Income Taxes III

 

As Time Goes By

You must remember this
A kiss is just a kiss
A sigh is just a sigh
The fundamental things apply
As time goes by

Is Sam from Casablanca a System Optimizer?

The odds of becoming a professional basketball player (Pick your sport. I chose basketball because my eldest son was on his high school basketball team), if you are on your high school team is 1 in 1,920. It may be a mix of skill and luck, but humor me by saying that it is only luck. (Yes, I know that it is also skill. That same son did not even make an intramural team in college, so I know I am simplifying by saying that it is only luck). If it is luck, then it may make sense for a group say of five friends on an youth basketball team to make a pact. They will each contribute 10% of their salary into a pot if they don’t make an NBA team, but if someone beats the odds and makes it to the NBA that person will contribute 40% of their salary to that pot. The distribution from that pot will be in equal amounts regardless, 1/5 to each member of the group. If no one from the group makes it to the NBA, the payout from the pot is the same as the contribution to the pot. But if any one of the group does makes it to the NBA, the payout to each of the group is considerably more than the contribution from the non-NBA players. The one who did make it to the NBA will get 60% of that NBA salary plus 1/5 of the pot. Yes, the one who made it to the NBA is receiving less than his full salary, but the other members of his group are receiving more.

And on a very large scale this is a simplification of the US income tax system, where making it in any field is a random event. The question is are you for the group, a System Optimizer, or for yourself, a User Optimizer. I'm with Sam, the piano plyer in the movie Casablanca, who, when he was presented with the chance of making more money if took a job at somewhere other than Rick’s place said . “Yeah, but I ain't got time to spend the money I make here.” Sam was clearly a System Optimizer. Play it, Sam. You played it for her, you can play it for me!