McArdle v Piketty

Good idea:

As I’ve been reading, though, I keep returning to a question I heard at an economics conference a couple of months back: If we did implement a wealth tax, should it tax tenure?

Professorial tenure is, after all, a valuable asset. As long as you show up and teach your classes, and you don’t make passes at your students or steal from the department’s petty cash drawer, you can draw a paycheck for the rest of your working life. And since the abolition of mandatory retirement ages, that working life can be as long as you like.

Ah, you will say, there are risks: Your school could go out of business, or you might get ill and be unable to work, or inflation could eat away at the value of that paycheck. Just so. All assets are risky. That doesn’t make them worthless; it just means that the price has to take the potential downsides into account.

Why single out professors? you ask. Isn’t this just more academic-bashing? You’re quite right: We shouldn’t single out professors. Everyone with civil-service protections or similar employment guarantees should probably have that asset taxed.

Luckily I don’t have tenure. Before you all get excited, your favorite (Australian) social-democrat economist that you all love to hate doesn’t have tenure either.

(HT: Token)

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10 Responses to McArdle v Piketty

  1. Alfonso

    “a wealth tax.”
    Some statist possum has too much free time on his hands.
    WT won’t work unless a capital flight tax gets introduced with no notice.

  2. Tel

    If we did implement a wealth tax, should it tax tenure?

    Only if it trades on the open market… which perhaps it should.

  3. Craig Mc

    Before you all get excited, your favourite (Australian) social-democrat economist that you all love to hate doesn’t have tenure either.

    But there’s so many to choose from. How can you be sure?

  4. Token

    Peter Robinson picked up on the article & opened it to the contributors on Ricochet with interesting results.

    It is worth listening to Richard Epstein on any topic, so his review on the book from a Libertarian perspective is worth a listen.

  5. JohnA

    Why single out professors? you ask. Isn’t this just more academic-bashing? You’re quite right: We shouldn’t single out professors. Everyone with civil-service protections or similar employment guarantees should probably have that asset taxed.

    Because you are almost putting a price on people – and that used to be called slavery. Probably still is.

  6. entropy

    A professor’s tenure might have a market price. As for the public service, I doubt anyone would pay to do my job.

  7. feelthebern

    If you have Foxtel, Piketty will be on the Colbert Report today. That’s on the Comedy channel.
    Pretty sure the youtube will be geoblocked by the US parent.

  8. Diogenes

    Read an interesting comment over at townhall that resonates with me by Peter Schiff about economic “dark matter” I will not even try to summarise but quote fully

    The primary flaw in his arguments are not moral, or even computational, but logical. He notes that the return of capital is greater than economic growth, but he fails to consider how capital itself “returns” benefits for all. For instance, it’s easy to see that Steve Jobs made billions by developing and selling Apple products. All you need to do is look at his bank account. But it’s much harder, if not impossible, to measure the much greater benefit that everyone else received from his ideas. It only comes out if you ask the right questions. For instance, how much would someone need to pay you to voluntarily give up the Internet for a year? It’s likely that most Americans would pick a number north of $10,000. This for a service that most people pay less than $80 per month (sometimes it’s free with a cup of coffee). This differential is the “dark matter” that Piketty fails to see, because he doesn’t even bother to look.

  9. Piett

    I’m confused. The tenure and tenure-track labels are things you read about constantly in American academia. People bust their guts to get on to the tenure track.

    But in Australia every full-time, permanent academic is effectively the same as a tenured academic in the States, no?

  10. Sinclair Davidson

    Some are, others are not. I’m too young to have gotten tenure. :) So I’m an on-going employee who can be terminated or retrenched just like any other employee.

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