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I've been watching in horror the story of Tom Perkins, wealthy co-founder of famous VC firm KPCB, who used a Hitler analogy to make a point about the demonization of the rich. I haven't yet seen a rational discussion of it in the media so I guess it's up to me.

For starters, using a Hitler analogy is almost always a self-refuting argument. And by that I mean that if you need to invoke a Hitler analogy, there's probably something deeply wrong with your point of view in the first place.

But I said "almost always." Interestingly, the Hitler analogy actually works in this particular case. My interpretation of Perkins' point is that the growing level of contempt for the rich is fueled by scapegoating. And if the economy falls into something like a depression, it is a legitimate concern that angry mobs might drag rich people out of their mansions and do harm under the theory that the rich are the problem.

What are the odds of that, you say? Low? Impossible?

I'd put the odds somewhere in the 5% range and growing. Remember, Perkins didn't say it will happen next Tuesday; he's simply identifying an emerging trend. Is it legitimate for Perkins to identify a potentially dangerous trend in its early stages with the hope of heading it off early? I'd say that's a legitimate position.

Keep in mind that Perkins got rich by identifying trends before others recognized them. His firm invested in AOL, Amazon.com, Citrix, Compaq, Electronic Arts, Genentech, Geron, Google, Intuit, Netscape, Sun, Symantic and more. So if you disagree with Perkins' assessment of the risk, please compare your success rate to his. And no fair saying VCs only get it right 10% of the time because in this case that would be often enough to totally justify raising the issue. And I don't believe anyone disagrees with Perkins' observation that the public's opinion of the top 1% is worsening.

Before delivering my verdict in this case, I'd like to state the facts as I see them.

1. I keep seeing comments and even headlines saying Perkins compared the suffering of the rich to the suffering of Jews during the Holocaust. As I have often written, all analogies invite wrong interpretations. I interpreted his analogy to mean that if the demonization of the rich continues there is a non-zero chance it could escalate into violence. That's far from saying rich people are exactly like Jews in concentration camps. The willful misinterpretation of his point (or perhaps confirmation bias) is strong evidence of his point. 

2. I often hear it said that the rich are torpedoing the U.S. economy by shipping jobs overseas or introducing robots. For starters, big corporations are owned by shareholders, most of whom are not rich. Second, the idea that the rich are, on average, subtracting jobs from the economy is economic illiteracy, not an opinion. That's the same sort of ignorance that drives most forms of discrimination and violence. 

3. If a pundit of modest means had raised a warning that worsening attitudes about the rich might someday escalate to violence no one would raise an eyebrow. The angry contempt shown to Perkins' opinion piece supports his opinion. Sure, the Nazi analogy was a bad choice, but does that make his point wrong? 

4. The fact that few citizens seem to care there is a chance that the rich might someday be dragged from their homes and killed is evidence of Perkins' point. The rich have already been dehumanized to the point where an offensive analogy seems the bigger crime against humanity than the possibility that the rich could someday be slaughtered by mobs. 

5. Much of the public believes the economy is a zero-sum game and therefore the rich are stealing their money from the poor. That is economic illiteracy, not opinion. It's the same sort of ignorance that made ordinary German citizens think the Holocaust might be a solution to their national problems. 

My verdict is that Perkins' point about escalating contempt for the rich potentially leading to violence is legitimate, in large part because the media contributes to economic illiteracy and highlights the bad apples in the top 1%.

The Nazi analogy wasn't politically correct. Nor was it a brilliant choice because all analogies cause fights, and when you throw in some Holocaust references you're just asking for trouble.

Is Perkins sort of a dick? Yes. But I have some respect for the fact that he's not trying to be a phony. And based on what I've read online, most of his critics are ignorant dicks. That seems one level worse than being a well-informed dick.

Yeah, I know, I'm a dick too. That goes without saying. Let's not get sidetracked.

 

 
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Jan 31, 2014
Scott, I think you sunk yourself by your own initial rationalization.
Hitler did a lot of things besides genocide, some of it good, some of it bad, but none of it as bad as the genocide part. I think most people agree that genocide is the worst thing a person can possibly do, so it's easy to see how that would basically override anything else he did in people's minds.
So while it may be technically valid to compare someone with Hitler for being a teetotaler, for example, comparing anyone with Hitler who is not a genocidal dictator is going to make your comparison look really dumb, and rational people will stop listening to you.
If you want to cite a well-known example of someone vilifying the rich, you really are better off sticking with Karl Marx or Josef Stalin. At least then people might take you seriously.
 
