 - I'm going to call him or her One - only makes 90 Units a year and all the rest still make 100 Units a year.  One still has as much as he or she needs and no one has to take care of One.  So, all is still well.  No class warfare there.

But, change the assumption just a little.  Assume that One becomes incapacitated in some way, perhaps even at birth, and makes zero Units a year, but still needs 90 Units a year just to survive.  All the rest still make 100 Units a year.  The social contract kicks in.  All the rest have an obligation to care for One, and One has a right to be cared for.  So, each other person contributes 10 Units a year to the care of One, and now One has 90 Units a year, enough to surivive, and so does everyone else.

Is it class warfare because the 9 are required to each contribute equally to the care of One?  Clearly, the 9 are in a different economic class than One.  After all, each has more than he or she needs and One has nothing.  So, is One, in a lower economic class than the other 9, waging class warfare on the other 9, or is One merely using the social contract exactly as it was meant to be used?  I think there is no class warfare in this example, merely the social contract in action.

Now, vary the example just a little more.  Assume that One makes zero Units a year, Two makes only 90 Units a year, and Ten makes 110 Units a year, but everyone still needs 90 Units a year, just to survive.  Now, to be clear, the assumption is that Ten has done nothing wrong in making 110 Units a year when the most anyone else makes is 100, Two only makes 90, and One makes nothing.  Perhaps Ten is smarter, or works harder, or is just luckier.  But, Ten has done nothing wrong.  The 110 Units a year are rightfully his.

In this example, if everyone contributes 10 Units to care for One, then everyone winds up with just what they need to survive, except Two and Ten.  Two winds up with only 80 Units and will slowly starve to death, while Ten will have 100 Units, more than he needs to survive.  So, Two is in trouble and everyone else is okay.  To solve this problem, everyone could contribute one more Unit.  Then Two would have 89 Units, almost enough to survive.  He'd still starve to death, but not as quickly. Ten would have 99 Units, still more than he needs.  But Three through Nine would, like Two, only have 89 Units.  So, in this example, everyone but One, the totally destitute, and Ten, the fairly better off, will die.  One will just barely make it, while Ten will be fine, but the rest will die.

This doesn't seem to make sense.  Worse, it is not in compliance with the social contract.  Ten, who has an obligation to care for everyone else in his society, is not meeting his obligation, while Two through Nine have a right to be cared for, but that right is not being honored.

On the other hand, there is a straightforward way to follow the terms of the social contract to a tee in this example.  Instead of having everyone, including Two, who has barely enough, contribute to the care of One, who has nothing, Three through Nine could contribute 10 Units and Ten could contribute 20 Units.  Then, everyone would have 90 Units, everyone would survive, everyone would be cared for, and the terms of the social contract would be perfectly met.

Is this class warfare?  More to the point, when Three through Nine realize that if everyone contributes equally, they are going to all starve while Ten prospers, is it class warfare if one of them even suggests that they should, perhaps, discuss the possibility of Ten, who has more than he needs, contributing a little more so that everyone can survive?

Is it class warfare if those who have barely enough suggest that those who have more than enough ought to contribute more so that all can survive?  I don't think so.  I think it is merely the carrying out of the social contract.

But, let's make the example a little tougher.  Let us assume that One has nothing, Two has exactly 90 Units, Three through Nine have 100 units, and Ten, through entirely fair means, has 200 Units.  Clearly, if Three through Nine each contribute 10 units and Ten contributes 20 Units, there will be enough to care for One and make sure he survives.  But, then, Three through Nine, who start with more than they need, will barely make it by, while Ten will live in oppulence.

Is it class warfare if Three suggests that they all discuss whether it would make more sense for Three through Nine to contribute only 9 Units each, and ask Ten to contribute 29 instead of 20?  Ten would still have way more than he needs to survive, One and Two would have enough to get by, and Three through Nine would at least have a little extra, instead of barely getting by.  Ten would still be paying more than Three through Nine, and more than if he paid 20, but he'd still be a lot better off than everyone else.  Class warfare?  Class warfare even to suggest that the possibility of Ten paying a larger share even be discussed?  I don't think so.

Now, would it be class warfare if Three through Nine all forced Ten to pay 90 Units - everything that was needed to care for One, thus leaving Ten with only 120 Units while Three through Nine, who could pay something, paid nothing at all?  Yeah, it might be.  In that case, one economic class is clearly ganging up on another economic class and maybe that's class warfare.

Somewhere in between suggesting that the society discuss whether someone might pay more than their pro rata share and forcing someone to pay everything that is needed there is a line.  On one side of that line it is at least reasonable to have the discussion.  On the other side of that line folks are being unreasonable.  I can't tell you where that line is, but I can tell you that I don't think merely raising the idea of discussing whether a rich person ought to pay a little more so that the middle class can prosper, just a little, is class warfare.  That, on its face, is not unreasonable.

Yet, that is exactly what those who cry "class warfare" everytime someone suggests talking about raising taxes on the rich are claiming.  They are accusing someone who merely suggests a reasonable discussion of being unreasonable, of engaging in "class warfare."

I don't know where the right balance is.  Reasonable people will disagree on where the right balance is.  But, I am convinced that merely suggesting that we discuss whether we have the right balance now and where that right balance may be is not class warfare.

And those who claim it is are not being reasonable.