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Sunday, March 31, 2013

OTP: April 2013: Daily Caller: Baseball and the GOP: To rebrand the party, think like a sports fan

This week’s GOP autopsy report, commissioned by RNC Chairman Reince Priebus, is a great start in the much-needed task of rebranding the Republican Party. As the chairman acknowledged, “the way we communicate our principles isn’t resonating widely enough” and “we have to be more inclusive.” The report contains 219 recommendations to “connect people to our principles.” To achieve that goal, the party will need a strategic vision of how voters think about politics, which is something that the report lacks. For that, the GOP can learn a lot from another American passion: baseball.

This year, about 75 million Americans will go to the baseball stadium to watch a ballgame, about the same number as those who will vote in next year’s election. We rarely think about why someone becomes a baseball fan, or why they root for a certain team. Nor do we usually think about why someone chooses to vote for a certain political party. But it’s actually a very useful exercise.

When it comes to baseball, fan loyalty has almost nothing to do with the brain, and almost everything to do with the heart. In all of history, there’s never been a baseball fan who rooted for his team because it had the lowest ticket prices, or because it had the most taxpayer-friendly stadium deal, or because its players did the most community service. For the vast majority of Americans, rooting for a baseball team — not to mention, voting for a political party — isn’t really a rational choice; it’s more of a statement of personal identity — a statement telling the world, “This is who I am.” And for most people, defining “who I am” starts with family and community, before branching out into areas like race, age, gender, and class.

Family is pretty straightforward. If your mom and dad are Yankee fans, you’re almost certainly a Yankee fan. The same is true in politics. If your mom and dad are Republicans, you’re almost certainly a Republican.

Community is also pretty straightforward. If you grew up in, say, Philadelphia, chances are pretty great you’re a Phillies fan. Likewise, someone who grew up in Republican territory like, say, suburban Dallas or rural Indiana is much more likely to become a Republican than a nearly identical person from Seattle or Santa Fe.

Cities with more than one baseball team, like New York or Chicago, show revealing breakdowns by race and gender. The racial split in Chicago between Cubs fans on the North Side and White Sox fans on the South Side is well-documented. In New York, there’s an intriguing gender gap between Mets and Yankee fans, with women gravitating a lot more to the Yanks. While there’s a few theories out there trying to explain that, one obvious answer leaps out: Yankees heartthrob Derek Jeter.

In sports, as in politics, people’s convictions can’t be conveniently reduced to who their parents are or what they look like. But those things are an important foundation, upon which more rational sentiments come into being. Once you’re attached to your team on an emotional level — seeing them as a personal reflection of who you are and what you care about most — a rational exterior comes into being through phrases like “the Red Sox are the best team because they have the most heart” or “the Republicans are the best party because they know how to create jobs.”

Tripon Posted: March 31, 2013 at 10:52 AM | 6544 comment(s) Login to Bookmark
  Tags: politics

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   6101. Weekly Journalist_ Posted: April 29, 2013 at 02:52 PM (#4428285)
The last monarch of England who was "English" is also a fun conversation some history nerds like to play around with too.


Harold Godwinson and no other.
   6102. Joe Kehoskie Posted: April 29, 2013 at 02:54 PM (#4428289)
There was nothing actionable in the first communication from Russia and the CIA's request was basically the same. And the lack of an answer from Russia to the follow-up suggests to me that they didn't exactly see him as a major problem either.

The lengthy trip is weird but not scary. The Islamist postings that everybody finds so ominous were probably not up (remember the initial investigation has to be closed within 90 days -- timing is probably going to turn out to be important)

Look, it's going to cost people at the FBI their career and maybe that's appropriate (though I don't think it's likely that the people that replace them would have done better with the same information or will do better in the future). I'm not saying that there was not a failure. It's one of analysis and analysis is hard. — Ron J.

The third paragraph seems to be in conflict with the first two. If the FBI did everything it could with the information available, then no one should be scapegoated.

***
You also have to account for the fact that many of the non-legitimately disabled claimants probably work off the books as well as collecting SSDI. — snapper

No doubt. The U.S. now has an underground economy that's estimated to be $2 trilliondouble the $1 trillion estimate from when Obama took office in 2009.
   6103. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 02:55 PM (#4428292)
From whom? The Hermits up north? If that goes hot it goes nuclear and Pyongyang's a glassy wasteland.

That sort of theory makes nuclear war more likely. If they know you can crush them conventionally, they don't even dare.

From whom? Iran? Please. Their own citizens? Not a war we should be involved in.

Iran, Iraq, Syria, their own people, anyone. As long as the world economy depends on oil, we can't let those fields fall into hostile hands. Even if we became 100% independent of imported oil, it still presents the threat of global depression if the supplies are cut.

Again, from whom? Russia? Somehow I doubt a potential Russia vs US and Western Europe free-for-all in the mid-21st century is going to come down to tanks.

Yes, Russia. Or Germany.

Relying on some MAD theory involving nukes is immoral when we have the military strength to meet our aims conventionally.

Your fundamental mistake is thinking that we can pick and choose the wars we want. In 1989, no one thought we'd ever be fighting a war in the Persian Gulf. In 2010, no one thought we'd ever have troops in Afghanistan.
   6104. Lassus Posted: April 29, 2013 at 03:06 PM (#4428298)
In 2010, no one thought we'd ever have troops in Afghanistan.

Anyone (who was paying attention) presented with this scenario in 2010 and finding it surprising would have to be pretty naive.
   6105. Joe Kehoskie Posted: April 29, 2013 at 03:08 PM (#4428300)
No, you simply don't understand how litigation works. The government was sued. It's position in the litigation was bad -- liability was pretty much a slam dunk and the facts are embarrassing. What the government did was what every corporate litigant does in such a case: it asked the other side how much they wanted to make this litigation disappear. The parties agreed on a sum and the court approved. Congress then appropriated the money to fund the settlement. — Mefisto

I can't believe this guy has expended so much energy on this discussion without even reading the article. The whole point of the report is that the government's "position in the litigation" was NOT bad, and that liability was the OPPOSITE of a "slam dunk."

The DOJ not only seized defeat from the jaws of victory vis-a-vis the 90 or so plaintiffs who supposedly had semi-credible claims, but it decided to pay thousands of additional claimants, most of whom weren't even involved in the litigation. Only a class-action lawyer, like "Mefisto," could see this as anything other than a corrupt, horrendous result and a perversion of justice.

***
Unfortunately, massive accumulations of wealth (which are horrible for Democracy) tend to come this way. ...

I agree with this, as long as we're talking about inherited wealth and not entrepreneurial wealth. I have no problem with Steve Jobs being worth billions; I have big problems with his grandchildren and great-grandchildren potentially being billionaires before they're even born.

Likewise, I'd have no estate tax up to say $3-5M per heir, above that, 50%+. ...

If reversing the trend quoted above is the goal, these numbers are way too high and way too low. I'd go with $1M and 90 percent.
   6106. Ray (RDP) Posted: April 29, 2013 at 03:11 PM (#4428303)
There was nothing actionable in the first communication from Russia and the CIA's request was basically the same. And the lack of an answer from Russia to the follow-up suggests to me that they didn't exactly see him as a major problem either.


The problem with the first sentence: Russia's communication called for us to investigate and follow him. Russia's communication was specific enough to do that. And that was the "action" needed.

The problem with the second sentence: It is inherently contradictory. They saw him as enough of a problem to flag him for us. Who cares that they didn't answer our follow-up?

The lengthy trip is weird but not scary.


When viewed in context instead of isolation - he was already flagged for us, he had other red flags at home (*), he left his wife and child for 6 months to go to Dagestan - it had warning signs all over it.

(*) As has been exposed, even the most cursory follow up of the domestic violence charge would have revealed an ex-girlfriend who independently confirmed letter for letter what the Russians were warning us about: he was an islamic extremest with serious anti-American leanings. And had experienced psychotic behavior at home to boot. Of what value is it to us that this kind of person should continue to have the privilege -- he was not a citizen -- of living in the US instead of being deported? It makes a mockery of all the people trying to live here who were far more deserved than this maniac.