 
Jan 31, 2014
>The fact that few citizens seem to care there is a chance that the rich might someday be dragged from their homes and killed is evidence of Perkins' point.

Maybe I'm wrong, but I don't think the average citizen wants to see any and all rich dragged from their homes and killed, just some of them. For example, I wouldn't expect philanthropist types like Bill Gate, Warren Buffet, Angelina Jolie, or Brad Pitt to be on the hit list. The people I could see on the list are the ones perceived as hurting the little guy to get their wealth. The guys who walked away from Enron rich with little to no jail time. CEO's who get a fat bonus while eliminating jobs beneath them. Or raiders like Carl Ichan who dismantle successful companies in hopes of a short term stock payout. THOSE are the guys that most average people resent, and it could be a good thing if they're a bit scared...
 
 
Jan 31, 2014
I agree with the post and with the comments. But dismissing Perkins' Hitler analogy as merely politically incorrect is as misinformed as assuming that Jews were the cause of Germany's economic woes in the 30's. There are a still scores of people in all countries, including America, whose parents and grandparents suffered deeply disturbing things under the Nazi regime and as a result of the war. It's been 70 years, but yes, it's still too soon.
 
 
+1 Rank Up Rank Down
Jan 31, 2014



"The new poll goes beyond results released by Gallup last week, which indicated 67% said they were dissatisfied with the way income and wealth are distributed in the U.S."

That's a big number.

The way income and wealth are distributed? How about a mutually agreed exchange? Let's say a King should not decide how wealth is distributed.

How about we discuss that the forced taking from one person to give to another is wrong? (Returning stolen property doesn't count - not every person with more money than you is a thief.)

If voters decide, then will 51% be taking from the 49%?

Remember if I don't think my labor or my investments will benefit me in some way, and you get to decide to take them from me at your whim, I will stop working for you.

Is that the income equalist's goal?
 
 
+1 Rank Up Rank Down
Jan 31, 2014
The problem is not the poor, the problem is the rabble rousers that incite the poor. The definition of American poverty is greater than the income of 90% of the world.

The poor in American don't have it bad. The liberals just keep telling them they have it bad.
 
 
Jan 31, 2014
@MTBob

To look at the press one could be forgiven for thinking income inequality is the problem here. It isn't. The real problem is unemployment and poor pay for those who ARE working. Americans will trade in all the utopian visions in the world for a shovel and a decent paycheck.
 
 
+26 Rank Up Rank Down
Jan 31, 2014

Is anyone really talking about the issue?



Should everyone earn or have a net worth of the same amount?

What is an acceptable ratio of income equality and net worth equality, to you? Should everyone be within 5% of each other or maybe 10%?

What should be the upper limit of income and wealth?

Would you rather Obama decides this number, or George Bush, or the majority of voters, or each person deciding where to spend their own money?


Should the Ant's food be taken from him and given to the Grasshopper? Or maybe you prefer to guilt trip the ant first hoping that works, and then if it doesn't, then break his windows?


 
 
Jan 31, 2014
Did you hear the story on NPR's On The Media about movie executives, including Jews, before and during WWII that worked with the Nazis to censor movies that would have been critical of the Nazis so that the movie companies could maintain their businesses in Nazi controlled territory?

Enron, Madoff, Koch brothers, Murdock, Ailes, HSBC, Freedom Industries... We can find plenty of examples of rich people !$%*!$%* over the general population. The problem is over generalization. Not all rich people are bad. The rich are like everyone else capable of doing good and bad.

Lots of rich people are smart and got rich because they are smart, but they can be insensitive and arrogant. The most recent example is Peter Schiff on The Daily Show saying the wages for the mentally retarded are worth $2 an hour.
 
 
0 Rank Up Rank Down
Jan 31, 2014
Never use a Hitler analogy. It doesn't matter if it is a good analogy or bad analogy... its a bad analogy.

If you are a self-aware 1% who sees a good possibility of the unwashed masses rebelling over the growing levels of inequality in our society shouldn't you be in favour of tax reform to reduce that inequality?

