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Actually, a "wealth cap" is not such a ridiculous idea. Essentially, it's simply a progressive income tax with a tax bracket at 100%. If the bracket is high eno

Actually, a "wealth cap" is not such a ridiculous idea. Essentially, it's simply a progressive income tax with a tax bracket at 100%. If the bracket is high enough, e.g. $200 million, then it doesn't act as a disincentive and helps to balance the imperfectness of the market. Many would cite John Rawls here, but I have my own criticisms and my philosophical debates (I am a philosophy minor) can run into weeks of time. Instead, I'm going to simply make the argument that wealth over $200 million is meaningless to a single person. That is, from a practical perspective, that is more money than one could ever spend. The only positive use that could come from that amount of money is heavy watched investment and philanthropy. It is not easy to see that $1 billion is enough to move the world. Why should that responsibility fall into a single citizen's hands? In the best circumstances, the citizen hires a flotilla of people to manage that wealth (e.g., Gates and Buffet) and they spend it wisely and do great good. I don't see the fundamental reason why the government couldn't just do the exact same thing. By awarding the money of a government to a single person (Gates and Buffet each had, at the height of their wealth, more money than most of the governments in the world), this simply ensures an entrenched oligarchy of the rich (and therefore powerful) unless they decide to give it away. Many would argue that this is "their" money so they deserve it. I think this argument is mostly bollocks, though. Bill Gates had over $100 billion at one point. Let's say that a skilled professional makes ~$1 million (gross) over the same time period. That's a 100,000x multiplier. Did Gates really do 100,000x more work? Did he really have 100,000x more insight? I think he just got lucky. He was at the right time at the right place with a good idea. From there he built a company. But the trick is that it's a lot easier to make a lot of money when you already have a whole lot of money. Anyway, I'm gonna end this here, even though I'm not completely satisfied with my argument because this is becoming ridiculous. P.S. This is not for those who believe that the government can do nothing right. I'm not sure that it's even worth arguing with those people. Theoretically, there's no satisfying proof that that's the case and practically the only evidence I see is that when those same people set the government up to fall, it falls hard.

jodrellblank 16y ago
That is, from a practical perspective, that is more money than one could ever spend. There are lots of things which cost more than a billion dollars which makes this statement false. Not individual items, of course, but buying a billion dollar railway is both possible and spending. I don't think philanthropy (as in, charity) goes far enough. It isn't thinking big enough. Imagine what Buffet could do if he spent his fortune on a Manhatten Project for room temperature superconductors? He could nearly start a lunar colony for that money. The fundamental reason the government can't do the same thing is because they would be voted out for 'wasting' money on speculative ivory tower wankery. Anyway, so what if Bill Gates got lucky, this just sounds like sour grapes. Is he not allowed to get more lucky than you approve of? Whether he 'deserves' it is neither here nor there - it's a non question, like does he deserve two feet or to live past 30. P.S. This is not for those who believe that the government can do nothing right I'll just note that here in England, our recent government scandal is on what MPs had been taking from taxpayer money for their expenses. It included one MP expensing £1600 (>$2000) on an ornamental floating duck house. They do a lot right, but just giving them money because they will magically spend it better than any normal person is not something I can go along with.
- mattm 16y ago
  I'll get downvoted for this, but what the heck. Comedian Louis CK on Bill Gates: http://www.youtube.com/watch?v=95fNgx8aCS8 http://www.youtube.com/watch?v=95fNgx8aCS8 "You know what you could do with 85 billion dollars? You could buy every baseball team and have them all wear dresses for only like 3 billion. How do you not do that? I would do that everyday. One day I would go out and buy all the pants in the world and just burn them. Start over with making pants. They're all gone."
Ardit20 16y ago
Well you have five points taking a very unconventional stance, thus, I do not think your argument is ridiculous at all. I would be more interested in the solution however, taking into account the practicalities. I mean, if the government had the billions of Gates, besides using them to pay off their debt, their only option might perhaps be to give it to people on benefit who do nothing with their day whatever, rather than, as Gates has, though a rare occurrence, employ a lot of people for a very worthy cause. My point I think is that to allow people to make as much as possible, allows the society to benefit from the fundamental ideas of the free market, while, to give it to the government effectively locks this wealth in bureaucracy and grant it to people who might be very stupid and waste it all entirely to no good whatever.
trominos 16y ago
This is a bad idea. Even if we accept that no individual can reasonably spend more than $200 million non-charitably (which is false), super-rich people tend to care deeply about money for its own sake -- I say this from limited but real personal experience -- and the accumulation of money tends to be a major factor in their motivation to continue to produce and to invest. If you impose a $200 million wealth cap, you are going to substantially reduce the wealth production of some of the most productive members of society and dramatically curb certain kinds of investment. What do you get in return? Essentially the government receives a bunch of claim checks for wealth (remember that "money" itself has almost no intrinsic value; what we're after, from a macroeconomic viewpoint, is a maximal sustainable production of wealth). Your proposal amounts to reducing overall wealth production in exchange for increasing the government's buying power by a comparatively small amount. Forget ethical arguments against it; except in very extreme economic circumstances, it's absurd from a practical standpoint.
- _delirium 16y ago
  This is assuming that the "super-rich people [who] tend to care deeply about money for its own sake" are actually "productive members of society" engaged in "wealth production", as opposed to merely being very good at rent-seeking (which gets easier as you get larger amounts of capital).
Confusion 16y ago
Instead, I'm going to simply make the argument that wealth over $200 million is meaningless to a single person. The problem with this argument is that in hinges on your view of what constitutes 'meaninglessness'. Although the money is legally his, the single person may feel the money is not 'his', but belongs to him, his family, his friends and all their offspring. To all those people combined, a share of the $200 million is not meaningless and a cap at $200 million would be a disincentive.

