4 ms·

Sure and if you impose a tax a national level instead of a state (or EU member country) the diminishing returns for increased taxation occur at a higher rate be

Sure and if you impose a tax a national level instead of a state (or EU member country) the diminishing returns for increased taxation occur at a higher rate because it's much harder to move to a new country than it is to move to a new state. Also housing prices probably have more to do with people leaving high priced cities than taxes do.

andrewtbham 6y ago
If you impose a wealth tax at the national level, rich people will leave America (edit: renounce citizenship) and ambitious people will never come here to begin with. America will no longer be the land of opportunity. The US has already passed an exit tax to try to prevent the wealthy from renouncing their citizenship. At some point even an exit tax won't be enough. If you study the fall of the roman empire, you will find people abandon huge estates to just start over away from roman taxes. https://www.irs.gov/individuals/international-taxpayers/expatriation-tax https://www.irs.gov/individuals/international-taxpayers/expa...
- take_a_breath 6y ago
  ==If you impose a wealth tax at the national level, rich people will leave America and ambitious people will never come here to begin with.== This is a pretty absolute claim to make without any sources or data to back it up.
  - andrewtbham 6y ago
    The source is the incentives theory of motivation and the work of behavioral psychologist such as Pavlov and BF Skinner. Also the "magic" of compounding gains that wealthy people understand (at least intuitively).
    - learc83 6y ago
      So your source for any wealth tax whatsoever having catastrophic consequences is Pavlov and BF Skinner? You think that a 1% wealth tax on wealth over $1 billion would completely destroy any incentive for an ambitious poor person to immigrate to the US? People are still immigrating to Switzerland, Belgium, and France.
      - andrewtbham 6y ago
        I don't think in absolutes. It won't "destroy any incentive" But yes, it is a powerful disincentive due to the compounding nature of wealth taxes. Rich people are already leaving such as Eduardo Saverin. It's a growing trend and one that, as I mentioned, the US is desperate to stop by imposing an exit tax for renouncing US citizenship. https://www.migrationpolicy.org/article/renouncing-us-citizenship-new-trend https://www.migrationpolicy.org/article/renouncing-us-citize...
        dlp211 6y ago
        An example of a guy who left nearly a decade ago to avoid paying taxes on wealth he did virtually nothing to earn is not data of an impending mass exodus of the ultra wealthy. Yes, there are handful number of people who have done such things, their existence is proof of nothing but absolute human greed and disloyalty to this great nation.
        andrewtbham 6y ago
        I like America. I don't plan to leave but yes... many wealthy people already have secondary citizenship. Jim Rogers says you should think of it like insurance. Hopefully you don't need it but for a variety of reasons it's a good idea to have a backup plan.
        dlp211 6y ago
        Secondary citizenship is not the same thing as denouncing your citizenship and fleeing taxes. US citizens are taxed worldwide, irrespective of location or other citizenship status. Your point is taken, it's just not relevant.
        learc83 6y ago
        >I don't think in absolutes. But you speak in absolutes. >If you impose a wealth tax at the national level, rich people will leave America (edit: renounce citizenship) and ambitious people will never come here to begin with. America will no longer be the land of opportunity. >But yes, it is a powerful disincentive due to the compounding nature of wealth taxes. This compounding nature of wealth taxes is nonsense. It's a negative feedback loop not a positive one. Compound interest is powerful because it compounds on itself--it's a positive feedback loop. Comparing compound interest to a wealth tax is just flat out wrong.
