Paul Ryan and the rich man’s burden

By Michael Maiello
August 12, 2012

Mitt Romney’s decision to name Representative Paul Ryan of Wisconsin as his running mate says quite a lot about what Romney thinks about America and its workers, and none of it is good. In recent years, Ryan has earned a reputation as the intellectual of the conservative movement. He’s a gutsy guy who has been willing to transparently share his vision for America through a detailed budget proposal that leads inescapably to this conclusion: He believes that American workers are slackers and freeloaders.

Ryan hasn’t written a book, but his defining work is “A Roadmap For America’s Future,” where he was admirably honest about his plans for dealing with the long aftermath of the 2008 financial crisis.

But his diagnosis of the problem should make taxpayers who go to work every day wonder what the potential vice-president of the United States really thinks about them. Summing up the problem, he writes:

Americans have been lured into viewing government – more than themselves, their families, their communities, their faith – as their main source of support; they have been drawn toward depending on the public sector for growing shares of their material and personal well-being.  The trend drains individual initiative and personal responsibility. It creates an aversion to risk, sapping the entrepreneurial spirit necessary for growth, innovation, and prosperity. In turn, it subtly and gradually suffocates the creative potential for prosperity.

To support the notion that most Americans have come to view the government as a provider, Ryan cites analysis done by the Tax Foundation, a non-partisan research group that had concluded, when Ryan first published his “Roadmap” in 2008, that 60 percent of American taxpayers receive more in government services than they pay in taxes. Of course, these taxpayers make up the bottom 60 percent of wage earners. This is the source of the “rich man’s burden” argument – that our society is built on a system of patronage where a minority pays for the needs of all the rest and the richer you are, the more you pay and the less you get back.

In a system of progressive taxation this is not all that surprising. The more you have, the more you can pay without needing anything. The Tax Foundation attempted to be expansive in its analysis so that the benefits received by taxpayers include not just direct payments, like unemployment insurance and Medicare, but also our broader societal initiatives such as air-traffic control, space exploration and national defense. Fair enough. We all share in those programs, but we don’t all share in them equally.

What the analysis lacked was a look at relative benefits. We all, for example, have better lives because the U.S. has a functioning and safe air transportation system. But that good clearly means more to the people who use air travel for business and recreation, and a little less to those who use Greyhound buses. To broaden the example, U.S. military spending and foreign policy clearly mean more, in a practical way, to multinational businesses than they do to smaller local businesses, even though both benefit to some measurable extent.

The world offers more visceral examples. Eduardo Saverin, born in Brazil to a wealthy family, spent his formative years in the U.S., where he made his way to Harvard, met Mark Zuckerberg and made the small investment in Facebook that turned him into a billionaire. Why did his family move him from Brazil to Miami, where he would find his own path to building generational wealth? His parents moved because they had gotten word that their son was a target for kidnapping and ransom. That’s Brazil. The rich pay more taxes in the U.S., but in return they can sleep soundly, knowing that the police are available and effective. The median American household, making $50,000 a year, might pay less in taxes than a wealthy one, but it is surely not as worried that the children will be kidnapped and ransomed.

This isn’t a new idea. When the U.S. was founded, only property owners could vote, on the theory that people with assets had more interest in society. The founders recognized that those with more have more to protect; but they chose the wrong policy response. Those with more to protect shouldn’t be granted additional rights, they should be given a larger bill for services.

By choosing Ryan as his running mate, Romney is endorsing an economic plan that asks less of those who have more and, as a consequence, more of those who have less. Ryan believes that 60 percent of the country is getting a free ride. The election should now be about whether or not the majority agrees.

PHOTO: Republican U.S. presidential candidate Mitt Romney and U.S. Congressman Paul Ryan (R-WI) walk with Ryan’s daughter Liza to the Romney campaign bus after Ryan was introduced as the vice-presidential running mate during a campaign event at the battleship USS Wisconsin in Norfolk, Virginia August 11, 2012. REUTERS/Shannon Stapleton

39 comments

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I try to boil things back to the basics. Our country developed a system that was very benevolent to the lower and low middle class American. This benevolence, as many well intentioned acts has resulted in the paved road , not to hell, but to fantasy that every social program is socially sustainable, and even worse, a perception of an entitled privilege. Equate to one own budget. If one cannot afford a Disney World vacation for their 6 yr old child, local day trips may need to be the compromise, Your child is not entitled to meet Mickey Mouse.
Back in 2000 someone perceived the home ownership mantra in the USA as a right to own your own home. It never is nor was a right, it was an attained station of one’s financial capacity through work, prudence and good fortune.I think American’s must realize that LIFE IS NOT FAIR. Thus trying to make fair when we cannot pay the cost is a path to bankruptcy and peril to our very nation.

