thedrifter
05-07-06, 07:00 AM
May 7, 2006
Everybody's Business
You're Rich? Terrific. Now Pay Up.
By BEN STEIN
I GAVE a speech in Orlando, Fla., late last month to some private-equity folks who said that business was great. Then I flew up to Newark and the first-class section of the plane was full, and even had a waiting list. Then I rode into New York City in a blizzard of limousines, and ate dinner with my sister and her husband at a Greek place called Milos, on West 55th Street. Fresh swordfish, and it was heavenly. The place was expensive and packed.
It was a fine evening, apparently the first in the city for weeks, and men and women were in outdoor cafes, eating, drinking, winking, smiling and flirting. A few were shouting, "Bueller! Bueller!" at me as I passed. I walked by a stunning woman in front of the Peninsula who giggled as she saw me. I walked down to the Yale Club on Vanderbilt, where men and women looked happy and assured under the portraits of presidents — the Bushes and Clinton.
On my way back, two young men accosted me in front of Rockefeller Center. They told me they were recent Yale graduates who were making a great living working at hedge funds. They told me that their boss made $100 million a year trading currencies, and that there were dozens like him making more money than I could imagine. (I have my doubts, but that's what they said.)
Suddenly, as the men happily walked away from me, I had a vision. Here we all are under the gorgeous crystal dome of prosperity, drinking, making money, eating swordfish, changing money at the temple, showing off ourselves to others, bragging — and all of it, every bit of it, is made possible by the men and women who wear the uniform.
Every bit of it is done under the protection of the Marines, the Army, the Navy, the Air Force and the Coast Guard, serving and offering up their lives for pennies. And we're also under the protection of the police and the firefighters and the F.B.I., who offer up their lives for nothing compared with what others make trading money on computer screens.
Something flashed into my mind — something that my late father used to say, quoting loosely from the economist Henry C. Simons, a founder of the Chicago School of economics: that it is "unlovely" to see the extremes of wealth and nonwealth that are evident in contemporary America.
We may be able to live with it. Some of us may even be able to prosper amid it. But it's not pretty. The rich should simply not be that much richer than everyone else — especially those whose lives protect them from terrorism.
As I thought that, I had a revelation about oil. We all know — and I mean all, even Congress — that the oil companies are not fixing prices. We all know that the oil companies are not creating these wild prices out of thin air.
The worldwide market is at work, and traders and speculators are driving up the price, based on uncertainty of supplies and inventories, and presumably becoming very rich in the process (at least some of them). That's the market at work. It's not up to the government to set the price or to fix the situation except by opening more space for exploration, and even that may not help.
In the same way, even I was startled when I read about the pay of Lee R. Raymond, the former chief executive of Exxon Mobil, who recently retired. His retirement package was in the neighborhood of $400 million — a breathtaking sum, even for those of us who admire the job that Big Oil does and think that the industry gets a bum rap.
Still, that's between him and his stockholders, not a matter for Congress. And it would not even remotely be addressed by a windfall profits tax — an idea that has been tried and has failed miserably.
The real problem is the difference between the rich — including rich oil people, of whom there are not many, but there are enough — and the poor. It is up to the government to redress this extraordinary difference in incomes of the rich and the nonrich, even at the margins.
What Congress can do, and should do, is address the stunning underpayment of military men and women and the staggering budget deficits that will be a burden on our posterity for decades, by raising the taxes on the rich. It's fine that there are rich people. It's even fine that there are superrich people.
But if they are superrich, they derive special benefits from life in the United States that the nonrich don't. For one thing, they can make the money in a safe environment, which is not true for the rich in many countries. It is just common decency that they should pay much higher income taxes than they do. Taxes for the rich are lower than they have been since at least World War II — that is to say, in 60 years.
This makes no sense in a world at war, in a nation with so many unmet social needs, in a nation with so many people without health care, in a nation running immense and endless deficits.
America is becoming a nation of many rich people. I recently read that there were close to 10 million millionaire households. I read that there were hundreds of thousands who made more than $1 million a year. Good for them.
But it's unlovely for them to pay as little tax as they now pay. The real problem in this country is only temporarily about oil. That will right itself, or we'll get used to it and adjust.
The real problem is saving a nation that is beset by terrorism, and we cannot do that unless we feel that we are all in the same boat, pulling at the oars together. That includes the rich.
Whatever rationale there may have been in 2001 for lowering their taxes is long gone. It's time for them — us, because it includes me — to pay their (our) share.
It's not about oil. It's about fairness.
Ben Stein is a lawyer, writer, actor and economist. E-mail: ebiz@nytimes.com.