    - komali2 6y ago
      This is a classic mistake made all the time in economics, assuming all people are rational actors operating on a "money go up" algorithm. It ignores emotions, it ignores our vast swath of cognitive biases and shortcomings, and it ignores a hugely complex capitalist system. Off the top of my head, reasons a millionaire might not move out despite the existence of a wealth tax 1. They're too lazy to figure out how to move, including moving all their assets etc and sorting a new citizenship, finding a new job 2. They're too scared, for reasons above 3. They're a perfectly rational actor and the cost of a move doesn't outweigh the tax 4. They love their city 5. They have a huge family spread throughout the area 6. They're a fervent patriot 7. They don't want to leave their local church 8. They're the coach for the local little league team 9. Usa law is more reflective of their own value system (say, they like guns) 10. The rockies are too beautiful to leave behind
      - VRay 6y ago
        That's a great point Right now you can save tremendous amounts of tax money by spending 50% of the year in Puerto Rico, but most rich people still don't bother
        relaxing 6y ago
        I actually know someone who does this. Real weirdo, but then what other kind of person is there who’s so afraid of not having enough millions they feel the need to uproot their life every 6 months.
    - take_a_breath 6y ago
      So...that's a "no" on sources?
      - pc86 6y ago
        It's obviously impossible to provide a source for what people will do in the future based on some hypothetical policy change, on either side of the argument. Stop it.
        take_a_breath 6y ago
        I don't buy this argument at all. This is exactly the type of thing experts write policy papers and perform economic research to answer. If your claim were true, we could never debate policy proposals because they all rely on what people will do in the future based on a policy change. Medicare-for-All is a hypothetical policy change that has lots of research (data and sources) on how things would play out if implemented [1] [2] [3]. [1] https://www.peri.umass.edu/publication/item/1127-economic-analysis-of-medicare-for-all https://www.peri.umass.edu/publication/item/1127-economic-an... [2] https://www.urban.org/research/publication/sanders-single-payer-health-care-plan-effect-national-health-expenditures-and-federal-and-private-spending https://www.urban.org/research/publication/sanders-single-pa... [3] https://www.mercatus.org/publications/government-spending/costs-national-single-payer-healthcare-system https://www.mercatus.org/publications/government-spending/co...
- learc83 6y ago
  >If you impose a wealth tax at the national level, rich people will leave America and ambitious people will never come here to begin with. America will no longer be the land of opportunity. Has this happened in Switzerland? Would it happen in the US if we had a wealth tax of 0.001%? Obviously not. It likely would if we had a wealth tax of 100%. An income tax should do more to dissuade ambitious people than a wealth tax. A wealth tax only kicks in once you've accumulated wealth, and income tax slows that accumulation in the first place. We already have a national income tax. That doesn't seem to slow down immigration. > If you study the fall of the roman empire, you will find people abandon huge estates to just start over away from roman taxes. I know that it's fashionable in some circles to compare every non libertarian move the US makes to "The fall of the Roman Empire", but honestly people can't agree on what economic lesson to take from the great depression, do you really think we are going to be able to agree on what lessons to learn from the economy of the late Western Roman Empire?
  - andrewtbham 6y ago
    > An income tax should do more to dissuade ambitious people than a wealth tax That is wrong. I don't think you understand the power of compounding. That is the whole point of all of this... wealth compounds. Wealth taxes compound negatively. Read about Benjamin Franklin and his obsession with compounding interest. I learned it in school.
    - shkkmo 6y ago
      ”negative compounding" doesn't really do anything for your argument. All else being equal, the taxes amount would go down each year. Paying a .1% weath tax on a billion dollars for 60 years is cheaper than paying a flat 100,000 per year for 60 years. Any disencentive of the wealth tax comes from paying higher taxes, not from any "compounding" of the taxes.
      - Mirioron 6y ago
        >Paying a .1% weath tax on a billion dollars for 60 years is cheaper than paying a flat 100,000 per year for 60 years. Do you mean 1,000,000 a year? Because: 60 * 100,000 = 6,000,000 1,000,000,000 - 1,000,000,000 * 0.999^60 = 58,263,738 Also, keep in mind that if you want to actually have the money, you will pay the income taxes on top of that.
- sam_lowry_ 6y ago
  US is known to tax Americans abroad. IMO, rich people seeking to avoid taxation will have to loose US citizenship. And even after that, it's not clear whether US will let them off the hook.
