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The question articles like this never get around to asking is: What would "fair" look like? The data is never going to be flat. That would mean the top earners

by bluetwo 10y ago

The question articles like this never get around to asking is: What would "fair" look like? The data is never going to be flat. That would mean the top earners and the lowest earners had identical incomes. Call that what you want but that's not a free economy.

devilsavocado 10y ago
Picketty's book does at least attempt to address this. He proposes a switch from income tax to wealth tax. He shows that most inequality is a result of the growth of existing wealth (most of which was inherited). Taxing wealth instead of income can help reverse, or at least stop the increasing levels of inequality. A very small percentage of wealth would need to be taxed to accomplish this.
- pavlov 10y ago
  Such a wealth tax existed in Nordic countries in the late 20th century, at least. Wealth taxes in Sweden and Finland were eliminated around 2005 because capital gains tax was considered more equitable to various wealth classes and more easily administrated. The wealth tax laws had become a nest of loopholes that brought in relatively little income in the end. It would be interesting to see a new wealth tax designed for the digital era.
  - devilsavocado 10y ago
    There are still a few countries with wealth taxes[0]. I'm not sure if they work well or not for these countries. Picketty doesn't spend to much time on the subject of existing wealth taxes. He is more focused on a global wealth tax, which is much more ambitious. Something that would need to be designed for the digital era indeed. Amusing find from the linked article: Back in 1999 Trump proposed a one time wealth tax of 14.25% for individuals worth more than 10 million. [0] https://en.wikipedia.org/wiki/Wealth_tax https://en.wikipedia.org/wiki/Wealth_tax
- trendia 10y ago
  Woudln't this reduce incentives to save among low income individuals?
sharemywin 10y ago
10%-12% for the top 1% and 1%-2% for the top .01% graphs of % of income by 1% and .01% https://youtu.be/d-6PusM9aks?t=32 https://youtu.be/d-6PusM9aks?t=32 graph of US gpd adjusted for inflation http://www.multpl.com/us-gdp-inflation-adjusted/ http://www.multpl.com/us-gdp-inflation-adjusted/
jxramos 10y ago
Haha, identical incomes is what Scott Winship would call Denmark. I've recently got exposed to someone questioning whether or not we should even care about inequality, a provocative idea for sure. Hillsdale college had a worthy lecture posted earlier this month. Scott Winship talks about Intergenerational mobility as an interesting orthogonal concept (https://youtu.be/vDUhpaO1YCE?t=305 https://youtu.be/vDUhpaO1YCE?t=305) William Watson says in the same lecture "The question I was assigned 'Do we want income inequality', just so it's clear I don't care about inequality. What I want is fairness, or equity." (https://youtu.be/vDUhpaO1YCE?t=3131 https://youtu.be/vDUhpaO1YCE?t=3131). A classic one I like on the topic is Sowell's manna from heaven slant on income and its distribution... Peter Robinson: Intellectuals and Society once again, “The very phrase income distribution is tendentious. Wealth can be created only after capital and labor have reconciled their competing claims and agreed to terms on which they can operate together in the production of wealth”. Income distribution, the very phrase is tendentious how come? Thomas Sowell: Income is not distributed, and newspapers are distributed. Social security checks are distributed and one time milk was distributed. Income is not distributed, people earn it directly from those for whom they provide some good or service. And, the argument made by many people you see, is that the, it’s a question of capital and labor have conflicting interests and dividing up the income. No, no, there is no income to divide up before they first reconcile their conflicting interest and decide on what terms they’re going to produce that income. There is no preexisting, there’s no manna from heaven for them to fight over.

by bluetwo 10y ago

devilsavocado 10y ago

Picketty's book does at least attempt to address this. He proposes a switch from income tax to wealth tax. He shows that most inequality is a result of the growth of existing wealth (most of which was inherited). Taxing wealth instead of income can help reverse, or at least stop the increasing levels of inequality. A very small percentage of wealth would need to be taxed to accomplish this.

pavlov 10y ago
Such a wealth tax existed in Nordic countries in the late 20th century, at least. Wealth taxes in Sweden and Finland were eliminated around 2005 because capital gains tax was considered more equitable to various wealth classes and more easily administrated. The wealth tax laws had become a nest of loopholes that brought in relatively little income in the end. It would be interesting to see a new wealth tax designed for the digital era.
- devilsavocado 10y ago
  There are still a few countries with wealth taxes[0]. I'm not sure if they work well or not for these countries. Picketty doesn't spend to much time on the subject of existing wealth taxes. He is more focused on a global wealth tax, which is much more ambitious. Something that would need to be designed for the digital era indeed. Amusing find from the linked article: Back in 1999 Trump proposed a one time wealth tax of 14.25% for individuals worth more than 10 million. [0] https://en.wikipedia.org/wiki/Wealth_tax https://en.wikipedia.org/wiki/Wealth_tax
trendia 10y ago
Woudln't this reduce incentives to save among low income individuals?

sharemywin 10y ago

10%-12% for the top 1% and 1%-2% for the top .01% graphs of % of income by 1% and .01% https://youtu.be/d-6PusM9aks?t=32 https://youtu.be/d-6PusM9aks?t=32 graph of US gpd adjusted for inflation http://www.multpl.com/us-gdp-inflation-adjusted/ http://www.multpl.com/us-gdp-inflation-adjusted/

jxramos 10y ago

Haha, identical incomes is what Scott Winship would call Denmark. I've recently got exposed to someone questioning whether or not we should even care about inequality, a provocative idea for sure. Hillsdale college had a worthy lecture posted earlier this month. Scott Winship talks about Intergenerational mobility as an interesting orthogonal concept (https://youtu.be/vDUhpaO1YCE?t=305 https://youtu.be/vDUhpaO1YCE?t=305) William Watson says in the same lecture "The question I was assigned 'Do we want income inequality', just so it's clear I don't care about inequality. What I want is fairness, or equity." (https://youtu.be/vDUhpaO1YCE?t=3131 https://youtu.be/vDUhpaO1YCE?t=3131). A classic one I like on the topic is Sowell's manna from heaven slant on income and its distribution... Peter Robinson: Intellectuals and Society once again, “The very phrase income distribution is tendentious. Wealth can be created only after capital and labor have reconciled their competing claims and agreed to terms on which they can operate together in the production of wealth”. Income distribution, the very phrase is tendentious how come? Thomas Sowell: Income is not distributed, and newspapers are distributed. Social security checks are distributed and one time milk was distributed. Income is not distributed, people earn it directly from those for whom they provide some good or service. And, the argument made by many people you see, is that the, it’s a question of capital and labor have conflicting interests and dividing up the income. No, no, there is no income to divide up before they first reconcile their conflicting interest and decide on what terms they’re going to produce that income. There is no preexisting, there’s no manna from heaven for them to fight over.