5 ms·

Anyone who believes we should live in a meritocracy (or thinks we already do) should support a 100% estate tax.

masklinn 8y ago
Even a 100% estate tax wouldn't do it, the disparities in opportunities (access to and expectation of education, social contacts, …) don't go away, nor do provisions set up during life (companies, trusts, …).
- throwaway45332 8y ago
  Not to mention other genetic differences, such as physical health, attractiveness, height, etc.
  - masklinn 8y ago
    Do you mean non-genetic? There may be a measure of genes, but in the aggregate these will more likely be linked to nurture (access to food, healthcare, …) than nature.
    - mactrey 8y ago
      Yeah, obviously "in the aggregate" everyone is average-looking and of average height. When looking at a single individual in a first world country genetics will be the primary determinant of their height and physical attractiveness.
mises 8y ago
I believe we live in a meritocracy, but don't think we should do that. I see no moral reason to do this. Inheriting money doesn't make any one else poorer. If I'm wrong, why? All this aside, I think it's great that this gentleman made this choice. I think it will do a lot more good this way, and might even make his son more successful (by avoiding trust-fund syndrome).
- floe 8y ago
  It does, if you would have redistributed the proceeds from the estate tax. But I'm guessing you really have a different objection.
- danans 8y ago
  The process of acquiring a massive fortune does make some poorer (definitely in the relative sense), even as it makes some better off, that is, it drives inequality. Technology picks up some of the slack by raising the floor standard of living, but only if doing so is also profitable for the financier or seller of the technology, and never anything beyond that. While that process may be necessary to incentivize innovation, it has societal costs, and it's not unreasonable to consider offsetting those costs by confronting the wealth gap directly. But I would argue the concentration of extreme wealth in few hands actually hinders innovation, and therefore makes society poorer overall, because a great number of people who might otherwise contribute creatively to major societal problems instead must focus their efforts on daily survival.
  - jacobwilliamroy 8y ago
    Inequality stifles innovation because capialists have no reason to make production more efficient when labor is artificially cheap, as it is in Asia. Why build an automated factory to build the machines that build memory chips when little slave children can do the same thing for pennies? In this way, organized labor drives innovation under capitalism, because capitalists will seek to maintain and grow their profits in the face of rising labor prices.
  - mises 8y ago
    > The process of acquiring a massive fortune does make some poorer (definitely in the relative sense) This is my issue with the whole "wealth inequality" concept. It's just that: you have more money than I do. So what? Sure, I'd like more money, but I don't think it's the government's job to take your money and give it to me. I have never seen the issue with CEOs making tens of millions of dollars; they do a very singular job (in a well-run company). > Technology picks up some of the slack by raising the floor standard of living, but only if doing so is also profitable for the financier or seller of the technology, and never anything beyond that. You think the Gates Foundation operates on a for-profit basis? I think you are correct with respect to businesses, but would prefer non-profits pick up the slack for the very bottom of society, rather than the government. > While that process may be necessary to incentivize innovation, it has societal costs, and it's not unreasonable to consider offsetting those costs by confronting the wealth gap directly. I agree it has