Minto advocates 100% tax rate
September 1st, 2009 at 1:00 pm by David FarrarI was never sure of John Minto is a communist or just a socialist (in terms of economic philosophy). He answers that today with his blog advocating a salary cap and 100% tax rate on top of that:
My pick would be to set the maximum income at 10 times the minimum wage. This would mean a maximum income of $250,000. The easiest way to enforce this would be setting a 100 per cent income tax rate for the combined income from all sources (including share allocations, allowances etc) above this level.
This system of salary caps is not a new concept. Most communist countries have or had such salary caps. Most have abandoned such practices, as they have learnt what happens when you do. I think North Korea and maybe Cuba still have such salary caps though.
Note Minto’s proposal is not just for salaries. He proposes 100% tax on income over $250,000 from all sources.Can’t see a lot of people setting up their own companies or businesses in future.
What will be most amusing is to see how much the tax take drops. It wouldn’t just be people earning over $250,000 who would be leaving. Minto doesn’t understand what aspiration is.
Tags: communism, John Minto
September 1st, 2009 at 1:03 pm
The ten-times limit isn’t new. George Orwell proposed it in The Lion and the Unicorn. (Full text.)
Vote:September 1st, 2009 at 1:07 pm
Why do we give this tiresome, morally condescending school teacher the time of day?
Vote:September 1st, 2009 at 1:12 pm
John Minto is like those guys over at the standard, you find yourself thinking this must be satire, surely nobody is that stupid?
Vote:September 1st, 2009 at 1:18 pm
The more I see the imbecile Minto, the more I love my dog.
Vote:September 1st, 2009 at 1:20 pm
Come on guys, leave Minto alone. He’s clearly the victim of be being batton too many times.
Vote:September 1st, 2009 at 1:21 pm
I don’t see why extremist idiots like Minto get column inches. He is nuts!
Vote:September 1st, 2009 at 1:24 pm
Another candidate for dimmocrazy’s tar and feather protocol!
Vote:September 1st, 2009 at 1:24 pm
I don’t see why extremist idiots like Minto get column inches. He is nuts!
Well his comments section is buzzing, maybe the advertisers like it
Vote:September 1st, 2009 at 1:25 pm
I didnt think anyone could give jeanette a run for her crazy money, i was wrong, Minto wins
lets see if any idiots like phule turn up to defend him
first to reference WhaleOil past this point fails
Vote:September 1st, 2009 at 1:28 pm
Sheesh.
Between Minto, Fitzsimons, and There is nothing unique about the persecution of Jews., Kiwiblog is mining a rich vein of comedy gold today.
Vote:September 1st, 2009 at 1:30 pm
I had thought that if Labour had won another term at the last election I would leave this country, such was the level of my aggravation and mental dismay at living in a socialist paradise. I can’t tell you how psychologically freeing for me it was when National won the election. I thought that finally we would be free of mindless drones spouting ideological rubbish like Minto, Bradford, Mallard etc and they would disappear in a puff of smoke (Sue that’s undoubtedly a death threat too, quick run to the police!!!). But I was so so wrong and here we have that idiot Minto popping up like a recurring wart bollocking on again. Mr Minto- its just lucky for you that there is innovation in this world and that salaries aren’t capped otherwise your ability to access computer systems and blogs would be non-existent and you’d be reduced to spewing your crap using smoke signals, you IDIOT.
Vote:September 1st, 2009 at 1:31 pm
Orwell is a strange one; on the one hand he wrote the most popular indictment of Communism in the 20th century but on the other he is in favour of centralised government. Didnt he realise that the failings of one are the same as the other?
Its a shame Hayek didnt write his book with funny farm animals. Its also a shame that people think that because they read Orwell they arent communists.
Vote:September 1st, 2009 at 1:39 pm
Holy Crap Batman!
You see how the internet offers people limitless opportunities to marginalize themselves. Something we all (DPF included) could learn from.
OTOH – good to see Kiwiblog back to tempo primo…. Why destroy someone’s argument rationally, point by point, when you can just jeer eh?
[DPF: You think there needs to be a point by point rebuttal of why the top tax rate should not be 100%? Sure. And then lets debate point by point why rape is a bad thing]
Vote:September 1st, 2009 at 1:40 pm
What a minto moment. Next he’ll be advocating against anyone running 100m in less than 11 seconds.
Vote:September 1st, 2009 at 1:43 pm
The sad part is that this and previous Goverments keep giving Minto young minds to poison if he is indeed a schoolteacher. The man is a raving nutbar.