The Islamist postings that everybody finds so ominous were probably not up (remember the initial investigation has to be closed within 90 days -- timing is probably going to turn out to be important)

Look, it's going to cost people at the FBI their career and maybe that's appropriate (though I don't think it's likely that the people that replace them would have done better with the same information or will do better in the future). I'm not saying that there was not a failure. It's one of analysis and analysis is hard.


As Joe says, your judgment here that it may be appropriate to relieve people at the FBI of their duties based on this, and that it may indeed have been a failure, is in conflict with your preceding paragraphs.

This did not come out of nowhere. This guy was flagged for us and a cursory investigation and followup would have revealed that there was absolutely nothing to be gained by continuing to extend him the privilege of living here.
   6107. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 03:16 PM (#4428306)
If reversing the trend quoted above is the goal, these numbers are way too high and way too low. I'd go with $1M and 90 percent.

$3-5M is chump change when it comes to wealth. Not nearly enough to buy political power. You should probably never tax anything at 90%. 75% with no way of avoiding it (besides giving it away in $3-5M increments) is enough.

I agree with this, as long as we're talking about inherited wealth and not entrepreneurial wealth. I have no problem with Steve Jobs being worth billions; I have big problems with his grandchildren and great-grandchildren potentially being billionaires before they're even born.

Nope. Both. I have problems with anyone having enough wealth to influence the political process, regardless of how they get it. Michael Bloomberg is no less problematic than the Koch Brothers in this regard.

   6108. Ray (RDP) Posted: April 29, 2013 at 03:16 PM (#4428307)
No, you simply don't understand how litigation works. The government was sued. It's position in the litigation was bad -- liability was pretty much a slam dunk and the facts are embarrassing. What the government did was what every corporate litigant does in such a case: it asked the other side how much they wanted to make this litigation disappear. The parties agreed on a sum and the court approved. Congress then appropriated the money to fund the settlement. — Mefisto

I can't believe this guy has expended so much energy on this discussion without even reading the article. The whole point of the report is that the government's "position in the litigation" was NOT bad, and that liability was the OPPOSITE of a "slam dunk."


Right. I expended no further energy on him after reading the non-serious scripture he wrote above, which I concluded was pure trolling.
   6109. Joe Kehoskie Posted: April 29, 2013 at 03:29 PM (#4428324)
$3-5M is chump change when it comes to wealth. Not nearly enough to buy political power.

Ha ha. I can always tell the NYC residents from comments like this.

You should probably never tax anything at 90%. 75% with no way of avoiding it (besides giving it away in $3-5M increments) is enough.

Taxing Warren Buffett's estate at 90 percent would still leave his family with $5 billion to split up. There are probably a few hundred other families on the Forbes lists who would still have hundreds of millions left to split up after a 90 percent estate tax on anything over $5M or $10M (or, hell, even $50M).

If the problem you seek to solve is that there's too much money in the hands of too few people, and that those few people are unduly influencing American politics, you're not going to reverse let alone correct that trend with a 50 percent estate tax on anything over $10M, or even a 75 percent estate tax.

Nope. Both. I have problems with anyone having enough wealth to influence the political process, regardless of how they get it. Michael Bloomberg is no less problematic than the Koch Brothers in this regard.

Well, you lost me here. Unless you're advocating a hardcore system of socialism, which I'm sure you're not, there's no way that a brilliant entrepreneur like Steve Jobs could do what he did but not amass enough wealth to influence American politics.
   6110. Rickey! trades in sheep and threats Posted: April 29, 2013 at 03:32 PM (#4428330)
Well, you lost me here. Unless you're advocating a hardcore system of socialism, which I'm sure you're not, there's no way that a brilliant entrepreneur like Steve Jobs could do what he did but not amass enough wealth to influence American politics


The aristocracy has always run the state. The aristocracy will always run the state. Money is power. Power is money. There is no line between private wealth and political power.
   6111. Slivers of Maranville descends into chaos (SdeB) Posted: April 29, 2013 at 03:35 PM (#4428333)

Harold Godwinson and no other.


Half Danish.
   6112. Lassus Posted: April 29, 2013 at 03:38 PM (#4428343)
Ha ha. I can always tell the NYC residents from comments like this.

So what figure is more realistic? You realize we aren't talking about the Onondaga County Board of Supervisors, right?
   6113. Ron J2 Posted: April 29, 2013 at 03:39 PM (#4428347)
#6106 I honestly see you (and others arguing similar) as deciding the outcome (should have known) and working backwards.

Is a domestic violence arrest (but no prosecution) a sign of a future terrorist? I'm not aware of any such link. I am aware that there has been some pretty serious work done in trying to predict future terrorists from past actions, but I don't think there's anything to support the notion that this was a predictor of future problems. Remember, the FBI isn't an arm of the INS and has a very different mandate.

As I think I said earlier, I think this is going to show that as the FBI (and other agencies) get drowned in data they're heavily reliant on statistical analysis.

   6114. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 03:42 PM (#4428352)
Well, you lost me here. Unless you're advocating a hardcore system of socialism, which I'm sure you're not, there's no way that a brilliant entrepreneur like Steve Jobs could do what he did but not amass enough wealth to influence American politics.

I don't have a good answer. I just know that entrepreneurial wealth is just as dangerous as inherited wealth.

Especially, if you're going to tax the inherited wealth away, then the entrepreneurs will have even greater power.
   6115. Joe Kehoskie Posted: April 29, 2013 at 03:43 PM (#4428353)
So what figure is more realistic? You realize we aren't talking about the Onondaga County Board of Supervisors, right?

I already quoted the number I believe is "more realistic," at least if we're trying to reverse the trend Snapper was talking about. (See #6105.)

***
Especially, if you're going to tax the inherited wealth away, then the entrepreneurs will have even greater power.

I'd probably make that trade. Giving a person like Steve Jobs a little more power while he's alive probably couldn't go all that much worse than allowing dimwitted heirs to maintain wealth and power almost in perpetuity.
   6116. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 03:44 PM (#4428355)
The aristocracy has always run the state. The aristocracy will always run the state. Money is power. Power is money. There is no line between private wealth and political power.

But at different times they are forced to give different amounts of credence to the well being of the rest of us. We are trending more and more towards them either not giving a rat's ass, or trying to regulate our every move.
   6117. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 03:47 PM (#4428360)
I already quoted the number I believe is "more realistic," at least if we're trying to reverse the trend Snapper was talking about. See #6105.

$1M isn't even enough to guarantee a comfortable middle class life for your child, much less provide for future generations.

There's no reason someone who built a family business or financial portfolio worth $10-20M shouldn't be able to divide that among their kids and grandkids w/o having it taxed away. That level of wealth doesn't influence anything in society.

The people who are the problem are the billionaires and hundred millionaires. Maybe we should have a wealth tax, 10% p.a. on all wealth over $100M.
   6118. Ray (RDP) Posted: April 29, 2013 at 03:55 PM (#4428373)
Is a domestic violence arrest (but no prosecution) a sign of a future terrorist? I'm not aware of any such link.


The link is that a simple interview with the girl would very likely have confirmed that he was an islamo extremist with serious anti-american leanings which would have gone right along with what the Russians warned us about.
   6119. Never Give an Inge (Dave) Posted: April 29, 2013 at 03:55 PM (#4428374)

There's also a huge difference between a 10-year-old whose parents die and leave him with $1 million and a 50-year-old whose parents die and leave him with $1 million.

Anyway, the problem with taxing inheritance at very high rates is it creates a disincentive for saving and investing. People should be incentivized to build wealth and savings, and the ability to leave it to your kids is one such incentive.
   6120. Rickey! trades in sheep and threats Posted: April 29, 2013 at 03:56 PM (#4428375)
But at different times they are forced to give different amounts of credence to the well being of the rest of us. We are trending more and more towards them either not giving a rat's ass, or trying to regulate our every move.


