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The solution to this is plain and simple wealth-tax that can only be avoided if their investment creates X% jobs. There are corner cases to it but the underlyi

• flamedoge 9y ago
  Ah, so either take the risk or get taxed? Kind of bold.
  • NTDF9 9y ago
    It's basically a choice between: 1. Hire more people and get a tax break 2. Innovate and hire less people and have smaller payrolls Both are win-win for companies and customers and employees. Today, it is just point 2.
    • refurb 9y ago
      Man oh man could you ever game a tax like that. Start a small company and hire your own family at minimum wage would be cheaper than just paying the tax. That would introduce a ton of perverse incentives.
      • NTDF9 9y ago
        >> That would introduce a ton of perverse incentives. That will also solve the unemployment problem and incentivize people to start small businesses. The family members will also have a choice between working minimum wage for their own business or seek a higher paying job, pushing wages higher and higher. Sounds good to me.
• dclowd9901 9y ago
  Sitting on money isn't profitable either. Equity investment is a risk, and simply saving it is a loss (due to inflation). It's just that businesses don't _need_ to spend more on payroll to be successful, or they don't see the relationship of that investment to payoff vs. any other investment they could make. And to be fair, it _is_ rather fluffy. How many more dollars do you need to pay on a position to get 10x return? Can you even quantify that at the level of a single business? If you pay a lot, but have a shitty workplace culture, you may be just as unproductive as a place that pays less, but has a great culture. Unfortunately dollars for employees doesn't necessarily translate to return as well as, say, hiring a process manager or automation engineer to try to eliminate the effects of a bad employee.
  • NTDF9 9y ago
    >> Unfortunately dollars for employees doesn't necessarily translate to return as well as, say, hiring a process manager or automation engineer to try to eliminate the effects of a bad employee. Like I said, there are corner cases. But most businesses would rather fire an unproductive employee than keep them around just for tax breaks.
    • shados 9y ago
      I wish. Getting bad apples fire at anything but a retail store or a McDonald is very nearly impossible. And since bad employees attract bad employees, a lot of companies find themselves in a position where they're hiring like crazy and productivity isn't going up. Often, they're oblivious to the root cause.
• jaredklewis 9y ago
  Seems like the cure is worse than the disease. In addition to incentivizing investments that create more jobs at the expense of those that create less (using robots, software, and all that), the government must now evaluate and track how many jobs all investment vehicles create. Also, queue massive new industry that specializes in creative job accounting/number fixing in 3, 2, 1...
  • droidist2 9y ago
    Yes, also more work for the tax lawyers, accountants, and lobbyists as the tax code becomes that much more complex.
  • NTDF9 9y ago
    >> Seems like the cure is worse than the disease. In addition to incentivizing investments that create more jobs at the expense of those that create less Here's the thing. There is still more money to be made by hiring fewer employees (because employee payroll cost > tax break). Will it slow some things down? Sure. But it will also disincentivize the current slaughtering of humans. >> Also, queue massive new industry that specializes in creative job accounting/number fixing in 3, 2, 1... What do you think the current set of laws do? >>
• paulddraper 9y ago
  That sounds not at all plain not simple.
• deleted 9y ago
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• harryh 9y ago
  So if I invest money into a manufacturing process and build an automated factory that can do with 100 people what used to take 500 people, and then I therefore lower costs to all the people buying things from me...that's now bad? And I get to pay an extra special wealth tax for my trouble? LOL
  • unclebucknasty 9y ago
    In some ways, yes, it actually is bad. Depends on your perspective. As a very simple example, imagine that you were able to fully automate, such that you required zero workers. Imagine further that all other businesses did the same.
    • harryh 9y ago
      If literally all imaginable human work was 100% automated then the cost of goods and services compared to today would be tiny. The poorest member of that society would live like a king from our present day world.
      • unclebucknasty 9y ago
        >If literally all imaginable human work was 100% automated then the cost of goods and services compared to today would be tiny Well, that assumption is pretty general and doesn't account for natural resources/raw materials, energy inputs required for production, or other factors. It would also vary per sector, such that the statement is far from universally true. >The poorest member of that society would live like a king from our present day world But, regardless, there would be some cost for goods. How do you propose the now 100% unemployed population pay for anything, let alone "live like kings"? The answer is that you would need to devise a method of wealth distribution that is orthogonal to capitalism. Say, for instance, a tax that subsidizes everyone else. That, of course, would not be capitalism. The point is that wage labor is fundamental to capitalism. Somewhere between our present state and 100% automation, a capitalist system requires so much intervention that it breaks down.
        • 9y ago
• specialist 9y ago
  Oddly enough, Amazon is apparently the only major corporation utterly committed to spending every nickel it earns. Creating plenty of jobs in the process. Keeps the money moving.
  • milesvp 9y ago
    I'd not thought to couch it in these terms, but yeah, committing to 4% operating margins is essentially committing to spend all their revenues. Not sure how much it keeps the money moving, but I'm sure it encourages investment and growth.
• jaggederest 9y ago
  No need for any ability to avoid it. You could replace nearly all federal taxation with a 50 basis point net asset value annual tax. I for one would rather pay 0.5% of my book value than the vastly larger amount in income taxes I pay. And it's a small enough value I think even extremely thin margin businesses could probably afford it. Everyone on HN says "People would just flee" but in the end almost all the value in the US is real assets i.e. you can't move a physical building overseas.
  • skgoa 9y ago
    Also, the US already has you pay taxes on any wealth you expatriate.
    • KekDemaga 9y ago
      Only really a problem if you intend to return.
  • Inthenameofmine 9y ago
    Do you have any links or books on the topic or this specific calculation? Sounds very interesting.
    • jaggederest 9y ago
      To be honest I just back of the enveloped it, taking into account the stated revenue for the entire federal government and the putative value of all real, physical or financial assets in the continental US. It would be somewhere in that order of magnitude for sure. I think the larger question is the implication that (assuming we moved to a purely wealth tax), there's a minimum rate of return on wealth - this is already functionally true, but it sets an interesting floor to the return on investment for an asset. I'm by no means a financial wizard, I'm sure there are huge flaws in the idea I can't see after an hour's thought, I was just playing with the idea, but it seems like it solves a lot of the problems inherent in income taxation - different entities (people, corporations, foreign investors, etc) being taxed at different rates, the relative spending ratios of various income brackets, etc. It follows essentially a similar line of thought as the land value taxes, except of course applying to all assets.