Vote:September 1st, 2009 at 1:44 pm
If your world view believes that people with higher income usually get it through luck, then it logically follows that people who have too much income should have it taken and redistributed – as it isn’t fair that some people are so lucky.
If your world view is that people with higher income usually get it through hard work, then you would see that redistribution as counter productive – as people will just work less hard, and therefore that income will evaporate, will never exist.
I’ve noticed that those with wealth who got it through means that I would see as heavily luck driven (sports stars, movie stars, models and others born with talent) seem to be more left leaning, and more believing in redistribution. Those who worked damn hard to get where they are (self employed, some salaried people, professionals) tend to be more right leaning. If you dig in more detail, there are a bunch of middle income professionals who do appear to have been lucky rather than hard working – lucky in birth, lucky in opportunities, and they tend to be hand wringing chardonnay socialists. And there are those who work their arses off to be where they are, and they tend to be more right leaning.
I’m guessing Minto sees income as very much luck of the draw.
Vote:September 1st, 2009 at 1:44 pm
RRM, you can only destroy rational arguments in a rational manner. Some are so ludicrous that summary dismissal is all they are worth.
Vote:September 1st, 2009 at 1:45 pm
Minto’s proposal would put an end to the NZ film industry. For sure, Peter Jackson is earning more than $250k and, since he hasn’t capped his income voluntarily, thinks he is worth more than that. And Hollywood types are hardly likely to come to NZ to make a film if their salary for the film, often several times the Telecom guy’s annual salary, is going to be confiscated.
Vote:September 1st, 2009 at 1:48 pm
I understand that in France no CEO can earn more than a statutorialy prescribed multiple of the salary of the lowest paid worker in the Company. An interesting concept. Given the arbitrary nature of executive salaries here (set by compliant advisors and Boards, seemingly outside shareholder sanction) it may be something we could adopt.
Vote:Minto fancies himself as a new age Bill Anderson (Socialist Unity party), always looking for a headline; but Anderson had style, and loved being hated
September 1st, 2009 at 1:49 pm
[DPF: You think there needs to be a point by point rebuttal of why the top tax rate should not be 100%? Sure. And then lets debate point by point why rape is a bad thing]
Out of my nearly limitless capacity for charity, I will assume that you are merely telling me to F off because you will not derive your objection to Minto from first principles, not that you cannot do this
Vote:September 1st, 2009 at 1:50 pm
Was John Minto, Tara te Heke?
Vote:September 1st, 2009 at 1:52 pm
RRM:
Holy Crap Batman! – I know of no religion where crap is considered holy, but then I don’t mix in the same circles as you. Batman may well be the leader of such a religion, if you are referring to the Mike Williams incarnation of Batman.
You see how the internet offers people limitless opportunities to marginalize themselves. – yes, you and philu are great examples.
Something we all (DPF included) could learn from. – what exactly is the take-away message here? Having NZ’s most popular political blog with the widest freedom of speech in the comments section is I guess in the margin, but on the other side of the page from where the envious left would like it to be.
OTOH – good to see Kiwiblog back to tempo primo…. – agreed, pointing out how irrational the loony left are is the best thing about Kiwiblog.
Why destroy someone’s argument rationally, point by point, when you can just jeer eh? – it’s your lucky day, on Kiwiblog you get both. It’s quite refreshing after reading some of the left blogs where they label parents who voted no in the recent CIR as baby-beating sadists.
Vote:September 1st, 2009 at 1:54 pm
Kimble
I agree that Minto beats the arsonist in the “mad” race but how do you reckon he would get on if you put him up against Delahunty?
Vote:September 1st, 2009 at 2:00 pm
Its a push BB.
Vote:September 1st, 2009 at 2:01 pm
Rightnow:
(1) “Having NZ’s most popular political blog with the widest freedom of speech in the comments section is I guess in the margin…”
Compare and contrast political blog discussions to anything you have ever heard on the street. Seriously. Observe thus the considerable gulf between even the most popular blog and what normal people think/care about all of it!
(2)
“some of the left blogs where they label parents who voted no in the recent CIR as baby-beating sadists.”
Citation needed.
(3)
Vote:http://lmgtfy.com/?q=robin+holy+batman!
September 1st, 2009 at 2:01 pm
Minto is a prisioner of socialist dogma at its best/worst. Ok, so he looks at himself and sez no way can I ever aspire to $250k so why in hells name should anyone else.
Actually I would have more respect for his position were he, as a secondary school teacher receiving (I suspect) in the band $63,392-$68.980, to advocate a 100% tax rate to apply to anything over say $50,000.
No way he said. That means ME.