Posted by stefmansr | Report as abusive

Tea Party budget hawks such as Paul Ryan want to blame the middle class and poor for the budget deficit. But Ryan and the Tea Party are ignoring one crucial reality that has exacerbated US budget troubles:

Since 2000, America has lost roughly 2.8 million jobs and 50,000 businesses to China. This is largely because China’s dictators manipulate their currency to achieve an unfair advantage in world trade, and thereby retain their grip on power.

Of course, America’s unemployed workers and closed businesses do not pay taxes. By reducing US tax revenues and increasing cash outflows to support the unemployed and needy, China’s currency manipulation has made it much harder to balance the US budget.

Clearly, the USA needs to limit access to its market to countries that do not manipulate their currencies. China’s dictators are the biggest offenders here. Unfortunately, Obama has not yet done enough to address this enormous problem, and needs to take a much stronger stand.

Romney has promised to take action, but he is beholded to the mega corporations and wealthy vested interests who profit from cheap Chinese labor, made even cheaper by China’s artificially low currency. So if elected, Romney would probably not keep his promise to take action on China, as that would offend his financial backers.

Romney and Ryan are candidates for the ultra wealthy, nothing more, and should not be trusted by the middle class, seniors, and the poor. If elected, they will make life more miserable for the vast majority of Americans. Consider this:

“The six children of Walmart’s founders … had the same net worth in 2007 as the entire bottom 30 percent of American earners”
“The top 10 percent of U.S. earners control two-thirds of the country’s wealth and the richest 400 Americans control as much wealth as the bottom 50 percent of Americans.”

References:
http://blogs.reuters.com/david-cay-johns ton/2012/06/20/americas-long-slope-down
huffingtonpost.com/2011/12/08/walmart-he irs_n_1137492.html

Posted by DifferentOne | Report as abusive

Wow — your leap from Americans’ expectation of handouts to “free ride” is so large that it makes responding to your article somewhat unecessary. Nowhere does Ryan say Americans are getting a “free ride.” He’s saying that Americans today, whether they need it or not, expect freebies from the government and distribute their vote according to whoever doles out more of them. Ryan, correctly, recognizes where that attitude leads us as a country — down a path similar to that of the Roman Empire. The rich already pay a staggeringly asymmetrical amount of taxes in this country. However, I actually support them paying a bit more in taxes at this time, since so many wealthy were bailed out from this financial crisis, without a scratch, by Middle America, which got little benefit. But, when it comes to determining which long-term vision leads to a healthier America — Obama/Biden’s or Romney/Ryan’s — it is not even close. Obama sees a public sector driven, union-dominated economy which, anyone schooled in economics can tell you, cannot stand (as we see today in Europe and, now, the US). Romney sees a private sector driven, free market dominated economy (yes, with appropriate regulation) which has dominated the world in recent history and will continue to do so if we let it.

Posted by Welred | Report as abusive

“Americans have been lured into viewing government – more than themselves, their families, their communities, their faith… they have been drawn toward depending on the public sector for growing shares of their material and personal well-being. ”
This is a great statement coming from a guy who lives off the public purse. Another hypocrite running for office!

Posted by mrpos | Report as abusive

Mr. Maiello, As usual you and the media, unions & 3 federal branches of government have taken the viewpoint for the 45 or 55% (we’ll see in the next election) of the Americans or the title wave of “undocumented” residents. who do nothing but collect some government “entitlement”. You never look from the view of those of us have worked very hard our whole life, to build a future for our children, a home and financial foundation, without considering spending the time in a welfare line. Unions rarely pat the backs of those do better, instead alienate workers who do…ie: the NEA & tenyear guaranties. Guess where all the great teachers went? & Our? congress is the best money can buy. Stop whining about the “so called middle class”($50m? really-what has your congress done to the value of this income in the last 6 years) that you think Ryan is calling lazy.

Posted by Sregord | Report as abusive

The quoted Ryan remarks are accurate. The competing philosophy of the author here can be characterized fairly as the “Organized Crime” theory of government – those who have incomes must pay protection money so they are not kidnapped by the non-productive. A protection racket is not exactly what the Founders had in mind, and which in any other context is seen as illegitimate and immoral.

Posted by SayHey | Report as abusive

Well said.