jodrellblank 16y ago

That is, from a practical perspective, that is more money than one could ever spend. There are lots of things which cost more than a billion dollars which makes this statement false. Not individual items, of course, but buying a billion dollar railway is both possible and spending. I don't think philanthropy (as in, charity) goes far enough. It isn't thinking big enough. Imagine what Buffet could do if he spent his fortune on a Manhatten Project for room temperature superconductors? He could nearly start a lunar colony for that money. The fundamental reason the government can't do the same thing is because they would be voted out for 'wasting' money on speculative ivory tower wankery. Anyway, so what if Bill Gates got lucky, this just sounds like sour grapes. Is he not allowed to get more lucky than you approve of? Whether he 'deserves' it is neither here nor there - it's a non question, like does he deserve two feet or to live past 30. P.S. This is not for those who believe that the government can do nothing right I'll just note that here in England, our recent government scandal is on what MPs had been taking from taxpayer money for their expenses. It included one MP expensing £1600 (>$2000) on an ornamental floating duck house. They do a lot right, but just giving them money because they will magically spend it better than any normal person is not something I can go along with.

mattm 16y ago
I'll get downvoted for this, but what the heck. Comedian Louis CK on Bill Gates: http://www.youtube.com/watch?v=95fNgx8aCS8 http://www.youtube.com/watch?v=95fNgx8aCS8 "You know what you could do with 85 billion dollars? You could buy every baseball team and have them all wear dresses for only like 3 billion. How do you not do that? I would do that everyday. One day I would go out and buy all the pants in the world and just burn them. Start over with making pants. They're all gone."

Ardit20 16y ago

Well you have five points taking a very unconventional stance, thus, I do not think your argument is ridiculous at all. I would be more interested in the solution however, taking into account the practicalities. I mean, if the government had the billions of Gates, besides using them to pay off their debt, their only option might perhaps be to give it to people on benefit who do nothing with their day whatever, rather than, as Gates has, though a rare occurrence, employ a lot of people for a very worthy cause. My point I think is that to allow people to make as much as possible, allows the society to benefit from the fundamental ideas of the free market, while, to give it to the government effectively locks this wealth in bureaucracy and grant it to people who might be very stupid and waste it all entirely to no good whatever.

trominos 16y ago

This is a bad idea. Even if we accept that no individual can reasonably spend more than $200 million non-charitably (which is false), super-rich people tend to care deeply about money for its own sake -- I say this from limited but real personal experience -- and the accumulation of money tends to be a major factor in their motivation to continue to produce and to invest. If you impose a $200 million wealth cap, you are going to substantially reduce the wealth production of some of the most productive members of society and dramatically curb certain kinds of investment. What do you get in return? Essentially the government receives a bunch of claim checks for wealth (remember that "money" itself has almost no intrinsic value; what we're after, from a macroeconomic viewpoint, is a maximal sustainable production of wealth). Your proposal amounts to reducing overall wealth production in exchange for increasing the government's buying power by a comparatively small amount. Forget ethical arguments against it; except in very extreme economic circumstances, it's absurd from a practical standpoint.

_delirium 16y ago
This is assuming that the "super-rich people [who] tend to care deeply about money for its own sake" are actually "productive members of society" engaged in "wealth production", as opposed to merely being very good at rent-seeking (which gets easier as you get larger amounts of capital).

Confusion 16y ago

Instead, I'm going to simply make the argument that wealth over $200 million is meaningless to a single person. The problem with this argument is that in hinges on your view of what constitutes 'meaninglessness'. Although the money is legally his, the single person may feel the money is not 'his', but belongs to him, his family, his friends and all their offspring. To all those people combined, a share of the $200 million is not meaningless and a cap at $200 million would be a disincentive.