Poor Todd, where I don’t fear to tread, Todd (now) refuses to go:
Everybody hates Todd Henderson.
In case you haven’t heard, he’s the University of Chicago law professor who unwisely blogged about his financial woes in a post headlined “We Are the Super Rich.”
Mr. Henderson and his wife, an oncologist, make more than $250,000 a year, and apparently they’re struggling to get by. If President Barack Obama gets his wicked way, and tax rates rise for those earning more than $250,000 a year, Mr. Henderson says it will mean real sacrifice in his family.
It’s too easy to pelt Mr. Henderson with rotten eggs, as so many have now done. (He yanked the post, but way too late–and on the Internet, one’s blunders never die.)
Never, ever, ever again blog about how hard it is to live on $300,000 or $350,000 a year at a time when one middle-aged man in four can’t find a full-time job, and one in five can’t find any job at all.
Yeah, I understand that Mr Todd was whinging to people much worse off than him.
But, I’m not afraid to speak my mind – when it comes to money – after all, ever heard of “teach a man to fish …”?
The problem with that particular story is the woes he claimed. He would have to lay off his maid, his kids might not be able to go to as an expensive private school, etc.
In America, there has never been a time where it was alright to cry yourself a river because you laid off your maid.
@ Evan – Yes. You have to be resilient in life: you can plan for the multi-million dollar lifestyle, but don’t EXPECT it as a right.
While it is difficult to have much sympathy with Mr Henderson’s financial position (he is much better off than most) and his presentation was an invitation to be tarred and feathered, the debate he started (or contributed to) does raise some valid points:
1. an increase in taxes must either result in lower spending or lower savings, most likely a combination of both. Lower spending by those who will be paying higher taxes means lower income for others – in effect the higher taxes will result in economic contraction;
2. asking the “rich” to pay more in hard times is one thing, but asking them to do so while Washingtion spends more money than ever, makes it harder and more expensive to run a business and indulges in “bash the rich” politics is something else altogether. I am looking forward to retireing and escaping the US tax net for good
3. there is an economic theory that holds that as taxes rise, the net return on each hour worked goes down. As the reward for working declines so does people’s willingness to work – i.e. economic output declines.
@ TraineeInvestor – I’m not an expert on rich american and their taxes (even though I technically am one), but here is somebody who is:
From the article you cited:
Billionaire Warren Buffett said that rich people should pay more in taxes and that Bush-era tax cuts for top earners should be allowed to expire at the end of December.
“If anything, taxes for the lower and middle class and maybe even the upper middle class should even probably be cut further,” Buffett said in an interview with ABC’s “This Week With Christiane Amanpour” that is scheduled to air on Nov. 28. “But I think that people at the high end — people like myself — should be paying a lot more in taxes. We have it better than we’ve ever had it.”
Like many, I don’t sympathize with Todd Henderson for his woe-is-me attitude. A lack of due diligence — tax planning, budgeting, and a comprehensive investing strategy (or at least an awareness of the necessity of these) — led to a lot of painful decisions as he reluctantly downsized his standard of living.
Insofar as Buffet is concerned, I couldn’t disagree more with his advocacy for confiscating wealth through ever-increasing taxation. Instead, I would argue for a flat tax for all American citizens. Those who felt led to contribute to charities would then have the option and the funds to do so. Do I feel a moral obligation to give to those who are less fortunate than I am? Yes. Is taxation and redistribution the means to accomplish this? No. Buffet’s opinion only fosters ongoing class warfare, just as the article concerning Henderson does, and taxation is more a means of enforcing government’s will than helping the needy through poorly administered income redistribution programs.
“We have it better than we’ve ever had it.”
@ TECNHNOMancer – I may have a t-shirt signed by Warren Buffett and Charlie Munger behind my desk, but that doesn’t mean that I’m a a groupie. I’m not sure that I agree with the above statement, certainly not post-recession. On the other hand, I’m sure the rich/poor gap has widened in these tough times …
Also, my point is that Todd gets vilified for sharing / complaining, but I write a lot of posts about my standard of living for RELATIVE better or worse, so why don’t I get equally vilified? I think the answer is that I am sharing to educate … if I don’t share, who else will?
“so why don’t I get equally vilified? I think the answer is that I am sharing to educate …”
You don’t get vilified because you don’t put up posts bitching and moaning that life is too damn hard for Septamillionaires (not sure that is a word but I am running with it).
If you did, it would either be taken as tongue in cheek or you’d lose half your readers in a day.
If it makes you feel better, we would be happy to villify you ;_)
I agree with Technomancer that Warren Buffet has it wrong when he advocates higher taxes. Taxes generally are too high as it is – especially when you consider how much of our tax dollars are simply wasted
@ TraineeInvestor – I have learned that generally the more successful somebody is in a specialized field than me, the more likely he is to be right than me 😉