As millions of Americans rush to the local corner market to buy Powerball tickets (including me), a question hovers over all this Powerball frenzy. With President Obama out on the campaign trail continuing his class warfare crusade, do you really want to be a millionaire in 2012 America?
On the face of it, that seems like a really dumb question. Of course, everyone would love to be a millionaire. Never having to worry again about bills and buying anything you could possibly want seems like a no brainer. There are, however, a few questions you might want to answer first.
Let’s take the Powerball out of it. Even if that jackpot is split several ways, it is such an enormous amount of money that if you plan wisely (and even if you go a little crazy now and then), you should live just fine. So let’s take jackpot winning millionaires out of it. No one in their right mind wouldn’t want to be that kind of millionaire even if it might mean living the rest of your life hated and despised by 99 percent of the public.
How about a millionaire who inherited all his money and lives mostly a life of leisure? Would you like to be that kind of millionaire? Again, that seems like a pretty easy decision. Unfortunately, that’s not a decision at all since that possibility is decided the moment you’re born or when your great Aunt Ellie decides she really likes you and remembers you generously in her will. So, for most of us, that’s not an option.
What about a Nancy Pelosi or Warren Buffet kind of millionaire? Sure you make investments and these are probably going to be taxed more, but with many millions and even billions of dollars in the bank, you probably won’t notice any difference in your lifestyle one way or the other.
How about if you’re a businessman making one million dollars? Let’s say between Federal, State, and local taxes, you pay about 50% in taxes. Well, then you’re not exactly a millionaire anymore, are you? Now you have about $500,000 to run your business and take care of your family. On top of that, a lot of people (including the President of the United States no less) wants the entire country to think you’re selfish and greedy and really aren’t paying you’re fair share. Would you want to be this kind of millionaire?
That’s where it starts to get a little tricky.
I practiced law for several years and never really loved it. Some people do, but even for them there is a limit to how much they’d be willing to do that job if most of their earnings went to taxes.
I asked a very good friend of mine who is quite liberal and a very successful attorney if there was a percentage in taxes where he would no longer want to practice law. This is a person who actually enjoys law practice. He responded “yes” but he wasn’t sure what the percentage would be.
Another friend shared with me a story about her brother who is a graphic artist and very adamant about well off people paying very high taxes. He is happy doing what he loves even if it doesn’t pay much. Her husband grew up struggling with a single mother. He vowed never to have to live like that again, so he worked hard in school and is now a successful banker.
“He’d rather be a high school football coach,” she told me.
It would appear then that there are certain successful people who might be just as happy doing something they truly love instead of what they’re doing now. They might prefer to do this even if they made less money if the alternative is to work in a tedious job with lots of stress, pay half or more of their earnings in taxes, and then get publicly vilified to boot.
A landscaper friend of mine shared another interesting thought on the matter. He told me that he’s starting to lose some business because real estate investors are liquidating everything this year and holding onto their money because they don’t know what’s coming next.
“You can’t necessarily blame them,” he told me, “because when you have that kind of money everyone is trying to pick your pocket.”
If we’re going to insist that the well to do pay a huge chunk of the taxes in this country then it stands to reason that in a country of 300 million people, we really need lots of people to want to be millionaires. That means that we’re going to have to encourage people to work hard, take risks, and possibly do something they might not otherwise really want to be doing. Back when the American Dream was in vogue, it was easy to encourage people to do this. As we continue down the road we’re on now, it will be interesting to see if this will actually continue to be the case.