The rich man’s burden

NOTE: Prof. Henderson’s original blog posts have been deleted, along with all comments to them. Cached copies of the blog posts are here, after the jump.

Over the past few days there has been an interesting series of comments going on in the blogosphere. A law professor, Todd Henderson of the University of Chicago, was seeking to make a point about how proposed changes to the tax code are inherently unfair. Or maybe he was trying to talk about the inherent waste in government spending. He kind of mentioned both, but never really bothered to talk about it in a way that works.

Instead he basically talked about how he may have to let his maid or gardener go is his tax bill goes up. Interestingly he also says he must have these (the house cleaner at least) due to other concerns, which means he wouldn’t actually fire anyone if his bill goes up, he would simply look for sufficient work to maintain his lifestyle.

Any way, back to his postings and attempts to make his point.

He REALLY failed, no seriously, he is so screwed up in his demonstrations that even a nobel prize-winning economist got in on the act of sticking it to him over his method of trying to show how unfair it is. It got so good Steve Kass labeled it toddfoolery.

Oddly enough he actually thought having the Nobel winner against him that helped his case.

Now, I will not say that just because someone with a Nobel chimes in you are wrong. Hell here I am telling the esteemed Prof Henderson that he is hurting the case with his disingenuous examples and I have neither an engineering or a law degree. But here is the issue. Mr. Henderson indicated a few facts, but his facts don’t hold up to even the most cursory of investigation.

He described him and his wife earning:

…combined income exceeds the $250,000 threshold for the super rich (but not by that much)… Last year, my wife and I paid nearly $100,000 in federal and state taxes, not even including sales and other taxes.

And here we have the first major problem, because Mr. Henderson:

received an engineering degree cum laude from Princeton University…was an Editor of the Law Review…graduated magna cum laude…served as clerk to the Hon. Dennis Jacobs of the U.S. Court of Appeals for the Second Circuit…His research interests include corporations, securities regulation, bankruptcy, law and economics, and intellectual property

Todd is a really smart guy it seems, or grade inflation is, and has been, as bad as some have described it. See I played with a tax calculator, as others did before me, and came to the same conclusion. That under the most severe tax accounting possible (no deductions other than the standard, no mortgage deduction, no retirement funds, nada, zip nothing) he would have to be earning in the neighborhood of at least $340,000 per year in order to have that kind of tax bill. Now, this is a man who should know his stuff. He is probably aware the median income in the US is $50K. So when he says his income exceeds $250K, but not by that much, when in truth it exceeds it by about twice the median income, well if he thinks that isn’t “by that much” he either: has suffered a stroke, is too stupid to be a professor, is just making shit up/intentionally trying to mislead people.

By the way he got upset when some people suggested he might be making nearly $450K per year. Of course they were assuming he had certain contributions and was actually taking more than the standard deduction, but since our law professor has already said:

…we can’t afford fancy accountants and lawyers to help us evade taxes…

 I will not assume he knows the arcane rituals and obscure forms needed to claim these nigh unheard of deductions that goes by the name IRA and their ilk.

Of course our good professor made a post a while later, which in my opinion is still just a little self-serving, and dug the hole just a little bit deeper. In all honesty though I liked the post, it gave me the opportunity to point out just how similar we probably are (although I still have all my hair 😉 I mentioned an area I think we probably agree upon, and honestly thought that would be the end of it.

But then he went full-tilt at his windmill and decided in for a pinch in for a pound. If he was going to say taxes were unfair, dammit he’s going to stick to those guns.

I have to admit I admire that in a way. He has a principle and he is sticking to it. He is being unfairly targeted (yeah, that is pretty much his point). Yes he understands marginal benefit (it is why he works rather than watching Steelers games), and yes he thinks taxes should be invisible to those who pay them (damn close to arguments supporting the progressive marginal rates and a really bad idea if we want an informed electorate), but damn it government does too much, they have over-extended and shouldn’t be burdening him with the purchase of these things.

Because if they do he may no longer decide to take on that extra work, and instead watch the football game, because he just doesn’t have the incentive to do the work. Of course he makes that proposition while out the other side of his mouth discussing how his family is just making it by and are extremely sensitive to any change in their monthly income. Of course I also expect someone with his credentials to understand he is pounding away with that hammer on his thumb, not the nail.

Hopefully the Prof. will let this horse rest in peace. If he had a point it was lost in his self-serving descriptions. If he wanted to discuss the waste of the government and how it burdens the people with the bill for that waste there were much better ways. His description was simply too much of a Rich Man’s burden. Next time a little less about him and a lot more about the government may work better.

EDIT: The original posts have gone AWOL, all three related posts have been removed so far as I can tell. Here are the cached versions I could find and screenshots (click to enlarge them). Unfortunatley with the deletion of his blog posts he has also deleted the comments, where some of the meat of the entire conversation was laid out. I apologize for this, but it is far beyond my control.

In my opinion it is cowardly to have deleted them. If he felt the comments were going too far he could have locked the new comments. Deletion of the posts in their entirety hints at something else.He apparantly caught hell for his postings, and offended his wife. Mrs. Henderson (if you go by a maiden name or seomthing else please forgive me for abiding by the mroe regular convention) I am sorry. If the damage done, in part, by your husbands refusal to understand he was throwing gasoline on a fire, were in my power to undo, I would undo it. Unfortunatley that is impossible.

Part 1: We are the Super Rich

Blog Post 2: 10 Things (cached)

Blog Post 3: Now I know I must be right. Not a google cache and its formatting was horrible, so I have cleaned it up a little for here. This is the only post left fully intact as it seems t have no details of the rest of his family.:

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