On a side point, isn't this how Marx imagined the evolution from capitalism to communism? The capitalist system would lead to growth but also concentrates the wealth into the hands of the few owners of capital. Once inequality reached passed a certain threshhold labour would revolt and take all the capital and redistribute it equally. If the Russian and Chinese experiments hadn't failed so dramatically (acting like a vaccine against communism) I sometimes wonder whether the USA would be reaching the point of extreme inequality that Marx wrote about.
 
 
Jan 31, 2014
benoitpablo: [ You wrote: "big corporations are owned by shareholders, most of whom are not rich" Show me any poor person that owns stock, that they bought while they were poor. ]

That's a false dichotomy, one employed way too often in the service of denigrating wealthy people. There isn't just "the rich" and "the poor". The vast majority of people live somewhere in between (and most of them probably do own some stock). The larger point, though, is that ownership of most corporations isn't somehow denied to Decent Hardworking "Real" Americans.

If you want a specific example, I'll point you to my father. My family was anything but rich growing up. My father made some key investments that changed that. He was admittedly fairly lucky in his timing, but he could have done something else with that money -- buy a second car or something. He chose to invest it instead.
 
 
Jan 31, 2014
aol: [ The wealthy are simply not being demonized (at least not in any real way, I'm sure a few people hate them). ]

The only thing I can extrapolate from this is that you live in a cave. The amount of animosity that is spewed at "the 1%" is almost off the charts. It didn't start with Obama, but he did bring a lot of focus to it, with the "the rich should pay their fair share" screed that he used to help propel himself into office (and keep himself there during the last election). It's a ridiculous notion with no well-defined terms, i.e. a perfect political rallying cry. Unfortunately, it's also become the mantra of a large group who have given up rationality and taken to bleating "Four legs good, two legs bad!" Oops, sorry, my mind wandered there for a second.

I don't think there is much chance that the rich will be dragged into the street, though, simply because the time we live in makes that much less likely to happen. Mob action requires anonymity and isolation from authority to be successful, neither of which is readily available in the Information Age.

A much more likely scenario than direct physical violence is one where the rich are subject to draconian taxes, naturally in the name of making them pay "their fair share". What I'm really surprised by is that no one has yet come up with the notion of taxing actual wealth (as opposed to income). It's only a matter of time, I think, before it gets proposed. It will even sound reasonable, like: "Anyone with a net personal wealth over $1M must pay 1% of it every year to the government. Over $10M, 2%." And so on. Come on, The Rich, it's such a small amount! Why would you be so petty as to complain about it?
 
 
Jan 31, 2014
@PhantomII

...So you're basing your opinion on one post while Im basing my opinion on at least four?
 
 
-1 Rank Up Rank Down
Jan 31, 2014
I don't see the point of dissecting Tom Perkins statement.
We are way beyond the point where a purely rational discussion can be had. For the '99%', the discussion of rich-vs-poor has developed a strong emotional charge, and ignoring that aspect is insensitive/arrogant/ignorant. It will also draw all sorts of nonsense economy-illiterate counter-arguments, but that's to be expected when a discussion turns emotional for anyone involved. What you need then is conflict management, not more rational arguments.

That doesn't mean that Tom Perkins isn't right. But he is antagonizing the 99% by ignoring the emotional charge that the discussion has taken on.
 
 
Jan 31, 2014
I think it's important to remember that we're really talking the .01% at most. People who can buy or sell Scott Adams for a fraction of what they spend on elections.

And they don't act like Scott Adams. Adams created a product people wanted to buy, and successfully marketed it. That's capitalism.

Adams didn't inherit or hostile-takeover an existing brand -- say, "Family Circus" or "Blondie" -- and turn production over to a minimum-wage worker tracing over old cartoons, while hiking book prices and squeezing higher fees out of newspapers afraid to drop it. And then pressing costs down and price up even more when the discernible stagnation of the product began to hurt sales.

Adams didn't use his market clout to crush possible rivals. Otherwise he would have slapped "Pearls Before Swine" with an infringement suit (Ratbert came before Rat), wearing down Pastis in costly litigation. Or announced he was developing an animal-based Dilbert spinoff, and newspapers & readers should wait for it instead of reading other such strops. Or he would have simply bought out Pastis and quietly deep-sixed "PBS" after replacing Ted with Larry the Croc.

