“If you add up all the federal and you look at the disability and the unemployment and the Social Security and the state, my tax rate’s 62, 63 percent. So I’ve got to make some decisions on what I’m going to do.”
-Phil Mickelson, professional golfer
Since turning professional in 1992, Phil Mickelson has made a lot of money. His official earnings are over $55 million, but that figure represents a relatively small portion of his total earnings, since he has been doubling or even tripling that in endorsement deals ever since he became the prime rival to Tiger Woods (in fan affection, if not quite in talent). His total worth is said to be between $150 and $180 million, which, as they say, can buy a lot of stuff.
Most recently, Mickelson was part of an investment group that purchased the San Diego Padres baseball team. Mickelson’s home is in San Diego, but in the end, he pulled out of the deal, implying as he did that he couldn’t afford it.
In any event, it’s safe to say that “Lefty,” by any measure, is wealthy. Just to put it in perspective, Mickelson’s average annual earnings from the PGA tour (approximately $5 million) amount to twice the income the average American makes in a lifetime. And that 5 million, as noted above, doesn’t include his endorsements or the returns on his investments.
But, hey, a guy has to feed his family, right? And that must have been Mickelson’s thinking when he followed up on his recent comments by saying that he was going to have to take some “drastic measures.” Asked to elaborate, he allowed that they could include leaving California, if not the country, because of the combination of increased tax rates passed by California voters in November and by Congress at the turn of the year.
Within a few days (the original comments were made on January 20), Mickelson was trying to apologize—for speaking his mind, not for the sentiment of his statements. He didn’t back away from his meaning; he just tried to cry mea culpa for being so outspoken.
Thus we must assume that poor (tongue-in-cheek pun intended) Phil must still feel terribly aggrieved by the exorbitant tax rates he must endure if he continues to call California his home and the United States his country.
Ah, Phil. And you had so charmed us for all these years with your everyman persona. Let’s see if we can help you out of your misery. First of all, are you really paying that much of your income in taxes? Don’t you have the opportunity to set aside as much of your earnings as you want in the PGA’s retirement program, which is said to be the best in professional sports? And doesn’t that retirement money reduce your taxable income considerably? And what about your investments in the many tax shelters that your financial team must surely be using for you? Aren’t they reducing your taxable income as well?
But assuming that you are still stuck with the prospect of paying a sizeable chunk of your remaining earnings in taxes, the question remains: Just how much do you need, Phil? How much income, how much net worth, do you need to take care of yourself, your family, your family’s friends, and those many free-loaders who may have ingratiated themselves to you over the years?
More to the point, how much is enough to live as comfortably as you want, Phil? Please think as you answer that question about what “comfortably” means. Yes, you have several estates (according to published reports) that are large enough to house a dozen families, but how much of that property do you really need?
“Need” is a word that means different things to different people. To most of us, it means being able to pay the rent (or the mortgage), to eat enough to sustain our health, to provide for our children’s basic needs (clothes for school, maybe a new bike for a birthday, a computer they can call their own), to pay the medical bills that aren’t covered by the insurance plan we hopefully have at work (assuming we aren’t “between jobs”), and maybe a little set aside every year for a family vacation to some exotic place like Disneyland or Yosemite.
That is how most of us would define “need,” Phil. And we work very hard just to meet that “need,” maybe even, in our own way, as hard as you do to amass the impressive fortune you have attained. In fact, Phil, the main difference between us isn’t in how hard we work. Many of us work every bit as hard at our jobs or careers as you have in yours. The difference between us is that you have a special talent—a gift, a blessing—that just happens to pay well.
Our talents are less impressive, to be sure, but we work just as hard at them. And most of us don’t complain about the taxes we pay, which, in truth, are probably a higher percentage of our annual income than you pay, and which, most definitely, leave us with a lot less to live on than you end up with.
Maybe this perspective is not something you’ve thought about as you’ve won tournaments and accumulated your wealth, Phil. And maybe you still have the view that you’ve earned it and should be able to keep it.
If so, then here’s a word for you to ponder: plutocrat. It refers to someone who seeks a government that caters to his or her wealth. Plutocrats don’t particularly care about the rest of us. They just care about their wealth and how to be able to continue to amass it.
Plutocrats aren’t bad people. Many of them give to charities, tip generously, and even pick up the tab after a round of golf. But they don’t like to pay taxes and they don’t think they should have to.
In a plutocratic society, Phil, the rich take care of themselves and let everyone else get by as best they can.