On The "Rich" And The "Job Creators"

Personally, I've been dreaming of this moment for three years. I go to bed every night and I dream of another recession. - Alessio Rastani

To begin with, I'm in favor of taxes, and taxing wealth. I think people deserve to keep what they earn, but earnings are not the result of a windfall, they take time to mature into wealth. My views are unorthodox, but I'd tax exceptional incomes at exceptional rates. Nobody on earth is going to try to earn less money simply because it's taxed more--especially the people who love money the most.

Short term gains should be taxed at the highest rates. Long term investments should be taxed lower. Wages, actual, honest wages should be taxed at the lowest rate since they are the most "earned." I'd still tax income progressively, though, and my top tax bracket would not be $250,000.

A lot of the rhetoric in politics lately talks about the rich and the job creators. Frankly, this gets us nowhere. There's no unilateral definition for "rich." Even job creator as a class is ambiguous. Rich in Connecticut is different than rich in Florida. Rich in Greenwich, Connecticut is different than rich in Derby, Connecticut. Most people would agree that $10 million is rich, but some wouldn't. Some people find this whole conversation irrelevant, because their money is theirs. Period.

Job creator as a title is equally ambiguous. Anyone who has hired someone is a job creator. And referring to a class of people as a job creator doesn't do anything for the national conversation. Should we tax job creators? Absolutely. Should we encourage them to create jobs? Absolutely. Does offering tiny tax cuts to businesses do it? No, not really. But cutting their taxes entirely won't either.

The logic is that if the corporations and rich have more money, they will hire more. The Job Creator Fallacy. The problem with this logic is that corporations are hoarding trillions of dollars in loans from the treasury, and they aren't using it to hire people. They are sitting on it. They are buying their competitors with it. And they are buying patents with it. This actually gets rid of jobs with things like consolidation and excessive litigating. Congress recently passed a law to "reform" patents. This did nothing to solve the problem, though. Google shouldn't be spending $12.5 billion on patents, they should reinvest it, or create jobs. The same is true for every other tech company battling over patents.

The problem with this whole conversation is how polarized and politicized it has become, however. Liberals see the rich as a bunch of assholes hoarding the wealth of this country while taking a massive dump on the rest of Americans. Conservatives see the rich as benevolent job creators who want to reinvest their money in their companies and create jobs, if only their taxes were lower. If only America wasn't such a high-taxed, terrible place to house a corporation. Lower their tax burden, and the jobs will come.

Liberals would counter that this "race to the bottom" gains nothing. Sure, there are jobs then (maybe) but what kind of job? All jobs aren't created equally. There are good quality jobs and terrible quality jobs. And wages are only a very small part of the quality equation.

Conservatives would counter that liberals in favor of taxing the wealthy and spreading their wealth constitutes socialism, and socialists are very, very bad. Why should they have to give up what they earn to lazy, incompetent people who don't want to work, they'd argue. It's a valid point, but who says the poor don't want to work? Maybe no one will give them a job. It's one big circle jerk, where the poor man on the totem pole isn't getting his, but ends up with everyone else's "egg" on their face. And I'm not exactly referring to trickle down "economics."

I don't care where you are on the map of conservative or liberal views, but people like this deserve to be taxed. This person deserves to be taxed at the standard rate up until $75,000 (and I'm being very, very generous. Anything after that should be taxed at 100%.



Some gems in case you don't want to watch the whole five minutes or so:

The governments don't rule the world, Goldman Sachs rules the world.

The savings of millions of people are going to vanish" in less than a year

This economic crisis is like a cancer, if you just wait and wait thinking this will go away, just like a cancer it's going to grow and it's going to be too late

Personally, I've been dreaming of this moment for three years. I go to bed every night and I dream of another recession.

When the market crashes... if you know what to do, if you have the right plan set up, you can make a lot of money from this.

For most traders we don't really care about having a fixed economy, having a fixed situation, our job is to make money from it

Until next time.