- virtue3 6y ago
  Idk. It's about time rich people got to pay for the wealth they enjoy on the back of the USA. It's not free to send multiple carrier groups into the south china sea/SE asia region when we're forcing TikTok to sell itself to us you know? And we've also seen a complete and utter reduction of the middle class over the last 40 years, resulting in a much richer 1% and poorer 50% https://equitablegrowth.org/the-distribution-of-wealth-in-the-united-states-and-implications-for-a-net-worth-tax https://equitablegrowth.org/the-distribution-of-wealth-in-th... The other aspect here is that the people with wealth have seen it increase at a fairly linear rate. They can handle a small tax on it just fine. and it's about time they start directly paying for a service that the rest of us have.
  - andrewtbham 6y ago
    The irony is poor people will never be wealthy till that start investing in assets and understand the compounding nature of wealth. It's that same lack of understand of compounding that contributes to the argument for a wealth tax. It's true. US inequality is rising as you stated, but global inequality is down. So you don't have the moral high ground. You have a false sense of entitlement and want to profit on the backs of the rest of the world instead of the people who invest their time and money into those assets. https://ourworldindata.org/grapher/distribution-of-population-poverty-thresholds?stackMode=relative https://ourworldindata.org/grapher/distribution-of-populatio...
    - catears 6y ago
      Would you mind stop telling everyone that they don't understand compounding interest? I've read a lot of comments and your replies and I have noticed a disturbing amount of normal comments being greyed out while you explain to them that they don't understand compounding, because if they did understand it they would be against any form of wealth tax. Pretty much everyone who owns stocks or invest money, which quite a lot of people do, understand the effects of compounding interest.
      - andrewtbham 6y ago
        > The other aspect here is that the people with wealth have seen it increase at a fairly linear rate. Do you think this guy understands compounding growth? It would actually help his argument if replaced the word linear with exponential, which is more accurate. Compounding growth is exponential, not linear.
- alistairSH 6y ago
  If you impose a wealth tax at the national level, rich people will leave America US taxes the income of citizens living abroad, so that doesn't help. They'd have to reject their American citizenship to avoid US taxation of their income (and presumably their wealth as well). That's certainly possible, and wealthy retirees certainly do this. But, it's not without downsides.
  - andrewtbham 6y ago
    that's what I meant by leaving, renouncing US citizenship.
    - catears 6y ago
      If I understand you correctly, you mean that wealthy americans who have built their fortune and life in america will choose to not only leave but also revoke their citizenship and leave the US? All because they have to pay more money than before in taxes? Personally, I don't think all millionares and billionares are willing to leave their life and family behind because of a some dollars in federal tax...
      - andrewtbham 6y ago
        Yes. Many US tech founders weren't born in America. So they would be going back to their families. And taking their immediate families with them. Eduard Saverin (facebook) did renounce his citizenship. There are many immigrant founders: Elon Musk (South Africa, Canada), Sergey Brin (Russia).
    - enraged_camel 6y ago
      I think a more accurate way of phrasing your original statement is "if a wealth tax was implemented and I myself were wealthy to the point where it applied to me, I would renounce my citizenship". Because you don't speak for rich people, as there is no evidence that they would, in fact, leave America.
      - 6y ago
- jasonwatkinspdx 6y ago
  If the presence of wealth in a nation was the sole factor in growing entrepreneurship then the gulf kingdoms would have dethroned silicon valley decades ago. There's obviously a whole lot more involved in the decision making of wealthy people looking to start their next venture.
  - andrewtbham 6y ago
    I never said wealth is the sole factor for a tech hub/ecosystem. California is creating a huge incentive for billionaires to leave. So they are more likely to move and take their experience and move the tech ecosystem. It's fine with me. I don't live in California. Boston lost the tech ecosystem with government regulation around non-competes... maybe California will lose it over a wealth tax or even the threat of one. It would probably be better for the whole country if less wealth was concentrated in California and the wealthy moved to red states. Probably Texas.
