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Piketty's charge: How a French economist 'rock star' is 'freaking out' the super rich

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  • Redshirt1701 Deep Space 9, Ut
    April 29, 2014 3:36 p.m.

    To "Commodore" what do you meant that " CEOs are not really worth $300 million a year plus stock options. Likewise, the janitor at your company is not worth $25,000 a year, he is actually worth more." How many people do you know that have the skills, knowledge, and reputation for successfully leading a multi-billion dollar corporation? (Hint: Think Pro-sports and the multi-million dollar contracts)

    As for the janitor not being worth $25,000/yr. What if I have a small investment company that operates in a 3000 sqare foot office. I may only need a janitor to come and clean twice a week for 4 hours each time. Why should the janitor be paid $60/hr when they have no specialized skills?

    The problem is not what YOU deem somebody to be worth, but the availability of persons qualified for the jobs available. Few are qualified to be CEO, and thousands are qualified to be janitors. Plus, how do you know what a person is worth? We know what they are worth to you, but not the business.

  • Commodore West Jordan, UT
    April 28, 2014 7:48 p.m.

    True wealth is created in and by labor. Laborers deserve a bigger piece of the pie than they are currently getting because without them, capital has no vehicle to create products or services. I'm not in favor of equal pay for all that won't work.

    They say that you are paid what you are worth, but that is a lie. CEOs are not really worth $300 million a year plus stock options. Likewise, the janitor at your company is not worth $25,000 a year, he is actually worth more.

    People are not paid what they are truly worth, because what the market will bear and fair wages are actually two very different things.

    In the 1960's the largest employer in America was GM and they paid their employees in today's wages about $50 an hour+ benefits. Interestingly enough unions and high progressive taxes were firmly in place then. Today the largest employer in America is Walmart and they pay their people about $10 without benefits. If higher tax brackets and unions are effective methods to encourage companies to be more fair with the distribution of wealth, then I say yes to more of both!

  • RedShirt USS Enterprise, UT
    April 28, 2014 2:52 p.m.

    To "andyjaggy" you assumption about "Most of the super rich are super rich because they started off with an already good stash of money/inheritance" is wrong. If you read "The Millionaire Next Door: The Surprising Secrets of American's Wealthy" in the NY Times, they point out that most millionairs are first generation millionairs. That means that most of the wealthy people came from middleclass or poor families.

  • andyjaggy American Fork, UT
    April 28, 2014 2:10 p.m.

    "The wealthy are not getting rich from their work or talent, but from their wealth, Weissmann says."

    I agree with that statement. Most of the super rich are super rich because they started off with an already good stash of money/inheritance, and where then able to make that money work for them, they are rich from investments usually, not because they started a company. Obviously there are exceptions.

    The solution? I don't know. Here is a start though, get rid of social security and let me invest that money on my own. If I could do that in addition to what I already do, I could retire with 2-3x more wealth than I otherwise will.

  • Just Wondering... Gilbert, AZ
    April 28, 2014 12:55 p.m.

    Vern001,

    The "average american" isn't paying 36% of their income to taxes...that tax rate is reserved for the wealthiest of American's. The "average american," by definition is paying almost no income tax since 50% of the American populace pays no federal income tax at all.

    As for the capital gains tax, isn't that just a 2nd tax on the same income? Business income is already taxed at the federal level, so the owners (shareholders) of that business have already paid a tax on the productive profits that they have generated with their capital.

    However, then the capital gains and dividends from that successful capital investment are taxed AGAIN at the individual level at 20% (only for the rich though...the "average american" is the one that pays 15% for capital gains and dividends these days).

    It seems that in combination, the capital holders get taxed quite a bit on all of the value that they help to create?

  • RedShirt USS Enterprise, UT
    April 28, 2014 10:46 a.m.

    To "Danite" the middleclass defend the rich because someday they hope to be rich.

    Lets think about what this "economist" is proposing. If you build a business that does really well, you will be taxed more to discourage you drawing too big of a salary. Now, why would you bother to grow your business very much since you will be taxed the more you earn.

