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I'm familiar with the theory, but I think economic theories that only looks to maximize economic productivity while ignoring philosophical or ethical concerns a

I'm familiar with the theory, but I think economic theories that only looks to maximize economic productivity while ignoring philosophical or ethical concerns are idiotic. If you don't take into account what is being produced and why, you are left with a line of tautological reasoning that more productivity is good because more productivity is good. The reason this is idiotic because there are a lot of ways to maximize productivity where the vast majority of people do not benefit. Not only that, but there is absolutely no reason that maximizing the productiveness of an economy results in maximum utility (in the philosophical sense). Even if you could demonstrate that economic productivity was positively correlated with (philosophical) utility, you'd have absolutely no guarantee that utility would be distributed equitably. You could literally have 1 super happy person with everyone else on the planet enslaved in perpetual (productive) agony. That's even before you get into the fact that maximizing production now probably ends up creating a hellscape of a planet tomorrow. Of course you could argue that you can account for all of this using negative externalities. In that case you might as well tax capital gains to account for the negative externalities. I suppose you could tax something else, like lifetime earnings, but the point is I feel comfortable making the claim that not taxing capital gains is idiotic.

WalterBright 8y ago
Capital gains taxes resulting in less efficient resource allocation does not imply that it is instead allocated in an ethical way, nor distributed more equitably, or any of the other notions mentioned. Having a more efficient economy means there's a surplus that enables resources to be expended on environmental and social concerns. Hungry people don't care about those things. There's a reason poor countries tend to be the worst polluted. Lastly, efficiency isn't about maximizing production. It's about maximizing productivity, i.e. production/cost.
- Declanomous 8y ago
  I never said that less efficient resource allocation would result in more utility. That's a straw man. My claim is the argument that more efficient resource allocation would result in greater utility is almost certainly false in a hypothetical situation where capital gains tax is eliminated. What evidence have we ever seen that allowing wealthy individuals to make more money results in increased utility? There is literally no reason to believe that any of the marginal increase in resources would be expended on environmental and social concerns. The only reason you could justify eliminating capital gains is if you literally believe all government is evil.
  - WalterBright 8y ago
    > What evidence have we ever seen that allowing wealthy individuals to make more money results in increased utility? SpaceX is a modern example. Historically, people of great wealth have been able to invest in great projects. Scientists historically have been wealthy people. The guy who won WW2 was a wealthy man who invested his fortune into developing radar. Many historians believe that radar shortened the war considerably and saved an awful lot of lives. Wealthy people donate a ton of money to universities to fund research. (UW has a Gates building and an Allen building.) > on environmental and social concerns The Gates Foundation, for a modern example. For a historical one, see the Carnegie libraries.
    - notahacker 8y ago
      I can't think of worse examples of industries supposed to benefit from reducing funds available for government investment to ensure more funds are available for private investment than space and defence, which have depended almost entirely on government investment. Similarly, charitable donations are generally tax deductible so again, if anything, capital gains taxes serve to encourage people to allocate more of their returns to it.
      - WalterBright 8y ago
        SpaceX shows that people with great wealth can embark on successful space programs. > charitable donations are generally tax deductible I find it ironic the complaint that wealthy don't use their money to help social causes and yet complain that such help is tax deductible.
        notahacker 8y ago
        SpaceX took enormous amounts of funding from the government, which also happens to be its only customer for most of its services. Virtually all the technological advances which made it feasible for Elon Musk to found a rocket company were based on enormously expensive state funded programmes which private companies would neither have had the fundraising ability nor the realistic expectation of returns to embark upon. Arguing that the space industry would be better off with less government funding and more private wealth is akin to arguing the earth is flat. And I'm not "complaining" that private charitable donations are tax deductible, I'm observing that because they are tax deductible they're not particularly likely to be reduced by the existence of taxes.
harryh 8y ago
Economic theories do take into account what is produced and why. No one thinks that we should devote 90% of our economy to paperclip production even if that meant we would be producing more total stuff than otherwise. When people talk about economic efficiency they actually are talking about utility. Economic theory can also address questions of equality. There are efficient ways to redistribute income and there are less efficient ways. Economic theory can also address environmental questions. There are efficient ways to address resource usage and there are less efficient ways. Philosophical and ethical concerns are indeed outside the realm of economics. That part is true (which is why I said "there are certainly fine arguments against that point of view"). But much of your rebuttal understates the range of topics than can be reasonably addressed by economics.
- Declanomous 8y ago
  My topic statement was thus: > Economic theories that only looks to maximize economic productivity while ignoring philosophical or ethical concerns are idiotic. I did not claim that economic theories cannot address philosophical or ethical concerns, I claimed that economic theories which do not take these in to account are idiotic. I am not an economist, but I took quite a few economics classes in college. I am confident that I know enough to say that eliminating the capital gains tax is not a policy that would be pursued by someone looking to address concerns of regarding equality or the environment. The economic theory that supports the elimination of capital gains tax is one that focuses on maximizing productiveness above all else. It's the type of policy you come up with if you got your hands on a macro 101 textbook and you forgot other people exist.
  - harryh 8y ago
    > I am confident that I know enough to say that eliminating the capital gains tax is not a policy that would be pursued by someone looking to address concerns of regarding equality or the environment. Your confidence is misplaced. On equality one might convincingly argue that by lowering cap gains rate we could increase the overall growth rate of the economy. By doing so we could increase other taxes on the rich without leaving them in a worse state than they would have been in the lower growth economy. We can then use this additional tax revenue to fund social services or otherwise redistribute income to reduce inequality. On environmentalism, one might argue that we should cut cap gains taxes and, in order to make up the lost revenue, institute a carbon tax or other tax on environmentally damaging activities. This could have a profound positive impact on our environmental footprint. Now, I'm not necessarily saying these are good ideas. But they are also not, prima facie, idiotic (to use your word). They are complex questions uncertain impacts. Reasonable people can disagree. Your assertion about "macro 101 textbook and you forgot other people exist" is also quite strange when you consider the fact that I'm not talking about college freshman's stoner thoughts on optimal taxation of capital. I'm referring to the ideas of professional PhD economists who are well respected in their fields.