Vote:September 1st, 2009 at 2:13 pm
Hot on the heels of his discovery of the unintended consequences of the end of Apartheid, (not that I am for one minute suggesting that white minority rule should have continued in South Africa, by the way), John Minto shows that he has learned exactly NOTHING!
Vote:September 1st, 2009 at 2:13 pm
Is Minto’s entire life one big lie?
Remember how Whale exposed Minto as a property speculator http://whaleoil.gotcha.co.nz/page/2/?s=john+minto&x=0&y=0
Remember how he pretended to be an anti apartheid demonstrator when in fact he was protesting against capitalism?, earlier this year Minto told us that he now feels his 1981 protests were in vain as the old apartheid government was not replaced by a communist one.
Vote:September 1st, 2009 at 2:15 pm
RRM;
(1) To be honest I have no problem differentiating between blogs and ‘what you hear on the street’.Blogs provide outlets for people without them having to ruin friendships. It may well be that some of the people I disagree most with on blogs are among my best friends. I consciously avoid the possibility of finding out, I rather like my friends.
(2)
“some of the left blogs where they label parents who voted no in the recent CIR as baby-beating sadists.”
Citation needed.
Nope, go and find it yourself, I get nauseous at the stranded, I’m not going back.
I notice you spend a bit of time on Kiwiblog so I guess you don’t find it that unpleasant.
(3)
http://lmgtfy.com/?q=robin+holy+batman!
Thanks, that’s a handy link to pass on. I am sure Robin never said Holy Crap Batman! And I watched a lot of episodes when I was a boy.
Vote:September 1st, 2009 at 2:20 pm
Ross Miller: to follow through on your argument – why should we draw the line at NZ’s boundary. 250K makes sense as a limit in the context of NZ, but in the context of overall worldwide income:
1. 250K isn’t actually all that high in an American context (what – 160K US?)
2. 50K to a person living in Africa is probably like 250K is to Minto. So probably the limit should be 50K or lower, and we should transfer all our money to the poor starving millions in Africa.
Funny how, as you say, these arguments (which are just as logical as his current argument) are suddenly not interesting when he is above the threshold.
Vote:September 1st, 2009 at 2:27 pm
This is a joke.
I actually find Minto’s suggestion so far off this planet as to be hilarious.
Why do communists like him think they have any fucking right to interfere in a private company?
If you’ve got some kind of problem with private sector companies, the solution is simple- dont use their products.
I always wonder why such odious socialists want to meddle and interfere in successful private enterprises so much- I’m beginning to think its related to some kind of self esteem or personal inadequacy issues- there is literally no-one I know on the left political spectrum in NZ who has made it in the private sector successfully- perhaps the left just want to shut donw the most successful out of sheer spite and jealousy?
Vote:September 1st, 2009 at 2:30 pm
tom hunder said: Kiwiblog is mining a rich vein of comedy gold today.
Nope. Just a stinking pile of fithy lignite, actually.
Not that I actually agree with Minto on this one, I might add before someone presumes I do.
Vote:September 1st, 2009 at 2:38 pm
[DPF: You think there needs to be a point by point rebuttal of why the top tax rate should not be 100%? Sure. And then lets debate point by point why rape is a bad thing]
Compare and contrast with this previously highlighted comment on mining in National Parks:
“That’s like saying you’ve got six children, so it doesn’t really matter if you lose one does it.”
Or, you might say “a calm and rational analogy from DPF” … but “a ridiculously over the top statement from the Greens”. Or is it the other way round? So hard to tell …
[DPF: I don't think anyone needs convincing on the problems of 100% tax rate. Let me know if this is not the case. My analogy would be over the top if I had been asked the merits of a 50% tax rate (for example).
Jeanette was asked about what the problem was with mining a tiny fraction of the conservation estate and she compared it to losing a child. ]
Vote:September 1st, 2009 at 2:50 pm
If I said that taxes should be capped at 10x the minimum wage (eg: income over $250,000 is tax free because you have already paid plenty of tax by then) I would be called a nutta by the same people who back Minto. People like Minto, and the twats who support him, are about as useful as an ashtray on a motorbike.
Vote:September 1st, 2009 at 3:10 pm
Out of curiosity I plugged in $5 mil into the IRD tax calculator to see what the potential tax take would be. The system pumped out a figure of $1,940,540 as being the tax payable which is pretty impressive.
Vote:Even if Mr Reynolds has massaged his income to minimise the tax he pays he will still be paying annually in tax more than Mr Minto will pay in a lifetime.
September 1st, 2009 at 3:16 pm
Exactly Alex, incredible that socialists still don’t realise this, it is people like Reynolds who are funding all the social engineering, welfare state etc etc.