In the great history of the species, the blip on the graph where the upper class gave any real credence to the well being of the rest of us is fantastically small. Like, that 20 game span in 2005 where Jeff Francoeur hit super good, small. We might need to consider a version of Voros' Law applied to this phenomena.
   6121. Rickey! trades in sheep and threats Posted: April 29, 2013 at 03:59 PM (#4428378)
People should be incentivized to build wealth and savings, and the ability to leave it to your kids is one such incentive.


Yes, and the wicket to unstick is where incentivizing the building of such wealth ends and the disincentivizing of hoarding and aristocratic caste creation begins.
   6122. Ray (RDP) Posted: April 29, 2013 at 04:01 PM (#4428381)
Anyway, the problem with taxing inheritance at very high rates is it creates a disincentive for saving and investing. People should be incentivized to build wealth and savings, and the ability to leave it to your kids is one such incentive.


Yes. People always overlook this.
   6123. Rickey! trades in sheep and threats Posted: April 29, 2013 at 04:02 PM (#4428383)
Yes. People always overlook this.


Not really.
   6124. Joe Kehoskie Posted: April 29, 2013 at 04:02 PM (#4428384)
Is a domestic violence arrest (but no prosecution) a sign of a future terrorist? I'm not aware of any such link.

No, but it's highly likely to be a sign of a future bad citizen, and since Tamerlan wasn't a citizen yet, it was the perfect excuse for DHS to send him packing.

***
$1M isn't even enough to guarantee a comfortable middle class life for your child, much less provide for future generations.

Are you talking about some rich guy dying and leaving behind a 5-year-old? If so, that's what life insurance is for. Otherwise, life should be a carnival for any adult who inherits $1M and isn't a drug addict or gambler, even in NYC.

EDIT: Water for Dave (#6119).

There's no reason someone who built a family business or financial portfolio worth $10-20M shouldn't be able to divide that among their kids and grandkids w/o having it taxed away. That level of wealth doesn't influence anything in society.

The people who are the problem are the billionaires and hundred millionaires. Maybe we should have a wealth tax, 10% p.a. on all wealth over $100M.

Again, I believe your political objectives and the realities of your life in high-cost NYC are in conflict. Inheriting $1M or $2M in just about any city in America should mean a life of comfort for anyone who isn't a fool with money. And unless a person who "built a family business or financial portfolio worth $10-20M" has at least 7 or 8 kids, splitting that money tax-free assuredly would leave the heirs in position to influence politics with the inherited money. They might not be able to engage in Soros- or Koch-level national SuperPAC campaigns, but they could pay for lobbyists, or even buy themselves a few legislators or congressmen.

Making a million dollars is hard. Making a million dollars when starting with $5M or $10M isn't hard at all. I believe you're underestimating the power that even a dumb heir would have after inheriting $5M.
   6125. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:02 PM (#4428385)
In the great history of the species, the blip on the graph where the upper class gave any real credence to the well being of the rest of us is fantastically small. Like, that 20 game span in 2005 where Jeff Francoeur hit super good, small. We might need to consider a version of Voros' Law applied to this phenomena.

Except there is no "natural force" driving us back to aristocracy. The super-wealthy aren't any more talented or smart than the merely wealthy. It's 99% luck and theft that separates them. If the entire Fortune 400 and the CEOs of all the Fortune 500 Cos. had been strangled in their cribs, the world would be no worse off, and we wouldn't suffer an iota if they all died tomorrow.

This is a matter of political choice. We're voting for it, again, and again, and again.
   6126. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:05 PM (#4428392)
Anyway, the problem with taxing inheritance at very high rates is it creates a disincentive for saving and investing. People should be incentivized to build wealth and savings, and the ability to leave it to your kids is one such incentive.

That's why you want to set the caps high enough not to effect 99.9% of all estates.
   6127. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:11 PM (#4428398)
Are you talking about some rich guy dying and leaving behind a 5-year-old? If so, that's what life insurance is for. Otherwise, life should be a carnival for any adult who inherits $1M and isn't a drug addict or gambler, even in NYC.

$1M will generate an annual income of maybe $30-40,000 if you invested in a fixed annuity and weren't too young. Some Carnival.

Again, I believe you're conflating your political objectives with the realities of your life in high-cost NYC. Inheriting $1M or $2M in just about any city in America should mean a life of comfort for anyone who isn't a fool with money. And unless a person who "built a family business or financial portfolio worth $10-20M" has at least 7 or 8 kids, splitting that money tax-free assuredly would leave the heirs in position to influence politics with the inherited money. They might not be able to engage in Soros- or Koch-level national SuperPAC campaigns, but they could pay for lobbyists, or even buy themselves a few legislators or congressmen.

Why can't they split it among kids and grandkids? A person who dies in their 80's may very well have 8 or more living children and grandchildren.

I think leaving each of them $3M is a worthy goal, not something to be discouraged by the tax code.
   6128. Rickey! trades in sheep and threats Posted: April 29, 2013 at 04:16 PM (#4428408)
Except there is no "natural force" driving us back to aristocracy.


This is your error. Money is power. Power is a "natural force." Power accrues power. Every last time. Like clockwork. Without fail. Money accrues money, which is power, which is a self-replicating natural force, which is politics. Talented or smart ain't got nothing to do with it, for the most part. Barring some other force disrupting the naturally accruing powers of inertia, the rich will get richer, the poor poorer, etc, et al, ad infinitum. This is the basic premise of all revolutionary logic.
   6129. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:19 PM (#4428414)
This is your error. Money is power. Power is a "natural force." Power accrues power. Every last time. Like clockwork. Without fail. Money accrues money, which is power, which is a self-replicating natural force, which is politics. Talented or smart ain't got nothing to do with it, for the most part. Barring some other force disrupting the naturally accruing powers of inertia, the rich will get richer, the poor poorer, etc, et al, ad infinitum. This is the basic premise of all revolutionary logic.

In a Democracy, only if the 99.9% of us schlubs vote for it. Unless we let the rich rig the system in their favor, the natural tendency will be for wealth to be squandered, as less talented heirs take it over.

And I'm all for a revolution, if it's a conservative one.
   6130. Slivers of Maranville descends into chaos (SdeB) Posted: April 29, 2013 at 04:20 PM (#4428417)

$1M will generate an annual income of maybe $30-40,000 if you invested in a fixed annuity and weren't too young. Some Carnival.


An annual income of $35,000 would give you a greater annual income than 61% of working Americans over the age of 15. Without working a minute.
   6131. Rickey! trades in sheep and threats Posted: April 29, 2013 at 04:20 PM (#4428418)
I think leaving each of them $3M is a worthy goal, not something to be discouraged by the tax code.


Why would it be so hard to fix inheritance rates to a percentage of the COL for the zip code of the deceased primary residence?
   6132. Joe Kehoskie Posted: April 29, 2013 at 04:20 PM (#4428420)
Except there is no "natural force" driving us back to aristocracy.

Yes, there is: The natural force of compound interest.

If the entire Fortune 400 and the CEOs of all the Fortune 500 Cos. had been strangled in their cribs, the world would be no worse off, and we wouldn't suffer an iota if they all died tomorrow.

This is crazy talk, even accounting for hyperbole. There are plenty of lousy CEOs and plenty of rich people who have contributed little or nothing to humanity, but there are plenty of Babe Ruths and Barry Bonds in the above group as well.

$1M will generate an annual income of maybe $30-40,000 if you invested in a fixed annuity and weren't too young. Some Carnival.
Why can't they split it among kids and grandkids? A person who dies in their 80's may very well have 8 or more living children and grandchildren.

I think leaving each of them $3M is a worthy goal, not something to be discouraged by the tax code.

It seems like you're being inconsistent here. If it's bad for people to sit at home and live off welfare, then it's bad (or almost as bad) for people to sit at home and live off inherited wealth.

I'm certainly not arguing that Steve Jobs shouldn't be able to make sure his wife and kids have a comfortable life, but the price tag on a comfortable life doesn't start at $3M or $5M.
   6133. Rickey! trades in sheep and threats Posted: April 29, 2013 at 04:26 PM (#4428425)
This is crazy talk, even accounting for hyperbole. There are plenty of lousy CEOs and plenty of rich people who have contributed little or nothing to humanity, but there are plenty of Babe Ruths and Barry Bonds in the above group as well.


