In honor of Labor Day, I wanted to write a quick post on Marxism. I’m not anti-Marxist; in fact I’ve endorsed ONLY Marxists for President of the United States on this blog (Bernie Sanders and Jill Stein), and given the U.S. Supreme Court’s ridiculous Citizen’s United ruling, the U.S. needs Marxists now more than ever. But even though Marxists probably tend to be quite smart given the correlation between IQ and liberalism and the difficulty of reading Marx, there are two ways in which Marxists seem clueless.
Marxists assume that enormous economic inequality is in and of itself, proof that the market is rigged. This ignores the fact that there is enormous inequality in human productivity. For example, a member of Prometheus brilliantly noted that because the human mind operates in parallel, complex learning and problem solving speed doubles every 5 or 10 IQ points. What that means is that is that in complex jobs, we should expect an IQ 170 to be up to 15,625 times more productive than an IQ 100. Further, if the IQ 170 is ten times more motivated than the IQ 100, he becomes perhaps 156,250 times more productive than the IQ 100.
The other factor that Marxists don’t seem to get is the role of technology in creating enormous inequality. In the distant past, a writer would take years to write only one book, which would severely diminish his productivity, but with the advent of the printing press, writers can produce MILLIONS of copies of their books. So you have this huge divide between those whose work can be multiplied a million fold by technology, and those whose work can only be done once per unit of effort. This divide seems most unfair when we compare dumb athletes making millions entertaining sports fans to brilliant doctors who make only six figures saving lives.
But what people don’t get is that a brilliant doctor, will save maybe five lives a year, while thanks to television, the dumb athlete is entertaining TENS OF MILLIONS of people a year: a trivial service multiplied by tens of millions is indeed worth more than a valuable service for only five people. So in a very objective sense, the dumb athlete deserves more money than the brilliant doctor.
When you combine the fact that complex problem solving speed doubles every 5 -10 IQ points, and then gets multiplied by differences in motivation and the use of technologies like the printing press, we should expect unbelievably large differences in wealth and income between the rich and the poor, even if everyone were playing fair (which they’re not). Yes the system is rigged, but mere inequality doesn’t prove anything; a truly fair system might result in even more inequality!
But at the same time, the athlete did not invent the television and the writer did not invent the printing press, nor does he enforce the arbitrary intellectual property laws that allow him to monopolize all the profits from reprints of his work. All success is the product of both the individual and the society in which he lives, which is why I don’t object to a 50% tax rate for all who can afford it. In theory I would even support a 50% tax rate on investment income, but that’s stupid because the government actually collects more tax dollars when they keep the capital gains tax low because more rich people then invest.
I also support a 50% inheritance tax. Some object to this because they’ve already been taxed 50% on their income, so everything they have left at death should be tax free. However I don’t see the inheritance tax as a tax on the dead, I see it as a tax on the person who inherits the money. If the tax rate on earning a million dollars in 2016 is for example 50%, why should the person who didn’t even earn his million in 2016, but was given it because his father died, be spared that 50% tax rate?
What should be done with all those tax dollars? Above all, I support Charles Murray’s idea of a negative tax for the relatively poor that would replace the welfare state and income transfer programs like social security, Medicare, Medicaid, Obamacare etc, (though a certain percent would have to be earmarked for health costs as Murray was reluctantly pursuaded).
I do NOT support a minimum wage. If a consenting adult is willing to work for less than a penny an hour, the government has no right to prevent it. A minimum wage unfairly places the burden of helping the poor on job creators, rather than distributing it equally among all tax payers, and with a negative tax for the relatively poor, it becomes redundant.
It also destroys jobs. Cashiers are being replaced by automated checkout machines and McDonalds has introduced automated ordering machines, though they say the new gourmet burger you can order on them create new jobs for chefs.