Vote:1.9 mil is over 100 people’s unemployment benefits, wonder if Minto realises that
September 1st, 2009 at 3:20 pm
Actually Burt there are sound economic reasons for such a proposal and it was in fact previously mooted (I think by the McLeod comittee). Essentially if you have a cap on what people pay there are incentives for those earning REALLY high incomes to stay/come and live here.
Of course if wealthy people come and live in your country (or stay) it results in “more inequality” and that’s bad. Far better to tax them to leave and have more equality even if those of you who remain have to live in grass huts.
I’m in China right now and I can tell you I havent met anyone who wouldnt think this was an incredibly stupid idea, and a fair number of those folk are card carrying Communist Party members.
Vote:September 1st, 2009 at 3:21 pm
@ nickb “, wonder if Minto realises that” – you need to understand he doesnt care about that, it isnt part of the objective.
Vote:September 1st, 2009 at 3:30 pm
nickb
Socialists will never work it out. The same people who think highly progressive tax systems are good complain when thresholds are adjusted and the benefits go to the big tax payers. Imagine under Minto’s idea if we lifted the minimum wage to $30K he would be moaning that people earning between $250K and $300K just got a massive tax cut…
Clearly not the sharpest tools in the shed or they would notice that what they think is bad is a natural consequence of what they think is good. Muppets is possibly the best description for them.
Vote:September 1st, 2009 at 3:32 pm
True, true: but the reason your fithy lignite stinks is because it burns only in fits and starts, whereas truly filthy lignite can warm an entire planet.
Ah well, as some left-wing intellectual said the other day in his calm and rational, point-by-point rebuttal of the challenges to the smacking law:
Vote:September 1st, 2009 at 3:33 pm
I would go the other way and put a CAP in income tax. Pay $250,000 in income tax and you do not have to pay any more tax nor even file a return. Make yourself tax resident in NZ pay the $250,000 file some form stating this is the payment for income tax, that is it. Might need some other tightening, I am sure it could be abused somehow. This would only be available for individuals and ONE per person. A similar scheme to put a cap for listed companies could also be put in place etc etc.
Vote:September 1st, 2009 at 3:34 pm
Nickb
Vote:The other point that Minto misses is that the top 10% of income earners pay 70-80% of the personal income tax paid in this country.
It would be a bugger if the top 10% took off to pastures green.
Gawd Minto is a sad unhappy man. He wanders around Sandringham with a face longer than a Lurgan drum! Fair spoils your day to see him.
September 1st, 2009 at 3:38 pm
Thank goodness there are sane people in this country who aren’t going to give a moment’s attention to the likes of what Minto propounds. What a wanker. Perhaps he should find a communist country to go and live in (if they would let him).
Vote:September 1st, 2009 at 3:46 pm
“Most communist countries have or had such salary caps.”
I’m sorry, but where are these classless stateless societies of which you speak? Surely you have not gone and made the mistake of confusing a Socialist State with communism. It strikes me as quite odd that someone who is so learned in politics (and in many areas more so than myself) would make such a mistake. As you should be aware Karl Marx was a nineteenth century evolutionist who believed all societies were following the same path of social evolution. Although he was one of them who held that there was a final stage of evolution. That it was in this final stage that there would no longer be a State or any classes, this stage is known as communism.
I will clarify here, that I do not believe his theory to be correct. However if one is going to talk about communism, it helps when you actually talk about it and not the Socialist State which is one of the stages in Marx’s evolutionary path to communism.
Vote:September 1st, 2009 at 4:00 pm
Minto walks past my work place in Sandringham regularly from his comfortable bourgeois villa down the road.
Vote:His tortured demenour and bearing are burdened by years of hatred for the “system.” I kind of feel sorry for these sad comrades. They are going to go to their grave filled with unrequited revolutionary yearnings. Still, my sympathy is quelled by the thought that if they got into power there would be many thousands perish in their reeducation camps.
September 1st, 2009 at 4:19 pm
Reddeath you are confused, because you do not understand true communism. Marx did indeed note that socialist states would evolve into communism and so has been the case proven in Cuba and N. Korea. What we see today in those countries today is true communism* as it has peaceably evolved from socialist statehood.
* both are marvellous examples of despotic dynastic communism.
Vote:September 1st, 2009 at 5:00 pm
This is a breathtakingly naive idea from John Minto. It’s not as if this hasn’t been tried. It has, and abandoned, in part because it creates more problems than it solves and in part because, as you point out David, it lowers the tax take and damages economic growth.
I do think “communist” is a bit strong a term for the idea – Communism is, afterall, the abolishment of private property and Minto isn’t advocating that here.