Not really. C-level status is part of being in a club. It's not a performance based club.
   6134. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:26 PM (#4428426)
An annual income of $35,000 would give you a greater annual income than 61% of working Americans over the age of 15. Without working a minute.

What's your point? We want people to build businesses and save and create wealth. They don't work very hard and take risks to do this so their kids can live on $30K a year.

This is crazy talk, even accounting for hyperbole. There are plenty of lousy CEOs and plenty of rich people who have contributed little or nothing to humanity, but there are plenty of Babe Ruths and Barry Bonds in the above group as well.

I doubt it. I doubt you'd notice any difference if every CEO was replaced by his deputy. Smart people are very fungible.

It seems like you're being inconsistent here. If it's bad for people to sit at home and live off welfare, it's bad for people to sit at home and live off inherited wealth.

It's bad for people to live off inherited wealth and do nothing. It's worse to have that wealth never created in the first place.

If you set the caps too low, and the tax rate too high, you're going to send the vast majority of your most talented citizens to the golf course at age 50. That's not good for the country.
   6135. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:28 PM (#4428430)
Not really. C-level status is part of being in a club. It's not a performance based club.

Correct. It's an entirely corrupt self-dealing system. Corporate Boards are populated with other CEOs who are the CEO's buddies, and who will all vote each other higher and higher pay, and enforce no accountability.

If it was a merit based system, why would CEOs fight so hard not to separate the positions of CEO and Chairman? (see Jamie Dimon/Chase)

On average there is zero difference in ability between the CEO and his 10 most senior executives, yet he probably earns 10 times what any of them do.
   6136. Joe Kehoskie Posted: April 29, 2013 at 04:32 PM (#4428436)
Not really. C-level status is part of being in a club. It's not a performance based club.

I'll concede this is both mostly true and increasingly true, but it's not true as a rule. He's obviously gone now, but Steve Jobs performed. He's probably the best recent example, but he's far from the only one.

***
What's your point? We want people to build businesses and save and create wealth. They don't work very hard and take risks to do this so their kids can live on $30K a year.

This seems like much more of a middle-class striver's mentality than that of the risk-takers and high achievers. To continue using Steve Jobs as an example, I highly doubt he was motivated by the thought of allowing his kids to be lazy and unproductive. I'm sure he wanted them fed and clothed and sheltered, but I doubt he was trying to ensure they'd never have to work a single day in their lives and contribute nothing to humanity other than spending the money their father earned.

I doubt it. I doubt you'd notice any difference if every CEO was replaced by his deputy. Smart people are very fungible.
If you set the caps too low, and the tax rate too high, you're going to send the vast majority of your most talented citizens to the golf course at age 50. That's not good for the country.

If the first quote is true, then the result in the second quote shouldn't be anything to fear. Indeed, it might be one of the best ways to achieve the results you seek.
   6137. The Id of SugarBear Blanks Posted: April 29, 2013 at 04:33 PM (#4428438)
There are plenty of lousy CEOs and plenty of rich people who have contributed little or nothing to humanity, but there are plenty of Babe Ruths and Barry Bonds in the above group as well.

There are very, very few pure entrepreneurs in that group. The group consists primarily of people with a talent to rise in the bureaucracies of the behemoths of managerial capitalism (*), but that's a very fungible skill to the extent it's a skill at all. It's also a vastly overcompensated skill, which is why its returns should be heavily taxed.

(*) As a class, with the help of their self-interested lackeys in the media and politics, they've misappropriated the honorific of "entrepreneurs," because they know society will cheer on their outsized rewards if they're seen as that, but they aren't.
   6138. Rickey! trades in sheep and threats Posted: April 29, 2013 at 04:33 PM (#4428439)
CEO is a cult of personality more than anything else. Anyone argues otherwise hasn't dealt with a lot of CEO's. Your secondary C-levels have some functional skill set. CFO's know the numbers. CTO's know the tech. COO's know the operational necessities. CEO is just a self-selecting throne voted on by other members of the group.
   6139. Poulanc Posted: April 29, 2013 at 04:34 PM (#4428440)
It feels very odd to read posts by Joe and find myself agreeing with them.


Carry on.
   6140. Rickey! trades in sheep and threats Posted: April 29, 2013 at 04:35 PM (#4428442)
He's obviously gone now, but Steve Jobs performed.


Steve Jobs is a massive outlier to trend. And he was always so.
   6141. Slivers of Maranville descends into chaos (SdeB) Posted: April 29, 2013 at 04:36 PM (#4428443)

What's your point? We want people to build businesses and save and create wealth. They don't work very hard and take risks to do this so their kids can live on $30K a year.


No, they do it so they can have millions of dollars. Which they do.
   6142. 'zop sympathizes with the wrong ####### people Posted: April 29, 2013 at 04:36 PM (#4428444)
On average there is zero difference in ability between the CEO and his 10 most senior executives, yet he probably earns 10 times what any of them do.


Oh, I vigorously disagree with this. While a CEO might have a senior executive under him who is as good or better than him - the process is, of course, not entirely meritocratic - CEO's are generally far more capable than the next tier down, and so on and so forth.


I doubt it. I doubt you'd notice any difference if every CEO was replaced by his deputy. Smart people are very fungible.


And I completely disagree with this as well. Like everything else, when you get out on the edges of the normal distribution the gap between "best" and "second best" is generally very large. I come to a different conclusion than snapper; it's not that smart people are fungible, its that there aren't enough potentially competant CEOs to fill all the CEO positions available - because we impose artificial requirements on CEOs that they have certain credentials and social graces and language skills, and the pool of western, well-educated (read: properly credentialed), good-looking folks who are willing to travel 40 hours a week and skilled enough to be a competent CEO is tiny tiny tiny.

This is the difficulty with CEO pay. Snapper et al are right that, mostly, exec comp is rent seeking and cronyish, but a good CEO - say, the top 20% - is worth every penny paid and probably more. And no one wants to admit that they are not in that "good" pool, and no board wants to admit that the guy they hired isn't in that pool (or send a message to the market that they don't think the guy they hired is in that pool).
   6143. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:37 PM (#4428445)
If the first quote is true, then the result in the second quote shouldn't be anything to fear.

No, because if the cap is $1M before a confiscatory estate tax, not only are the CEOs going to the golf course at 50, but all their EVPs, SVPs, MDs and VPs are going too.

The top-100 executives at a large corporation (who will all have estates worth multiple of $1M) are not easily replaceable.

There's a lot of talented executives worth $250K, $500K, even $1M or $2M a year. You want those people working until 60 or 65 or even 70.

There's no executive worth $50M.
   6144. Ron J2 Posted: April 29, 2013 at 04:37 PM (#4428446)
Incidentally Ray there's an interesting story that suggests that Tsarnaev changed profoundly after he was barred from competing in the 2010 Golden Gloves tournament of champions. Eligibility rules had changed so that only US citizens were eligible.

And the interviews for the article don't square with the ex's accounts. For one thing: "The cocksure fighter, a flamboyant dresser partial to white fur and snakeskin" -- that doesn't sound like a hardcore fundamentalist.

And later in the article:

His aspirations frustrated, he dropped out of boxing competition entirely, and his life veered in a completely different direction.

Tsarnaev portrayed his quitting as a reflection of the sport’s incompatibility with his growing devotion to Islam. But as dozens of interviews with friends, acquaintances and relatives from Cambridge to Dagestan showed, that devotion, and the suspected radicalization that accompanied it, was a path he followed most avidly only after his more secular dreams were dashed in 2010 and he was left adrift.

And later:

He dropped out of community college and lost interest not just in boxing but also in music; he used to play piano and violin, classical music and rap, and his e-mail address was a clue to how he once saw himself: The_Professor@real-hiphop.com.

