David Rubenstein seems like a nice enough guy. At least he did in Sunday’s 60 Minutes hagiographic segment, All American. But I was really struck by this comment, “The government doesn’t have the resources it used to have. We have gigantic budget deficits and large debt. And I think private citizens now need to pitch in.” There are so many things wrong with that statement. To begin with, what is a “gigantic budget deficit”? It is half the size it was only a few years ago. Pretty much all of it is due to the fact that the United States pays twice as much for its medical care as the rest of the developed world. As for resources: the government has as many of those as it ever did. Did some national parks sink into the ground or something?
I think we know what Rubenstein is saying here. The government does have as much tax revenue as it once had. That’s true! But it isn’t anything fundamental. There is a reason that tax revenues are low: people like Rubenstein have done everything they can to have their tax rates lowered, increase loopholes, and hide income. Almost all of his current income is capital gains that he pays no payroll tax on and a maximum tax rate of 20%. If you make the minimum wage, you pay 15.3% in payroll taxes on every dollar you make. So even under the best of circumstances, you pay almost as high a rate of federal taxes as does Mr Rubenstein. If you are in the middle class, you probably pay a higher rate.
But rather than Rubenstein working to make the tax rate more fair, he is out there working in “patriotic philanthropy.” What this seems to mean is that he uses his money to support high profile historical preservation. So not only does he get the thrill of buying an original copy of the Magna Carta, he gets the thrill of very publicly giving it to the nation. As he said in the segment, “I’m giving it to the country, in effect, as a down payment on my obligation to give back to the country.” Let me outsource my response to one of my favorite Iron Age philosophers:
Rubenstein paid $21.3 million for the document. That’s a small price to pay for all the publicity that he received for it. Let’s put it in perspective. Rubenstein is worth an estimated $3 billion. Imagine that you were worth one million dollars. His purchase would be equivalent to roughly $7,100 to you. So it is a decent used car. Also note: the Magna Carta really isn’t that important to this country. Ever read it? It basically just says that the king doesn’t have the right to kill other members of the aristocracy. It’s important, but hardly Enlightenment thinking.
Also from this glowing puff piece, we learned that Rubenstein has committed to giving half of his wealth away to worthy causes. That’s fine, but it doesn’t exactly make him different from the robber barons of old. But more to the point: so what?! His billions and Bill Gates’ billions and all these guys’ money is not going to do all the things that the government needs to do. What we need is a just tax system. But none of these bozos will get behind that. It’s much more fun to build an opera house or fix the Washington Monument so that the whole nation can stand up and cheer you.
The hard work of running a country is something that we should all do every day. But I don’t see the rich doing it. I just see them making themselves feel even better about themselves because of all the love they are buying. Truly I say to you, they have their reward in full.