Vote:September 1st, 2009 at 5:13 pm
The massive irony for people like John Minto is that he shares his ideas by typing into a Dell connected to the internet via a telco sipping on his fair trade coffee heated in his Zip jug, powered by virtually pollution-free electricity in a modern, self-contained home that he owns wearing his “I love Castro” printed t-shirt.
He writes his ideas that most people disagree with and he is free to.
Every single one of these things – both the materials and the political and economic freedom to own those things and to say what he wants on almost anything – are unique to Western capitalism.
So it is, to say the least, ironic that he would take the incredibly high standard of living, by historic standards, that he and most of us are so fortunate to enjoy and then rail against the very thing that produced it.
Vote:September 1st, 2009 at 5:18 pm
Minto’s Marxism raises the question of whether the Soviets or Mao’s blue ants helped stir activism in the the Springbok tour protests back before Dan Carter was a blip on his father’s radar screen. The Reds were active in Angola and in helping Mugabe’s mob in old Rhodesia.
NZ wouldn’t tolerate an active Fascist teaching in its schools and propagandising through newspaper columns. Why should the Far Left be treated differently from the Far Right? More of the colonial guilt bullshit?
Ben (at 5.0): I don’t think you can deny that Minto argues the Marxist position in his column. That doesn’t mean he was a communist agent amid more liberal protesters, but there were a lot of extreme lefties involved in those protests, as there were in the CND anti-nuclear protesters.
It was an old Agitprop technique to infiltrate more moderate groups and goad them into more vigorous protest.
I don’t think the Soviet Union communists totally abolished private property. It gave the monopoly on pencil production to an American millionaire, probably a fellow traveller, for example.
Vote:September 1st, 2009 at 6:09 pm
I think David’s analogy that Minto’s proposal is like rape is a pretty amusing instance of someone taking the bait. I don’t agree with Minto’s proposal, but it does provoke a thought experiment: is Paul Reynolds’ worth really that of 159 linesmen. I’ll perhaps agree that some people DO deserve a Salary like Reynolds, but there has developed a culture whereby top executives can receive extraordinary remuneration and aren’t held properly accountable (cf. Reynolds). Some people are so eager to defend market capitalism (and I AM eager to defend market capitalism) that they will swallow the justification for these execs hook line and sinker.
What I think is more fucked up than John Minto proposing a maximum wage of 10 x the minimum wage (which as ‘communists’ go, is pretty moderate, and is far more reasonable than a lot of the tripe he says) is someone like Stephen Schwartzman getting $1Bil. Some execs earning mega bucks ARE brilliant and deserve it but no one person is that economically valuable!
Vote:September 1st, 2009 at 6:28 pm
“I don’t think the Soviet Union communists totally abolished private property. It gave the monopoly on pencil production to an American millionaire, probably a fellow traveller, for example.”
You got a citation to back that up?
Vote:September 1st, 2009 at 6:30 pm
“is Paul Reynolds’ worth really that of 159 linesmen”
Markets decide prices not worth. There is a reason linesmen/factory workers whatever command lower incomes
“Some execs earning mega bucks ARE brilliant and deserve it but no one person is that economically valuable!”
Says who? Or are you just proposing an alternative “cap” to Minto. They are both daft ideas.
Vote:September 1st, 2009 at 6:32 pm
It comes down to people’s idea of “deserving”. Asking whether or not John’s labour is worth 159 times as much as Peter’s is meaningless to someone who believes that labour’s value is whatever people will pay for it. Frankly, I think high-paying jobs are the least of the socialist’s concern. It’s the people who are paid far more for not working (but rather for owning) that Minto should be concerned about.
Vote:September 1st, 2009 at 6:46 pm
I’d rather everyone earned $250k, than we punished those who attained that level of income. Still, I guess I’m positive, ambitious and ‘right’, rather than negative, envious and ‘left’.
Vote:September 1st, 2009 at 6:48 pm
@unaha-closp-
Vote:I get the distinct feeling that it is you who does not understand Historical Materialism. When the State was no longer needed and had withered away, then we would be in communism.
September 1st, 2009 at 6:51 pm
Token anarchist criticism of that idea: authority doesn’t voluntarily wither away.