    As others have pointed out, this will kill innovation. Is this what you really want to do?

  • the truth Holladay, UT
    April 27, 2014 6:47 p.m.

    If Marxists and socialists truly want to change the world, and change the rich,

    they need to teach morality, yes that is right, morals,

    and not teach theft and coveting and violence and force to get their way.

    Change mans heart not his wallet. That is the right way.

  • blackattack Orem, UT
    April 26, 2014 9:07 p.m.

    Very well written UStraveler. It restores a little faith in capitalism for me. Unfortunately, our government is not responsive to us--they respond to the wealthy in the form of campaign donations and special interest groups consisting of multinational corporations and the 1%. I am frustrated because I don't feel we have a voice as the general public, or at least one that is responded to. If it were, we wouldn't have politicians having pensions for their entire lives with nothing to show for it. It indeed has become "crony capitalism". There is no "trickle down" as the rich and their supporters suggest. If so, why are so many without jobs or not even receiving cost of living salary increases? And yes, college has become unaffordable and only large sums of debt are incurred with hopes of landing a job that will pay it off. But pell grants are not the answer. I have seen far too many people at a university with a very honest reputation w/these students using them for the biggest TVs, x boxes, brand new cars, and other luxury items while still getting financial aid from their parents.

  • Laura Ann Layton, UT
    April 26, 2014 11:48 a.m.

    Sounds like coveting to me. So I'll never be super rich. We manage to get by on a pretty good income, but it took us years to get where we are. The one percent should be helping out others, like Bill Gates , but many are selfish. This is their right. They have the agency to choose what to do with their money. This is America, the land of the free and the right to choose how to live our lives. True happiness comes from helping others.

  • a_voice_of_reason Woods Cross, UT
    April 26, 2014 9:54 a.m.

    @vern001 - "College is increasingly out of reach for the average American family."

    What?!? How many people are going to college today versus a generation ago - or two generations ago? It's hard for graduates to find jobs with their degrees because every one else has one too. Two generations ago an associates degree would ensure you a middle class income. A generation ago it was a bachelor's degree. Well, now it takes a Master's. Why? Because college is accessible to everyone - not a bad thing - but it is. Some have parents who pay for it (and can afford it) others receive Pell Grants, and others have to take cheap, flexible, government subsidized student loans (that's me). Either way, if you can study hard, work hard, and live moderately to minimize your debt, anyone can go to college today.

  • play by the rules SOUTH JORDAN, UT
    April 26, 2014 12:41 a.m.

    Markets are the solution to the very problem he is suggesting exists. The redistribution of poverty simply increases the number of poor dependent on the government. Sad to see the Deseret News running an article promoting such dribble.

  • Danite Salt Lake City, UT
    April 25, 2014 11:30 p.m.

    vern001,

    Amen brother!!!!

  • ustraveler Victor, ID
    April 25, 2014 12:50 p.m.

    I think something left out here is a look at history and a look at what we call "free market" capitalism. In the past 200 years, we've had the greatest increase in wealth and long life ever. That's due to capitalism and the concept that you don't fight over pieces of a pie that never grows. You fight over pieces of an ever increasing pie. That's why the "poor" of today have two cars, three tv's, cable subscriptions, microwaves, and other items people from 50 years ago would call luxury items. No other system can claim that kind of success.

    Today we see a crony capitalism based on the rich getting richer because of rules and regulations that benefit them. They crowd out those willing to work under a true free market. Then those against capitalism can decry the result and point the finger in the wrong place. We have plenty of examples.
    - Insurance companies benefit from Obamacare
    - Cities pass laws banning Uber because of "safety" reasons and thus allow cab companies to keep their $100,000 medallions

    Too many examples, too little time.

  • slcdenizen t-ville, UT
    April 25, 2014 12:26 p.m.

