Lion of the Blogosphere

Greg Mankiw and inherited wealth

Greg Mankiw, who is a libertarian-economist type, wrote a New York Times column about inherited wealth last month.

He starts out by calling it “intergenerational altruism.” Because everyone knows that altruism is good, this artful use of language is designed to make people have good feelings about bequests of wealth. But this could also be explained in terms of evolutionary biology. People have a natural biological urge to ensure that their children are successful, because in the past this has led to having more great-grandchildren which is for the most part the ultimate goal of all animals.

The desire to bequest money to one’s children could just easily be described in terms of greed, as in greed to have a sort of immortality through one’s children and perpetual fame for having fathered a great dynasty.

The bottom line here is that rich people are not saints because they leave money to their children, they are just doing what is normal behavior for rich people. And remember that the behavior of rich people is intended to benefit themselves and not society at large.

Mankiw then spends a large part of the column writing about regression towards the mean. This is yet another emotional argument instead of a utilitarian one. This is supposed to make us feel bad for rich children that they will probably not be as successful as their parents, thus we should not begrudge them their inheritance which they presumably need in order to alleviate the low self-esteem they have from living in the footsteps of their more successful parents. Boo hoo, poor rich children.

Then finally we get to an actual economic argument rather than an emotional one. We need to allow rich children to keep their inheritance so that they will invest it in ways that increase productivity and therefore make everyone richer!

For starters, this in contradiction to the regression-towards-them mean argument he made previously. Which is it? Are children of the rich unsuccessful losers who will just spend the money on big parties thrown at their big mansions, or are they hyper-smart investors who will direct their inheritance towards the investments that will produce the optimal return, thus becoming even richer by doing so and not regressing towards the mean as Mankiw earlier said they would?

If people need to be rich in order for the economy to have an adequate level of investment (which is a rather dubious assumption because the whole point of things like corporations and investment funds is that many people of average wealth can group their money together to invest in big projects), then it would surely make more sense to take away the money from the stupid rich children via a high inheritance tax and then transfer it to smart poor people, perhaps those who score the highest on the GMAT, who would then use the money a lot more intelligently to grow the economy.

I should point out that with the last argument, Mankiw is merely using one of the standard libertarian arguments for low taxes on passive income, which is that a small number of people need to be able to become rich and stay rich in order for investment to take place, and as I pointed out above, it’s a dubious assumption.

Written by Lion of the Blogosphere

July 22, 2014 at 9:51 AM

79 Responses

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  1. If Gregory Clark is to be believed, regression toward the mean for wealth and especially social status is an extremely slow process if you look at more than two generations. I guess it doesn’t change the emotional argument much but I think it’s important to consider.

    Jokah Macpherson

    July 22, 2014 at 10:00 AM

  2. Agreed, played out bullshit arguments that amount to: we have it and want to keep it and you should agree with us about that. Sadly nobody cares about people of intellect, in fact it’s my experience that many people despise them and hope they’ll fail. If inheritance is taxed at a higher rate, it will no doubt go toward the most needy with zero regard for whether they are likely to use it for value creation or simple consumption.

    Sisyphean

    July 22, 2014 at 10:12 AM

  3. they are just doing what is normal behavior for rich people.

    It’s normal behavior for anybody with children.

    This should only be a problem for society if the legal framework restricts alienability or encumbrance of bequeathed assets. Otherwise, if a fool inherits a million dollars, that money is redistributed to smarter people in short order.

    The Anti-Gnostic

    July 22, 2014 at 10:51 AM

  4. It would be interesting to do real research into the attitudes of the wealthy towards their children over time. Historically Western Europeans were just not as invested in their biological children as our modern 1%. Romans, notoriously, viewed adopted heirs as just as legitimate as natural children, and would often favor a more competent adopted child over an incompetent natural child. The great and powerful for most of European history were primarily concerned that their reputations and fame last down the century – memes over genes. Even the industrial barons of the 19th century like Getty, Morgan, etc. seemed more concerned about creating lasting institutions and monuments that would carry their names, and were often uncaring fathers, or outright mean to less promising offspring. A shifting emphasis to devoting resources to one’s biological offspring over the maintenance of one’s individual reputation seems to me more typical of clan-based societies than Western European tradition, and is probably due to the increasing influence of Jewish, Southern European and Asian cultural traditions. Or it could be due to the atomization of society. In a world of diversity and rapid technological change, concepts like “reputation”, “honor”, and “fame” don’t have the importance they had to our ancestors, who believed they lived in an important civilization whose values and traditions had endured and would endure for many generations. Probably nepotism is the rational response today. In any case the concentration of wealth today is likely to have a far more baleful influence on democracy and social mobility than it did in the 19th or early 20th centuries.