Vote:September 1st, 2009 at 7:02 pm
@KiwiGreg. I’m aware that prices are paid in transactions in an open market: I think in many cases people (and incidentally I think that those missing out in the Reynolds case are shareholders, not linesmen) allow themselves to be duped into thinking the performance-inelastic pay rates of top execs must be justified because ‘the market says so’. The dissent of shareholders can be a market force, people just need to realise whats going on! I’m not proposing any cap, not only because I’m realistic but because I disagree with it too. All I agree with Minto is that it’s fucked up how much some people earn relative to others, and that’s where it stops. What is really the problem is that shareholders are duped by some management myth and don’t protest against this obscenity. Occasionally people justify these sorts of salaries: it’s up to shareholders not be such avaricious groupies who maybe think that if the execs are getting such good cash they must be doing a great job (and maybe they will get in on the action). They only explanation I can come up with is that perhaps it is like Lotto: people see the big figures in the lights and want a piece of the action, continually get duped and continually come back for more. If Minto’s proposal were effected then the country would turn into a despotic socialist oligarchy I agree, yadah yadah yadah. I bet people like Reynolds love people like Minto, because Minto’s ridiculousness encourages people like you to be groupies for people like Reynolds, entrenching their undeserved economic hegemony.
Vote:September 1st, 2009 at 7:03 pm
They just gave him a couple minutes on 3 News. Funnily enough in the middle of the business section.
He claimed there was nothing special required to run Telecom and anyone who was organised and had good people skills could do just a good a job as Reynolds. How about understanding of technology, strategy and finance?
Also stated research had been done that the happiest countries in the world have the smallest income gaps but he didn’t name any. I bet it would be one of those socialist utopias like Cuba where half the population lives in the US, another quarter is swimming to the US and the last quarter is living in buildings that are collapsing because the Govt is bankrupt.
Vote:September 1st, 2009 at 7:04 pm
Problem is Hayek Minto represents dumb arse union members who apart from having limited intelligence and skills are also lazy as fuck
Vote:September 1st, 2009 at 7:16 pm
@Southern. Couldn’t be bothered reading Minto’s whole argument, but it didn’t seem that extremist. And ‘dumb arse union members’ is indicative of a perception problem in equating unionism with communism: Unions brought down Communism in Poland, going a large way towards cutting off Soviet influence in Germany and were one of the major factors bringing down communism in Eastern Europe as a whole.
Vote:September 1st, 2009 at 7:25 pm
Hayek, that is a pretty good example of the baptists and bootleggers paradox, no?
Vote:September 1st, 2009 at 7:28 pm
And I thought it was Pope John Paul 2.
Vote:September 1st, 2009 at 7:35 pm
@Southern Raider. Pope John Paul II and Solidarnosc (Solidarity). @Kimble The leader (Lech Walesa) went on to become president, and his political legacy is probably right of center.
It doesn’t pay to generalise…
Vote:September 1st, 2009 at 7:57 pm
It’s is said, be careful what you wish for. Minto is like a little kid at the zoo giving the gorilla shit, safe in the knowledge the gorilla can not escape the cage. Just for one moment I wish the door was left unlocked, this clown would be the first to fill his pants and scream out for mummy. As a taxpayer I would be happy to shout Minto a trip to N Korea for a year, just so he can see what life is like in the cage.
Vote:September 1st, 2009 at 9:17 pm
This is obviously in response to the recent article on the ratio of income between CEOs and the average worker in their company.
I agree this is a problem in that: why pay millions to someone who tanks the share price?
Yet it happens, a lot, doesn’t it.
It also happens that CEOs who are often rewarded solely on short-term said share price, make flawed strategic decisions. And why not? They’re incentivised to do so.
Now obviously Minto got hit once too often with a Red Squad baton, but the point he protests, is a valid one.
Vote:September 1st, 2009 at 9:24 pm
Karl Marx was a nineteenth century evolutionist who believed all societies were following the same path of social evolution. Although he was one of them who held that there was a final stage of evolution. That it was in this final stage that there would no longer be a State or any classes, this stage is known as communism.
Ahahahaahah.
Determinism fail.
Vote:September 1st, 2009 at 9:46 pm
Reid while I agree with your sentiment I struggle to believe Minto is interested in (let alone understands) shareholder value or CEO performance.
It is purely a state of envy and a drive towards the peoples revolutionary republic
Vote:September 1st, 2009 at 10:01 pm
“It is purely a state of envy and a drive towards the peoples revolutionary republic”
@Southern.
What Minto is advocating in this case is hardly a peoples’ revolutionary republic: reid seems to be saying that different individuals who don’t share much in common usually can raise points which the other person can take something from. It seems kiwiblog is no place for nuance?
Vote:September 1st, 2009 at 10:08 pm
Kiwiblog: No Place for Nuance.
Vote:September 1st, 2009 at 10:32 pm
Minto is wecome to his ideas, but they do betray a strikingly narrow vision of life.
I understand he is a senior science/maths teacher in an Auckland secondary school. As such, he is probably earning around $70k, a bit more if he is a HOD. The principal of his school will be on $120-140k.
