I’ve had plenty of time to watch CNBC this week. While I’ve been trying my darnedest to catch fish, the fact that most of the fish I’m trying to catch are dead because of 50 degree water has effectively hamstrung my best efforts. My idea to save the polar bears by shipping them from the warm waters of the arctic to the frosty waters of Marco is one that I’ll have to save for another day. What got my ire up today was a brief interview with Dennis “I honestly thought someone would vote for me to be president” Kucinich. In case you don’t know Dennis, there’s not much to know, besides the reality that he apparently hates wealth. Wealth hating is a popular past time of late, but Dennis took it to a new level today when he proposed a 75% bonus tax on banker’s bonuses. According to the Kucinich website…
Congressman Dennis Kucinich (D-OH) today introduced legislation to impose a 75% tax on the extraordinary bonuses that bankers are planning to pay themselves using windfall profits earned from massive taxpayer support of the financial services industry. The “Responsible Bankers Act” will not penalize banks for making a profit, but rather will tax the bonus pools that are set aside.”
I happened to come in from a fruitless morning of fishing just in time to catch (get it, fishing… catch? Thanks) Dennis, blinking aggressively with his wealth hating eyes, fielding questions from CNBC hosts who thought his idea was ridiculous. He answered the questions as best as anyone who isn’t in touch with reality can. What he said wasn’t really important, just that he wants to find a way to tax those bonuses, since it’s only “fair”. Hey, Dennis, guess what? Bonuses are taxed. It’s called income tax, and those evil fat cat bankers and their wealthy friends just so happen to pay the overwhelming majority of taxes in this country. The top 1% of wage earners paid 40% of the total taxes received in 2007, and that was without any 75% windfall tax on banker bonuses.
Obama famously said that he didn’t get elected to help out a bunch of fat cat bankers. Those bankers, according to many, are the ones who “ruined” the US economy by lending to people who had no ability to repay loans. Those fat cat bankers are the ones to blame, so says the administration and much of the country, yet Obama and Kucinich and other wealth haters enjoy their new role of advising banks to lend more. Fat cat bankers are evil for lending to people who had no means to repay those loans, and yet now the same people who blame those “fat cats” are begging them to lend more money to get the economy going again. Am I the only one who can’t understand this? Chastise the banks for lending too much, then yell at them when they start lending more responsibly. To borrow a line from Bill Clinton, it sounds like a fairy tale to me too.
I’m a bit torn on the bank bailouts, as I dislike them. I do enjoy seeing the banks pay back the TARP funds, and prefer as little government intervention in private industry as is possible. The concept that these bailouts generated huge revenues for the banks, and now the banks are rewarding those in control with huge bonuses is also a little troubling, but that’s not the point, nor is it the motivating factor behind Kucinich and his tax proposal. You see, Dennis went on to explain that his tax proposal would affect all bank bonuses, not just bonuses paid by banks that received TARP funds. But Dennis, I thought the whole idea was to punish banks that reaped huge rewards that were only made possible by taxpayer bailouts? You can’t claim it’s a measure to punish banks who received TARP funds, and in the same press release go on to say that the tax would apply to all bonuses, regardless of whether the bank received or repaid TARP funds. It just doesn’t make sense Dennis.
This proposal probably won’t go anywhere, but it does mark a shift in both public and political sentiment towards high earners. If Kucinich was only interested in recouping tax from profits earned with bailout funds, that would be one issue to discuss, but he’s not. He’s against private wealth in general, and both he and Obama are pandering to a newly minted public mindset that seeks to punish wealth. I, for one, find wealth captivating, and invigorating, though I personally have not yet worked hard enough nor long enough to experience the wealth that I admire. Wealth is the reward of hard work and the benefit of properly judging risk, and it is something that should be applauded, not despised. Punishing wealth might be a great way to make everyone poor, but it doesn’t exactly have a history of creating jobs or increasing consumption. To my fat cat banker friends who may be on the receiving end of 2010 bonus, I congratulate you and hope you’ll be able to keep as much of your money as possible. To Dennis Kucinich, I must paraphrase Jeremy Disher… Don’t hate the player, hate the game.