4 ms·

Wealth taxes would only be a band-aid, kicking the can down the road. The wealthy aren’t a magically endless source of loot.

mdorazio 7y ago
Wealth taxes might be the only way to avoid complete inequality in market-based systems [1]. Especially if the market is not growing for everyone. The wealthy kind of are an endless source of loot because the definition of wealthy is one relative to a median, so you'll either end up with everyone roughly equal in wealth (is that a bad thing?) or, more likely, over time new people will enter and exit the wealthy class due to various advantages and market dynamics so that there is an endless supply. [1] https://www.scientificamerican.com/article/is-inequality-inevitable/ https://www.scientificamerican.com/article/is-inequality-ine...
- deleted 7y ago
  [deleted]
- Isinlor 7y ago
  You should define what you mean by wealth. What does it mean that you will loot wealthy people? Will you eat shares of a company for breakfast? Will you burn cash in stove to warm your house? Wealthy people control resources. You can take control from them, but it will not create more resources. One, fundamental resource is human labor. This resource will decline in proportion to the total human population whether it will be controlled by wealthy people or not. Someone will need to physically do the work that needs to be done around old people. And there will be more old people, than there will be young people.
  - MiroF 7y ago
    > Wealthy people control resources. Yes, it turns out that resources are actually the thing we need to sustain older people. > Someone will need to physically do the work that needs to be done around old people. Someone literally is already doing the work that needs to be done for old people. It's just that most of the wealth produced from that work goes to already wealthy people.
    - brokenkebab 7y ago
      It's just that most of the wealth produced from that work goes to already wealthy people. Exactly that work (social support, and healthcare for seniors) in total numbers consumes resources, not produces them. If it wouldn't be so there would be no need to fund it from taxes. Frankly, it sounds like you rushed with a randomly chosen slogan to this thead.
  - mdorazio 7y ago
    I'm not really following your question. The idea of a wealth tax is pretty straightforward. You take stock of a person's assets, take a percentage of that figure (say 1%) and send them a bill for that dollar amount. How they choose to pay that bill is entirely up to them - they can borrow against their assets, liquidate some of them, or use cash on hand. I don't really see how control of resources factors into the equation.
    - Isinlor 7y ago
      Control of resources factors into the equation, because dollars are intrinsically worthless. If money have intrinsic value, why not to print 1 000 000 000$ on a bill and give one to everyone? Suddenly everyone would become a billionaire. Your example is less extreme, but it is still about redistributing control. Redistributing dollars redistributes control of what people do, and how other resources are allocated. This is related to the article, because moving control of people does not create more people. As population will be getting older, there will be more old people that less young people will need to take care of. This is a fact. You could argue that redistributing wealth will lead to more efficient control of resources, and so it will make it easier to provide care. But it is still fundamentally about control of diminishing resources and increasing needs. BTW - I'm Polish and my government tries to literally pay people for having children. Around 30 000$ spread across childhood (take into account that Poles earn a lot less than Americans), and while it put a small dent in fertility rate, the number of children born in Poland is currently lower than before introducing that program.