    Peter Akuleyev

    July 22, 2014 at 10:56 AM

    • Thanks for the outstanding post, Peter Akuleyev. Agree with you in every respect.

      Concordia_Pete

      July 22, 2014 at 3:44 PM

  5. Mankiw is an idiot

    vic

    July 22, 2014 at 11:21 AM

  6. “This is supposed to make us feel bad for rich children that they will probably not be as successful as their parents, thus we should not begrudge them their inheritance which they presumably need in order to alleviate the low self-esteem they have from living in the footsteps of their more successful parents. Boo hoo, poor rich children.”

    Wait, the other day, weren’t you all like “Who cares if today’s poor live in conditions that a Roman emperor would envy? It’s all relative so they suffer because of income inequality. (Non-sarcastic boo hoo)”

    Hepp

    July 22, 2014 at 11:41 AM

  7. Your belief in evolutionary biology defeats your argument. You admitted that people work hard so they can leave money to their offspring. If you start confiscating their wealth at death, wouldn’t people stop working hard?

    Hepp

    July 22, 2014 at 11:44 AM

    • You mean like the world would be better of if Bill Gates were still running Microsoft instead of having retired to run his charity?

      • People who stopped working because they were selfish wouldn’t probably run charities. Gates is giving his stuff away after death regardless of what government does.

        Hepp

        July 22, 2014 at 12:13 PM

      • Considering the causes that Gates has been donating to, I think we would be better off if he kept everything for himself.

        BehindTheLines

        July 22, 2014 at 12:34 PM

      • I think the real problem is the charities and foundations. They’re mostly used for things I wouldn’t support and one of the primary reasons for them is to shelter that money from taxes. Get rid of the foundations tax exemption let the tax man have the same cut of Gates and Buffets wealth that he’ll take from ours.

        destructure

        July 22, 2014 at 4:41 PM

      • i think bill gates left msft to spare himself the embarrassment of having to be in charge when the world realized that msft was completely out of world-historic tricks (unlike aapl/goog) and was down to milking cash cows. ego injury.

        lion of the lionosphere

        July 22, 2014 at 10:14 PM

      • The Gates Foundation is not really a charity, it is a Tax Shelter. An irrevocable trust is only required to spend or allocate a measly 3% of its Net Worth every year for “Charitable” purposes which includes fundraising. Fundraisers are merely extravagant parties for the Rich and Famous where less money is raised than the party actually cost. For a real charity, this would be disastrous, but fortunately real charities are rare or non-existent. This is not snark or cynicism either, check for yourself if you doubt my words.

        Joshua Sinistar

        July 23, 2014 at 9:29 AM

  8. Government will waste it because that is what they do.

    Kurt (@Vypuero11)

    July 22, 2014 at 12:24 PM

  9. Of course, a Leftist will interpret the critique of Mankiw’s argument as making sure that every small businessman with a hardware store leaves nothing for his kids because Mankiw is full of BS. Meanwhile, the Buffets, Gates, and Clintons can continue to make money through value transference and leave as much as they want for their children.

    This concern about inheritance is misplaced. It’s like the concern over automation destroying jobs. It simply does not exist.

    What we really have is a systematic destruction of upward mobility as expressed through the tax, regulatory and educational systems. Any system that attacks inheritance will operate the same way that “progressive” taxation operates: it will destroy upward mobility and not touch a penny in Warren Buffet’s account.

    map

    July 22, 2014 at 12:30 PM

    • A guy who owns a hardware store should be able to leave the same amount for his children as a guy with a salaried job who has the same amount of income and assets.

      By the way, currently you have to have more than $5 million in assets before inheritance tax kicks in. That’s a lot of money.

