“Catch and Release” Taxation

Dollars as fish. An interesting metaphor for a Friday afternoon. - promoted by david

While I am not wealthy and not part of the now-infamous “one percent” (perhaps some day), I have known and worked with enough men and women who are to notice that many (almost all) tell me that above a certain threshold (measured in tens or hundreds of millions of dollars), gaining wealth is primarily about keeping score. It’s a game (although a deadly serious game), and a player’s score is measured in dollars (or millions of dollars, depending on the venue).

What if we encouraged this behavior by treating wealth the way we treat bass (the sport fish) — what if we created a culture that celebrated “catch and release” economics, so that after the scores were counted and the winners congratulated, the wealth was returned to the “reservoir” (perhaps with a set-aside for personal consumption)?

Bass tournaments long ago imposed catch-and-release rules on their participants, because that community realized that they were destroying the bass population in the waters they fished. Today, most of the men and women I know who are serious about fresh-water fishing practice catch and release (I like to fish, though I’m not nearly as serious as some). We do this because we love to fish, and we understand that this is the best way to ensure that we and our progeny can continue to enjoy our pastoral pastime.

Isn’t this an appealing metaphor for taxes? I don’t hate the wealthy, and I don’t see taxes as stealing from me or anybody else. Instead, I recognize that there is a limited amount of wealth in the country (and the world) and I think we need to find a sustainable way to maintain and expand it.

If we built a wealth-culture as committed to returning (through taxes) the wealth we harvest (after enjoying the game of collecting it) as bass fishermen (and fisherwomen) are to returning their catch at the end of the day, then I am convinced that all of us would live better lives — and the Bill Gates, Warren Buffetts, and Larry Ellisons of the world could still play and enjoy the game they are so accomplished at.

Full Disclosure: This appealing metaphor is the invention of my best friend, Chuck.

Recommended by amberpaw, bean, judy-meredith, kbusch.



Discuss

23 Comments . Leave a comment below.
  1. that's an awful small bass

    I’d hope anyone would throw that one back.

    Here’s a BASS:

    FWIW, I’m also a catch-and-release fishing enthusiast.

    • You never know *lol*

      The limit in MD (when I grew up) was 9″. The limit in MA is 12″ today (though I wouldn’t want to eat any fresh-water fish caught east of Quabbin).

      The truth is I just liked the picture. Yours is great as well, as that you?

      • pics

        The cool thing about your pic is that it really shows why the fish is called a “largemouth” bass.

        No, that’s not me. I wish I was that young and caught fish that big :) . It is a fish caught in MA, however.

        When I was a kid in MI the limit on bass was 10″, then upped to 12″.

  2. This reminds me of Biblical Jubilee.

    The party opposite claims to want to return us to Biblical values and precepts, so I wonder if there would be any takers for this.

  3. Potlatch

    The Pacific Northwest Indians/Native Americans/First Nations did exactly this in their Potlatch ceremonies: prestige was gained by staging the most elaborate ceremonies, singing and dancing, and by giving the best gifts, not by becoming and remaining the richest person or family. The goal was indeed the redistribution of wealth. Naturally the US government outlawed it. Perhaps it’s time to bring back Potlatch.

  4. Tom. You're in luck!

    At least two of the three billionaires you mentioned (I am not sure about Larry Ellison) have pledged to give away through charity up to 99% of their net worth.

    Bill and Melinda Gates have given away tens of millions and the foundation is currently endowed at $33.5 Billion including a gift from Warren Buffett of Berkshire Hathaway stock worth $1.5 Billion.

    I don’t know why they have decided not to give the money to the US Treasury Department. They have a special office expressly for that purpose. Perhaps Gates, Buffett and other super-wealthy think they can best decide how their money is used.

    It would seem that Potlatch is alive and well with many wealthy individuals and the foundations they fund.

    • Funny you should mention Bill Gates

      According to Forbes Magazine (that left-leaning liberal socialist rag), the personal net worth of Bill Gates was sixty one billion dollars as of March, 2012. That’s after he endowed his foundation (and the net effect of that foundation is an entirely different discussion). The “tens of millions” that they’ve given away is long long way from being a significant piece of his personal fortune. Let’s assume, for a moment, that the value of his portfolio increases by 1% this year (surely it will go up by more than that). That corresponds to a six hundred ten million dollar income.

      Perhaps you didn’t realize that Mr. Gates is already on the record saying that America needs to raise taxes and that the wealthy should bear a larger part of that increase (emphasis mine):

      “Even as the economy improves and you end the wars, you’re going to have to raise taxes and certainly, whatever form it takes, and I’m not an expert on this — the rich should bear a larger increase than the rest,” the billionaire founder of Microsoft told Fox News Thursday in Switzerland, where he is attending the World Economic Forum.

      When asked about the argument that taxing the wealthy would actually hinder job creation by putting pressure on companies to contract and hire less, Gates said he didn’t see that to be the case.
      [snipped]
      There is no strong correlation between job creation and what the tax environment has been at any point in time,” [G]ates said. “If something’s a profitable activity, you’re going to engage in it. Yes, there are tax rates that are so high that people may work less. But that’s — you have to get up in the 50, 60 percent range before that’s the case.”