- marcusverus 7y ago
  You cannot destroy the incentive structure for economic activity (financial rewards) without catestrophic consequences. People don't pull start-up hours so that their neighbors can prosper, they do it for themselves. When you take away the possibility of great rewards, you destroy the incentive to add great value. See the entire history of collectivism.
  - ClumsyPilot 7y ago
    The conversation is about what's fair incentive structure, correcting it does not amount to its destruction. Also we do not require people to pull startup hours, and only a minority of the population ever does that. I dont see how that comes into this conversation.
    - MiroF 7y ago
      It's a Rawlsian question of "how can we structure incentives such that everybody is better off?" Now, the metric for "everybody is better off" is still an open problem, but there seem to be near pareto optimal steps we can take, like a high threshold wealth tax.
    - marcusverus 7y ago
      I'm not sure what conversation you're participating in, but the parent comment was flippantly discussing the possibility of taxes so draconain that the GIDI coefficient would approach zero: "The wealthy kind of are an endless source of loot because the definition of wealthy is one relative to a median, so you'll either end up with everyone roughly equal in wealth (is that a bad thing?) " In the world advocated for in that comment, with aggressively averaged out income/wealth, there is no incentive to produce value above what is required to reach the average income.
  - MiroF 7y ago
    A 2% wealth tax above a few hundred of millions of dollars doesn't destroy the incentive structure for economic activity, it is disingenuous to suggest it would.
moron4hire 7y ago
Given that the gap between the rich and poor as a share of GDP has been growing for quite some time, it kind of suggests the rich already do have a "magical, endless source of loot".
- praptak 7y ago
  This is known at least since Marx.
zappo2938 7y ago
I used to be a chef. In one situation I was payed dividing the number of patrons by number of cooks to cook for 40 people a night. In another situation I payed the same cook for 4 wealthy people on a yacht. It isn't hording. It is how the money is spent. One owner of a yacht was on the board of his alma mater. The school was required by law to spend equally on women's sports as men't sports. The school had to invest in sports fields which were expensive. He complained about it. Later I worked on a yacht of a person who grew grass. During this time when the schools were required to increase the size of their fields he made a fortune. There are just winners and losers. But cooking for 40 or 4 are pretty much the same from a labor perspective at that size because recipes scale to 10x easily.
MiroF 7y ago
Are people not aware how large wealth inequality is at this point? A small marginal wealth tax would generate just absolutely massive amounts of revenue because that is where most money is locked up, not in people's salaried income.
klyrs 7y ago
> The wealthy aren’t a magically endless source of loot. True. But that's how they've been treating folks with less advantage since time immemorial. Which tends to work until the exploitation becomes too egregious and lower classes implement a head tax on the wealthy.
notacoward 7y ago
I think it's very revealing that your argument assumes "the wealthy" are a class completely distinct from everyone else, without new people becoming wealthy all the time. Of course, nobody ever admits that they support such an arrangement, even as they oppose the primary means of preventing it.