    - relaxing 6y ago
      What kind of revisionist history is this? Boston “lost” the tech ecosystem because its main players were too entrenched in the mainframe/minicomputer business to pivot quickly enough to compete with the Silicon Valley microcomputer revolution.
      - njarboe 6y ago
        Silicon Valley is a start-up culture which can only thrive where non-competes are illegal. 'Main players' rarely pivot and create new business divisions that can compete with all the start-ups. I'm not saying the main players were not too entrenched, but that there is a reason that the Silicon Valley microcomputer revolution happened there. Fairchild's children and all that came after.
        jasonwatkinspdx 6y ago
        This is wild stuff. SV had its origins in Fred Terman, the halo effect of Stanford, and that Shockley happened to have been born there and decided to move back. By the time the computer club was around it already had enormous momentum. I'm no fan of noncompetes, but you are vastly overstating their impact.
- yourapostasy 6y ago
  > If you impose a wealth tax at the national level, rich people will leave America (edit: renounce citizenship) and ambitious people will never come here to begin with. I might be guessing wrong here, but I'm going out on a limb and asserting that you've never owned an international business for more than 7 years. The decision matrix on where to establish domicile if you have the means to pick anywhere in the world is a lot larger than the unitary "how much taxes" value. The US has a lot of problems with it. No question. The US also has a relatively unique business environment that happens to intersect well with many businesses' requirements, especially those owned by individuals who want to transact business internationally. It is unique enough that many with means to offshore their wealth voluntarily choose to domicile in the US. Yes there are many who run offshore accounts, but generally speaking, you "only" need around a consistent $1M USD in annual income before some pretty sophisticated offshore tax management structures start to become attractive. There are a heck of a lot of people like that in the US, and they aren't stampeding for many of these structures, despite the best efforts of those selling them. Roughly speaking, if you value your time, it doesn't become worth it until you can afford your own private wealth management office (say around $2-5M+ expense per year depending upon your overall directives to them). Generally speaking, the juice isn't worth the squeeze. People in that income bracket and above carefully spend their time, and even with a modest say 0.01-0.1% wealth tax per year, that's not enough to spend a huge amount of hassle over. We're not talking about the finance nexus moving from NYC/Chicago to Dubai, for example. They'll make it sound like it means just that because money is money. There are people who do move out, or renounce citizenship, but using the demand for residency visas as a proxy, we're "pricing" the benefits of staying in the US too low and there is room for a wealth tax. I don't unequivocally support a wealth tax, by the way. I'm pointing out that "the sky will fall, rich and innovative people will leave/never enter" line of argument against a wealth tax is not going to win with policy makers who have the facts at their staffs' beck and call. A more likely argument that will win with these policy makers however, is along the lines of "your $10K/plate donor base will evaporate if you vote for this, and you'll never offset the loss from the increase in people-who-work-for-a-living donations". Engage the wheels of constant price deflation with increasing quality for real-estate-dirt, healthcare, insurance, finance, and education, and that will go a long ways towards addressing the ailments a wealth tax purportedly does.
justinzollars 6y ago
If we pass a wealth tax we will be able to test your theory! I believe this action is lose lose. Let's see what happens

andrewtbham 6y ago

If you impose a wealth tax at the national level, rich people will leave America (edit: renounce citizenship) and ambitious people will never come here to begin with. America will no longer be the land of opportunity. The US has already passed an exit tax to try to prevent the wealthy from renouncing their citizenship. At some point even an exit tax won't be enough. If you study the fall of the roman empire, you will find people abandon huge estates to just start over away from roman taxes. https://www.irs.gov/individuals/international-taxpayers/expatriation-tax https://www.irs.gov/individuals/international-taxpayers/expa...

take_a_breath 6y ago
==If you impose a wealth tax at the national level, rich people will leave America and ambitious people will never come here to begin with.== This is a pretty absolute claim to make without any sources or data to back it up.
