Forbes and the Flat Tax

Now at his new perch at Reuters, Felix Salmon tweaks Steve Forbes for the news that Forbes magazine is cutting salaries by 10% for everything over $100,000:

This is taxing the rich! It’s class warfare! Why should those employees earning a six-figure salary be singled out for pay cuts? If you cut their pay, don’t you know that you’re going to reduce their incentive to work hard, and also the incentive for lower-earning employees to aspire to their position? And these are the most productive members of the firm! You’re punishing success! You should be giving the higher-paid employees a pay rise, instead — that will surely boost corporate revenues!
Come on Steve, walk the walk. If the rich can’t be treated equally with the poorer at Forbes, where is the hope for them in this world?

I know he’s joking, but two things. Obviously, a cut in salary isn’t a tax. There’s a major difference between dealing with a private employer and government taxes. With the government, you have no choice.
Secondly, what Forbes is doing isn’t running away from the flat tax — it’s exactly how his flat tax works. Forbes has called for a 17% flat tax on income only above a specific level (that’s changed over the years). You may not like his principles, but in this care Forbes is walking the walk.

Posted by on April 2nd, 2009 at 3:00 pm


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