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> He will spend a lot of time either angry at the situation, or spending that time also trying to get a tax break. It is a good financial decision to spend up

by flingo 6y ago

> He will spend a lot of time either angry at the situation, or spending that time also trying to get a tax break. It is a good financial decision to spend up to "$1M * <odds of success>" to get that tax break, or another better one. (especially if the ~$500K spent on retainered-lawyers sets you up to pay less due to future tax hikes.) Economics gets weird when any of the numbers get really big, or really small. I don't like this example though, as it doesn't detail why the tax break was so specific. Did 4/5 of them have no taxable income that year? Do all of these billionaires live in a despotic-shithole where the rule of law doesn't apply equally to everyone? (to be fair, most billionaires do. /s)

tripzilch 6y ago
It's a good financial decision for a business that is supposed to maximise profit for shareholders or employees or something. But this example is not about that. First to answer your last question, it's the despotic shithole kind. The point being, the reason is completely arbitrary. This is about a billionaire who can already buy whatever they want, regardless of said tax break. It won't make them directly happier because it doesn't allow them to buy anything they couldn't otherwise buy. The point of the example is that given this is the case, we still have a built in biological desire for "fairness" and if this billionaire would realise and observe this desire having no logical basis, they would not fight it. (assume fighting it is not as enjoyable to spend their limited life time as they could be doing something else with the money they already have) In an analogous situation, five people go to a fancy restaurant and for some reason four of them get 10 plates of food, and one gets 9 plates of food. Assume the restaurant is so generous one person can't possibly eat more than 2 plates anyway. Why is it easier to imagine simply not making a big deal out of it and enjoying your meal(s), in this situation? (Especially considering that the meal example is 100x more unfair)

by flingo 6y ago

tripzilch 6y ago

It's a good financial decision for a business that is supposed to maximise profit for shareholders or employees or something. But this example is not about that. First to answer your last question, it's the despotic shithole kind. The point being, the reason is completely arbitrary. This is about a billionaire who can already buy whatever they want, regardless of said tax break. It won't make them directly happier because it doesn't allow them to buy anything they couldn't otherwise buy. The point of the example is that given this is the case, we still have a built in biological desire for "fairness" and if this billionaire would realise and observe this desire having no logical basis, they would not fight it. (assume fighting it is not as enjoyable to spend their limited life time as they could be doing something else with the money they already have) In an analogous situation, five people go to a fancy restaurant and for some reason four of them get 10 plates of food, and one gets 9 plates of food. Assume the restaurant is so generous one person can't possibly eat more than 2 plates anyway. Why is it easier to imagine simply not making a big deal out of it and enjoying your meal(s), in this situation? (Especially considering that the meal example is 100x more unfair)