(of course there will be some who say that all white rappers should be deported on general principals)

And later:

Introducing what would become his signature style, he showed up overdressed, wearing a white silk scarf, black leather pants and mirrored sunglasses while the other contenders wore sweatsuits. (at the 2009 national Golden Gloves tournament)

Oh yeah. His explanation for going to Russia. "reconnect with family and to replace his nearly expired passport from the Republic of Kyrgyzstan with a Russian one" (And yeah, there's a problem with the story in that he waited for months before applying for the passport and left before it was delivered. Another little detail the FBI might have found interesting)

He seems to have changed after he got back from Russia. That's when he grew the 5 inch beard and became clearly more radicalized (the article mentions outbursts at the local mosque denouncing Muslims who observe Christian holidays for instance)




Full article
   6145. The Clarence Thomas of BBTF (scott) Posted: April 29, 2013 at 04:38 PM (#4428447)
It feels very odd to read posts by Joe and find myself agreeing with them.


Read my mind.
   6146. Ron J2 Posted: April 29, 2013 at 04:40 PM (#4428448)
#6128 That's why Payne argued for a confiscatory inheritance tax. Of course Payne was too radical for the US once the revolution was over.
   6147. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:41 PM (#4428449)
This is the difficulty with CEO pay. Snapper et al are right that, mostly, exec comp is rent seeking and cronyish, but a good CEO - say, the top 20% - is worth every penny paid and probably more. And no one wants to admit that they are not in that "good" pool, and no board wants to admit that the guy they hired isn't in that pool (or send a message to the market that they don't think the guy they hired is in that pool).

And then the other 80% are grossly overcompensated.

Is there a single CEO who would quit if they "only" made $3-5M p.a. instead of $30-50M? Where are they gonna go? Since the market can't distinguish the good ones from the bad ones, why not just cut all their pay?
   6148. Misirlou's been working for the drug squad Posted: April 29, 2013 at 04:43 PM (#4428450)
What's your point? We want people to build businesses and save and create wealth. They don't work very hard and take risks to do this so their kids can live on $30K a year.


They won't. Unless you raise the gift tax to the same level as the inheritance tax, they will just give the kids the money while they are still alive and pay the tax then. Even if you do increase the tax to the same level, and keep the exemption where it is right now, at $10,000 per year I believe (for each giver, thus a husband and wife can give $20K combined), the kids will build up quite a nice nest egg. If the parents do that for 30 years, the kids will have ~$3 mil each. Plus, nothing to stop the parents from buying a massive life insurance policy, unless you change the law there too.
   6149. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:44 PM (#4428451)
CEO is a cult of personality more than anything else. Anyone argues otherwise hasn't dealt with a lot of CEO's. Your secondary C-levels have some functional skill set. CFO's know the numbers. CTO's know the tech. COO's know the operational necessities. CEO is just a self-selecting throne voted on by other members of the group.

It's scary how much I'm agreeing with Sam today.

That's why Payne argued for a confiscatory inheritance tax. Of course Payne was too radical for the US once the revolution was over.

And I would be 100% onboard with confiscatory income tax rates too, if I didn't know they would eventually creep down to the upper middle class.

There's nothing inherently wrong, and a lot right, about a 50% Federal tax rate above $1M, scaling up to 80% above $5M.
   6150. 'zop sympathizes with the wrong ####### people Posted: April 29, 2013 at 04:44 PM (#4428452)
Is there a single CEO who would quit if they "only" made $3-5M p.a. instead of $30-50M? Where are they gonna go? Since the market can't distinguish the good ones from the bad ones, why not just cut all their pay?


Securities markets trade on public information. Hiring decisions, and assessments by boards, are not.

And yes, CEOs quit for greener pastures, if the opportunities are out there. If not, they empire build and goose their pay that way, or sell out to a PE firm. CEO comp is coercive.
   6151. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:44 PM (#4428453)
They won't. Unless you raise the gift tax to the same level as the inheritance tax, they will just give the kids the money while they are still alive and pay the tax then. Even if you do increase the tax to the same level, and keep the exemption where it is right now, at $10,000 per year I believe (for each giver, thus a husband and wife can give $20K combined), the kids will build up quite a nice nest egg. If the parents do that for 30 years, the kids will have ~$3 mil each. Plus, nothing to stop the parents from buying a massive life insurance policy, unless you change the law there too.

Yup, all true.
   6152. Rickey! trades in sheep and threats Posted: April 29, 2013 at 04:46 PM (#4428458)
This is the difficulty with CEO pay. Snapper et al are right that, mostly, exec comp is rent seeking and cronyish, but a good CEO - say, the top 20% - is worth every penny paid and probably more.


I'd like to see this in some sort of earnings percentage report. Otherwise, I think it's mostly assertion.
   6153. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:47 PM (#4428460)
Securities markets trade on public information. Hiring decisions, and assessments by boards, are not.

But if only 20% of CEOs are worth their obscene pay or more, then those assessments and decisions aren't worth a bucket of warm spit.
   6154. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:48 PM (#4428462)
I'd like to see this in some sort of earnings percentage report. Otherwise, I think it's mostly assertion.

Even granting him that, if 80% are worth much, much less, it's a total indictment of the system.
   6155. The Id of SugarBear Blanks Posted: April 29, 2013 at 04:48 PM (#4428463)
Is there a single CEO who would quit if they "only" made $3-5M p.a. instead of $30-50M? Where are they gonna go? Since the market can't distinguish the good ones from the bad ones, why not just cut all their pay?

Bingo.

The answer to these questions is almost never purely no, but I'd bet the answer to this one is very close to no: Has a CEO ever jumped from one Fortune 1000 company to another for more money? I can't remember one of them ever going to "free agency" or doing that kind of jump.
   6156. 'zop sympathizes with the wrong ####### people Posted: April 29, 2013 at 04:48 PM (#4428464)
I'd like to see this in some sort of earnings percentage report. Otherwise, I think it's mostly assertion.


Because earnings is a good benchmark of CEO quality. You can't futz with earnings at all, no sir.
   6157. The Id of SugarBear Blanks Posted: April 29, 2013 at 04:48 PM (#4428465)
He's obviously gone now, but Steve Jobs performed.

Jobs was a founder.
   6158. Joe Kehoskie Posted: April 29, 2013 at 04:49 PM (#4428466)
Steve Jobs is a massive outlier to trend. And he was always so.

As I admitted, but that doesn't change the fact that he performed. I have no problem saying that most CEOs are overpaid and/or amass too much wealth, but that's not remotely the same thing as saying "the world would be no worse off" if guys like Jobs, Gates, Walton, et al., "had been strangled in their cribs." Snapper threw the baby out with the bath water.

***
No, because if the cap is $1M before a confiscatory estate tax, not only are the CEOs going to the golf course at 50, but all their EVPs, SVPs, MDs and VPs are going too.

At which number does this change? $2M? $5M?

At anything beyond about $2M, you're ensuring the continuation of the aristocracy class you seek to eliminate.

There's no executive worth $50M.

There's probably no non-entreprenuerial executive worth $50M, but guys like Jobs and Gates and Ford (adjusting for current dollars) certainly were. Regardless, if we're talking about reducing or eliminating the aristocracy class, especially among heirs, it doesn't matter whether the money was earned or unearned by the person who amassed the wealth. All that matters is that the wealth exists, and is being passed down to subsequent generations.
   6159. Rennie's Tenet Posted: April 29, 2013 at 04:49 PM (#4428467)
a white silk scarf, black leather pants and mirrored sunglasses


This is overdressed?
   6160. Rickey! trades in sheep and threats Posted: April 29, 2013 at 04:53 PM (#4428472)
This is overdressed?


For Sparta, yes.
   6161. 'zop sympathizes with the wrong ####### people Posted: April 29, 2013 at 04:53 PM (#4428473)
But if only 20% of CEOs are worth their obscene pay or more, then those assessments and decisions aren't worth a bucket of warm spit.


To the contrary. You miss the point entirely. The goal of a company - meaning all stakeholders, directors, management, employees - with incompetent management is to disguise the incompetence of their management. This is even more true as comp because more incentive-based, since comp then scales with public trading on public information rather than directors' view of directors. It also is amplified as comp is made transparent.

