When the Rich Jump Ship
In the wake of the 2008 financial meltdown, one of the arguments you heard Republican economists and Wall Street executives repeatedly use to defend the amounts of money being paid investment bankers and hedge fund managers was that if these guys didn’t receive exorbitant salaries and bonuses, they would be forced to leave the U.S. and find jobs elsewhere, presumably in Western Europe and Hong Kong. In other words, if we don’t pay them what they demand, they’ll find someone who will.
Even though a simple examination reveals that federal income taxes are lower than they’ve been in many decades, you also hear something similar in regard to raising the taxes on the very rich. You hear pundits say that if we did that, if we nudged their brackets any higher, we’d risk having these people close up shop and abandon the country. Give these armchair pundits credit for being able to something that silly with a straight face.
Instead of being cowed by those absurd threats—instead of being intimidated into abandoning plans for a fairer tax system and stricter regulations on the banking industry—we should greet those condescending arguments with
delight. In truth, those defections would not only be welcomed, they would prove salutary because they would give ambitious men and women on the lower rungs the opportunity to move into the top spots.
There’s a corollary to that replacement argument. Wall Street cautions us that, should these financial prodigies leave the industry, the newbies who replace them wouldn’t be nearly as competent or reliable. That line of reasoning may have worked a few years ago, but it doesn’t today. Ever since we learned that it was those very “prodigies” who precipitated the financial disaster that almost destroyed the world’s economy, and required a trillion-dollar taxpayer bailout just to keep us afloat, that old, “We’re too damned talented to be replaced” argument has pretty much lost its luster.
Unfortunately, despite all the hand-wringing and chest-pounding, most of these Wall Street vultures aren’t going anywhere. They can huff and puff all they like, but on Monday morning they’ll show up for work just like the rest of us for the simple reason that they have no place to go. If they honestly believe all they have to do is report to Zurich, briefcases in hand, and they’ll be offered multi-million dollar banking gigs, they’re even more arrogant than we thought. Those European banking jobs are already taken. By Europeans.
But it would be wonderful if they did leave. These soulless whores may, technically, be citizens of the U.S., but by no index are they patriotic Americans. These ultra-materialistic people are cultural eunuchs. They have no sense of honor, no sense of community pride, no sense of “belonging.” They not only live rarefied, privileged lives in gated mansions or penthouses far, far away from the “herd,” but given a choice, they would rather watch America’s great industrial cities fall into decay and despair than voluntarily part with so much as a nickel of their own money.
More condescension: Those Wall Street executives who argued that we’d be losing invaluable “expertise” if we allowed these guys to get away are the same Wall Street execs who argue that if the very wealthy were, in fact, to leave the United States because of higher taxes, they would take their money with them, and that would put a sizeable dent in the economy. That’s a bad argument.
It’s already happened. Wealthy people already have their money squirreled away in places believed to bring them the maximum return. If one of those places happens to be the U.S., then lucky us, because that’s where they’ll keep it. But they’re far more likely to have money invested in convoluted off-shore bank accounts or foreign businesses. And that’s where it will remain, no matter where they live or work.
Let’s be clear. If the very rich threaten to jump ship, we need to do everything in our power to ensure they carry out that threat. What a cathartic moment that would be! The entrenched, inbred, self-perpetuating moneyed class being abruptly vacated—and new blood, new ideas, new faces and new ethnicities rushing in to replace it. Ain’t that what America was supposed to be all about?
DAVID MACARAY, an LA playwright and author (“It’s Never Been Easy: Essays on Modern Labor”), was a former union rep. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion, forthcoming from AK Press. He can be reached at firstname.lastname@example.org