      Whatever it is the Mr. Gates is doing with his wealth, “Potlatch” plays no significant role.

      • I guess you can't always trust Wikipedia

        From the Gates Foundation website, “From 1994 to 2006 Bill and Melinda Gates have given more than $26 Billion to the foundation.”

        That’s my bad for the lower number.

        It’s unclear if “Potlatch” plays a significant role as I doubt there are figures on how much of their net worth they gave away in that manner.

        I am also unclear if you support Gates’ position as he advocates raising taxes on everyone, not just the wealthy.

        As a compromise, I guess we could eliminate the Bush tax cuts. That would cost the top 1% $800 billion over 10 years and the bottom 99% $3.2 Trillion. In return on the spending side we hold the increase to the rate of inflation and population growth. No cuts, even per capita. That sounds fair doesn’t it?

        • And by that I meant

          we don’t know how much the Native Americans gave away as a percentage of their net worth.

          • Finally SomervilleTom Shuts Up.

            When I corrected my comment that Bill Gates had given $26 Billion instead of tens of millions I get crickets. I am sure Tom was busy or at an important family outing.

            • Responding to comments

              is usually not an urgent matter.

            • Which part of ...

              Which part of “[t]hat’s after he endowed his foundation (and the net effect of that foundation is an entirely different discussion).” was unclear to you?

              I didn’t respond to your comment because I see nothing to respond to. The actual amount I’ve heard cited for his foundation is $33B. He didn’t exactly “give” the money away — it is the “Bill and Melinda Gates Foundation”, and he has a large voice (as in controlling) about what that foundation does. The reason I said that the foundation “is an entirely different discussion” is that a number of well-qualified professionals offer significant criticisms of its overall impact.

              So Mr. Gates moved a portion of his staggering wealth into a tax-exempt foundation that he controls that executes his personal vision of what the world needs. That doesn’t exactly sound like “catch and release” to me. That’s more like “catch and move to my private aquarium”.

              aquarium_bass

              • LOL

                A number of well-qualified professionals offer significant criticism of the overall effect of federal government programs too. Education. Energy. War on Poverty. The list is virtually endless.

                I thought you might respond to Mr. Gates’ suggestion that we raise taxes on everyone, not just the rich. I thought you might respond to my suggestion of tax increases balanced by a reduction in the rate of growth in spending. They seemed like reasonable suggestions to me.

                Perhaps you will only be happy with “catch and then have confiscated by the government.”

                • There are always those who ...

                  There are always those who keep and eat as many fish as they can get away with. Your characterization of taxes as confiscation clarifies the kind of fisherman you are.

                  Mr. Gates acknowledged himself, in the quote I published, that he is “not an expert on this”. Indeed. I would never hold up Bill Gates as an expert on anything except perhaps how to most effectively plunder a population. If you want to rein in government spending, then we can first eliminate the subsidies to petroleum and defense industries.

                  In my view, our strategy should be to structure the “catch and release” tax program to return our GINI coefficient to something on the order of 30 (as opposed to its current 45). I am confident that the resulting growth of the consumer economy — which will then have a great deal more wealth to consume with — will solve the budget deficits created by the GOP handouts to the already-wealthy without resorting to the draconian cuts relentlessly advocated by today’s overly loud right-wing GOP.

                  • A sensible policy

                    Though you and I have been sparring partners in the past this last post, and the initial more philosophical post that generated it, is a very intriguing policy proposal. Obviously not a ton of Milton Friedman acolytes on the blog, but I did find his idea of the negative income tax very intriguing as a more market based approach to a guaranteed minimum income, an idea I might add that would get Obama labeled a socialist today that was very much a bipartisan idea in the early 1970s. But its the same principle, and catch and release is a much better way to frame it, although he applied it to the entire economy. Basically the government takes a large percentage of money from everyone (a flat tax but at a much higher rate than the 10% floated by the fair tax crowd), and then gives a percentage back in the form of block grants to individuals so that the poor and middle class end up getting more back than they give in. Per wiki http://en.wikipedia.org/wiki/Negative_income_tax#Flat_tax_with_negative_income_tax, I linked to the specific Friedman proposal but the entire article is good food for thought.

                    • Just out of curiosity...

                      … in what way can a “negative income tax” that provides “guaranteed minimum income” be called “market based”? Just becauseit comes from Friedman?

                    • fair point

                      I guess the main distinction is that instead of just giving poor people money you are giving everyone money and achieving a flat tax in the process while ensuring those that need the money get it most. It also helps remove some of the externalities of the welfare trap. Allegedly that is since it barely failed to pass in the US and has never been implemented anywhere else.

                    • Just to be clear ...

                      I appreciate the support of jconway.

                      At the same time, I’m not advocating any specific mechanism or tax legislation. Instead, I’m proposing:

                      1) A “re-framing” of how we think about wealth, taxes, and prosperity, and
                      2) Setting an explicit goal (30?) for the GINI coefficient, and using whatever tax policies make sense to accomplish that target.

                      I’m suggesting that when we do those two things, the “deficit” will cure itself as the economy is restored to full vigor.

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