- andrewtbham 6y ago
  The source is the incentives theory of motivation and the work of behavioral psychologist such as Pavlov and BF Skinner. Also the "magic" of compounding gains that wealthy people understand (at least intuitively).
  - learc83 6y ago
    So your source for any wealth tax whatsoever having catastrophic consequences is Pavlov and BF Skinner? You think that a 1% wealth tax on wealth over $1 billion would completely destroy any incentive for an ambitious poor person to immigrate to the US? People are still immigrating to Switzerland, Belgium, and France.
    - andrewtbham 6y ago
      I don't think in absolutes. It won't "destroy any incentive" But yes, it is a powerful disincentive due to the compounding nature of wealth taxes. Rich people are already leaving such as Eduardo Saverin. It's a growing trend and one that, as I mentioned, the US is desperate to stop by imposing an exit tax for renouncing US citizenship. https://www.migrationpolicy.org/article/renouncing-us-citizenship-new-trend https://www.migrationpolicy.org/article/renouncing-us-citize...
      - dlp211 6y ago
        An example of a guy who left nearly a decade ago to avoid paying taxes on wealth he did virtually nothing to earn is not data of an impending mass exodus of the ultra wealthy. Yes, there are handful number of people who have done such things, their existence is proof of nothing but absolute human greed and disloyalty to this great nation.
        andrewtbham 6y ago
        I like America. I don't plan to leave but yes... many wealthy people already have secondary citizenship. Jim Rogers says you should think of it like insurance. Hopefully you don't need it but for a variety of reasons it's a good idea to have a backup plan.
        dlp211 6y ago
        Secondary citizenship is not the same thing as denouncing your citizenship and fleeing taxes. US citizens are taxed worldwide, irrespective of location or other citizenship status. Your point is taken, it's just not relevant.
      - learc83 6y ago
        >I don't think in absolutes. But you speak in absolutes. >If you impose a wealth tax at the national level, rich people will leave America (edit: renounce citizenship) and ambitious people will never come here to begin with. America will no longer be the land of opportunity. >But yes, it is a powerful disincentive due to the compounding nature of wealth taxes. This compounding nature of wealth taxes is nonsense. It's a negative feedback loop not a positive one. Compound interest is powerful because it compounds on itself--it's a positive feedback loop. Comparing compound interest to a wealth tax is just flat out wrong.
  - komali2 6y ago
    This is a classic mistake made all the time in economics, assuming all people are rational actors operating on a "money go up" algorithm. It ignores emotions, it ignores our vast swath of cognitive biases and shortcomings, and it ignores a hugely complex capitalist system. Off the top of my head, reasons a millionaire might not move out despite the existence of a wealth tax 1. They're too lazy to figure out how to move, including moving all their assets etc and sorting a new citizenship, finding a new job 2. They're too scared, for reasons above 3. They're a perfectly rational actor and the cost of a move doesn't outweigh the tax 4. They love their city 5. They have a huge family spread throughout the area 6. They're a fervent patriot 7. They don't want to leave their local church 8. They're the coach for the local little league team 9. Usa law is more reflective of their own value system (say, they like guns) 10. The rockies are too beautiful to leave behind
    - VRay 6y ago
      That's a great point Right now you can save tremendous amounts of tax money by spending 50% of the year in Puerto Rico, but most rich people still don't bother
      - relaxing 6y ago
        I actually know someone who does this. Real weirdo, but then what other kind of person is there who’s so afraid of not having enough millions they feel the need to uproot their life every 6 months.
  - take_a_breath 6y ago
    So...that's a "no" on sources?
    - pc86 6y ago
      It's obviously impossible to provide a source for what people will do in the future based on some hypothetical policy change, on either side of the argument. Stop it.