Therefore, in Minto-land, no one is allowed to earn more than three times what he does, or more than double what his boss earns.
I don’t know where he teaches, but will use Tangaroa in South Auckland as an example. According to ERO, it has 1100 pupils, 75 teachers and 25 support staff.
So the principal has to manage a staff of 100, and in return earns 50% of the maximum allowable wage. Given that there are a fair few organisations with not just double this number of employees, but ten or twenty times the number, it is a bit hard to see how he arrived at this salary cap.
I really get the impression that he can’t imagine any task more challenging than running a school, and has designed a salary cap accordingly. Which further illustrates something that is already painfully obvious – he needs to get out more.
Vote:September 1st, 2009 at 10:54 pm
“So where should the appropriate maximum income be set? Paul Reynolds’s obscene $5 million income is close to 200 times the minimum wage. My pick would be to set the maximum income at 10 times the minimum wage. This would mean a maximum income of $250,000.”
@bobux
It seems that while Minto is firm on the idea of a Salary cap, he only posits $250k as a suggestion rather than a firm demand. As stated before, I think this foolish mispricing of executive remuneration levels should and can only be achieved by shareholder wising up and bringing them back down to earth.
It is hardly indefensible as a thought experiment, which I think is the main thrust. He harps on with the usual socialist themes about ‘worker created value’ but the main thrust of his argument is a.) that execs seem recession proof their incomes b.) that the way they are remunerated is excessive and moreover doesn’t necessarily reflect their contribution to a company’s long term prospects. These are valid points despite my disagreement with his solution.
Vote:September 1st, 2009 at 11:14 pm
@Ryan Sproull and Hurf Durf
Vote:I will once again clarify, that I believe the theory of Historical Materialism is incorrect. I have simply been pointing out that communism has never been reached in any society. I would also agree with Ryan on the notion that a Socialist State such as North Korea is most unlikely to simply give up power to make it to the stage of communism. I would even go as far to say that communism is beyond the realms of reality and little more than an Utopia which has been abused by those who wish to seek power for themselves.
September 2nd, 2009 at 12:10 am
I just wonder, if Minto is a teacher, how well his pupils do in the real world?
How would you like it if you or your kids had him?
He has no place, in that environment, unless he shuts up in the classroom and does his job, professionaly.
Given his peculiar views, it is right to ask, does he?
Vote:September 2nd, 2009 at 12:47 am
“Also stated research had been done that the happiest countries in the world have the smallest income gaps but he didn’t name any. I bet it would be one of those socialist utopias like Cuba where half the population lives in the US, another quarter is swimming to the US and the last quarter is living in buildings that are collapsing because the Govt is bankrupt.”
The smallest income gaps (if you even care for that pointless leftist drivel) are in the most socialist countries….a tiny elite and their cronies live it up while the vast majority suffer on far less.Its in the capitalist West that the gap is smallest.Thats because the West has something the Socialists don’t….a middle class.
Our so called ‘poor’ here in NZ nearly all have cars,TV’s,washing machines, running piped water,heating,plentiful food,a roof over their heads and a bank account etc etc….they are actually in the top 8% of the worlds wealthiest people.
Minto is a fool and a joke….traet him as such.
Vote:September 2nd, 2009 at 1:04 pm
Wasn’t Historical Materialism the theory to explain progression thru tribalism, monarchy,…, capitalism of Marx’s time, then on to socialist statehood and then communism? So accordingly whatever follows the socialist state (presuming it does not regress to capitalism like the Chinese or the Russians) is communism. N. Korea and Cuba have not regressed, but rather have plowed on into becoming fully communist.
Communism is not a utopia it is the functional outcome desired by those wishing to progress us to first a socialist state, then eventually a N.Korean and Cuban style existance. John Minto is one person who desires us to do so.
Vote:September 2nd, 2009 at 3:22 pm
“Wasn’t Historical Materialism the theory to explain progression thru tribalism, monarchy,…, capitalism of Marx’s time, then on to socialist statehood and then communism? So accordingly whatever follows the socialist state (presuming it does not regress to capitalism like the Chinese or the Russians) is communism. N. Korea and Cuba have not regressed, but rather have plowed on into becoming fully communist.”
Vote:Communism was believed to be the peak of social evolution the final destination for all peoples, where we lived in a classless, stateless society. Both N. Korea and Cuba as can be observed by most people have maintained their State so are not communist yet.
September 2nd, 2009 at 7:47 pm
Its interesting that no one challenges the proposition that CEO’s salaries, as a multiple of average wage, has skyrocketed. The trouble with having recourse to the market as a complete justification for the high level of CEO’s salaries is that the basic premise of Minto’s criticism is that the market isn’t doing the job that it should.
