Parable of the Poor and Rich Plumber
The days since the last presidential debate have been preoccupied with efforts to give satisfaction to "Joe the plumber." As everyone who follows the election knows, Joe Wurzelbacher presented himself to Barack Obama on the campaign trail in Ohio as an average American with reasonable doubts about Obama's tax program.
The Obama plan reduces or leaves untouched the income tax on persons earning less than a quarter of a million dollars a year. Above that amount, it would tax the earner at a slightly higher rate.
Wurzelbacher, at present, earns far less than a quarter of a million; but in the conversational exchange that has made him famous, he imagined himself as a successful plumbing entrepreneur, sitting atop a yearly income of $300,000. What then? Would I, he asked Obama, be required to pay higher taxes than someone earning a tenth as much?
Obama gave the honest answer. He added that the jump from 36% to 39% need not seem very onerous to a prospering businessman; and (he repeated) the increase applied only to Americans whose earnings place them in the top five percent. Throughout the exchange, Obama was clear, patient, and full of details. Mastery of a policy to which he has once committed his name is among his major strengths as a politician. Thus far, conciseness is not. His listener in Ohio seemed to be trying to remember his own next line or somehow to regain a foothold in a conversation that had taken so wide a turn.
The length of the encounter was surprising. Obama seems here to have surrendered to the professional deformation of every gifted speaker--the illusion that if only you stay in the argument long enough, you can persuade anyone. It was this belief, too, that gave scope for his use of the phrase "spread the wealth around." And those were the words the McCain-Palin campaign seized upon. The words are now taken to supply all the evidence anyone needs that Barack Obama was a "socialist" all along, a reckless democrat who would gladly level the deserving rich with the undeserving poor.
The truth is that Obama in Ohio spoke the language of American democracy, which has always included a perception that wealth is a form of power, and that stupendous inequalities of wealth produce an undemocratic inequality of power. His questioner, angry in anticipation that he could not hold onto all of the $300,000 he might hypothetically earn in a year, spoke the language of righteous self-interest; and he cited as his irrefutable authority "the American dream." If I follow that dream, said the Joe of today, hoarding the wealth of the Joe of tomorrow, why should I ever pay a higher tax?
Obama's answer was simple and Christian. Once you have been helped by a tax break to prosper and to grow relatively rich, it seems fair to give others lower down the ladder the same chance that once helped you.
We Americans suffer from a self-imposed immaturity. It goes back to the Reagan years and the dream of unregulated commerce--of great riches to which all eventually will surely rise; of a gambling society in which every citizen always wins his bet against an unbreakable bank. Joe had swallowed that dream. Obama, by contrast, with his suggestion of a small adjustment toward a graduated tax, was explaining the realism of the progressive tax that began with Theodore Roosevelt.
And yet, when Obama evokes a society in which you begin by working for someone else, pass on to work as your own boss, and end by employing others, he is going back further than Theodore Roosevelt. This was a favorite topic with Abraham Lincoln, a politician whose ideas of labor and progress were memorably captured in his Address to the Wisconsin State Agricultural Society (September 30, 1859). "The prudent, penniless beginner in the world," said Lincoln, "labors for wages awhile, saves a surplus with which to buy tools or land for himself; then labors on his own account another while, and at length hires another new beginner to help him." That the prosperous employer should assist the beginner was a natural corollary, for Lincoln, of his understanding of non-slave labor. Selfishness or, as he called it, "self-interest" was a symptom of a slavish mind, and incompatible with the high morale of democracy.
Is the American dream a selfish dream? Obama's questioner in Ohio seemed to believe that it was, and that it was always meant to be. It is clear the McCain-Palin campaign is doing everything it can to encourage that belief. In the latest ads, they are cultivating the fear of "socialism" much as Barry Goldwater in 1964 cultivated the fear that Medicare was a harbinger of "socialized medicine." This is a subject on which Americans some day soon will have to choose between Goldwater and Reagan, on the one hand, and Lincoln and Roosevelt on the other; and it is a consequential choice: between a selective dependency on government which cuts out the uses of government for persons less well off than oneself, and acceptance of the value of limited government that does "for a community of people" (as Lincoln said elsewhere) "whatever they need to have done, but can not do, at all, or cannot so well do, for themselves--in their separate, and individual capacities."