      - take_a_breath 6y ago
        I don't buy this argument at all. This is exactly the type of thing experts write policy papers and perform economic research to answer. If your claim were true, we could never debate policy proposals because they all rely on what people will do in the future based on a policy change. Medicare-for-All is a hypothetical policy change that has lots of research (data and sources) on how things would play out if implemented [1] [2] [3]. [1] https://www.peri.umass.edu/publication/item/1127-economic-analysis-of-medicare-for-all https://www.peri.umass.edu/publication/item/1127-economic-an... [2] https://www.urban.org/research/publication/sanders-single-payer-health-care-plan-effect-national-health-expenditures-and-federal-and-private-spending https://www.urban.org/research/publication/sanders-single-pa... [3] https://www.mercatus.org/publications/government-spending/costs-national-single-payer-healthcare-system https://www.mercatus.org/publications/government-spending/co...
learc83 6y ago
>If you impose a wealth tax at the national level, rich people will leave America and ambitious people will never come here to begin with. America will no longer be the land of opportunity. Has this happened in Switzerland? Would it happen in the US if we had a wealth tax of 0.001%? Obviously not. It likely would if we had a wealth tax of 100%. An income tax should do more to dissuade ambitious people than a wealth tax. A wealth tax only kicks in once you've accumulated wealth, and income tax slows that accumulation in the first place. We already have a national income tax. That doesn't seem to slow down immigration. > If you study the fall of the roman empire, you will find people abandon huge estates to just start over away from roman taxes. I know that it's fashionable in some circles to compare every non libertarian move the US makes to "The fall of the Roman Empire", but honestly people can't agree on what economic lesson to take from the great depression, do you really think we are going to be able to agree on what lessons to learn from the economy of the late Western Roman Empire?
- andrewtbham 6y ago
  > An income tax should do more to dissuade ambitious people than a wealth tax That is wrong. I don't think you understand the power of compounding. That is the whole point of all of this... wealth compounds. Wealth taxes compound negatively. Read about Benjamin Franklin and his obsession with compounding interest. I learned it in school.
  - shkkmo 6y ago
    ”negative compounding" doesn't really do anything for your argument. All else being equal, the taxes amount would go down each year. Paying a .1% weath tax on a billion dollars for 60 years is cheaper than paying a flat 100,000 per year for 60 years. Any disencentive of the wealth tax comes from paying higher taxes, not from any "compounding" of the taxes.
    - Mirioron 6y ago
      >Paying a .1% weath tax on a billion dollars for 60 years is cheaper than paying a flat 100,000 per year for 60 years. Do you mean 1,000,000 a year? Because: 60 * 100,000 = 6,000,000 1,000,000,000 - 1,000,000,000 * 0.999^60 = 58,263,738 Also, keep in mind that if you want to actually have the money, you will pay the income taxes on top of that.
sam_lowry_ 6y ago
US is known to tax Americans abroad. IMO, rich people seeking to avoid taxation will have to loose US citizenship. And even after that, it's not clear whether US will let them off the hook.
virtue3 6y ago
Idk. It's about time rich people got to pay for the wealth they enjoy on the back of the USA. It's not free to send multiple carrier groups into the south china sea/SE asia region when we're forcing TikTok to sell itself to us you know? And we've also seen a complete and utter reduction of the middle class over the last 40 years, resulting in a much richer 1% and poorer 50% https://equitablegrowth.org/the-distribution-of-wealth-in-the-united-states-and-implications-for-a-net-worth-tax https://equitablegrowth.org/the-distribution-of-wealth-in-th... The other aspect here is that the people with wealth have seen it increase at a fairly linear rate. They can handle a small tax on it just fine. and it's about time they start directly paying for a service that the rest of us have.
- andrewtbham 6y ago
  The irony is poor people will never be wealthy till that start investing in assets and understand the compounding nature of wealth. It's that same lack of understand of compounding that contributes to the argument for a wealth tax. It's true. US inequality is rising as you stated, but global inequality is down. So you don't have the moral high ground. You have a false sense of entitlement and want to profit on the backs of the rest of the world instead of the people who invest their time and money into those assets. https://ourworldindata.org/grapher/distribution-of-population-poverty-thresholds?stackMode=relative https://ourworldindata.org/grapher/distribution-of-populatio...