One of the most appealling off the cuff arguments for a progressive tax system can be found in rational economics, in the theory of diminshing marginal utility – the first pizza you eat is more satisfying than the second, and so on. Presumably dollars are the same – the first dollar you earn brings more satisfaction than the next and so on. On that basis it is better to take more money in taxation off higher earners than increasing the amount taken off lower earners at a lower tax rate.
DPF writes that the tax take would tank under Minto’s proposal. I suppose that he is right but it is worth reminding right wingers that at some levels an increased rate of taxation increases the tax take.
Free market and unbridled capitalism supporters have to acknowledge that the natural tendency of money is to accummulate into fewer and fewer hands (and no, inheritances on death don’t really counter this effect significantly) which leads to a disparity of power which is, ironically, the very antithesis of the underlying starting position of theoretical free market and perfect competition.
So it is a balancing act. Perhaps the question that should be asked is, “Is there any level of wage / salary remuneration which is so high as to be considered obscene and therefore socially unacceptable?” Now I don’t say income because I suspect that quite a few commentators on this site believe that property is an absolute right that trumps any societal interest and that therefore no level of return on asset ownership is unacceptable.
Paul L had an interesting comment early on. I have always got the impression that the people who have had to rely more on hard work and less on luck are more of a socialist bent because they see the great masses of middle income professionals who do appear to have been lucky rather than hard working – lucky in birth, lucky in opportunities, and they see that meritocracy is a lot further away than we like to admit.
Vote:September 2nd, 2009 at 10:17 pm
So say the marxists, not everybody’s a marxist.
Other people believed that progression from capitalism to a socialist state would lead in turn to a “shithole of rampant oppression where no freedom exists”. However “shithole of rampant oppression where no freedom exists” is an overly cumbersome term that (though very descriptive) lacks the bite of a single word name. So when the marxists arrived and shouted loudly that “Socialist statehood will mature to become Communism!” everybody adopted communism as the term for the resultant society.
Vote:September 2nd, 2009 at 11:22 pm
John Minto’s cry from his villa for a revitalisation of the class struggle with confiscatory income taxes on the modern New Zealand equivalent of the Kulaks reminds of the radical economist Joan Robinson’s book Essay on Marxian Economics first published in 1942.
She noted that when the communist manifesto was published, its battle cry ‘Rise up ye workers for you have nothing to lose but your chains’ would have had some currency in 1848. Alas 90 years later, Robinson suggested that this battle cry would have to be amended to ‘Rise up ye workers for you have nothing to lose but your suburban home and your motor car.’ The forces of history can be cruel. Not surprisingly, communist revolutions bypassed the industrialised nations of the West, where they were predicted to happen exclusively, occurring instead in feudal agricultural economies.
Minto reminds of what Orwell identified in his proposed preface of ‘Animal Farm’ as the renegade liberal. Renegade liberals glorify communist experiments and disdain middle-class life despite their own pleasant bourgeois circumstances.
Renegade liberals search for outlaws states and revolutionary movements to support, who, of course, would ship these renegade liberals straight to the camps as soon as they won power. These revolutionary excesses of the new regime would be excused as the misadventures of ‘liberals in a hurry’ who understandably lost patience with the slow pace of democratic reform.
How is the immiserisation of the proletariat going these days? This is the central prediction of Marxism, the driver of class conflict, and this growing misery is what will finally push workers to revolt in revolution. It is a bit hard to argue that workers are poorer today than in 1848. The central Marxist prediction is falsified by history.
To avoid the inconvenient truth of modern affluence, renegade liberals search endlessly for under-developed countries so they can blame their poverty on capitalism. When they visit them in solidarity, they should read the visa stamp: People’s Republic or socialist republic is so frequently on it. Nearly all of Asia (where much of the world’s population lives) has undergone rapid and sustained economic and social progress because they became market economies, starting from East Asia and recently in previously socialist India and China. Latin America and Africa adopted the very inward economic polices that Minto has recently praised and they became development disasters.
Socialism treats people who are not Party members as sources of money. Individuals have rights. Resources have moral histories. In 1945, Stalin made a victory toast to his henchmen – he proposed that the banquet toast ‘the cogs in the machine’. It was his reference for the Russian people. Individuals, talented or otherwise, are not cogs in the machine.
Vote:September 3rd, 2009 at 10:56 pm
Minto to anyone with ambition: “We don’t like you, we dont want you. Why don’t you go and live somewhere else?”
And still the myopic morans wonder why NZ has the highest diaspora rate in the world.
Vote: