Skin in the Game
Posted by Larry Doyle on September 15, 2010 2:16 PM |
I will never forget the mental and emotional sensation of purchasing my first real asset. That holding, a co-operative apartment in Brooklyn, New York was where I began my married life and started my family. I am not writing this to reminisce about life back in the mid-’80s, but rather because those memories came back to me as I read an article in this morning’s Wall Street Journal entitled, Obstacle to Deficit Cutting: A Nation on Entitlements:
Efforts to tame America’s ballooning budget deficit could soon confront a daunting reality: Nearly half of all Americans live in a household in which someone receives government benefits, more than at any time in history.
I have zero problem with people receiving benefits. To the extent that people have earned the benefits, let’s make sure that we take care of our elderly and ill. I am happy to be the first in line to make these payments.
At the same time, the fraction of American households not paying federal income taxes has also grown—to an estimated 45% in 2010, from 39% five years ago, according to the Tax Policy Center, a nonpartisan research organization.
This factoid, though, leaves me with an entirely different feeling.
To the extent that we are all in this together — or at least I thought we were supposed to be (maybe this is a bad assumption) — how can we have close to half our citizenry not paying federal taxes? I am not saying that we should totally overhaul our tax code to address this issue, but I am saying that if people have no ‘skin in the game’ then how can we expect them to care about how our finances are managed and how our nation will progress.
In a very similar regard, when I was a renter, did I care about the overall cleanliness of my apartment? I will admit I had a typical bachelor pad and did not much mind if the place was a mess. When I was an owner, I took very good care of that property.
I have no affiliation or business interest with any entity referenced in this commentary. As President of Greenwich Investment Management, an SEC regulated privately held registered investment adviser, I am merely a proponent of real transparency within our markets so that investor confidence and investor protection can be achieved.
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