societal costs. How do you propose to directly address it? I don't think giving the government the power to take and distribute how it deems best is a good solution. > the concentration of extreme wealth in few hands actually hinders innovation, and therefore makes society poorer overall, because a great number of people who might otherwise contribute creatively to major societal problems instead must focus their efforts on daily survival. Though it does have problems, I think it also makes it easier in some ways. Angel investors can make it much easier to start a business, and certainly easier than if you had to pitch the middle class for two thousand dollars a piece. I guess my overall issue is that I don't know of a better way. The best solution I can come up with to help is to stop the crony capitalist element, subsidies, etc.; where government picks winners and hands out contracts. I don't trust the government (particularly not the federal) to do most anything right, and I think if they are given more money (via, say, increased taxes), they will just waste it, likely signing more large, crony-ist government contracts in the process. If there's a better solution, what might it be? I think if one is proposed, maybe it's best to test it on a state or local level first. I tend to start from a moral perspective: how can we morally justify taking money from others at gunpoint to make things "fairer"?
aetherson 8y ago
If only there were some way for rich people to give away their money while they were still alive! To be a little less snarky, this kind of simple prescription gets very, very complicated in practice. You really want to make it so that a lower-middle-class family whose primary breadwinner dies has to lose 100% of their assets? No? Okay, now we have exceptions to the 100% estate tax. What about spouses who outlive their partner? If I die, should my wife get kicked out of the house that we own jointly? If not, what happens when Joe Billionaire marries someone who he never gives any indication of regarding as a spouse right after his terminal cancer diagnosis, and she marries his son right after Joe's death? What if she marries Joe, immediately divorces him, his divorce settlement gives her the overwhelming majority of his assets, and the she marries his son and they immediately divorce and the settlement gives him the overwhelming majority of their assets? What if Joe Billionaire starts foundations and those foundations employ his children? What if he starts a for-profit company that he owns 100% of the stock of, the company employs all his children and pays them $100M a year until the company runs out of money? At the end of his life, the government can take all the stock of the now-worthless company. What if Joe Billionaire locates his assets in a different jurisdiction? People (mostly) don't go to these extremes right now because they don't stand to lose hundreds of millions of dollars if they don't.
- minikites 8y ago
  >You really want to make it so that a lower-middle-class family whose primary breadwinner dies has to lose 100% of their assets? I'm talking about the estate tax we already have, where that family is already exempt: >Because of these exemptions, it is estimated that only the largest 0.2% of estates in the U.S. will pay the tax.[7] For 2017, the exemption increased to $5.5 million. In 2018, the exemption doubled to $11.18 million per taxpayer due to the Tax Cuts and Jobs Act of 2017. The rest of your examples aren't especially meaningful, the existence of loopholes doesn't mean we can't start with something simple and adjust it later. Those methods already exist and are used to dodge existing taxes, that doesn't mean taxes are a flawed concept.
  - aetherson 8y ago
    Sure it does. It means taxes that are high enough that it becomes vastly rewarding for large numbers of people to dodge them are flawed.