Ellie
Everybody's Business
You're Rich? Terrific. Now Pay Up.
By BEN STEIN
I GAVE a speech in Orlando, Fla., late last month to some private-equity folks who said that business was great. Then I flew up to Newark and the first-class section of the plane was full, and even had a waiting list. Then I rode into New York City in a blizzard of limousines, and ate dinner with my sister and her husband at a Greek place called Milos, on West 55th Street. Fresh swordfish, and it was heavenly. The place was expensive and packed.
It was a fine evening, apparently the first in the city for weeks, and men and women were in outdoor cafes, eating, drinking, winking, smiling and flirting. A few were shouting, "Bueller! Bueller!" at me as I passed. I walked by a stunning woman in front of the Peninsula who giggled as she saw me. I walked down to the Yale Club on Vanderbilt, where men and women looked happy and assured under the portraits of presidents — the Bushes and Clinton.
On my way back, two young men accosted me in front of Rockefeller Center. They told me they were recent Yale graduates who were making a great living working at hedge funds. They told me that their boss made $100 million a year trading currencies, and that there were dozens like him making more money than I could imagine. (I have my doubts, but that's what they said.)
Suddenly, as the men happily walked away from me, I had a vision. Here we all are under the gorgeous crystal dome of prosperity, drinking, making money, eating swordfish, changing money at the temple, showing off ourselves to others, bragging — and all of it, every bit of it, is made possible by the men and women who wear the uniform.
Every bit of it is done under the protection of the Marines, the Army, the Navy, the Air Force and the Coast Guard, serving and offering up their lives for pennies. And we're also under the protection of the police and the firefighters and the F.B.I., who offer up their lives for nothing compared with what others make trading money on computer screens.
Something flashed into my mind — something that my late father used to say, quoting loosely from the economist Henry C. Simons, a founder of the Chicago School of economics: that it is "unlovely" to see the extremes of wealth and nonwealth that are evident in contemporary America.
We may be able to live with it. Some of us may even be able to prosper amid it. But it's not pretty. The rich should simply not be that much richer than everyone else — especially those whose lives protect them from terrorism.
As I thought that, I had a revelation about oil. We all know — and I mean all, even Congress — that the oil companies are not fixing prices. We all know that the oil companies are not creating these wild prices out of thin air.
The worldwide market is at work, and traders and speculators are driving up the price, based on uncertainty of supplies and inventories, and presumably becoming very rich in the process (at least some of them). That's the market at work. It's not up to the government to set the price or to fix the situation except by opening more space for exploration, and even that may not help.
In the same way, even I was startled when I read about the pay of Lee R. Raymond, the former chief executive of Exxon Mobil, who recently retired. His retirement package was in the neighborhood of $400 million — a breathtaking sum, even for those of us who admire the job that Big Oil does and think that the industry gets a bum rap.
Still, that's between him and his stockholders, not a matter for Congress. And it would not even remotely be addressed by a windfall profits tax — an idea that has been tried and has failed miserably.
The real problem is the difference between the rich — including rich oil people, of whom there are not many, but there are enough — and the poor. It is up to the government to redress this extraordinary difference in incomes of the rich and the nonrich, even at the margins.
What Congress can do, and should do, is address the stunning underpayment of military men and women and the staggering budget deficits that will be a burden on our posterity for decades, by raising the taxes on the rich. It's fine that there are rich people. It's even fine that there are superrich people.
But if they are superrich, they derive special benefits from life in the United States that the nonrich don't. For one thing, they can make the money in a safe environment, which is not true for the rich in many countries. It is just common decency that they should pay much higher income taxes than they do. Taxes for the rich are lower than they have been since at least World War II — that is to say, in 60 years.
This makes no sense in a world at war, in a nation with so many unmet social needs, in a nation with so many people without health care, in a nation running immense and endless deficits.
America is becoming a nation of many rich people. I recently read that there were close to 10 million millionaire households. I read that there were hundreds of thousands who made more than $1 million a year. Good for them.
But it's unlovely for them to pay as little tax as they now pay. The real problem in this country is only temporarily about oil. That will right itself, or we'll get used to it and adjust.
The real problem is saving a nation that is beset by terrorism, and we cannot do that unless we feel that we are all in the same boat, pulling at the oars together. That includes the rich.
Whatever rationale there may have been in 2001 for lowering their taxes is long gone. It's time for them — us, because it includes me — to pay their (our) share.
It's not about oil. It's about fairness.
Ben Stein is a lawyer, writer, actor and economist. E-mail: ebiz@nytimes.com.
Ellie