      • Actually with minimal planning you can leave easily 10 million without paying any inheritance taxes.

        Don’t forget that double taxation argument is BS since so much wealth is unrealized capital gains, which have a stepped up basis upon inheritance. So if my father gives me stock in his startup worth 5 million, I pay no estate tax when I receive it and then no capital gains tax when I sell it for 5 million. Working stiffs might pay 45% of their income, but Dad and me pay absolutely nothing on this 5 million.

        Novo

        July 22, 2014 at 3:39 PM

      • Lion,

        For inheritance tax purposes, wealth is defined very broadly, often including the value of the insurance taken out on a business. A family farm worth $2 million can easily bump up to $5 million by the time you hit all of the tax adjustments the Feds include.

        But there is a much bigger issue here. The only thing protecting the middle class and the small business owner from massive amounts of wealth confiscation are the libertarian arguments made by Mankiw and others.

        Why is this the case?

        It’s not there is anything illogical about what you present. It is simply the bare empirical fact that guys like you have been making this same argument, and pushing the same policies, and successfully legislating the same wealth redistribution schemes for the last 100 years. Yet, the concentration of wealth continues to go up. Not just concentrations of wealth recently acquired, but year-in/year-out concentrations going back 100 years or more, through the implementation of the income tax, WWI, the roaring twenties, the Great Depression, WWII, the post-war economic boom, up to the present.

        In other words, there has been no real reduction in either the number of dynastic families with tens of millions of dollars in net worth or in the amount of wealth that they control. Both have been going up. More importantly, both have been going up in a political environment full of rhetoric and legislation designed to prevent those concentrations from happening in the first place.

        Your policy beliefs have turned into nothing but a spectacular failure. Yours is like the pro-immigration supporters who act as if Mexicans appeared in America in the last 10 years and immediately assume the nativists are making the same mistake as was made with the Irish and Italians. The reality is that Mexicans have been living in America for at least 150 years and no speculation is necessary about their upcoming dismal performance. Likewise, there is no speculation necessary about the outright abuse that your schemes are going to generate.

        America is the business of evil men. Don’t give them yet another place to hide.

        map

        July 22, 2014 at 9:15 PM

  10. In short, if someone is not born in a wealthy family, the person is for all practical purpose a lesser species.

    I have said many times that gods do exist, and they are called toos.

    Toos gain more from passive incomes.

    The descendants of the Spanish noblemen who have never crossed Atlantic for generations still collect rent from the land holdings of their distant ancestors whose property rights are still honored by the various Latin American governments.

    In a world of peons, today’s descendants of the rich will rule over whatever is remaining of the world.

    Colmainen

    July 22, 2014 at 1:27 PM

    • “The descendants of the Spanish noblemen who have never crossed Atlantic for generations still collect rent from the land holdings of their distant ancestors whose property rights are still honored by the various Latin American governments.”

      That’s something that’s always interested me, too. In the American South there are still many of the kinds of wealthy people descended of colonial agro-aristocrats that you refer to as existing in South America as well. They really are a different class of people, and most don’t realize they even exist.

      Concordia_Pete

      July 22, 2014 at 3:52 PM

      • I don’t think any antebellum Old Money is left in the South. The South was poor as dirt from the 1860’s to the 1950’s. What turned everything around was cheap energy and HVAC. Then the rest of the country realized they liked sunshine and low taxes. That’s when all the Money I know about started cashing in. But, I’m low bourgeois so I wouldn’t know.

        The Anti-Gnostic

        July 22, 2014 at 4:33 PM

      • Anti-Gnostic, they’re there. Trust me. You’re right about the poverty thing, and the average white in the South is unquestionably worse off than the average white up north, but the old families are doing just fine. As far as wealth, sure they’re a notch below wall street types and the alpha-tech people, but in terms of real assets and old fashioned exclusivity and political influence, the first families of the South can compete with any elites in the world IMO.

        Concordia_Pete

        July 22, 2014 at 4:55 PM

      • — Also, if you’re saying a lot of the wealthy old families sold out to RE developers in the seventies, you’re also correct. But they sold out for millions, and have invested well.

        Concordia_Pete

        July 22, 2014 at 4:59 PM

      • Well they are toos and the hoi polloi are not supposed to know about them.

