It is by Fortune Magazine senior editor Nina Easton, and to me, it preaches to the choir. This blog is about expressing views and engaging in civil, respectful, and insightful debate. That's why I'm posting this article. I think an open dialogue is a good thing, and the sharing of personal beliefs and opinions should be beneficial to all involved.
Let it be known, I pretty much agree with everything this article says. I'm glad Mrs. Easton wrote it. Some key things I took away:
"That's deeply troubling. Socially and politically, there are plenty of reasons to worry about the growing income gap. But rage against the 1% is misplaced. Income is not a zero-sum game: The rich aren't getting wealthier at the expense of the poor. Harvard's Lawrence Katz has calculated that even if all the gains of the top 1% were redistributed to the 99%, household incomes would go up by less than half of what they would if everyone had a college degree."
Yes! The rich are not getting wealthier at the expense of the poor. Some people argue they are, but, since there are no laws that mandate the poor stay poor, and everyone has the opportunity to become "rich," how could the rich possibly get wealthier at the expense of the poor? I think this paragraph starts a great conversation about the notion of wealth and wealth distribution in general.
Larry Ellison grew up in a poor to middle-class family. He didn't have a "silver spoon" in his mouth. He did, however, work hard and took personal responsibility for his actions, and became extremely wealthy. Did he do this by taking the wealth of someone else? No. In fact, his actions and his desires to become wealthy himself made many other people wealthy, too. In order to become wealthy he had to grow his business. To do this, he hired people who were given the opportunity to earn an income for themselves. Ellison got wealthier, but so did many people who worked for him. This is just one example of many, and I believe if he can do it, anyone can do it. As the author states, we shouldn't vilify Larry Ellison; we should try to emulate him.
Sure, there are those who make their millions unethically (cough, Bernie Madoff), but that's why we trust the courts and our legal system. But for those who truly do make it on their own, why should we promote the work-hard, do it yourself "American Dream," only to assail those who achieve it?
On top of the alleged "the 1% get richer of the 99%," many people will say that luck plays a huge roll in someone's success. I respectfully disagree with this position as well. I believe people make their luck, and I have often said the phrase, "there are no accidental doctors, CEOs, and lawyers out there, just as there are no accidental janitors." It's not a coincidence that hard work does pay off. Luck, to me, balances out for all. Of course, there are some statistical anomalies that exist. Some people have won the lottery multiple times, and some are inherently unlucky no matter what. But for the 99.9999% of us, We all have good luck, and we all have bad luck, too. Some people make better decisions when it comes to handling "luck," whether through preparation, mitigation, or management, and, as with success, to the victor should go the spoils and poor management and poor decisions should bring the consequences they normally do.
Some favor taxing the rich more to "level the playing field." In my opinion, with regards to tax rates, I don't believe we should be taxing the wealthy more to cover the bad luck of the non-wealthy. How would you measure the percentage of luck that exists for each individual? How would you regulate the amount of tax needed to cover bad luck? According to the IRS (see this chart), those making more than $200,000 per year already pay more than 100% more of their income to taxes (26.8% versus 13.3%) than those making less than $200,000. Are we implying these earners are 100% more lucky? To all the OWS supporters that believe the wealthy obtained their wealth not off the backs of the 99%, but off luck, how would you handle this? Would you put more power into the government's hands to regulate this? What if the average wealthy persons luck was at a level only 20% greater than the average middle-class American's luck? Should we tax the wealthy person 20% more?
Later in her article, Nina Easton then explains the possible reasons for the wealthy's growth. Her reasons are new to me, but her explanations are well documented. Her mention of the Yo-Yo Ma Effect is interesting, and has made me want to look into it more.
All in all, I do agree with her view that we shouldn't be angry at the 1%, but instead, we should try to achieve and match their successes. Instead of protesting, we should be producing. The 1% aren't holding us down. If one can succeed, we all can succeed. It starts with personal responsibility, not blame. In my opinion, whether you think that somehow the 1% truly exploit the 99%, or the wealthy are merely lucky, I don't believe it's the job of the government to become more powerful to even this out. We can all handle our own lives and, as I like to say: keep your eyes on the finish line, not on the field around you.
What are your opinions of Mrs. Easton's article? Do you agree? Disagree? Were her points on point, or way off the target? Additionally, how would YOU handle the income gap? What do you believe should (or shouldn't) be done? By whom? Please share your thoughts below.