The American dream has sometimes meant the selfish gamble that everyone takes and that all expect to win. But of the American dream when it comes in this questionable shape, we ought to begin to be wary. Not because all dreams, like all hopes that assist people in living their lives, are not to be sympathized with, but because it is possible for a platitude to acquire such an air of sacredness that the mere mention of it aborts all understanding and all thought.
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Here is a fair example of the problem. This halloween, send the only 1/2 kids out to go "trick or treat" The following day we force those kids to give 1/2 their candy to the rest of the kids who decided to stay home. Thats fair right?
Problem is human nature... Because eventually those kids who had to go walk around everyblock in the neighborhood will become tired of feeding half of their rewards to the those who decided to stay home and they will choose to stay home too... And in 10 years we will all wonder why there is no more candy.
your equating trick or treating with working are you serious the above is the perfect example of the dumbing down of america, this idiot actually thinks hes makeing a logical argument , wealth is created through the use of the commons and on the backs of the working class, a fair tax is vial to
this wealth creation for without roads, police , education, national defense, hosipitals, wealth creation would be impossible
Really? The only reason kids like to trick or treat is to get candy? Wow, that is news to me. I just stopped trick or treating myself about 5 years ago because it started feeling awkward (I'm 42) In fact the last couple of years I trick or treated I gave my candy away so as to not gain weight and to help cheer up kids that weren't able to trick or treat. My favorite part has always been dressing up - having the coolest costume I could put together. My 3 kids are the same way (they sell candy at the store cheaper than costumes and you can pick out the kind you want - trick or treating is for fun)
I also think your analogy is lame because you are implying that taxes just go primarily to welfare and that those on welfare are enjoying the same rewards as those who work. This is simply not true. The government uses money for a lot of different things that benefit everybody. Also ,if you have ever been down on your luck and had to get welfare you would know that those folks live on the equivalent of 1 weeks paycheck for a whole month. Hardly a desirable financial position.
Yes, this absolutely illustrates the American ideal; "Mine! All mine!"
You seem to have a slight problem with the word "fair." Keeping half the kids home, then acting like they're an example of the greedy undeserving because they "DECIDED to stay home?" Those other kids want go do the walking too, just like all the people whose jobs have been exported, or the people who can't get a small business loan. This whole "tax the rich too much and they'll stop paying" is the myth Rush has been pushing for decades now. I just recently heard the story again in which people bought yachts overseas because of a luxury tax. He tells that one because there aren't any others. Since Reagan, the rich have never been taxed too much, and they've still used every loophole they can find to throw the burden of paying taxes onto you and me. Then they pay millions of dollars to the guys you listen to, to convince you that it's the poor who are taking your money.
We got this for JOE!!
What do we want? REAPRATIONS!
When do we want it? NOW!
What do we want? REAPRATIONS!
When do we want it? NOW!
Obama will make JOE THE PLUMBER and JANE THE HAIRDRESSER pay for REPARATIONS!!
Who said Bill Ayers was wrong..........hmmmmmmmmmm?????
I think you mean Reparation not "Reaprations" Anyway.... As soon as we finish paying reparations to the native americans (the people that REALLY got screwed) we can discuss your claim.
You sound like a clever T R O L L.
The real funny part is that Obama's economic plan, tax breaks for middle class, economic stimulus in the form of infrastructure and green energy initiatives, is exactly the kind of thing that Joe would greatly benefit from. Not to mention continuing the financial bailout to loosen up the credit markets. Under Obama his talk about buying a $250K business might turn into a reality. Joe needs to reassess who's really going to help him get that dream.
But Joe's been sold the idea that he can get rich, and just in case, he has to insure the that rich don't get taxed the tiniest bit more. I think we should be talking about Joe the former factory worker, whose job is now being done not by somebody who will work cheaper, but by somebody who can be FORCED to work cheaper.