        They will do well 10,000 years from now, although they will probably look slightly darker like the Brahmins of Delhi.

        Colmainen

        July 23, 2014 at 1:21 PM

    • Columbus’s heirs were supposed to get a vig on all of it. Per wiki lawsuits by them dragged on for a couple of centuries.

      Dave Pinsen

      July 23, 2014 at 8:43 AM

  11. The money is in the middle class. When, not if, they start going after wealth to pay for the social programs, the definition of wealthy will be much lower than lion and others here imagine. When that happens, the resulting incentives will lead to lower productivity. My wife certainly wouldn’t be working right now if we knew the majority of her earnings would be paying to support someone else’s kids (or more likely another’s grandma) rather than ours.

    Bitter clinger

    July 22, 2014 at 2:25 PM

  12. Holman Jenkins once offered a different argument in favor of large inheritances, that it freed heirs to pursue work that wasn’t highly remunarative – science, art, philanthropy. You could make the same point about tech startup billionaires, but most seem to launch another startup.

    Dave Pinsen

    July 22, 2014 at 3:21 PM

    • A good reason for a universal basic income. That would free everyone to pursue self-actualizing work.

      Lion of the Blogosphere

      July 22, 2014 at 3:30 PM

      • For everyone to be freed from having to work to earn an income, you would need to soak the extremely wealthy, and only the extremely wealthy, in order to pay for a high enough basic income for everyone else. Given the fact that the extremely wealthy maintains such a high control of the political system, is such a thing possible?

        Jeff

        July 22, 2014 at 3:53 PM

      • There are millions of people with de facto basic incomes now, through current welfare programs. I suspect most aren’t pursuing self actualizing work.

        Dave Pinsen

        July 22, 2014 at 3:56 PM

      • The problem is that we only give welfare benefits to the stupid and uneducated.

        Why not give welfare to graduates of MIT?

        Lion of the Blogosphere

        July 22, 2014 at 4:09 PM

      • LotB,

        You pretend to know a great deal about libertarians even though you don’t actually refer to any that your libertarian readers would recognize as such. I’m going to assume that you don’t follow any which is why your views about them are so ignorant.

        Do you find it strange that Maslow had kids with his first cousin? That must be weird to do missionary with your dad’s brother’s daughter. Why is it that you spend so much time approvingly referencing sexual deviants and hard-core leftists but you insist that you’re not a leftist?

        runindogs

        July 22, 2014 at 5:43 PM

      • I cite Maslow because his idea about self-actualization has changed the way that the elite think about the meaning of life. It has nothing to do with Maslow himself who I actually know little about. I have no clue what this had to do with leftism.

        Lion of the Blogosphere

        July 22, 2014 at 6:10 PM

      • LotB,

        Is there some reason why you’ll respond to some of my questions, but not to my request for you to tell us which libertarians you follow? Any reasonable person in your position would do that.

        I’ll hold to my original thinking; you don’t know what you’re talking about at all, but you like ginning up these easy troll-posts. But perhaps you’re secretly a libertarian who’s setting up this whole line of posts to make libertarian-hating leftists look like the insular doofuses that everyone should know by now that they are.

        runindogs

        July 22, 2014 at 6:26 PM

      • Asking what libertarians I follow is a stupid question. I read Nozick. And Ayn Rand. what communists do you follow?

        I mostly follow bloggers like Steve Sailer.

        Lion of the Blogosphere

        July 23, 2014 at 6:44 AM

      • Read the wiki on Maslow’s hierarchy. It’s the usual leftist horse-shit, based on commies like Einstein, Eleanor Roosevelt, and other sickening types. Note the “values” in the “self-actualization” section; remind you of anything?

        runindogs

        July 22, 2014 at 6:34 PM

      • It would free everyone to sit around and smoke pot. How much more would you have to pay to get someone to work in an emergency room or drive a snow plow. If you have a basic income, then what is the first itme/luxury good that someone will have to work to purchase?

        superdestroyer

        July 22, 2014 at 7:21 PM

      • Instead of paying people to play WOW, how about paying them to work out at fitness centers? Added benefit is that a lot of obese proles would be less obese.