    @happy2bhere

    You clearly spend very little time with liberal debates, which, if one is otherwise convinced, why bother? Though if you did, you would understand that those very issues are being addressed, including by Piketty himself. The crux of the American debate is resting more on which party can present credible arguments for their policy position and which can wield alternate means of garnering votes, including propaganda-style media assaults.

    Take the Obamacare example. It was a complex attempt at a fix of an even more complex problem that is our health care delivery system. Rather than concede the point that America's health care apparatus is lousy and propose methods of fixing it, the right entrenched itself in denial and continues to spew misinformation and hyperbole. If half the effort employed in screeching about socialism had been used instead in fixing Obamamcare frailties, the success would have been bipartisan, instead of just an increasingly clear victory for the left. It will continue to reflect poorly on conservatism for the Republican party to be fixated on denialism instead of addressing issues with clear and direct solutions.

  • vern001 Castle Rock, CO
    April 25, 2014 11:49 a.m.

    Piketty is scaring the Right because he uses data to back up his points. And the data is unequivocal: Wealth is flowing up, not down. College is increasingly out of reach for the average American family. Healthcare costs have skyrocketed. Two incomes are necessary for families to scrape by.

    So, we can sit around and wait for the "free market" to solve these problem--although, it has done nothing to solve the problem in the past thirty years, so why should it do so going forward?--or we can try to fix this problem.

    How do we fix it? Piketty calls for taxes on the wealthy and education for all. The wealthy largely pay capital gains taxes on stocks (15%) while the average American pays taxes on income (up to 36%). How about we start by not penalizing work and taxing capital at the same rate as labor? And let's help poor kids go to school by raising the value of Pell Grants so they cover ALL of their college education, not just a fraction?

    If we want the US to maintain its position among developed nations, we can't afford to leave massive swaths of the population behind.

  • happy2bhere clearfield, UT
    April 25, 2014 11:14 a.m.

    scldenizen

    OK, maybe you and George Will should have a conversation.

    On the matter at hand, It occurs to me that many on the political left are greatly concerned with wealth re-distribution and have contempt for the wealth being held by too few people. Question, do they ever worry about too few people having to much of a WEALTH of POWER!? That is what seems to happen whenever government takes over the private sector business. In that arena, the left seems to believe that there should be no restrictions on how many laws and regulations and taxes government can impose on the wealth producers. Which, if it becomes too much will lead the country to where I first posted. Atlas will shrug.

  • slcdenizen t-ville, UT
    April 25, 2014 9:43 a.m.

    @happy2bhere

    Consider my views of the Burkian conservative tradition - in favor of consistent, methodical change implemented through robust and pluralistic institutions. The modern template is to recognize the failures of our institutions, in this particular case our news outlets and higher education.

    In response to Vanceone, the comments of whom are indicative of either general contempt for or ignorance of scholarship, one may certainly paint the comment liberal if being liberal means rebutting frivolous and unserious commentary.

  • samhill Salt Lake City, UT
    April 25, 2014 9:03 a.m.

    "Or, as Thomas B. Edsall in the New York Times puts it, 'worsening inequality is an inevitable outcome of free market capitalism.' Capitalism always leads to inequality."
    ---------------------

    This is **hilarious**!!

    If someone wants to see just how out of whack inequalities can get, go try an pry the lid off of the more extreme examples of the polar opposite to capitalism, Communism. Even one example, N. Korea, would suffice. There you have the party elites who systematically enslave the rest of the population in conditions of starvation and/or generational imprisonment, all while piping a constant drone of propaganda to let everyone know what a paradise they've been provided by the "Dear Leader".

    I can live with what I too believe are the inevitable inequalities of life. The crucial difference with Capitalism is that I can realistically have the expectation that with sufficient drive and determination, my condition will rise to some level that I prefer. AND, that my preferential level is mine to set.

    In other words, I am **free** to decide where on the scale of inequality I want to be and can reasonably have faith in determining it.

    I love freedom.

  • raybies Layton, UT
    April 25, 2014 8:45 a.m.