Adams didn't hire lobbyists to impede technology or trends would undercut traditional newspapers and his short-term profits. He embraced the Internet early on and discovered ways to use it, instead of stumbling after more visionary rivals when suppression ultimately failed (as entertainment giants did after failing to stop VCRs and other delivery systems that destroyed their old business model). Nor did he turn Dilbert into propaganda for public policies favorable to himself yet harmful to society at large.

Adams doesn't argue that tax exemptions and special incentives for big time cartoonists are essential for the survival of America. Nor does he draw absurd parallels between papers not carrying Dilbert and, for example, the Internet censorship of China and other totalitarian countries. And he certainly never suggests that his success comes from being a superior Christian (or a disciple of shallowly Darwinian economics, depending on the audience of the moment).

Perhaps most importantly, Adams states he has all the money he wants and is pursuing goals other than acquisition. He's not looking to monopolize all the space on the comic page and suck up every dollar associated with it, or to exercise power beyond what he can derive from his success as a cartoonist and a public figure given to substantive opinions.

Yes, I envy Adams' success; but I certainly don't begrudge it. If anything, his own achievements provide a viable roadmap to follow (insert book plug here). And whatever I may have contributed to that success came from my willing purchase of Dilbert books and the like, not from his rewiring the economy to suck money from my wallet with no value delivered in return.

 
 
Jan 30, 2014
whittlnew,

That's a distinction without a difference. Trying to say that he's a 6.9 point liberal on a scale of one to ten rather than a 7.1 liberal makes no difference. He is what he is. I say again, go back and look at his "presidential" manifesto.
 
 
Jan 30, 2014
"...the media contributes to economic illiteracy and highlights the bad apples in the top 1%."

As the recent economic crisis has shown, a few "bad apples" in the top 1% is all it takes to do massive damage to the 99%.

When people talk about 1%ers, they aren't talking about run-of-the-mill millionnaires like yourself. They're talking about the people and institutions that have damaged or destroyed many of their lives. Many of these people have already been "dragged into the streets" by the rich.
 
 
+19 Rank Up Rank Down
Jan 30, 2014
@PhantomII

[Overall, he's a California liberal, ]

...No...hes taken enough anti-leftist stands that he qualifies as, at most, a moderate liberal. He might SEEM overly leftist to a conservative though.
 
 
+3 Rank Up Rank Down
Jan 30, 2014
The rich I object to.
I don't believe that much of the public believes the economy as a whole is a zero sum game, but I do believe far to many in the public have had experience being on the losing side of a negative sum game which they didn't even know they were playing.

I don't think the rich are torpedoing the economy by shipping jobs overseas or modernizing there production process, but the rich who then take all of the savings and efficiencies from such processes as theirs because of their hard work, failing to pass on the value to the workers who got things to that point to begin with, might be torpedoing the economy. To appeal to the gods of trickle down and fail to do so is a problem.

Then there are the rich who appeal to the god of a free market, but determine there on pay packages behind closed doors or through manipulation.

Then there are the rich who play the negative sum games, that only enrich themselves without even improving the system. A worker entered a contract worked 30-40 years planning on a promised pension or other retirement fund, then they are cut out just before they qualify or worse a pirate swoops in and strips both the companies capital and credit takes off and leaves the company to its own fate.
Those are the rich I object to.

Of course that is not all the rich, nor are all aspects of the economy zero or negative sum games, and yes some rising tides do lift all boats, but sometimes someone has come and chained most of the boats to the ground so the rising tide just drowns them.

My rant for the week.
 
 
-2 Rank Up Rank Down
Jan 30, 2014
the purpose of Tom Perkins' quip: wasn't it to create an aire of credibility for Hitler?
 
 
Jan 30, 2014
@roger_cavanagh, I hope you wrote that to elicit a reaction. It was quite humorous. The letter to the editor in question referenced wanton vandalism and destruction of property during the 99% park squats and sit ins. That is an example of violence occurring. It's all the example you need to show that when people get inflamed into a mob, bad things happens that the same people would never, ever do if they weren't emotionally manipulated and caught up in the moment.

FYI, I'm not rich. I'm comfortably middle-class. I aspire to become wealthy, though I'll never be in the 1%. I'll be happy to reach the 5%.
 
 
 
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