        CamelCaseRob

        July 22, 2014 at 7:52 PM

      • That’s a great idea.

        Lion of the Blogosphere

        July 23, 2014 at 6:48 AM

      • universal basic income is a great idea. problem is if you implement in the USA the way things are today, you’re going to get more of what you don’t want and not much more of what you do.

        lion of the lionosphere

        July 22, 2014 at 10:17 PM

      • Lion,

        Previously, you’ve suggested paying people to play WOW. Why not make tens of millions of professional athletes? Sponsor soccer leagues for every able bodied man from 15-30. Make multiple tiers, feeding into MLS, and institute promotion and relegation of teams between leagues. Bottom tier gets basic income, higher tiers can supplement that with ticket sales, broadcast rights, or sponsorships.

        Would keep prime crime-age men off the streets and expand the soccer talent pool for future US World Cup teams.

        Dave Pinsen

        July 23, 2014 at 12:31 AM

      • I’ve also previously suggested paying people to play in sports leagues, so yes, I agree with the idea!

        Lion of the Blogosphere

        July 23, 2014 at 6:55 AM

      • LotB,

        Quoting you:
        Clearly they BELIEVE that the correlation is close-enough to perfect that the imperfections are not relevant to understanding economics.

        We are trying to figure out who “they” is. Nozick and Rand are dried up corpses and you claim to know modern libertarians by your reading of those two. This is impossible. You must be basing your screeds on something besides these two. There are dozens of intelligent libertarians with blogs and Steve Sailer is obviously not one of them.

        I don’t have to read so-named communists anymore, as the whole of the modern left refers endlessly to Marx. His raw stupidity, bloodlust, and desire for shared penury and death is on display throughout Occupy, this blog, all major papers, anywhere leftists are found.

        runindogs

        July 23, 2014 at 7:52 AM

      • I think that Anarchy, State and Utopia, The Fountainhead, and Atlas Shrugged is enough libertarian books to read. I don’t that anyone needs to read more than that to understand the movement. On top of that, I was a member of the Federalist Society and used to read the Cafe Hayek blog.

        Lion of the Blogosphere

        July 23, 2014 at 8:15 AM

      • I find Friedrich Hayeks work to be the most compelling of the libertarian arguments.

        map

        July 23, 2014 at 10:51 AM

      • All power is acquired and maintained through force including economic power. Property rights at their core require some degree of violence to protect. Half of Mexico was conquered by the United States and without that there would be no California. World War One the most useless war in history was a battle among capitalists in search of new markets. Tens of millions died but that never registers as capitalist blood lust.

        I’ve never seen any leftist properly cite Marx nor have I heard anything positive about communism from mainstream sources. Karl Marx”s ideas are undergoing a comeback of sorts because nobody else seems to have an answer for anything. Moreover the existence of Red China as an economic superpower has never been adequately answered either.

        Adam Smith had more in common with Marx than people realize. He believed ownership of production generated wealth not entrepreneurship, stimulus, and debt. He also endorsed the labor theory of value.

        Another thing reactionaries can’t explain is why current and former communist countries don’t have feminism, mass immigration, faggotry normalization, criminal mayhem, and other dysfunction. If liberalism and Marxism were the same thing why the major gap between them and us?

        This is a pretty good video on the renewal of interest in Marx. It has a bourgeois bias and denigrates the Soviet Union despite it’s achievements but overall good.

        eradican

        July 23, 2014 at 3:17 PM

      • LotB,

        Thanks, that’s helpful. Now when you post anti-libertarian screeds I can just refer back to your proudly ignorant comment here. You don’t know or care to know which is why you may actually believe the insane things that you write. You’re the perfect leftist.

        runindogs

        July 23, 2014 at 3:25 PM

      • eradican,

        The three major sources of your confusion are race, gov lies, and gov crimes. Check the racial mix for an apples-to-apples comparison. Stop believing stats just because they’re fed to you by a government. There’s a reason that Chomsky-friendly countries allow/ed no free press and little to no escapees. And the last one will be the hardest for you: just because a gov does a thing doesn’t mean it should be viewed as other than a crime. When the N. Korean gov kidnaps models for rape and pleasure, you don’t necessarily have to view that as a non-criminal act. I know that your particular bend causes you to forgive any gov crime, but you might want to consider whether gov should be held to somewhat the same standards as the rest of society about MASS murder, etc.