Thanks for the article. It's interesting to see how trickle down economics is not even considered to a business person when a company does make more money. Currently, the more you make, the bigger your tax break, and the more you get to take home. Where does the McBush tax cut for the wealthier and wealthiest help those down the ladder? It doesn't. Even Joe says he does not feel that he should help others down the ladder. He should get to keep it all. That's the American Dream to him. So instead of using tax breaks to invest in the economy, as in job creation, Joe would keep it for himself. What happen to a sense and pride in community, when one does well so should others. It's not a give away but an investment in opportunity for others. That's how America was created. Wise investments create more opportunity and then prosperity becomes abundant for all.
Lemme tell you, I work for a Joe the plumber. He's a millionaire, (who's daddy inherited the business from his daddy, who inherited it from his daddy). There are no cost of living raises, no annual reviews for a raise, and only when I demanded one graciously allowed me 50% of the raise I asked for to bring me to the median income for my position. Yes, the health benefit is good, and he matches 401K contributions, but will not increase the wages of people who've worked for him/his family for many, many years. It makes me angry. If not for the efforts of the employees, there would be no millions. Why is it so hard for business owners to recognize this??
What's gone unnoticed about Joe the Plumber, or Joe The Guy Who Needs a Reality Check, was that he said he was thinking of BUYING his boss' plumbing business. Now aside from obvious roadblocks (no license, existing tax lien) that would mean Joe would be taking out a small business loan, something that would have been impossible just a few weeks ago do to the lending crunch. It was only after the definitively socialist move of the US buying stake in troubled banks. How you like socialism now Joe?
The American dream that I remember is the ability to rise as high as you can through your own efforts. Taxes are a part of life and inevitable, but viewing the government as some kind of Santa Claus for favored groups is certainly unAmerican.
It's the "spread the wealth" that gets 'em. Sharing is a learned behavior. We were forced to do it as kids, and we don't like it now.
If Joe the plumber doesn't want the $300,000 a year job because he would have to pay 39% taxes on it, I'll take it. I would gladly pay the taxes and give nice campaign contribution to a president Obama.
You would until you were writing the check to fund another "bridge to nowhere".
As long as the bridge is in the UNITED STATES It's ok with me.
Little-known fact that is helping McCain on this. The 39% only applies to dollars 251,000-300,000. That's how tax rates work.
Republican ideology begins and ends with selfishness. There is nothing more to say about it. Republicans want to be assured that they will not have to contribute in any way to the common good.
Joe the plumber owes over a $1000 in back taxes. But can afford to contribute $100 to Sen. McCain's campaign.
Even after these Rebublicans have benefitted from that same common good. Lets not forget that most small business that are lucky enough to expand do so because these business received tax breaks before becoming successful. But once they become successful, they want to assume that they've done so without any help.
As if giving money to the government promotes the common good.
Which is how Republicans rationalize their greed.
nothing I have read yet better sums up this race and it is exactly why it is so important to this country's future for depending on who wins will determine wether I decide to give or take.
From my understanding of the tax code, income tax is calculated based on the amount of income above each tax bracket's income cutoff. Thus Joe's entire $40,000.00 income would not be taxed at 36%, and only $50,000.00 of Joe's $300,000.00 would be taxed at 39%. Thus, his tax burden in both cases would be less.
thank you for a well-written piece examining the latest media frenzy and misinterpretations.
as he was originally introduced during the debate as joe wurzelb-e-r-g-e-r by mccain, it is obvious he had not thoroughly vetted the man or the story - it was just another sad campaign 'gotcha' moment grasped by a sad and thoroughly drained campaign. gotcha!
Yes, the American Dream is a selfish one. And when we have laws against selfishness and greed the same as we do hate and violence, there will be no more room for economic inequality in America.
Of course, Joe The Plumber may beg to differ. But my guess is that he was a GOP plant to put Obama on the spot and pretend that high taxation is on working man wages, Not so. It'll make rich pay a fairer share.
The rich already pay far more than their fair share.