A board can never afford to have its "true" view of its CEO telegraphed to the market. It is like having a lame duck manager in baseball, except even more so because you don't have the artificial endpoints of a "season". The messaging always has to be this is guy for us, this guy is great, he is the ####### jesus of widgets, etc etc, until the second his ass is canned. He needs to make as much as his peers (subject to incentive comp) and be treated like a god, because if he is not, if he is known as a caretaker CEO till you find your next Moses, then the market will kill you.

In other words, the decision to overcompensate bad CEOs can be rational and considered and well within reasoned business judgment, because its worth far more than $[X] million for a multibillion revenue company to conceal the quality of its management team from the markets.
   6162. Jolly Old St. Nick Is A Jolly Old St. Crip Posted: April 29, 2013 at 04:54 PM (#4428474)
If you set the caps too low, and the tax rate too high, you're going to send the vast majority of your most talented citizens to the golf course at age 50. That's not good for the country.

Damn, if only you could get them to take up pool instead....[dreams of instant riches and curses the cult of fresh air and green grass]
   6163. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:54 PM (#4428475)
Has any country ever implemented a wealth tax?

I mean, we do this with real estate, in the form of property tax, I probably pay close to 2% of my house's value every year.

Why not extend the concept to financial assets, with a steeply progressive scale? Say, no tax up to $250K, 1% up to $1M, 2% to $5M, 3% to $10M, 5% to $50M, and 10% over that.
   6164. Ray (RDP) Posted: April 29, 2013 at 04:54 PM (#4428477)
Incidentally Ray there's an interesting story that suggests that Tsarnaev changed profoundly after he was barred from competing in the 2010 Golden Gloves tournament of champions. Eligibility rules had changed so that only US citizens were eligible.

...

"Tsarnaev portrayed his quitting as a reflection of the sport’s incompatibility with his growing devotion to Islam. But as dozens of interviews with friends, acquaintances and relatives from Cambridge to Dagestan showed, that devotion, and the suspected radicalization that accompanied it, was a path he followed most avidly only after his more secular dreams were dashed in 2010 and he was left adrift."


But the problem is that the timeline of this "he changed after his dreams of 2010 were dashed" theory doesn't work: he was arrested for assaulting his girlfriend in 2009. And by that time, she said, he had already been spouting anti-American sentiments and was already quite immersed in islamic extremism; indeed, she says the very argument that caused the domestic violence incident was him forbidding her from wearing cut-off jeans and a crop top (whatever that is) to a party.

Her telling of this is that he was fine in 2006, and then, somewhere after that, he changed -- but whatever the boxing thing in 2010 may have done to him, he was already far down this path by 2009:

When the 17-year-old Ascencao began her three-year romance with Tamerlan in 2006, he was a hard-partying, pot-smoking, aspiring fighter, the ex-gal pal told the newspaper.

Somewhere along the way, he morphed into a US-bashing hatemonger.

“One minute he’s this funny, normal guy who liked boxing and having fun, the next he is praying four times a day, watching Islamic videos and talking insane nonsense,” she said.

“He became extremely religious and tried to brainwash me to follow Islam. Tamerlan said I couldn’t be with him unless I became a Muslim. He wanted me to hate America like he did.”

The brute wanted Ascencao to isolate herself from non-Muslim friends and buy into his radical lifestyle.

“He once ripped a pair of my jeans and hit me in the face with them,” she said.

“Tamerlan told me I should only talk to Muslim girls, not other ‘slutty’ girls.”

The final straw came when Tamerlan attacked her for going to a pool party in cut-off jeans and a crop top.

“He was shouting and screaming at me,” Ascencao said. “He slapped me across the face really hard.”

Ascencao called cops, leading to Tamerlan spending a night in jail. She dumped him soon after.

   6165. The Id of SugarBear Blanks Posted: April 29, 2013 at 04:55 PM (#4428478)
In other words, the decision to overcompensate bad CEOs can be rational and considered and well within reasoned business judgment, because its worth far more than $[X] million for a multibillion revenue company to conceal the quality of its management team from the markets.

Well that one's simple -- we adjust the antifraud provisions of state and the federal securities laws to exempt a public company that lies about how much its paying its executives.

Problem solved.
   6166. Jolly Old St. Nick Is A Jolly Old St. Crip Posted: April 29, 2013 at 04:56 PM (#4428479)
A board can never afford to have its "true" view of its CEO telegraphed to the market. It is like having a lame duck manager in baseball, except even more so because you don't have the artificial endpoints of a "season". The messaging always has to be this is guy for us, this guy is great, he is the ####### jesus of widgets, etc etc, until the second his ass is canned. He needs to make as much as his peers (subject to incentive comp) and be treated like a god, because if he is not, if he is a caretaker CEO till you find your next Moses, then the market will kill you.

In other words, the decision to overcompensate bad CEOs can be rational and considered and well within reasoned business judgment, because its worth far more than $[X] million for a multibillion revenue company to conceal the quality of its management team from the markets.


Intuitively that makes total sense, though it makes even more sense if the company also disregards the CEO's advice.
   6167. 'zop sympathizes with the wrong ####### people Posted: April 29, 2013 at 04:57 PM (#4428481)
Well that one's simple -- we adjust the antifraud provisions of state and the federal securities laws to exempt a public company that lies about how much its paying its executives.

Problem solved.


That does nothing. The point is that if great CEO is making $X, then every other board will pay its CEO $X so that the market cannot distinguish from great CEO and bad CEO. Then great CEO's board will raise his salary to "reward" him. Then the bad CEOs' board will raise his salary to make him seem great. And so on and so forth.
   6168. Ron J2 Posted: April 29, 2013 at 04:57 PM (#4428482)
#6159 What can I say? And later in the article it mentions him showing up wearing snakeskin boots and a cowboy hat. Again, not really squaring with the fundamentalist picture.

Also from the article.

Jumping right into boxing after his arrival in the United States, he called attention to himself immediately in more ways than one. During registration for a tournament in Lowell, he sat down at a piano and lost himself for 20 minutes in a piece of classical music. The impromptu performance, so out of place in that world, finished to a burst of applause from surprised onlookers.
   6169. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 04:57 PM (#4428483)
To the contrary. You miss the point entirely. The goal of a company - meaning all stakeholders, directors, management, employees - with incompetent management is to disguise the incompetence of their management. This is even more true as comp because more incentive-based, since comp then scales with public trading on public information rather than directors' view of directors. It also is amplified as comp is made transparent.

A board can never afford to have its "true" view of its CEO telegraphed to the market. It is like having a lame duck manager in baseball, except even more so because you don't have the artificial endpoints of a "season". The messaging always has to be this is guy for us, this guy is great, he is the ####### jesus of widgets, etc etc, until the second his ass is canned. He needs to make as much as his peers (subject to incentive comp) and be treated like a god, because if he is not, if he is known as a caretaker CEO till you find your next Moses, then the market will kill you.

In other words, the decision to overcompensate bad CEOs can be rational and considered and well within reasoned business judgment, because its worth far more than $[X] million for a multibillion revenue company to conceal the quality of its management team from the markets.


Great, so if we cut CEO pay by 80%, they still won't have bad signals to the market, and shareholders will save billions of dollars a year. Win-win.
   6170. Joe Kehoskie Posted: April 29, 2013 at 04:59 PM (#4428485)
Is there a single CEO who would quit if they "only" made $3-5M p.a. instead of $30-50M? Where are they gonna go? Since the market can't distinguish the good ones from the bad ones, why not just cut all their pay?

So you want top CEOs to make $3M to $5M,* with "confiscatory" tax rates, but you want their heirs to be able to inherit at least $3M to $5M tax-free? This seems incongruous.

(* I'm guessing the average CEO is only CEO for about as long as the average MLB player is in MLB, so even if we assume that CEOs are highly overpaid, they're probably only highly overpaid for a brief part of their career.)

There's nothing inherently wrong, and a lot right, about a 50% Federal tax rate above $1M, scaling up to 80% above $5M.