        runindogs

        July 23, 2014 at 8:16 PM

      • LotB,
        Because you’re too busy to read libertarians who bemoan ill-gotten gains of rich people, I went to the first page at reason.com and found several links to crony capitalists in a few seconds. Don’t expect them to sound like Saul Alinsky. Most libertarians are intelligent, reasonable, and cooperative, which is why they identify broadly with an ideology premised on minimizing aggression. They tend to personalize and demonize less than the leftists you admire.

        http://reason.com/archives/2014/07/21/andrew-cuomos-corporate-welfare
        http://reason.com/archives/2014/07/19/the-crony-capitalism-machine

        runindogs

        July 23, 2014 at 8:31 PM

      • Both consistent with the libertarian belief that they only time value transference happens is when the government causes it.

        Lion of the Blogosphere

        July 23, 2014 at 9:32 PM

      • LotB,

        Must you use the moronic term “value transference”?

        To transfer something just means to move it. Moving value can refer to a million different things and the only people who use the phrase are in this little mind-ghetto with the rest of the angry leftist freaks.

        runindogs

        July 23, 2014 at 10:41 PM

      • LotB,

        Can you not follow your own silly arguments?

        They SAY that when I make the post that way, but otherwise they(sic) arguments betray their TRUE thinking on that matter. Libertraians(sic)* will never condemn rich people for getting rich while not doing anything useful for society. They will always insist that they were rewarded by the market for creating value.

        Libertarians point to ways that people get rich by doing nothing of value ALL DAY LONG, but because you’re such a pinko, you can write the above egregious and retarded blanket statement and then completely forget it when I point you to a couple of them.

        *Forget this comment of mine if you didn’t mean “libertarians” when you wrote the above.

        runindogs

        July 23, 2014 at 10:55 PM

      • runindogs

        If you want an apples to apples comparison then North Korea to Red China is pretty absurd when the former is the most isolated state on Earth while the latter is the world’s biggest trading nation.

        Free speech exists everywhere just don’t criticize the powerful. Even in the USA discussion is permitted within the parameters and framework the powerful set. Otherwise you lose your job, reputation, and possibly even your freedom. Even at this blog speech is restricted to whatever Lion allows. The IRS already taxes people living abroad as if they live in the states. Not only is that theft but a soft form of iron curtain. As the west sinks further things will get worse. At least the communists could legitimately say they were under siege but what’s the US/EU excuse?

        North Korea hasn’t invaded anybody in more than 50 years meanwhile the US/UK invaded and destroyed Iraq wrecking the lives of millions all to seize their oil wealth and prevent the Euro from being used as an alternative to the dollar as a reserve currency.

        eradican

        July 23, 2014 at 11:22 PM

      • Current libertarians seem a bit fey to me, mostly interested in positing more or less unlikely scenarios and drawing outrageous but principled conclusions. A bit like modern philosophy. The sole political program appears to be the right to smoke pot, which leaves me unmoved. But then I’d say most of the issues and solutions were worked out by well-known earlier minds anyway.

        In the greater historic scheme of things, our future political organization will likely be not so much Marx or Hayek as the Ottoman Empire, that is, managing a highly diverse, clannish population by whatever means necessary. This should be seen as a very deliberate outcome of the policies of the modern left.

        I conjecture that libertarianism only had a shot at working in highly outbred, high trust settings, like for instance the anglo West was (and partly still is, which accounts for why our “ideologies” still hang around). Perhaps the whole immigration era should be seen as the consequence of the losing left pushing the doomsday button to blow up this arrangement.

        Well, here we are.

        Glengarry

        July 24, 2014 at 7:33 AM

      • The presenter in this video is exceedingly attractive, to my mind. She dated Miliband, her father was an entertainer, so she’s a lefty. She read economics at Oxford. Her father attended Westminster and Oxford. (For those who don’t know, Westminster is the most prestigious British public school.) Her father’s parents aren’t in Wikipedia. She left journalism to become J P Morgan’s chief of asset management in Europe and Britain (which pretends to not be part of Europe).

