IMHO:
"Patriotism" != handing money to your government.
"Patriotism" == doing what is best for your country (i.e. the people).
Believe it or not, the government does not alway's have the country's best interests in mind. The example I always use is the Wall Street bailouts. Tax-payer dollars were used (mostly against tax-payer will) to bail out reckless banks and provide golden parachutes for undeserving CEOs. Sometimes the government will even hurt the country when it is trying to do the right thing - it was one of the major catalysts in the current recession, because it backed entities like Freddie Mac and Fannie Mae and their "toxic" mortgages.
If you want to do something good with your excess money, the government probably is not the best charity to donate to. A simple rule of thumb: the more hands that money passes through, the less money comes out the other end. If you want to be patriotic, give your excess money DIRECTLY to those who need it most.
And I would argue the best way to give your excess money directly to those it the most without waste is to pay your workers well. All of them, think of workers who can't command a high salary. If the industry allow you to pay a worker $7.70(about minimum wage) can you afford to pay them $15.00 hr ? Many companies don't want to pay their employees a living wages so they can keep more of the revenue, but instead of giving the excess to government in the form of taxes, or donating to an vetted charity, why not give it to the people you know, your workers. It will be an investment in your company. Workers who are content, are typically more productive and you'll have higher retention.
Ha, that's a joke - are you aware that during and prior to the crisis, Fannie and Freddie were both PRIVATE companies? They traded on the stock market, as private companies do. The government eventually nationalized them (in 2009 I think) and completely destroyed their value on the stock market (I should know, I owned stock in the two during the crisis - they traded under FRE and FNM before they turned into junk stock).
The only respect in which Fannie and Freddie were public (prior to being nationalized) is that they were federally-backed. What happens when you have lenders backed by government dollars? They take in riskier loans and leverage the hell out of their credit line. In reality, it is much more complex than that though - there are many layers on which debt is traded. But the end message is that private companies should never be federally backed!
Thank you! It's ironic that on a site like HN, so much of the commentary about home lending is based on rhetoric and dogma instead of fact. I wonder if GP even knows what Fannie or Freddie do.
There are a few assumptions in blog post but one in particular that I really do not like. And that is that 'making money' automatically equates to improvement of society.
For most businesses this is the case. If you manufacture something or provide a service then you are adding to the overall wealth of the nation. Making a lot of money from something that does not provide a valuable service to society actually detracts from the wealth of the nation because you are extracting resources (people, natural resources, time, etc) that could be assigned to more productive uses.
If you're rich and you can't recognize your debt to the society that enabled you to become rich, then you're a greedy, horrible person. Pay your taxes, for gosh sakes.
Strongly disagree. My classmates picked on me, my teachers didn't challenge me. The state didn't pay for my education. I'm successful because I've applied myself while my peers were screwing off.
Just because you need consumers to become wealthy doesn't mean that you're exploiting them... wealth creation is NOT a zero-sum game. Becoming wealthy is the reward you get for making consumer's lives better.
Edit// For clarification, I'm fine with paying taxes.
But I don't owe a debt to society just because of my success. I'm an equal citizen with everyone else, and we all benefit from the stability that government provides.
I would also say that if the concept of "societal debt" is legitimate, then the poor have accrued much more debt anyway.
(I'm fine with the downvotes. My highest net-point posts usually start with some downvotes.)
And here you are, posting on the successor to a government funded project, developed by brilliant minds who were likely the recipients of scholarships or state funded educations.
Just because some of humanity are dicks, doesn't mean that you didn't benefit from the people who aren't dicks.
And i'll reiterate what was said above. Just because you're making bank doesn't mean you're making people's lives better. You can make money making the lives of others awesome. But making bank doesn't necessitate that you're making the lives of others better.
That's the same logic that was used to over-inflate the sub-prime mortgage bubble. If you want to make the lives of others better, make sure you're doing that, rather than walmarting your customers.
Look man, just because the government created a packet switched network doesn't mean it wouldn't have happened eventually. Yes, war creates technology. Doesn't mean you should go bomb all the things.
"In the 1950s, the United States Department of Defense was concerned about the ability to survive a nuclear first strike due to a dependence on an effective communication network. Paul Baran of the Rand Corporation concluded that the strongest communication system would be a computer network that would be able to break messages into units and that the network route these message units went along a functioning path to their destination, where they could be reassembled into coherent wholes."
