Hiltzik: Our beleaguered billionaire crybabies

Nothing spells “billionaires” in America like demanding that their efforts to exercise control of society be shrouded in secrecy.

Exhibit A, for now, is Elon Musk’s suspension of more than half a dozen journalists and commentators from Twitter, the social media platform he owns. Their crime is that they wrote about @ElonJet, a Twitter account that tracked the trajectories of its private plane using public information.

The @ElonJet account has also been suspended. Some of the suspended journalists had written about the ElonJet ban.

Self-made billionaires are a myth. Just like unicorns.

– Former Secretary of Labor Robert Reich

Musk suggested the coverage was by and about @ElonJet synonymous with “doxxing”, A practice where an individual’s home address and other personal information is published online without their permission, often subjecting victims to harassment or physical harm.

Other billionaires have flexed their privacy muscles.

Hedge fund billionaire Ken Griffin on Tuesday sued the Internal Revenue Service for what he says was “unlawful disclosure” of his tax and income records due to the agency’s “willful and willful failure to maintain adequate administrative, technical, and/or physical safeguards in its system of records.” .”

The information ended up in a series of ProPublica articles detailing the taxes of Griffin and other members of the 1%. ProPublica did not disclose how it obtained the recordings.

Do billionaires really have anything to complain about? Hardly. You and your assets are protected by a bodyguard of laws and regulations.

Your political donations can be kept confidential thanks to lax enforcement of IRS rules that grant donor secrecy only to “social” organizations, not those involved in politics. As I wrote earlier this year, the IRS practice of treating millionaires and billionaires with kid gloves has been known and documented for ages.

Where is the IRS focusing its firepower instead? About the middle class and the poor: The agency tests households with incomes under $25,000 at five times the rate for everyone else.

When the Biden administration and Congress enacted an increase in the enforcement capacity of the IRS to correct the imbalance, Republicans on Capitol Hill reacted as if the republic’s foundations were crumbling.

The fine whistle of the 1% is not particularly new, but always with a certain absurdity.

As early as 2014, venture capitalist Thomas Perkins grotesquely (and ungrammatically) railed in a letter to The Wall Street Journal about “the parallels of fascist Nazi Germany with its war against its ‘one percent’, namely its Jews, with the advancing war on America percent, namely the ‘rich’.”

Leon Cooperman, a backsliding billionaire, berated Sen. Elizabeth Warren (D-Mass.) when she proposed a billionaire tax in 2019: “That’s it [blankety-blank] She is an American dream [blankety-blanking] on,” he complained to Politico. (Want to see the quote in all its Technicolor glory? Go here.)

Cooperman, who once paid nearly $5 million to settle insider trading fees levied by the Securities and Exchange Commission, resurfaced last year to once again fight over a wealth tax.

Venture investor Vinod Khosla has been fighting to keep the public away from the public beach in front of his San Mateo property since 2008; he keeps losing, including a failed appeal to the US Supreme Court.

At the moment, a gate to Martins Beach, the stretch of sand and ocean in question, is open by government order and a lawsuit by the state to secure the public’s rights once and for all is pending in a state court.

(My colleague Steve Lopez has called Khosla “one of the most arrogant people in the history of the state,” which almost sounds like charity given Khosla’s record.)

Billionaire lawsuits can be downright counterproductive. Consider the so-called Streisand effect. This stems from a lawsuit the world-famous entertainer filed to have an aerial photo of her Malibu property removed from the internet as an invasion of privacy. (The photo was part of a project to photograph the entire California coast.)

Instead of protecting her privacy, Streisand’s lawsuit turned her into an internet sensation. It remains easily accessible online.

As an example of the Streisand Effect, the recent whining of the wealthy about privacy reminds us of the truth of the observation made by an adviser to Rep. Alexandria Ocasio-Cortez that “every billionaire is a policy failure.”

This means that the extreme concentration of wealth seen in the US today is the result of economic incentives that fuel extreme inequality by failing to recognize the economic contributions of society as a whole. Of the top 20 members of Forbes 400, the magazine’s annual list of the wealthiest Americans, at least eight obtained their fortunes through inheritance or marriage (more specifically, through divorce).

Of all the others – in fact all 400 non-legacies – not a single one has amassed his or her fortune without the help of others, including possibly legions of employees, many of whom work minimum wage. Some also built their businesses using public investment – ​​highways, airports, basic scientific research, etc. etc.

“Self-made billionaires are a myth,” former Labor Secretary Robert Reich wrote earlier this year. “Just like unicorns.”

Reich points to the legs that even proverbial rags-to-riches billionaires got from family wealth and influence. Musk, for example, got at least part of his grub stake from an emerald mine his family owned during apartheid-era South Africa.

Jeff Bezos didn’t start Amazon.com as a penniless entrepreneur, but with a quarter million dollar investment from his parents.

It’s not uncommon for billionaire fortunes to be based on their own intellectual qualities, but they couldn’t make it where they are on their own. This points to the question of how much wealth they earn to keep and leave to their heirs.

The founding fathers had an answer: almost none. The founders had a deep fear of inherited wealth. In his autobiography, Thomas Jefferson advocated “a system whereby every fiber of Antient would be eradicated [sic] or future aristocracy; and laid a foundation for a truly republican government.” His aim was to “prevent the accumulation and persistence of fortune in select families”.

Jefferson and his companions would be appalled at the concentration of wealth in America today. Presumably they would find it economically and socially sensible to tax excessive income and wealth.

Among the benefits billionaires receive because of their wealth is zealous defense from journalists and other followers. In response to that line about billionaires being “political failures,” the Economist, which is usually the soul of sound analysis, wrote that, well, not every billionaire falls into that category.

The magazine acknowledged that “America’s political system is riddled with lobbyists cheering on incumbents,” and that about a fifth of American billionaires have taken advantage of either government generosity or market failures.

Cheerleading for wealth accumulation is always with us. The latest case concerns Sam Bankman-Fried, the cryptocurrency wannabe king, who is currently cooling his heels in a Bahamian jail awaiting extradition to the US for fraud.

In his brief heyday, Bankman-Fried was a believer and promoter of the concept of “effective altruism,” which held that when the purpose of life is to do good, the moral imperative is to make as much money as possible give it away.

Among the many problems with this notion is that billionaires tend to donate their money to causes that benefit them personally, rather than the public good. They find personal vanities like trillions of dollars in space travel and fight to the last drop of blood against efforts to increase their employees’ incomes, such as through unionization. Effective altruism provides a ready pseudo-intellectual justification for such self-dealing: the more resources billionaires hoard, the more good they can do.

To the extent that their accumulated wealth deprives the public of resources through low tax rates and ineffective tax enforcement, they deprive the public of the rational use of those resources where they are most needed. Think of the tax breaks lavished on donors to elite private universities—how much more money does Harvard need compared to, say, the University of California?

Billionaires want everything their own way. Influencing public affairs without accountability. advertising Spirit Privacy. They want respect, but don’t always feel the need to earn it.

If they are to influence society to a degree commensurate with their wealth, they must subject their private lives and private business practices to greater public scrutiny.

It comes with the territory. Please, can you stop complaining?

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