Brushfire of Freedom
The Irritable Pundit
I'm going to say this man. You need an intervention. Don't do it. Don't pull that trigger. I know you have your mind set on it. Lots of folks are even urging you on but wait. If you want to reconsider, if there is even the slightest doubt, can we talk it over? There are ramifications to any act Barry. Maybe they deserve it in your mind. But make no mistake, this is a bad idea. You see, you are about to kill the financial services industry and the US economy in general.
No no Barry, hear me out.
The US economy doesn't exist in a vacuum. The economy is truly global. Companies are international in nature. Headquarters are almost immaterial and can be moved at a moments notice. They move from State to State as they get better opportunities, better labor and quality of life for their employees, and better tax rates. It is natural, it happens all the time. This though, listen. You are about to fundamentally change the equation to the point that a brand new level of movement is going to occur. If you decide to raise taxes and limit salaries by Government fiat, an incredible series of events will occur. No Barry, LISTEN man. I don't mean "maybe", bad things are coming if you do this.
First taxes. A company cannot stay in an environment where it can't succeed. It isn't a matter of wanting to leave or not, it absolutely can't stay. You see the companies owe it to their shareholders to give a return on the investment. So they will move out of the country whenever they can -- and a lot of them can, today more so than ever. Say goodbye to the corporate tax base Barry. Of course revenues will drop and you'll what? Raise taxes on the few who are left? You can't drop services because of the promises you made and made and made, so that is your only option right? Well, that will trigger even more flight. Look at California Barry, thats a microcosm of what you will do to America. You think things are bad now? Do this, and just watch.
Hang on Barry, there is more.
Salaries Barry, salaries. This whole "Government determined salary" thing is insane. You do that and the best and brightest will not work for the companies you are regulating. No way, no how. Non-bailed out companies are about to take some very bright people and put them up against the mid-level talent that you are going to be stuck with. Your companies are going to get creamed Barry. The difference between success and failure is razor thin, the best can and do make the difference. That is why they get paid what they do, because they bring in enough value to justify it. They command those salaries because they deliver the goods. Companies wouldn't pay them otherwise. Populist rhetoric be damned. It's the truth.
I can't believe you even hinted about setting salaries at other companies as well. Haven't you read the papers? UK finance companies are already salivating about the corporate brain-drain they are going to be able to pull off. Dubai is gearing up facilities as we speak. Do it man and just watch people start applying elsewhere. From Manhattan to Santa Clara, a lot of extremely smart and talented people will take their ideas, innovations and their investment capital into other places. I'm serious Barry. They will be in Ireland or Argentina or anywhere else that hasn't lost their collective minds.
People simply are not stuck here. Not now. They can leave, they can work long distance. Haven't you even thought about the internet and how it changes things? They can work for other companies headquartered in other places and what are you going to do then? Build a wall? Bricks and regulations to keep them in? That didn't work out so well for the Soviets, hotshot. It will not work here. Think about the American legacy. The best always came to America from everywhere else. That is one of the big reasons why we are head-and-shoulders above the rest of the world. Turn that 180 degrees and the traffic will go the other way. We won't be the best anymore. Period.
This isn't just you Barry. This isn't just some academic exercise you can restart and try again if it fails. This is real, this is now, and it impacts all of us. Real life doesn't really lend itself to the silly ideas you and your counter-culture buddies dreamed up in your smoke filled dorms. Those ideas sounded cool precisely because you were not in the real world.
Well, that and the composition of the smoke I guess.
Barry, hey man, look at me!
Barry!
Are you even listening?
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