Tim Berners Lee invented HTML. Don't cherry pick the one example that makes your point. A thousand other technologies make up the Internet and they didn't depend on war.
So what? They all depend on the sun, quantum-scale interactions between atoms, and on the evolution of life on Earth too. Those are just as arbitrary as any other point being made here.
If you are currently living and creating wealth in Somalia, then I agree - society doesn't help you much and if you pay any taxes, you can stop.
If you live in a first world country, you should realize that the difference between your country and Somalia is a result of government work and is funded by taxes.
Secure borders, police guaranteeing your property rights, courts, lack of bribes and corruption (relatively!), good roads, good lines of communications, educated people to hire. They don't just show up randomly in places.
All right, but apart from the sanitation, medicine, education, wine, public order, irrigation, roads, the fresh water system and public health, what have the Romans ever done for us?
That said, this article is basically politics, and should be flagged as such.
That may be true, but it doesn't mean the government hasn't enabled you.
Most people fail to recognize that a big function of civilized society is to shift the power from the physically-strongest to economically- (or politically-) strongest. Enforcing property rights, keeping the horrible realities of war out of your life, building and maintaining the infrastructure that allows you mobility and access to goods and services, keeping the poor happy enough to avoid revolting against the (evolutionarily unnatural) rich, and maintaining a mostly fair capitalist market are major functions of government that the majority of us take for granted.
The rich benefit from these functions significantly more than the poor, so it makes a lot of sense for the rich to pay more taxes.
Warren Buffett made a comment to the effect of, even though he's intelligent and worked hard for his money, he still has to consider it luck that he happened to be born in the right circumstances because if he were born in a primitive hunter/gatherer society, he would be at the bottom no matter how smart he was because of his lack of physical strength. We all owe our success and the ability of be successful on the merits of our intelligence and hard work alone to the current structure of society to some extent.
I'm still confused at how the down-vote is supposed to be used. This person is getting down-voted for posting an opinion that people here disagree with. But it's a constructive opinion that has generated 5 constructive responses, which in turn has become a discussion. No reason for a down-vote here.
If I recall correctly, that was in the sense of a comment being factually incorrect, or so far off-base as to represent a damaging assertion. That is, the need to signal to a reader would outweigh the desire to avoid downvoting based on disagreement.
In this case, civilian presented interesting points regarding independent accomplishment and his own feelings of disenfranchisement. I can't come up with a very good explanation for a downvote.
'Wrong' in that it's like punching someone you disagree with as opposed to shaking his hand if you agree with them when you could have just voiced your thoughts. I presume pg says its fine because it'll mean less flamey comments.
Agree completely. The only honest way to make a living in a capitalistic society is to provide a service or product that someone wants. You can only make money by providing something people find valuable.
Yes, it's (approximately) true that the only way to make money is by providing something that people find valuable.
It doesn't follow, however, that if you make money then you must be providing something that is valuable overall.
Hypothetical example: I find a completely undetectable way to steal money from poor people and transfer it to rich people, except that 25% of it vanishes on the way. I offer my services to someone rich and unscrupulous. Although poor people don't have much money, there are a lot of them, and I am able to get my client $10M/year. She pays me $1M/year. (For some reason my method is only capable of enriching people who are already rich, which is why I don't just take the $10M myself directly.)
In this situation, I have provided something that someone finds valuable. It is unlikely, however, that I have made the world a better place (because of the diminishing marginal utility of money, etc., etc.), my actions would generally be considered unethical, and I wouldn't want to argue that I deserve all the money I'm getting that way.
(Some people would say that what I just described is the standard operating procedure of the financial industry. That may or may not have some truth to it, but all that matters for the point I'm making is that that general kind of thing can happen -- some jobs can be negative-sum but provide some people with enough benefit to make them well paid.)
Your comment's parent doesn't add anything to the conversation because it's a simple observation. I could add "I agree, people tend to spend money on things they want," and that would be valid.
But I haven't furthered the conversation because anyone familiar with the system of capitalism, i.e. everyone, knows this.
Totally agree. It seems that patriotism applies only to "normal" people, not to those huge businesses that operate internationally, across borders. Also, in an age when no country could exist in isolation, what sense does it make to think of just "my country, my society"?
It seems that paying taxes is the most patriotic thing you can do; being rich just allows you to pay more of them, as well as benefiting the economy in other ways.