Posted by ofilha | Report as abusive

In find the entire argument, “because some people pay no federal taxes there is something wrong with the system” to be utterly disingenuous — and so do some conservatives, including the current Republican VP nominee. Ryan has proposed a zero tax on dividends and capital gains, meaning that the wealthiest among us — Romney included — would owe essentially nothing.

The lie which supports this cognitive dissonance is that rich people are all job creators, so letting Romney keep more of his money would mean he would hire more people. Alas, he is not in business — so bang goes that theory.

On the other hand, letting the lowest income people keep more or all, or even more than all of what they earn is all pllowed back into ten economy. They spend everthing they have. They have to.

This isn’t an argument about getting back exactly what you out in because, with a progressive tax and a wide divergence of personal incomes, that isn’t possible. It is about not only who deserves to pay less tax (lower income people) but who should pay less for the good of the nation — the middle class, which spends and accounts for some two-thirds of the economy.

Business hires when they have customers, not just because they have money. Just ask Romney.

Posted by johncabell | Report as abusive

Republicans clearly do not share nationality with the bulk of the people of this country.

So why are they allowed to share a Government with us? We do have self-determination. We need to exercise it and exorcise these, and other, peoples from our midst. We will never be free again until we expel the hostile rich from our country, even if we have to redefine what that country is. They do not own us or our country as property, whatever they say. No more than the British Crown does. The association is voluntary.

Our choices are not limited to those presented to us by a corrupt and oppressive system.

Posted by usagadfly | Report as abusive

Any system of “progressive taxation” that lets 1/2 or more of us pay no income tax at all, while reaping government benefits and voting for more benefits for ourselves, will eventually end when there is no more money left, and that is exactly what is happening to our country right now. This and other issues need to have a serious debate and these ad hominem attacks are not helpful. Instead of making inferences about what you think Ryans opinion of working people is, you maybe should ask him. Personally, I’m for a flat tax with no loopholes so that every one of us will have a reason not to let our politicians spend ever more of our money to get themselves re-elected.

Posted by zotdoc | Report as abusive

Where does this idea that government services hurt entrepreneurship come from? The burden of college loans and insane insurance premiums greatly deter small business ownership. How is someone who has to pay $800 a month on their college loans and as much for insurance supposed to have any money to invest in building a business? I would imagine that universal healthcare and free (or near free) education would lead to a small business boom.

Posted by anarcurt | Report as abusive

I’m reminded of a book review I heard recently (unfortunately, I no longer recall the book) wherein the author includes an analysis of actor Sir Michael Caine’s anti-tax stance and attempts to roughly quantify how much exactly in government benefits Sir Michael has accumulated over the years. I’m sure Caine thinks that he earned his money by acting in films, but as it turns out, there’s a bit more to it than that. What if there were no copyright protection, a government benefit that his taxes provide, on the films he made? It turns out that there is no copyright protection on porn films, so the book author suggested that without copyright protection, Sir Michael’s income from acting might be more similar to that of a porn film star than what he in fact brings in. The copyright protection benefit of course means an awful lot more to Sir Michael than to most of us (its absence might indeed drastically reduce the cost of entertainment for most of us), but we all pay for it.

Posted by Sanity-Monger | Report as abusive

Is’nt the 60 percent’s freeride a consequence of capatalist extremism; The globalized laissez faire supply side economy?

The race to the bottom, …may the most efficient (the cheapest) supplier win over the backs of the middle (and “lower”) classes.

Posted by Beobachter | Report as abusive

What neither you, nor Mr. Ryan, mentions is that, while he is from quite a wealthy family, he apparently had no problem whatsoever accepting social security death benefits after the death of his father, which he used to pay for college.

Clearly, he didn’t need the death benefits, but had no problem using it, depending upon the government instead of himself, his family, their community, and their faith as their main source of support, which is what he is urging others to do.

Mr. Ryan, if you examine his background and character closely, is more of a believer in “do as I say, not as I do”.

It seems he didn’t have any problem taking money from the government when it was offered then, yet objects that anyone be offered the same opportunity.

Mr. Ryan has spent nearly his entire “working career” in government service, with all the benefits and perks that allows, but doesn’t count this as total dependency upon the government.