        She’s a cardinal case of how the rich and powerful tend to be much farther left than most Americans think, of how the have-nots >>are<<, paradoxically, holding themselves back. As one Australian journalist said, "America's Civil War never ended. There was just an agreement to stop the killing."

        In fact, the video's funniest segment is when some finance apparatchik in The City gets hateful comments/e-mails from Americans, when all he does is point out that Marx's criticism of capitalism was spot on in the most recent crisis.

        pequenino

        July 24, 2014 at 10:01 PM

      • or “pretends not to be” for the schoolmarms.

        pequenino

        July 24, 2014 at 10:53 PM

    • A good argument for Victorian England when a lot of people from rich families became scientists or sponsored them. Less so in the current era of unlimited greed, rich kids of Instagram, and slutty celebutants.

      Also, 5 million is more than enough to fund someone’s good work for life, that produces about $180,000 in safe passive income without touching the capital. So there is no argument for not taxing giant estates.

      Novo

      July 22, 2014 at 3:46 PM

  13. LotB,

    Is Mankiw the only “libertarian” that you follow? I can see how you could be confused about libertarians if you only followed one, but believed that he represented all of them.

    runindogs

    July 22, 2014 at 3:47 PM

    • bryan caplan over at econlog is just as bad. sailer takes him to task constantly.

      uatu

      July 22, 2014 at 9:42 PM

      • And surely you wouldn’t stereotype a giant broad movement based on a shallow reading of a couple people in it, I assume?

        runindogs

        July 23, 2014 at 8:07 AM

    • Runindogs,

      Libertarians are batshit crazy, why do you defend them. Murray Rothbard says that parents have no moral duty to feed and shelter their kids and it’s ok to let them starve, for example, and he’s very popular in the libertarian movement.

      David

      July 23, 2014 at 10:14 PM

      • Portions of Murray Rothbard’s giant intellectual output are popular with anarcho-capitalists like Tom Woods, Lew Rockwell, and Bob Murphy, none of whom espouse every element of Rothbard’s chain of reasoning about self-ownership. I’ve followed all three and never come across any defense of this idea, especially as they are all Christians. The lion’s share of libertarians know approximately nothing about Rothbard.

        I could as easily point to the leftists who’ve worn Che shirts for decades and say that they are psychos for aggrandizing a sadistic mass murderer, but most of them don’t know anything about that and just want a picture of a pretty man for the people or whatever braindead, teen, leftist nonsense.

        runindogs

        July 23, 2014 at 11:30 PM

      • Leftists would of course give you an injured look and loudly tell you they’re at least as peaceful as any rightwinger. In contrast with the left, libertarians do not keep the numbers of murderous crazies in their little black books, which is good. It probably also ensures they won’t ever win.

        Glengarry

        July 24, 2014 at 7:40 AM

  14. Clarke showed children of very accomplished individuals do regress to the mean, but an elite mean, where their descendants stay for many generations.

    Novo

    July 22, 2014 at 3:51 PM

    • A random distribution is indistinguishable from an overlay of many smaller narrower random distributions just by looking at a snapshot in time. Naturally, smarter genes mostly breed with smarter genes, so distribution of IQ of your descendents is unlikely to be centered at IQ=100. With that being said, most likely your lineage will die out, because probability is <50% that you would have grand-grandchildren

      MyTwoCents

      July 22, 2014 at 5:46 PM

      • You kidding? 100% certainty that your lineage dies out, along with everyone else’s. . .

        anon

        July 22, 2014 at 8:10 PM

  15. Mankiw is a shill for the Republican point of view on economics, he is intellectually compromised.

    Realist

    July 22, 2014 at 6:45 PM

  16. mankiw is a professor at harvard. of course he needs to think these things. to say the opposite would be madness in his position. think of all the alumni he would offend! it’s altruism, of course.

    lion of the lionosphere

    July 22, 2014 at 10:18 PM

    • Actually, it’s pretty easy for professors to agree with Democrats and still keep their jobs. Mankiw is one of the few Republican shills on campus.

      Lion of the Blogosphere

      July 23, 2014 at 6:52 AM

  17. It’s their money. Make yer own. They’re not hurting you because it’s not a zero sum world. Envy is one of the deadly sins. Mostly gone in 3 generations anyway and then it’s schadenfreude time.