It seems rather foolish to think that there can be a most patriotic thing you can do. Plus the grey area and loop holes in the tax code generally tend to favor the rich. Does the author mean that the most patriotic thing you can do is pay taxes without trying to minimize the amount of tax you pay? And if so whats the threshold of manipulative tax paying.
It's also very naive to think that your own bottom line and tax bill are in any way a measure of your patriotism. Is shipping jobs overseas to increase profit more patriotic than maintaining a more modest business while providing jobs in your country?
Associating patriotism with profit is just a psychological tool for justifying your own desire to have more things than everyone else.
The most patriotic thing you can do is love your country.
> The most patriotic thing you can do is love your country.
What does that actually achieve or change for anyone in a broader sense? Patriotism is by definition a kind of love for your country. Now what you do as a result is what actually matters.
Alternatively, can you love your country without striving to make it better in some way? Is an own love for the country without any action a valid concept?
I share his general sentiment. In a broader sense that's why I love the capitalistic system, or at least the way it's evolved within the US. People don't exist in a vacuum. Bettering your own situation with goals ranging from altruism to full on greed still pulls people up with you, and improves the lives of everyone else in society. Granted it's not a perfect system, and there's things we could do to make it better, but still at it's core I believe there is the best their is.
I'm sure Mark believes this to be true, but I find his comments to be self-serving. He's basically saying that what he's accomplished in his life is patriotic, and that should be your goal too! If we all follow his advice, by nature he will be "patriotic".
I don't necessarily disagree with the advice, but his sentiment toward it feeds his own feelings more than anything else.
So Greece should become the world's first anarchist state? Paying taxes there is only supporting corruption, bureaucracy (including their debt holders) and inefficiency. Part of their problem is that no one was paying taxes to start with. Not paying taxes is a form of corruption.
What you are talking about is a problem of government accountability. What you are suggesting is fighting fire with fire.
I don't see the connection between patriotism and taxes. I could see an angle where explicitly dodging taxes could be unpatriotic. But patriotism isn't something you buy. It just doesn't work like that.
1) Government knows how to spend our money wisely on things that improve the quality of our lives
2) Getting rich equates to improving the quality of lives of society, as a whole. I know several industries where this isn't the case.. (gambling, cigarettes, fast food)
I don't gamble, smoke or eat fast food - but I'd hate to live anywhere that didn't give people the freedom to do these things if they wanted (and in the case of smoking, outside or in their own properties).
He says no such thing. He says we live in an imperfect world where the government has a role to play in getting us out of this recession. As to your second point, that's based on your opinion of what constitutes making society better.
I didnt say he said those things explicitly. But by saying it's patriotic, he's assuming those things.
Yes, it's based on my opinion. Yes, I'm generalizing, and I bet the majority of human beings on this earth would agree there are industries that make people rich and are harmful to the general public. In fact, I'd argue there's a TON of them. Humans love to self destruct (ie. get fat, kill themselves, get addicted, overspend, etc)
Probably why we need government eh? Have you ever set your clock ahead 10 minutes to help keep you from being late? Why, you could just be responsible instead?
This is the premise of a democratic government, when you realize that you will not always do the best thing for yourself or your neighbors, but you still know what the best thing is and have a government that enforces it, knowing it could come for you if you break the contract.
Obviously it is not a perfect system and we must be vigilant to improve it constantly, but anarchy is not a viable option.
In many cases government does spend more wisely than any single individual, but that may not be the cheapest approach, there is a difference. Look up the "Price of anarchy".
Rather than me hiring security for my house at a rate of maybe one hour a day -- the only amount of private security I could afford -- the government pools the money of my entire community, hires many security guards, equips them, and lets them drive around my neighborhood.
Then, instead of my spending an hour or two educating all the kids in the neighborhood, in the hope that the next generation of people aren't morons, they take some money from all property owners and use it to build schools. Those schools to ensure that a very wide swath of the population, even the poor and stupid, meet minimum education standards. That way, at the very least they can go and do the service jobs that I don't want to do, and so many of them meet that minimum education level that they can be hired for a low wage, thus keeping the price I pay low.
Rather than me hiring security for my house at a rate of maybe one hour a day -- the only amount of private security I could afford -- the government pools the money of my entire community, hires many security guards, equips them, and lets them drive around my neighborhood.
But the reason there aren't private security companies working like that is because the police exists.
I know places (not in the 'States) where the police is grossly underfunded, and the local shop owners do exactly that: they all contribute some amount to a fund that pays a private security company to drive around in the area. It also protects the homes, which is good PR for the local shops.