mdorazio 7y ago

Wealth taxes might be the only way to avoid complete inequality in market-based systems [1]. Especially if the market is not growing for everyone. The wealthy kind of are an endless source of loot because the definition of wealthy is one relative to a median, so you'll either end up with everyone roughly equal in wealth (is that a bad thing?) or, more likely, over time new people will enter and exit the wealthy class due to various advantages and market dynamics so that there is an endless supply. [1] https://www.scientificamerican.com/article/is-inequality-inevitable/ https://www.scientificamerican.com/article/is-inequality-ine...

deleted 7y ago
[deleted]
Isinlor 7y ago
You should define what you mean by wealth. What does it mean that you will loot wealthy people? Will you eat shares of a company for breakfast? Will you burn cash in stove to warm your house? Wealthy people control resources. You can take control from them, but it will not create more resources. One, fundamental resource is human labor. This resource will decline in proportion to the total human population whether it will be controlled by wealthy people or not. Someone will need to physically do the work that needs to be done around old people. And there will be more old people, than there will be young people.
- MiroF 7y ago
  > Wealthy people control resources. Yes, it turns out that resources are actually the thing we need to sustain older people. > Someone will need to physically do the work that needs to be done around old people. Someone literally is already doing the work that needs to be done for old people. It's just that most of the wealth produced from that work goes to already wealthy people.
  - brokenkebab 7y ago
    It's just that most of the wealth produced from that work goes to already wealthy people. Exactly that work (social support, and healthcare for seniors) in total numbers consumes resources, not produces them. If it wouldn't be so there would be no need to fund it from taxes. Frankly, it sounds like you rushed with a randomly chosen slogan to this thead.
- mdorazio 7y ago
  I'm not really following your question. The idea of a wealth tax is pretty straightforward. You take stock of a person's assets, take a percentage of that figure (say 1%) and send them a bill for that dollar amount. How they choose to pay that bill is entirely up to them - they can borrow against their assets, liquidate some of them, or use cash on hand. I don't really see how control of resources factors into the equation.
  - Isinlor 7y ago
    Control of resources factors into the equation, because dollars are intrinsically worthless. If money have intrinsic value, why not to print 1 000 000 000$ on a bill and give one to everyone? Suddenly everyone would become a billionaire. Your example is less extreme, but it is still about redistributing control. Redistributing dollars redistributes control of what people do, and how other resources are allocated. This is related to the article, because moving control of people does not create more people. As population will be getting older, there will be more old people that less young people will need to take care of. This is a fact. You could argue that redistributing wealth will lead to more efficient control of resources, and so it will make it easier to provide care. But it is still fundamentally about control of diminishing resources and increasing needs. BTW - I'm Polish and my government tries to literally pay people for having children. Around 30 000$ spread across childhood (take into account that Poles earn a lot less than Americans), and while it put a small dent in fertility rate, the number of children born in Poland is currently lower than before introducing that program.
marcusverus 7y ago
You cannot destroy the incentive structure for economic activity (financial rewards) without catestrophic consequences. People don't pull start-up hours so that their neighbors can prosper, they do it for themselves. When you take away the possibility of great rewards, you destroy the incentive to add great value. See the entire history of collectivism.
- ClumsyPilot 7y ago
  The conversation is about what's fair incentive structure, correcting it does not amount to its destruction. Also we do not require people to pull startup hours, and only a minority of the population ever does that. I dont see how that comes into this conversation.
  - MiroF 7y ago
    It's a Rawlsian question of "how can we structure incentives such that everybody is better off?" Now, the metric for "everybody is better off" is still an open problem, but there seem to be near pareto optimal steps we can take, like a high threshold wealth tax.
  - marcusverus 7y ago
    I'm not sure what conversation you're participating in, but the parent comment was flippantly discussing the possibility of taxes so draconain that the GIDI coefficient would approach zero: "The wealthy kind of are an endless source of loot because the definition of wealthy is one relative to a median, so you'll either end up with everyone roughly equal in wealth (is that a bad thing?) " In the world advocated for in that comment, with aggressively averaged out income/wealth, there is no incentive to produce value above what is required to reach the average income.
- MiroF 7y ago
  A 2% wealth tax above a few hundred of millions of dollars doesn't destroy the incentive structure for economic activity, it is disingenuous to suggest it would.

moron4hire 7y ago

Given that the gap between the rich and poor as a share of GDP has been growing for quite some time, it kind of suggests the rich already do have a "magical, endless source of loot".

praptak 7y ago
This is known at least since Marx.

zappo2938 7y ago

I used to be a chef. In one situation I was payed dividing the number of patrons by number of cooks to cook for 40 people a night. In another situation I payed the same cook for 4 wealthy people on a yacht. It isn't hording. It is how the money is spent. One owner of a yacht was on the board of his alma mater. The school was required by law to spend equally on women's sports as men't sports. The school had to invest in sports fields which were expensive. He complained about it. Later I worked on a yacht of a person who grew grass. During this time when the schools were required to increase the size of their fields he made a fortune. There are just winners and losers. But cooking for 40 or 4 are pretty much the same from a labor perspective at that size because recipes scale to 10x easily.

MiroF 7y ago

Are people not aware how large wealth inequality is at this point? A small marginal wealth tax would generate just absolutely massive amounts of revenue because that is where most money is locked up, not in people's salaried income.

klyrs 7y ago

> The wealthy aren’t a magically endless source of loot. True. But that's how they've been treating folks with less advantage since time immemorial. Which tends to work until the exploitation becomes too egregious and lower classes implement a head tax on the wealthy.

notacoward 7y ago

I think it's very revealing that your argument assumes "the wealthy" are a class completely distinct from everyone else, without new people becoming wealthy all the time. Of course, nobody ever admits that they support such an arrangement, even as they oppose the primary means of preventing it.