They get the most benefit from infrastructure, a taxpayer program, from defense and maintaining the sovereignty of this Republic. They should pay more. If Hitler had invaded, do you think he was going to arrest the janitor and shake him down for his pennies? Does Al-Qaeda strike at the headquarters for the plumbers union?
actually they dont, the top 5 % have 90% of the wealth in this country and pay about 69% of the taxes we in the lower 95% who have only 10% of the wealth in this country pay the other 31% of the taxes dont sound fair to me
So if Joe realizes his dream and ( the figure 280, 000 sticks in my mind ) owns his business, he will be taxed an additional 3% on the difference between 250, 000 and 280,000. His additional tax burden will be $900. He gets to keep the remaining 29,100. Not a bad deal. If that $900 is spread around among 300,000,000 or so US citizens, each should get .003 cents. Not much of a redistribution of wealth.
If I made 300 thou/yr I would gladly pay the extra $900. And let's remember that if he owns his house he'll get some mortgage interest deductions that would probably total or be more that that amount.
But of course, the media and the pols and pundits don't wanna delve into that, they need a sound byte, kinda sad in a way.
Wrong. The home interest deduction is phased out at that income level.
Your math is a bit flawed Joe will only keep 18300 of the 30000 this does not include the deductions for additional payroll taxes for his employees and payments for entitelments. If Joe is lucky he might keep 15000 of the 30000.
What we forget in this "helping the common man" scenario is that when small or big business is taxed it is we the consumers who pay for it in the form of higher consumer prices.
Tax big oil = pay more for fuel.
Tax plumbing contracting business = pay more for plumbing.
Etc...
Let all Americans keep their own money and cut government spending to fund socialist programs if you feel we need them.
My calculations are based on the assumption that Joe will be taxed at a 36% rate up to 250,000. He will be taxed at a 39% rate above 250, 000. This comes out to a 3% increase on $30,000 , or $900. You are assuming he will be taxed at 39% on the entire $280, 000. Frankly, I don't know which assumption is correct. Can someone help us out ?
guess we can start cutting with the military budget, eh? that is if you think you need it. that will help pay for the roads, police, fire fighters, medical research, social security, food and drug inspections, professional sports stadiums, etc... if you think you need them. otherwise,by all means keep your money.
This notion of the "redistribution of wealth" is the biggest straw man in the universe. All wealth is redistributed day in and day out, from up to down and down to up and back again. The rich grow rich because labor produces a surplus - not because they plucked it out of thin air. The rich, despite all the right-wing rhetoric to the contrary, are not alchemists, turning sand to gold each day. Does anyone imagine that if the super-rich were all taken from earth and set down on a completely unpopulated planet, they would still manage to become "rich"? The whole notion of "wealth" is absurd beyond description. Nobody single-handedly creates wealth. It's time the human race put that fairy tale to rest. We may not be "our brother's keeper" but we are most surely our brother's helper. We help him grow rich; and he, in turn, helps us get by. And let's not forget all the public perks the rich get: the roads, the water and sewer, the police protection - all the things businesses need to flourish and grow, and all paid for by everybody, rich and poor alike. Like the poet said: no man is an island.
This might be the best posting on this I have read in a long time.
To sum it up. No man is an island.
Agreed! The tax cut for the wealthy was given at a time when we had a surplus. It was supposed to trickle down. Is that not a form of "wealth redistribution?" Or just a bonus for being rich already?
It didn't trickle down and we are borrowing money from China like there is no tomorrow. That is bad for all of us, wealthy or not.
Yes, but not at gunpoint, as it the government implements it. If you can't see the difference between coercion and freedom, you are a useful tool for your masters.
That's right, why should I pay for police protection for you? I'm sure you can take care of yourself. Of course, you have to sleep sometime.
The question for you Overdog. If taxes (and the civilization they buy for all of us) is so bad, why dont you set up business in Rwanda, Sudan, Somalia....
Oh Yeah because...
1. with no government there is no stability so businesses cant survive
2. There is horrible violence in these places and you might get hurt.
3. There are no consumers otherwise known as the middle class.
Every place that's good to do business in the world is a modernized country with taxes to pay for the society we all enjoy
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