Thanks, this would have been my response for the most part. National Defense, Police, Fire, Education, Roads, Water Systems, Sewer Systems, and Healthcare(just a form of nation defense IMO). These are all very expensive endeavors that simply don't work that well if the individuals "shops around".
The government spends wastefully in defense, education and every other service it seeks to provide.
I agree in principle that it's generally beneficial for individuals to pool resources in order to address common needs. But this happens on its own in a marketplace. It's called the division of labor.
Wastefully compared to what? Do you know of any other organization that provides essential social services to hundreds of millions of people?
Do you have actual facts to supply here? Can you provide an a legitimate comparison for us, or are we supposed to simply accept your free market mantra?
The existence of waste and inefficient behaviors does not mean that the system is wasteful.
> Do you know of any other organization that provides essential social services to hundreds of millions of people?
I would categorize food, clothing, furniture, and housing as essential needs. They're all provided for by competitive markets.
There's nothing unique about health care, education, fire, power, water and roads that these couldn't be provided by competitive markets, too.
> Do you have actual facts to supply here?
I think the price tag on the Middle East war(s) is over 1 trillion dollars. This expenditure is done under the umbrella of "defense."
If your local security company told you they think it will make you safer if they expand their operations to the Middle East to seek out shady characters, and oh by the way, we need to charge you 10 times as much to pay for these new operations, you'd take your business elsewhere.
The inherent danger in government programs is that there is no effective check on expenditures save the restraint of the government itself.
There is certainly waste in a free market, but in a free market the waste is isolated to individual firms. If they lose money, they go out of business.
There is a good case that the cost of the war(s) is so high because the administration which prosecuted them relied so heavily on private companies for services. Donald Rumsfeld came into the DoD with an ideological belief that private companies could do the job more efficiently, and, based on that belief, he turned the DoD into an ATM for the largest defense and security contractors.
And waste in free markets definitely is not isolated to one firm. Ask a bank.
Why must there be a single organization that provides services to hundreds of millions? Why can't there be thousands of orgs that provide service only to a few hundred people?
The food industry is a good example. Unless you don't consider food essential.
Is that really a good example? The public subsidizes agriculture in the US and other industrialized nations precisely because it is essential to the public good.
Without subsidy, food would be as expensive at Safeway as it is at your local farmer's market -- which varies drastically by location. In Sacramento, fresh fruit is <$1/lb; in SF it can be triple that, or more.
Maybe that's not a bad idea to have people pay what food really costs, but it's not a free market success story in any way.
It's difficult to find any example of a free market in America. The food industry an a whole is more free than the other social services listed above.
And a government can't just make something cheaper by edict. All a subsidy does is shift the burden of cost from the consumers to the taxpayers, or more likely anyone holding a dollar because most of these government programs are funded through deficits.
To be fair, I used to advocate public works projects and argued for smarter spending of public money. I changed my mind drastically after studying a bit of basic economics.
If you're really interested in exploring these principals and have an open mind, I recommend "Economics in One Lesson."
I've studied economics well, I just haven't come to the same conclusion as you.
Piece of unsolicited advice, take it or leave it:
I would suggest that, if you want to be taken seriously, you present your ideas in a way that demonstrates your understanding of the nuance involved. When you say things like "all a subsidy does is X" and imply simple A-B causal relationships between the public and private sectors, it's hard to believe that you have considered these issues thoroughly, as opposed to merely another axe grinder.
These are real-world systems, which deeply impact the lives of millions of people. To simply dismiss them or force them to fit into Platonic molds is silly.
I appreciate your advice. I kept my post short because I think long posts tend to get tedious and discourage a healthy back and forth. But please don't assume I haven't thoroughly considered the issue.
> I've studied economics well, I just haven't come to the same conclusion as you.
What are your conclusions? It would be more fruitful to hear your thoughts on the issue rather than a critique of my presentation style.
I'm not trying to grind an axe by stating that a subsidy "shift[s] the burden of cost from the consumers to the taxpayers." Wikipedia's statement on the impact of subsidies is nearly identical to mine:
"Farm subsidies have the direct effect of transferring income from the general tax payers to farm owners."
I agree with you that the system is complex. The complexity is precisely what makes it difficult to identify the hidden costs of subsidies.
