Why Doesn’t Warren Buffett Give All His Money to the Government?

November 4th, 2011

Psychohistorian’s comment over at Modeled Behavior gives the best answer I’ve seen to this question (a specious rhetorical question that — since it ignores the obvious issue of collective action — Tyler Cowen acknowledges to be worthy of a fifteen-year-old).

If I say, “We should all bring a dish so we can have a potluck,” but people don’t agree, I am not a hypocrite if I later fail to show up with food. If I suggest to my two brothers that we should all pitch in to buy our parents a vacation, I am not morally obligated to pay for a third of a vacation regardless of their decision. If I advocate that our cities zoning laws should limit houses to three stories, there’s nothing hypocritical about building a 4 story house if that ordinance fails – doubly so when all my other neighbors are building four story houses.

There is nothing inconsistent about being willing to bear a larger part of a reciprocal burden, but being unwilling to pitch in absent a larger framework. This is particularly true at the high reaches of wealth, where income is significantly positional. If other people’s incomes are also reduced by taxes, there’s an overall downward shift in the demand for certain luxury services. If I pitch in without this reciprocation, my ability to pay shifts, but the equilibrium price does not.

Nor is there anything hypocritical about adopting that stance.

Update: Steve and Barry Ickes give more great examples in the comments to Tyler’s post:

Barry: “So I believe in a draft for national service and we don’t have one I suppose I must volunteer for the army. I should serve while others skate. I don’t buy it.”

Steve: “I don’t think being ONE soldier landing in Normandy did anything for anyone.”

Tyler suggests at the top of his post that he grasped this fairly simple and obvious issue when he was in high school. So why does he now feel the need to obfuscate it with contortionate logicalizing? I would suggest that it’s a form of false signaling, a behavior that is collectively corrosive, and cheap or free if we don’t all punish it.

  1. November 7th, 2011 at 12:10 | #1

    Mmmm, so maybe W. also has the mild form of Asperger’s Syndrome I once read Cowan has – e.g. – W once saying those who object to the deficit are free to mail checks to Treasury….

    There is the interesting problem though that (most?) everyone’s doing what is wrong does not absolve me of my responsibility still to do right, e.g., obey traffic rules. Somehow, pointing to the failure of the collective does not entitle me to say “I’d have more integrity if other people did too…” Man, I just love the clash of morals and self-interest …..

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