damnum absque injuria

May 22, 2010

Raise Eric Schoenberg’s Taxes, Please

Filed under:   by Xrlq @ 9:30 am

If you can find a way to do that while leaving everyone else’s rates alone, have at it (‘hat tip: Molly). Here’s the lowlight on why incentives don’t matter:

Consider research conducted by two psychologists, Dale Miller and Rebecca Ratner. They told a group of Princeton students that the Red Cross would be coming to campus for a blood drive. Because blood supplies were dangerously low, the organization was considering paying $15 for donations, and it wanted to get a sense of how much difference that would make. The students estimated that 63% of their classmates would donate if they got paid, almost double the 33% they predicted would donate without pay. But when asked whether they themselves would donate, those students were only slightly more likely to donate for $15 than for nothing: 73% vs. 63%. In other words, they thought their classmates would be more influenced by money than they actually were.

In other words, Eric Schoenberg is retarded. Non-retards, by contrast, understand the difference between what people say they will do and what they actually end up doing, and that incentives can help to bridge that gap. Suppose the Red Cross had actually held a blood drive at Princeton without compensation. Does anyone seriously believe that 63% of the student body would actually have shown up? Or that the same percentage who would have flaked out on a free blood drive would also have flaked out if there were money on the table? That the entire U.S. population is as idealistic as the average college student, or that a modest incentive that boosts donations by “only” 16% among spoiled rich kids* might not serve as a stronger incentive among those who consider $15 real money? Even if we do assume all this – and I don’t – increasing blood donations by 16% strikes me as a worthy enough goal to make the $15 incentive worth exploring. of course it won’t be since we live in a retardocracy that forbids people to sell their own blood even for a modest price like $15, while allowing the recipients of their gift to sell it to others for much more than that.

I will concede this much, however: raising Schoenberg’s taxes, and those of everyone else in his bracket, by a paltry $15 a year would have a negligible impact on economic activity. Of course it won’t make a dent in the budget deficit, either, which is why no one is debating a $15 tax increase on the rich. Which brings me to yet another reason why Eric Schoenberg is retarded: he fails to grasp that large incentives often succeed where smaller ones fail. Not happy with a $15 incentive that “only” increases blood donations by 16%? Then pay them more, dumbass. This isn’t rocket science.

The rest of Schoenberg’s article doesn’t even try to make the case that letting the government take even more money than it does will close the deficit, end world starvation, whiten your teeth while you sleep, or make the world a better place in any way, shape or form. Like most other liberal dogma, you are simply asked to accept this premise on blind faith. Just believe, man, just believe.

*No, I’m not suggesting that all Princeton students are spoiled rich kids, only most of them. We can quibble over “most,” I suppose, but that would miss the point, which is that majority or no, spoiled rich kids are certainly over-represented at Princeton vis a vis the population at large.

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