A subsidy takes taxpayer money and transfers it to producers of a certain good. I think this is inherently unfair, regardless of whether it's done with good intentions. I think the only fair method is to let people choose for themselves how they want to spend their money without coercion.
I'm a vegan, and believe my food choices make a positive impact in terms of the environment and reducing environmental cruelty. But I think it's immoral to force that same belief on others using the apparatus of government. It would be unfair for the government to intervene and make it prohibitively expensive to buy meat or animal products.
In addition to being inherently immoral (IMHO), subsidies have unanticipated costs and unforeseen consequences. Some examples:
- The artificially low price of the subsidized good leads to an artificially high demand for the subsidized good at the expense of demand for competing goods that are not subsidized. This hurts the producers of those unsubsidized goods.
- The corn subsidy has driven the price of corn syrup below that of cane sugar, making corn syrup the sweetener of choice in mass produced foods. Corn syrup is an inferior sweetener and leads to health problems such as obesity.
If you require links to supporting commentary I'm happy to provide them.
I don't doubt that many subsidies are created with good intentions, but because of the unseen costs and consequences, it is prudent, for the long term health of an economy, to avoid them.
I find almost all vegans annoying, particularly because they have no understanding of economics, or human behavior or the importance of either. So it's refreshing to see someone who is vegan and also cares about those things; I also am vegan.
This thread is getting out of hand for HN but I'd like to continue it; if you'd like to also, my email address is in my profile. Thanks,
I know the price of anarchy. We don't have such a thing in this world. So no sense in learning the "price". We COULD learn a thing or 2 by looking at the PROS though.
I think there's an argument to be made that even the industries you mention improve the lives of people in society. Assuming (1) all gambling/cigarette/fast food transactions are voluntary on both sides, and (2) people act rationally, then any money that you spend is done because you perceive the good you receive to be worth more than the money you spend on it.
One counterargument in the case of addictive drugs or "vices" is that transactions aren't completely voluntary, since you are acting under the influence. In gambling you might also not act rationally. Nevertheless these are still a subset of all transactions, and taking your argument to the extreme of outlawing these industries would prevent a decent number of society-bettering transactions from taking place.
I never suggested outlawing any industries. Just pointing out the flaws in his post.
Our modern society is set up so that it takes our primal urges to the extreme, making it BAD for the individual, but probably good for the overall economy. Our choices are hardly rational because we don't understand how our genes and primal urges work subconsciously. That's why men cheat, do drugs, and self sabotage ourselves.
Alternate patriotic strategy: learn to live comfortably on an untaxably low income, or an unreported cash income. Draw the maximum benefits you can. Keep yourself healthy and don't buy health insurance. Help to accelerate the inevitable collapse of a corrupt, immoral, and unsustainable system.
Patriotism is a sham put in place by a social experiment of the introduction of organized sports. It created team-spirit and it was translated to other levels to equate patriotism. In the original days wars were small enough and there were enough real patriots to fight it. But since the country was based on violence and theft I have no faith in it anymore.
In a country founded by patriots protesting taxes, I find his rhetoric tiring. Patriotism doesn't create jobs, capitalism does.
Taxes, legal fees and regulation can all kill a start up. The government has a money printing machine, it's not like a fledgling startups is the only source of revenue to finance endless war. If we want to create jobs, it should be free to start a company, sell shares, and start doing business.
The way I remember it, the founding fathers weren't protesting the taxes, so much as the lack of representation. Ben Franklin famously wrote that "In this world nothing can be said to be certain, except death and taxes." This country wasn't founded on the notion that we should be tax free. The Boston Tea Party basically came about because The East India Tea company made bad business decisions, and wanted a tax break in England to alleviate warehousing issues.
Actually, it's all quite complicated, but to say that this was a country founded by patriots protesting taxes and then to complain of tiresome rhetoric is to illustrate how little you understand both American history and rhetoric.
The way I remember it, the founding fathers weren't protesting the taxes, so much as the lack of representation.
That's arguably wrong as well. A large number of American colonists (particularly in Boston; esp John Hancock) made a living as smugglers bypassing English tax laws and circumventing the EITC's trade monopoly on tea. The administrative changes that parliament made in that time included not only new taxes but better enforcement of laws which were already on the books and this nearly drove many prominent Americans out of business.
Corruption (both Dems and Reps are guilty of this) is the disease will kill capitalism as it clogs the arteries of the economy.
I also love Cuban's logic - be happy you have a large tax bill to pay for that is a good problem to have.