WalterBright 8y ago

Capital gains taxes resulting in less efficient resource allocation does not imply that it is instead allocated in an ethical way, nor distributed more equitably, or any of the other notions mentioned. Having a more efficient economy means there's a surplus that enables resources to be expended on environmental and social concerns. Hungry people don't care about those things. There's a reason poor countries tend to be the worst polluted. Lastly, efficiency isn't about maximizing production. It's about maximizing productivity, i.e. production/cost.

Declanomous 8y ago
I never said that less efficient resource allocation would result in more utility. That's a straw man. My claim is the argument that more efficient resource allocation would result in greater utility is almost certainly false in a hypothetical situation where capital gains tax is eliminated. What evidence have we ever seen that allowing wealthy individuals to make more money results in increased utility? There is literally no reason to believe that any of the marginal increase in resources would be expended on environmental and social concerns. The only reason you could justify eliminating capital gains is if you literally believe all government is evil.
- WalterBright 8y ago
  > What evidence have we ever seen that allowing wealthy individuals to make more money results in increased utility? SpaceX is a modern example. Historically, people of great wealth have been able to invest in great projects. Scientists historically have been wealthy people. The guy who won WW2 was a wealthy man who invested his fortune into developing radar. Many historians believe that radar shortened the war considerably and saved an awful lot of lives. Wealthy people donate a ton of money to universities to fund research. (UW has a Gates building and an Allen building.) > on environmental and social concerns The Gates Foundation, for a modern example. For a historical one, see the Carnegie libraries.
  - notahacker 8y ago
    I can't think of worse examples of industries supposed to benefit from reducing funds available for government investment to ensure more funds are available for private investment than space and defence, which have depended almost entirely on government investment. Similarly, charitable donations are generally tax deductible so again, if anything, capital gains taxes serve to encourage people to allocate more of their returns to it.
    - WalterBright 8y ago
      SpaceX shows that people with great wealth can embark on successful space programs. > charitable donations are generally tax deductible I find it ironic the complaint that wealthy don't use their money to help social causes and yet complain that such help is tax deductible.
      - notahacker 8y ago
        SpaceX took enormous amounts of funding from the government, which also happens to be its only customer for most of its services. Virtually all the technological advances which made it feasible for Elon Musk to found a rocket company were based on enormously expensive state funded programmes which private companies would neither have had the fundraising ability nor the realistic expectation of returns to embark upon. Arguing that the space industry would be better off with less government funding and more private wealth is akin to arguing the earth is flat. And I'm not "complaining" that private charitable donations are tax deductible, I'm observing that because they are tax deductible they're not particularly likely to be reduced by the existence of taxes.

harryh 8y ago

Economic theories do take into account what is produced and why. No one thinks that we should devote 90% of our economy to paperclip production even if that meant we would be producing more total stuff than otherwise. When people talk about economic efficiency they actually are talking about utility. Economic theory can also address questions of equality. There are efficient ways to redistribute income and there are less efficient ways. Economic theory can also address environmental questions. There are efficient ways to address resource usage and there are less efficient ways. Philosophical and ethical concerns are indeed outside the realm of economics. That part is true (which is why I said "there are certainly fine arguments against that point of view"). But much of your rebuttal understates the range of topics than can be reasonably addressed by economics.

Declanomous 8y ago
My topic statement was thus: > Economic theories that only looks to maximize economic productivity while ignoring philosophical or ethical concerns are idiotic. I did not claim that economic theories cannot address philosophical or ethical concerns, I claimed that economic theories which do not take these in to account are idiotic. I am not an economist, but I took quite a few economics classes in college. I am confident that I know enough to say that eliminating the capital gains tax is not a policy that would be pursued by someone looking to address concerns of regarding equality or the environment. The economic theory that supports the elimination of capital gains tax is one that focuses on maximizing productiveness above all else. It's the type of policy you come up with if you got your hands on a macro 101 textbook and you forgot other people exist.
- harryh 8y ago
  > I am confident that I know enough to say that eliminating the capital gains tax is not a policy that would be pursued by someone looking to address concerns of regarding equality or the environment. Your confidence is misplaced. On equality one might convincingly argue that by lowering cap gains rate we could increase the overall growth rate of the economy. By doing so we could increase other taxes on the rich without leaving them in a worse state than they would have been in the lower growth economy. We can then use this additional tax revenue to fund social services or otherwise redistribute income to reduce inequality. On environmentalism, one might argue that we should cut cap gains taxes and, in order to make up the lost revenue, institute a carbon tax or other tax on environmentally damaging activities. This could have a profound positive impact on our environmental footprint. Now, I'm not necessarily saying these are good ideas. But they are also not, prima facie, idiotic (to use your word). They are complex questions uncertain impacts. Reasonable people can disagree. Your assertion about "macro 101 textbook and you forgot other people exist" is also quite strange when you consider the fact that I'm not talking about college freshman's stoner thoughts on optimal taxation of capital. I'm referring to the ideas of professional PhD economists who are well respected in their fields.