quote:

Originally posted by Nancypalooza

I don’t understand economic policy that rewards those who are already wealthy by letting them keep more of their money because it’s just bad math. If you’re a manufacturer of a non-luxury-good, wouldn’t you prefer to have the business of 40 million people who got to keep a little bit of their money and can spend a bit more freely, rather than the more individually unlimited discretionary spending of the elite among them . . . ? I mean logically, it just doesn’t make sense.

You are making the economically irrational argument that the only use of money that matters is consumption. As a matter of fact, it seems very likely to me that one problem the US has now is too much consumption–and too little investment. Among the best and often easiest ways to increase productivity–which makes a society generally richer–is investment in plant and equipment. By way of example, consider a newspaper: You could hire thousands of people to hand copy the paper or you could hire hundreds with typewriters and hand-set type or you can hire just a few with computers and computerized presses. The latter option requires requires lots of invested capital but it allows you to pay the few needed workers high salaries. And it also allows you to put out a lot more papers than you realistically could the hand-copied way.

While I agree that a graduated tax structure, taking more from the rich than from the not-rich, makes sense, it does not make sense to argue that you should take all the money rich people have that they don’t need to spend on consumption because it’s the money they spend on investment that actually benefits the economy the most.

And there’s another issue: throughout history, high culture has mostly been a product of rich aesthetes, people with the money to hire and nurture the Michelangelos and Leonardos. In San Francisco, where I live, we have this weekend begun to move into a new natural history and sciences museum costing over $400 million of which the city has raised about $120 million through binds and rich private donors have contributed $150 million (the museum board member themselves have contributed $90 million). Rich people with money not taxed away from them are making this museum and the great public benefit it represents possible just as their kind have always made life much richer and more interesting for the rest oif us.