—————————-

From Wikipedia:

Ryan was born and raised in Janesville, Wisconsin, the youngest of four children of Elizabeth A. and Paul Murray Ryan, a lawyer.[6][7][8]

His great-grandfather, Patrick William Ryan (1858–1917), founded the Ryan Incorporated Central construction business in 1884.[11][12][13]

While growing up, Ryan and his family often went on hiking and skiing trips in the Colorado Rocky Mountains.[7][14]

When Ryan was 16, his father died of a heart attack. [14]

His father’s death provided Ryan with Social Security benefits until his 18th birthday, which he saved to pay for his education at Miami University of Ohio.[15][16]

——————————

Maybe Mr. Ryan should be required to return the social security money he used to pay for college, instead of living expenses as most others would be forced to do in his circumstances.

Think of it as a sort of “student loan” from the government, which Mr. Ryan has never bothered to pay back.

Posted by Gordon2352 | Report as abusive

Great article Michael – you raise some interesting points about how the election process has changed over the years to include not just non-property owners, but those who may not be white males. Wouldn’t it be interesting if you could “sit out” on taxes if your candidate doesn’t get elected? So if the person that you voted for didn’t get elected, you simply get a “pass” on taxes for those 4 years. Of course if you don’t pay any taxes during that period, you also get no benefits either. Of course we couldn’t pull back on the military protection or the air traffic controller types of benefits, but if you want unemployment, food stamps, FEMA assistance, or any type government subsidy, you’ll just have to wait until your candidate gets into office. That could really make life interesting, don’t you think ;)

Ok back to reality…. what does it matter what the public wants anyway – it’s really what the electorates want? Otherwise, there would have been a couple of different pictures of presidents hanging on the wall.

Posted by TheWiseOne | Report as abusive

Great article Paul – you raise some interesting points about how the election process has changed over the years to include not just non-property owners, but those who may not be white males. Wouldn’t it be interesting if you could “sit out” on taxes if your candidate doesn’t get elected? So if the person that you voted for didn’t get elected, you simply get a “pass” on taxes for those 4 years. Of course if you don’t pay any taxes during that period, you also get no benefits either. Of course we couldn’t pull back on the military protection or the air traffic controller types of benefits, but if you want unemployment, food stamps, FEMA assistance, or any type government subsidy, you’ll just have to wait until your candidate gets into office. That could really make life interesting, don’t you think ;)

Ok back to reality…. what does it matter what the public wants anyway – it’s really what the electorates want? Otherwise, there would have been a couple of different pictures of presidents hanging on the wall.

Posted by TheWiseOne | Report as abusive

You’ve hit two home runs here. The first regards who pays. Mr. Ryan’s ideas are nothing new. As a teenager in the 70′s I complained to my father about taxes. His response: “Be glad you can pay them. The haves always pay for the have-nots”. The second concerns living in a civil society. There truly is a thin blue line that protects the middle/upper classes. Look at the crime rates for inner cities vs. suburbs. If you’re wealthy you probably think bad things cannot happen to you, after all they are not in your experience, yet….

Thinking that the poor are lazy is naive. Surely there is some of that but in my experience many of us lack opportunity and lack the resources to gain life experiences that expand horizons. There is a lot of mental illness, drug abuse and child abuse. If you’re a kid growing up in an abusive household you’re busy trying to survive and get out of there. Homework and college applications are probably not high on your priority list.

I’m old enough to remember the riots of the sixties. A lot of that was based on race but poverty played a large part as well. Paul Ryan was born in 1970 so those days are not in his personal experience. Mr. Romney should know better.

There are many more guns on the street today than in the sixties. I hope our politics don’t take us back to that place.

Find someone to speak with who’s involved with Child protective Services or Family Court. Educate yourself and I believe that you will see some flaws in Mr. Ryan’s agenda.

Posted by Missinginaction | Report as abusive

The Ryan quote is accurate. What the author of this article, and many commenters, are urging is what modern progressivism has become – a kind of Organized Crime theory of government where the government is a variation of a protection racket – pay up so you will not be kidnapped. This is hardly what the Founders envisioned. Moreover, the claim that not enough is being done for the poor is a plain departure from reality. To put it in perspective, the Mars mission tab this year is about $500 million. The state of New York alone spends twice that amount on Medicaid – in a week.

Posted by SayHey | Report as abusive

It’s the same discussion in the UK: ‘benefit cheats’ vs. ‘tax avoiders’. I personally think that the small minority of rich tax avoiders and corporations and their offshore trusts and foundations, where trillions are kept far away from the taxman(see recent study of offshore finance by the tax justice network) are far more damaging for the country’s finances than health insurance and pensions for the poor and disabled. The money spent on the poor are peanuts compared to the trillions hidden on the tax heavens. Clamp down on the tax heavens! Why do Romney and Ryan do not talk about the problem of offshore money?

Posted by fernando80 | Report as abusive