    Roland

    July 22, 2014 at 10:36 PM

  18. “Why not give welfare to graduates of MIT?”

    Why give welfare benefits to anyone? People got along fine before welfare. They got married and worked instead of having illegitimate children. There used to be a stigma against adultery, illegitimacy and divorce before the government started funding it. The problem with turning charity into an entitlement is it gives people the confidence to engage in irresponsible behavior. If you want to know how to stop people from having children they can’t support then that’s it. The problem is that the leftists have turned it into a class war of working/middle class against upper class instead of working/middle class against illegals and h1b’s. If we got reduced entitlements then working/middle class would fight immigration instead.

    “I cite Maslow because his idea about self-actualization has changed the way that the elite think about the meaning of life. “

    Looking at Maslow’s chart it’s obvious he’s a leftist. The bottom two are common sense. No big deal there. But notice as you start climbing the chart that it becomes less about real needs and more about his own values and opinions. Only he does something sneaky by mixing leftists values with things everyone supports such as problem solving and acceptance of facts. The latter no more belong in the top category than the bottom. People use those to meet their physiological and safety needs as much as they do any others. There’s no science there. He just created a chart to push his own paradigm.

    Not that I haven’t observed some of those tendencies. But my observation is that the further away from basic physiological and safety needs one gets the more likely someone’s “higher needs” are to be expressed in a flawed manner. That’s half the problem with elites — they grew up in a sheltered environment in which they could take basic physiological and safety needs for granted. Ergo their “higher needs” are disconnected from the more important “basic needs”. Rather than writing about the importance of self actualization we should be discussing how the “higher needs” become corrupted if they’re not rooted in the more important “basic needs.”

    destructure

    July 22, 2014 at 10:36 PM

    • Good post. And yes, I think most of those with these universal moralistic ideas come from the children of the elite. Even Jesus, since he was the son of a presumably well off home builder.

      CamelCaseRob

      July 23, 2014 at 10:12 AM

  19. The original New York Times articles shows 55 comments…Lion has 54 so far…

    Graf von Jung

    July 23, 2014 at 9:06 AM

  20. Personally, I find nothing repulsive about someone bequeathing his/her wealth to their children, as long as the money was not gained dishonestly. However, having the Government steal the money to redistribute to all the Losers in exchange for votes has merely created a Permanent Underclass of Professional Victims that engage in Crime and Property Destruction. The dysgenic effects of subsidizing the proclivity of Retards to engage in Promiscuous Sex without consequences (for them at least) is the Primary Reason for the Idiocracy you see today.
    However, whenever I see a Paris Hilton (the titular heir of the Hilton Hotel Empire) engaging in meaningless parties and “starring” in internet sex videos, I wonder about the wisdom of leaving large sums of money or Trusts to heirs. Certainly, without the Trust Fund, those like Paris Hilton could not engage in such low-brow and ludicrous activities as being a party girl all day, because of the necessities of earning a living, and famous people like John Wayne left little or no money to his children so that they would be forced to earn it on their own and not fall into the Trap of the Idle Rich…

    Joshua Sinistar

    July 23, 2014 at 9:45 AM

    • Paris may be boring and trashy but she earns money by the boat load, mostly thru endorsemenrs. Most estimates put her personally earned wealth to be far greatertl than her inheritance/trust fund. Fyi her family makes money from real estate and have no connection with hotels.

      Rol

      July 23, 2014 at 10:57 AM

      • And the fact that Paris Hilton makes a lot of money disproves the implied libertarian assumption that the money one earns is equal to the value created. Paris Hilton creates negative value by being a role model for bad behavior.

    • Paris Hilton would be considered a millennial and it seems many of them are pretty much bored, idle and unproductive regardless of class. Further, millennials lack a creative streak. As ironic as it seems, even with online tools that promote narcissism, their heavy internet usage would make them more innovative and creative when it comes to social trends and deviating from the established norms. Instead we see an opposite effect with a herd mentality. Occupy Wall St. gotta be the most boring movements that eventually fizzled out because millennials wanted to be like the people whom they were protesting against.

      JS

      July 24, 2014 at 3:09 PM


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