If the "most talented citizens [will go] to the golf course at age 50" if the estate tax is too high, why would they keep working despite confiscatory tax rates like the above? It seems illogical. It's one thing to lose 80 percent of your wealth to the government after you die; it's quite another to lose 80 percent of your income to the government while you're alive. The latter is much more of a disincentive than the former.
   6171. The Id of SugarBear Blanks Posted: April 29, 2013 at 04:59 PM (#4428487)
That does nothing. The point is that if great CEO is making $X, then every other board will pay its CEO $X so that the market cannot distinguish from great CEO and bad CEO. Then great CEO's board will raise his salary to "reward" him. Then the bad CEOs' board will raise his salary to make him seem great. And so on and so forth.

No one will know that great CEO is making $X because the report that he/she is might be a lie.

If all that matters is PR and market perception, then you just lie and say you're paying your CEO big dollars without actually paying him that.

   6172. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 05:00 PM (#4428489)
No, because if the cap is $1M before a confiscatory estate tax, not only are the CEOs going to the golf course at 50, but all their EVPs, SVPs, MDs and VPs are going too.

At which number does this change? $2M? $5M?

At anything beyond about $2M, you're ensuring the continuation of the aristocracy class you seek to eliminate.


It's a hard balancing act. That's why this is a difficult issue to get right.

$2M per heir might be OK. Or even $1M, if you let spouses and minor children get their own share.

I wouldn't worry about aristocracy at low single digit millions. I know lots of people worth $1-2M. None of them has any political clout.
   6173. Ray (RDP) Posted: April 29, 2013 at 05:00 PM (#4428490)
My position on CEOs: I quite simply don't care what they make, and don't think it's a bad thing if they make $50 million a year -- or $500 million. It's a complete non-issue. I'd guess the core of it is jealousy, but who the hell knows.

So: I disagree with all members of the bizarre Snapper/SBB/Poulanc/Scott/Sam alliance.
   6174. Rickey! trades in sheep and threats Posted: April 29, 2013 at 05:01 PM (#4428491)
But the problem is that the timeline of this "he changed after his dreams of 2010 were dashed" theory doesn't work: he was arrested for assaulting his girlfriend in 2009. And by that time, she said, he had already been spouting anti-American sentiments and was already quite immersed in islamic extremism; indeed, she says the very argument that caused the domestic violence incident was him forbidding her from wearing cut-off jeans and a crop top (whatever that is) to a party.


Actually, no. The 2009 DV incident indicates that he was having difficulty accepting sexual and gender norms of American society and was abusive in his attempts to make his girlfriend live by his religious standards. But that is wholesale removed from "making and planting pressure cooker bombs." Being and abusive jackass is not identical to being a truly radicalized terrorist. If it were, half of rural American men would be terrorists.
   6175. Jolly Old St. Nick Is A Jolly Old St. Crip Posted: April 29, 2013 at 05:04 PM (#4428493)
Has any country ever implemented a wealth tax?

I mean, we do this with real estate, in the form of property tax, I probably pay close to 2% of my house's value every year.

Why not extend the concept to financial assets, with a steeply progressive scale? Say, no tax up to $250K, 1% up to $1M, 2% to $5M, 3% to $10M, 5% to $50M, and 10% over that.


I don't object to that in principle, but in practice you'd likely just create another enormous bureaucracy along with a slew of wealth tax lawyers and millionaire tax evaders. What are you going to do, hire a bunch of jewelry appraisers to check up on all the diamonds and Cartier watches that are hidden away in safes?
   6176. Ray (RDP) Posted: April 29, 2013 at 05:05 PM (#4428495)
Actually, no. The 2009 DV incident indicates that he was having difficulty accepting sexual and gender norms of American society and was abusive in his attempts to make his girlfriend live by his religious standards. But that is wholesale removed from "making and planting pressure cooker bombs." Being and abusive jackass is not identical to being a truly radicalized terrorist. If it were, half of rural American men would be terrorists.


No, that's incomplete, and thus incorrect. Quoting once again from the article:

“He became extremely religious and tried to brainwash me to follow Islam. Tamerlan said I couldn’t be with him unless I became a Muslim. He wanted me to hate America like he did.”


   6177. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 05:05 PM (#4428496)
If the "most talented citizens [will go] to the golf course at age 50" if the estate tax is too high, why would they keep working despite confiscatory tax rates like the above? It seems illogical.

Because $1M as an income stream is much, much higher than $1M as an estate. A person making $1M a year already pays a marginal tax at or above 40%. We know that doesn't seem to deter work.

Plus, the estate has already been taxed when the income was earned.

So you want top CEOs to make $3M to $5M, with "confiscatory" tax rates, but you want the heirs to be able to inherit at least $3M to $5M tax-free? (I'm guessing the average CEO is only CEO for about as long as the average MLB player is in MLB.)

With the rates I quoted above, they would be paying maybe 60% on average the money above $1M. That's no particularly confiscatory.

Again, the estate has already been taxed once.

There's a complicated balance of incentives and fairness to be met here. It's a non-trivial problem.

   6178. Mefisto Posted: April 29, 2013 at 05:06 PM (#4428498)
I'm not sure if snapper wants me on his side on the wealth tax issue, but I am.
   6179. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 05:07 PM (#4428500)
My position on CEOs: I quite simply don't care what they make, and don't think it's a bad thing if they make $50 million a year -- or $500 million. It's a complete non-issue. I'd guess the core of it is jealousy, but who the hell knows.

So: I disagree with all members of the bizarre Snapper/SBB/Poulanc/Scott/Sam alliance.


Even though their pay is mostly determined by self-selected board members who have every incentive to have CEO pay rise, since many are CEOs or aspiring CEOs themselves?

I would think that sort of crony capitalism would worry you.
   6180. Ron J2 Posted: April 29, 2013 at 05:09 PM (#4428501)
Incidentally there's an interesting National Post article which goes a long way to explaining (to me at any rate) why US anti-terrorism investigations are so resource intensive (and generally involve stings of some kind)

Criminal conspiracy in the U.S. requires an overt act in furtherance of the plan. Talk is not enough, and so investigators often construct scenarios, such as providing a fake bomb, in which a suspect can incriminate himself with no risk to the public.

“That’s not the case in Canada,” said Mr. MacFarlane, who has also taught law at the University of Manitoba, and argued cases at the international level in The Hague.

“We don’t need [an overt act], so you could have three people sitting around a table plotting a conspiracy. As long as they’re serious, as long as there’s a meeting of the minds and they’re serious, then it is a conspiracy,” he said.

And yes, I know that the argument is that Tsarnaev could have been deported. But when the culture of the organization is focused on criminal prosecution (as in the FBI) they're going to be very concerned with having actionable evidence.

And it turns out that there was a fairly big anti-terrorism investigation in Boston (predictably involving a sting) and that's probably going to turn out to be an issue as we learn more.
   6181. Jolly Old St. Nick Is A Jolly Old St. Crip Posted: April 29, 2013 at 05:09 PM (#4428503)
My position on CEOs: I quite simply don't care what they make, and don't think it's a bad thing if they make $50 million a year -- or $500 million. It's a complete non-issue. I'd guess the core of it is jealousy, but who the hell knows.

As long as their total income and other benefits are a matter of public record (if it's a publicly held company), I don't care, either. As long as you tax him at a steeply progressive rate, what a CEO makes should be strictly between him and the company's shareholders. I'm much more interested in seeing that a good part of that income supports a strong social safety net than I am about what the CEO does with the money that's left over.
   6182. Jolly Old St. Nick Is A Jolly Old St. Crip Posted: April 29, 2013 at 05:13 PM (#4428508)
Even though their pay is mostly determined by self-selected board members who have every incentive to have CEO pay rise, since many are CEOs or aspiring CEOs themselves?

I would think that sort of crony capitalism would worry you.


AFAIC that's a blight on the company's reputation, but again, what's far more important is how much they pay the workers on the bottom. Ridiculously high CEO pay only becomes an issue to me when sub-living wages are being paid to other workers of the company.
   6183. Ray (RDP) Posted: April 29, 2013 at 05:13 PM (#4428509)
Even though their pay is mostly determined by self-selected board members who have every incentive to have CEO pay rise, since many are CEOs or aspiring CEOs themselves?


Yes. Even though that.

I would think that sort of crony capitalism would worry you.