Even a 100% estate tax wouldn't do it, the disparities in opportunities (access to and expectation of education, social contacts, …) don't go away, nor do provisions set up during life (companies, trusts, …).

throwaway45332 8y ago
Not to mention other genetic differences, such as physical health, attractiveness, height, etc.
- masklinn 8y ago
  Do you mean non-genetic? There may be a measure of genes, but in the aggregate these will more likely be linked to nurture (access to food, healthcare, …) than nature.
  - mactrey 8y ago
    Yeah, obviously "in the aggregate" everyone is average-looking and of average height. When looking at a single individual in a first world country genetics will be the primary determinant of their height and physical attractiveness.

mises 8y ago

I believe we live in a meritocracy, but don't think we should do that. I see no moral reason to do this. Inheriting money doesn't make any one else poorer. If I'm wrong, why? All this aside, I think it's great that this gentleman made this choice. I think it will do a lot more good this way, and might even make his son more successful (by avoiding trust-fund syndrome).

floe 8y ago
It does, if you would have redistributed the proceeds from the estate tax. But I'm guessing you really have a different objection.
danans 8y ago
The process of acquiring a massive fortune does make some poorer (definitely in the relative sense), even as it makes some better off, that is, it drives inequality. Technology picks up some of the slack by raising the floor standard of living, but only if doing so is also profitable for the financier or seller of the technology, and never anything beyond that. While that process may be necessary to incentivize innovation, it has societal costs, and it's not unreasonable to consider offsetting those costs by confronting the wealth gap directly. But I would argue the concentration of extreme wealth in few hands actually hinders innovation, and therefore makes society poorer overall, because a great number of people who might otherwise contribute creatively to major societal problems instead must focus their efforts on daily survival.
- jacobwilliamroy 8y ago
  Inequality stifles innovation because capialists have no reason to make production more efficient when labor is artificially cheap, as it is in Asia. Why build an automated factory to build the machines that build memory chips when little slave children can do the same thing for pennies? In this way, organized labor drives innovation under capitalism, because capitalists will seek to maintain and grow their profits in the face of rising labor prices.
- mises 8y ago
  > The process of acquiring a massive fortune does make some poorer (definitely in the relative sense) This is my issue with the whole "wealth inequality" concept. It's just that: you have more money than I do. So what? Sure, I'd like more money, but I don't think it's the government's job to take your money and give it to me. I have never seen the issue with CEOs making tens of millions of dollars; they do a very singular job (in a well-run company). > Technology picks up some of the slack by raising the floor standard of living, but only if doing so is also profitable for the financier or seller of the technology, and never anything beyond that. You think the Gates Foundation operates on a for-profit basis? I think you are correct with respect to businesses, but would prefer non-profits pick up the slack for the very bottom of society, rather than the government. > While that process may be necessary to incentivize innovation, it has societal costs, and it's not unreasonable to consider offsetting those costs by confronting the wealth gap directly. I agree it has societal costs. How do you propose to directly address it? I don't think giving the government the power to take and distribute how it deems best is a good solution. > the concentration of extreme wealth in few hands actually hinders innovation, and therefore makes society poorer overall, because a great number of people who might otherwise contribute creatively to major societal problems instead must focus their efforts on daily survival. Though it does have problems, I think it also makes it easier in some ways. Angel investors can make it much easier to start a business, and certainly easier than if you had to pitch the middle class for two thousand dollars a piece. I guess my overall issue is that I don't know of a better way. The best solution I can come up with to help is to stop the crony capitalist element, subsidies, etc.; where government picks winners and hands out contracts. I don't trust the government (particularly not the federal) to do most anything right, and I think if they are given more money (via, say, increased taxes), they will just waste it, likely signing more large, crony-ist government contracts in the process. If there's a better solution, what might it be? I think if one is proposed, maybe it's best to test it on a state or local level first. I tend to start from a moral perspective: how can we morally justify taking money from others at gunpoint to make things "fairer"?

aetherson 8y ago

If only there were some way for rich people to give away their money while they were still alive! To be a little less snarky, this kind of simple prescription gets very, very complicated in practice. You really want to make it so that a lower-middle-class family whose primary breadwinner dies has to lose 100% of their assets? No? Okay, now we have exceptions to the 100% estate tax. What about spouses who outlive their partner? If I die, should my wife get kicked out of the house that we own jointly? If not, what happens when Joe Billionaire marries someone who he never gives any indication of regarding as a spouse right after his terminal cancer diagnosis, and she marries his son right after Joe's death? What if she marries Joe, immediately divorces him, his divorce settlement gives her the overwhelming majority of his assets, and the she marries his son and they immediately divorce and the settlement gives him the overwhelming majority of their assets? What if Joe Billionaire starts foundations and those foundations employ his children? What if he starts a for-profit company that he owns 100% of the stock of, the company employs all his children and pays them $100M a year until the company runs out of money? At the end of his life, the government can take all the stock of the now-worthless company. What if Joe Billionaire locates his assets in a different jurisdiction? People (mostly) don't go to these extremes right now because they don't stand to lose hundreds of millions of dollars if they don't.

minikites 8y ago
>You really want to make it so that a lower-middle-class family whose primary breadwinner dies has to lose 100% of their assets? I'm talking about the estate tax we already have, where that family is already exempt: >Because of these exemptions, it is estimated that only the largest 0.2% of estates in the U.S. will pay the tax.[7] For 2017, the exemption increased to $5.5 million. In 2018, the exemption doubled to $11.18 million per taxpayer due to the Tax Cuts and Jobs Act of 2017. The rest of your examples aren't especially meaningful, the existence of loopholes doesn't mean we can't start with something simple and adjust it later. Those methods already exist and are used to dodge existing taxes, that doesn't mean taxes are a flawed concept.
- aetherson 8y ago
  Sure it does. It means taxes that are high enough that it becomes vastly rewarding for large numbers of people to dodge them are flawed.