    I oppose marxism because of its intrusiveness. It solves the wrong problem. Being wealthy is not inherently evil. Having vast resources gives one potential to do vast good, it really depends.

    Marxism's reach, however is too unwieldy. It doesn't just apply to taking money from rich people. It involves constant surveillance from committees. It's a good idea to read up on the implementations of communism before you decide that rich people are the problem.

    I've read a number of biographies from men who fiercely loyal to Marxism, and saw it as a supremely moral, but once it was implemented met with disillusion and were even victimized by oppressive communes.

    I like the limited freedoms I have enjoyed in the current US oligarchy with its smatterings of capitalism. I have not dedicated my life to the pursuit of wealth, and I have not had to oppress my neighbors in their hope to achieving their dreams either.

    Until human beings stop their hate, envy, pride, lusts, and ignorance, Marxism will always be unachievable and flawed. It robs men of their individual rights and ability to achieve good as individuals.

  • happy2bhere clearfield, UT
    April 25, 2014 8:38 a.m.

    slcdenizen

    Interesting responses. When responding to Vancone you sounded like a liberal. When responding to Danite you sounded like a conservative. Was that your intent?

  • slcdenizen t-ville, UT
    April 25, 2014 7:05 a.m.

    @Vanceone

    It's clear you've neither read the book nor understood the general premise. If your politics are driven by mischaracterizations of groups and ideas, then you must fit in perfectly with Republicans. You didn't also attend BYU by chance?

    @Danite

    Perhaps your question is rhetorical, but I'll nonetheless take a stab. Accompanying the increasingly busy lives of working Americans is a marriage between entertainment and news. Hence the attention grabbing headlines that fill most websites promising groundbreaking information or events. The result is an uninformed populace unaware of their ignorance, and often times convinced that they have a firm grasp on the topic of the day. Contributing to this problem is our school system which breeds confidence in place of humility. Education ought to shed light on how little one knows about their world, rather than reinforce the notion that the world is small and easily perceived.

  • happy2bhere clearfield, UT
    April 25, 2014 6:46 a.m.

    Read Ayn Rand and you will see what will happen. The smart, ambitious, movers and shakers who are the ones that have the ability to create wealth will just take their ball and go home. (to their mansions). The average person (who has depended on the few wealth creators) will be left hanging. In this case the average person is 99% of us. If capitalism in America is somehow torn down, we might as well change out the stars and stripes for the hammer and cycle.

  • caleb in new york Glen Cove, NY
    April 24, 2014 9:50 p.m.

    "If a person gains more knowledge and intelligence in this life through his diligence and obedience … , he will have so much the advantage in the world to come” (D&C 130:19).

    I think the concern about jumping into a relationship with all Americans so that we all earn equal amounts, is that I don't trust most Americans. There are way too many freeloaders for that to work out well for us at the present time. Having the opportunity to make substantial economic advancement helps bring out all sorts of innovation that might not otherwise happen if we all shared everything equally.

  • george of the jungle goshen, UT
    April 24, 2014 4:39 p.m.

    I think about how many Fed,State and local jobs. The people that count on the support and how many who work in the privet sector, I can tell that the tower of babel will fall.

  • Danite Salt Lake City, UT
    April 24, 2014 3:55 p.m.

    Can someone please explain to me why average earning Americans are the fierce defenders of the super rich? Why aren't middle class Americans more concerned about what is best for middle class Americans? It's easy to paint a picture of any one who dislikes such huge inequality as Communists but man, if you read your scriptures, it's pretty clear God doesn't approve of inequality.

  • Vanceone Provo, UT
    April 24, 2014 3:12 p.m.

    The ultimate liberal mantra: Everyone who makes more than me needs to have what they have stolen and given to me.

    Marxists: No one every dreams about being the janitor in the New World Order, comrade. They are all part of the ruling class. Who, pray tell, is going to be the janitors in this brave communist world that Piketty's peddling? Him? Somehow, I doubt that he is willing to have his wealth confiscated and be put to work scrubbing toilets. That's for some other chump.