Not at all.
   6184. The Id of SugarBear Blanks Posted: April 29, 2013 at 05:13 PM (#4428510)
As long as their total income and other benefits are a matter of public record (if it's a publicly held company), I don't care, either. As long as you tax him at a steeply progressive rate, what a CEO makes should be strictly between him and the company's shareholders. I'm much more interested in seeing that a good part of that income supports a strong social safety net than I am about what the CEO does with the money that's left over.

I guess I don't "care" either if this is the definition. I'd tax everything above CEO salaries from the era of the Great Consensus (adjusted for inflation) at something like 95%, so that would become an effective ceiling anyway.

The money isn't paid in an arms-length hard-edged negotiation, for the reasons snapper said, so it's just funny money anyway. Tax it.
   6185. Ray (RDP) Posted: April 29, 2013 at 05:15 PM (#4428514)
That's a blight on the company's practice AFAIC, but again, what's far more important is how much they pay the workers on the bottom. Ridiculously high CEO pay only becomes an issue to me when sub-living wages are being paid to other workers of the company.


Those workers are free to seek gainful employment elsewhere.

Presuming they are indeed being paid wages that are "sub-living" in this reality, as opposed to what liberals consider "sub-living."
   6186. The Id of SugarBear Blanks Posted: April 29, 2013 at 05:16 PM (#4428517)
Not at all.

Ray, if you don't care a fig about the mechanics of how money is paid and earned in the US, you lose a great deal of credibility when you comment on the low pay of the poor and them being subsidized.
   6187. Ron J2 Posted: April 29, 2013 at 05:18 PM (#4428520)
I love wonkblog. New medicare rules

Medicare released a 1,424-page rule that tells Medicare hospitals what they will get paid in 2014. The table of contents alone stretches on for 37 pages.

   6188. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 05:19 PM (#4428522)
Ray, if you don't care a fig about the mechanics of how money is paid and earned in the US, you lose a great deal of credibility when you comment on the low pay of the poor and them being subsidized.

Concur. Why should we care about welfare fraud, or politicians taking payoffs, if we don't care about CEO pay fraud? Root, hog or die.

Stealing from shareholders is just as immoral and damaging as stealing from taxpayers.
   6189. Joe Kehoskie Posted: April 29, 2013 at 05:19 PM (#4428523)
Because $1M as an income stream is much, much higher than $1M as an estate. A person making $1M a year already pays a marginal tax at or above 40%. We know that doesn't seem to deter work.

I'm not sure we know this at all. If guys like Tom Golisano are moving from New York to Florida because of New York's tax rates, which are only a fraction of his tax liability, then I have to believe he might start golfing* more if the feds start taking 50 percent of everything he makes after $1M or 80 percent of everything after $5M.

(* Or playing tennis; as of last year, Monica Seles is or was his girlfriend.)

Plus, the estate has already been taxed when the income was earned.
Again, the estate has already been taxed once.

Ha ha. This is the battle cry of the anti-estate tax aristocracy.

I know you're arguing in good faith, but it seems like you're trying to thread one hell of a needle here.
   6190. Jolly Old St. Nick Is A Jolly Old St. Crip Posted: April 29, 2013 at 05:20 PM (#4428526)
Those workers are free to seek gainful employment elsewhere.

Sure, just as a CEO who objects to a high marginal tax rate is always free to move to Fredonia.

Presuming they are indeed being paid wages that are "sub-living" in this reality, as opposed to what liberals consider "sub-living."

If you really have to wonder what a sub-living wage is, with luck you'll never have to find out the answer for yourself.
   6191. Ray (RDP) Posted: April 29, 2013 at 05:22 PM (#4428529)
Concur. Why should we care about welfare fraud, or politicians taking payoffs, if we don't care about CEO pay fraud? Root, hog or die.

Stealing from shareholders is just as immoral and damaging as stealing from taxpayers.


Serious questions: What is "CEO pay fraud" and where is the "stealing from shareholders"?
   6192. Joe Kehoskie Posted: April 29, 2013 at 05:25 PM (#4428531)
Serious questions: What is "CEO pay fraud" and where is the "stealing from shareholders"?

I'm wondering the same.

It's kind of bizarre how little regard Snapper, et al., have for the Forbes 400 and C-suite execs while also arguing that their heirs should be able to inherit enough money that they never have to work.
   6193. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 05:27 PM (#4428536)
I know you're arguing in good faith, but it seems like you're trying to thread one hell of a needle here.

The fundamental problem is one hell of a needle to thread, so yeah.

Serious questions: What is "CEO pay fraud" and where is the "stealing from shareholders"?

CEO's "capturing" the board of directors (appointing their friends and cronies) who then vote the CEO outsized pay packages, with little link to performance. If a CEO makes $50, and his #2 guy $5M, there's almost no reason for that except his rent-seeking behavior.

That excess pay is literally stolen from the shareholders, in the form of decreased profits.
   6194. snapper (history's 42nd greatest monster) Posted: April 29, 2013 at 05:30 PM (#4428543)
I'm wondering the same.

It's kind of bizarre how little regard Snapper, et al., have for the Forbes 400 and C-suite execs while also arguing that their heirs should be able to inherit enough money that they never have to work.


Answered above.

I'm not worried about their heirs. Their estates will be in the hundreds of millions.

I'm worried about the incentives for the people who work really hard at their profession, or build a small business, and invest wisely, so they can leave $5-10M to their children, and grandchildren.

I don't see why we should be trying to undermine that. Those people aren't the problem.
   6195. Misirlou's been working for the drug squad Posted: April 29, 2013 at 05:35 PM (#4428548)
while also arguing that their heirs should be able to inherit enough money that they never have to work.


I'm with you in spirit on this. But as a practical matter, I don't see how to ever do away with it. Even if you close the loopholes I mentioned above, what's to prevent Joe Billionaire from hiring his son as his personal assistant at $50 mil per year?
   6196. The Id of SugarBear Blanks Posted: April 29, 2013 at 05:37 PM (#4428551)
Even if you close the loopholes I mentioned above, what's to prevent Joe Billionaire from hiring his son as his personal assistant at $50 mil per year?

Smart adjustments to the gift tax rules (assuming they're needed). A gift to heirs at these levels is taxed at confiscatory rates.
   6197. Ray (RDP) Posted: April 29, 2013 at 05:39 PM (#4428553)
CEO's "capturing" the board of directors (appointing their friends and cronies) who then vote the CEO outsized pay packages, with little link to performance. If a CEO makes $50, and his #2 guy $5M, there's almost no reason for that except his rent-seeking behavior.

That excess pay is literally stolen from the shareholders, in the form of decreased profits.


Is there an agreement or contract this behavior would be breaking? Maybe duty of loyalty or fiduciary duty? Are there restrictions or checks on who the CEO can appoint to the board? On what the board can do? Does the CEO have unfettered power? If this is such a big problem corporations want to stay away from, why would the CEO be given this power if it is bad for the corporation and shareholders?

Are there successful lawsuits for fraud or shareholder stealing on these bases? Shouldn't there be, if this is so egregious and so frowned upon and so clear?
   6198. Misirlou's been working for the drug squad Posted: April 29, 2013 at 05:45 PM (#4428562)
Smart adjustments to the gift tax rules (assuming they're needed). A gift to heirs at these levels is taxed at confiscatory rates.


Will you tax all salaries of $50 mil at confiscatory rates, or just based on the relationship between employee and employer?
   6199. Never Give an Inge (Dave) Posted: April 29, 2013 at 05:49 PM (#4428568)


This seems like much more of a middle-class striver's mentality than that of the risk-takers and high achievers. To continue using Steve Jobs as an example, I highly doubt he was motivated by the thought of allowing his kids to be lazy and unproductive. I'm sure he wanted them fed and clothed and sheltered, but I doubt he was trying to ensure they'd never have to work a single day in their lives and contribute nothing to humanity other than spending the money their father earned.

No, but he probably wanted them to be able to go out and start their own companies, or to try to become writers/artists/olympic athletes without going hungry.
   6200. Joe Kehoskie Posted: April 29, 2013 at 05:51 PM (#4428570)
.
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