Tuesday, February 14, 2012

The Spectacle Of Wealth Envy

I learned long ago not to worry about what others make. It can eat you up, from the inside out. Is what I'm making fair to me? That's the way I look at it.

And rich? Who's rich? My experience has been that nobody, regardless of their income, thinks of themselves as rich. Always, there is somebody else more wealthy than me or you, and THAT is the slacker who is getting off light. Tax that bastard!

People truly lack perspective. The 1%? Who are they? Well, in the US, you're top 1.5% if you make more than $250,000 in a year. Worldwide? If you earn $50,000 a year, you're top 1% worldwide. I think a lot of people getting upset about the upper 1% in the US find themselves in the top 1% worldwide. And top 20% worldwide? No doubt about it, being that it only takes $1,500/year to get there.

Now comes Roddy White, pro football player with the Atlanta Falcons. He makes $8.33 million per year. Definitely in the 1%. So, is he satisfied? Because he's in the top 0.1% in the USA. Wealth envy, and a lack of perspective know no bounds. From ESPN:
Roger Goodell reportedly will make $20 million per season by the end of his current contract. That figure set off Falcons receiver Roddy White, who posted his displeasure Monday at the commissioner's salary on his Twitter account.

"How in the hell can u pay a man this much money that cant run tackle or catch," White wrote, posting a link to a ProFootballTalk.com story which referenced the Sports Business Journal's report on Goodell's compensation.
How? The Commissioner does a few important things, like negotiate the TV deal. This is a large source of White's income.
When one of White's followers pointed out that Goodell is running the biggest sports league in the country, White took offense.

"Thats the stupidest thing i have ever heard the players make this league dont ever forget that," he wrote.
I'll accept some measure of his frustration, in that in sports or other entertainment, the performers are the whole show. If you don't have the best or most entertaining talent to showcase, your product isn't as valuable. But, having a highly paid professional Commissioner isn't the stupidest thing ever. The NFL was once a league where players made $10,000 a year and worked in factories or sold insurance in the off-season. Perhaps White would prefer to go back to that? Get Joe Blow off the street, who would be willing to do the job for $50,000/year, and see what you get.

One of White's followers asked the receiver in a tweet if he expected to be fined for questioning Goodell's salary.

"I hope not im praying not i need my money," he wrote.

Ah. Now you get to the root of it. Roddy White's $8.33 million is important to him. I wonder if it ever occurred... No. I'm sure it never occurred to White that Goodell values his salary, all of it, as much as White values his.

White best be careful. There stands 99.9% of the population looking up at his salary much the way he looks at Goodell's. Many times have I heard, "They get paid ridiculous amounts of money to play a game," or, "School teachers are more valuable than pro athletes". A lot of people are in real trouble if we move away from markets and towards public votes on who gets what.


Doug said...

What irritates me to no end isn't people making more than me; it's people declaring that envy and only envy is the only reason someone could possibly want to level out the economic system to one extent or another.

It's not much good declaring that one isn't envious; but I'll do it anyway. I'm not. In the scheme of things, my family and I are awfully comfortable. I know some really wealthy people; for the most part (from my perspective anyway), my family seems a lot happier than them.

But, I can't say that money is entirely irrelevant to happiness. If you're sweating how to feed, clothe, shelter, or provide medical care to your family; I can see where money is significantly intertwined with happiness. Or, if you have to work so many hours you've got nothing left over for your family, I can see that as well.

To some degree, disparity of wealth is an actively healthy thing for an economy. It encourages hard work, ingenuity, and risk taking to get ahead; things which not only benefit you, individually, but leads to infrastructure and innovation that helps everyone to some extent.

But at a certain point, I think the disparity becomes wasteful -- it no longer encourages economically useful behavior to any appreciable degree (most individuals who do what they do for $200 million, I'll bet, would do the same for $150 million; the economy has left $50 million on the table.) It becomes toxic as it encourages envy. It might be a drain on others -- say, if a pension goes bankrupt because a hedge fund manager figured out a legal way to make his $150 million by performing some risky maneuver with the pension assets.

Or, if a factory owner figures out he can make $200 million instead of $150 million by moving his factory to China, cashing in by externalizing his costs to employees working without safety protection or to a locality without any environmental protections.

So, anyway, I appreciate that envy could be a source of advocacy for more income equality. But, I'm going to keep pushing for acknowledgment that a difference of opinion, independent of envy, on what economic system provides the most utility to its participants might also be a source of advocacy for more income equality.

Mike Kole said...

Doug- I wasn't writing it to you or with you in mind. I was writing in reaction to a guy without any perspective, a genuinely wealthy man doing something others may find less valuable than being a teacher, honking pissed about someone making a few million a year more than him.

But also, I wrote it as a cautionary piece, warning that a lack of perspective can land a political impetus right back in one's own face as a boomerang.

To the point of your comment, I don't believe envy is the only possible reason people would want to level off starting at the top. I think others believe they will be safe from such leveling, so it's all good to go forth and redistribute.

It's probably hard to demonstrate sincerity here. I can take the wealthy who call for higher taxes on the wealthy, and then do nothing to shelter their earnings from taxes at their word and pay it straight, in full. After all, it's easy to be generous with other people's money.