  - catears 6y ago
    Would you mind stop telling everyone that they don't understand compounding interest? I've read a lot of comments and your replies and I have noticed a disturbing amount of normal comments being greyed out while you explain to them that they don't understand compounding, because if they did understand it they would be against any form of wealth tax. Pretty much everyone who owns stocks or invest money, which quite a lot of people do, understand the effects of compounding interest.
    - andrewtbham 6y ago
      > The other aspect here is that the people with wealth have seen it increase at a fairly linear rate. Do you think this guy understands compounding growth? It would actually help his argument if replaced the word linear with exponential, which is more accurate. Compounding growth is exponential, not linear.
alistairSH 6y ago
If you impose a wealth tax at the national level, rich people will leave America US taxes the income of citizens living abroad, so that doesn't help. They'd have to reject their American citizenship to avoid US taxation of their income (and presumably their wealth as well). That's certainly possible, and wealthy retirees certainly do this. But, it's not without downsides.
- andrewtbham 6y ago
  that's what I meant by leaving, renouncing US citizenship.
  - catears 6y ago
    If I understand you correctly, you mean that wealthy americans who have built their fortune and life in america will choose to not only leave but also revoke their citizenship and leave the US? All because they have to pay more money than before in taxes? Personally, I don't think all millionares and billionares are willing to leave their life and family behind because of a some dollars in federal tax...
    - andrewtbham 6y ago
      Yes. Many US tech founders weren't born in America. So they would be going back to their families. And taking their immediate families with them. Eduard Saverin (facebook) did renounce his citizenship. There are many immigrant founders: Elon Musk (South Africa, Canada), Sergey Brin (Russia).
  - enraged_camel 6y ago
    I think a more accurate way of phrasing your original statement is "if a wealth tax was implemented and I myself were wealthy to the point where it applied to me, I would renounce my citizenship". Because you don't speak for rich people, as there is no evidence that they would, in fact, leave America.
    - 6y ago
jasonwatkinspdx 6y ago
If the presence of wealth in a nation was the sole factor in growing entrepreneurship then the gulf kingdoms would have dethroned silicon valley decades ago. There's obviously a whole lot more involved in the decision making of wealthy people looking to start their next venture.
- andrewtbham 6y ago
  I never said wealth is the sole factor for a tech hub/ecosystem. California is creating a huge incentive for billionaires to leave. So they are more likely to move and take their experience and move the tech ecosystem. It's fine with me. I don't live in California. Boston lost the tech ecosystem with government regulation around non-competes... maybe California will lose it over a wealth tax or even the threat of one. It would probably be better for the whole country if less wealth was concentrated in California and the wealthy moved to red states. Probably Texas.
  - relaxing 6y ago
    What kind of revisionist history is this? Boston “lost” the tech ecosystem because its main players were too entrenched in the mainframe/minicomputer business to pivot quickly enough to compete with the Silicon Valley microcomputer revolution.
    - njarboe 6y ago
      Silicon Valley is a start-up culture which can only thrive where non-competes are illegal. 'Main players' rarely pivot and create new business divisions that can compete with all the start-ups. I'm not saying the main players were not too entrenched, but that there is a reason that the Silicon Valley microcomputer revolution happened there. Fairchild's children and all that came after.
      - jasonwatkinspdx 6y ago
        This is wild stuff. SV had its origins in Fred Terman, the halo effect of Stanford, and that Shockley happened to have been born there and decided to move back. By the time the computer club was around it already had enormous momentum. I'm no fan of noncompetes, but you are vastly overstating their impact.
yourapostasy 6y ago
> If you impose a wealth tax at the national level, rich people will leave America (edit: renounce citizenship) and ambitious people will never come here to begin with. I might be guessing wrong here, but I'm going out on a limb and asserting that you've never owned an international business for more than 7 years. The decision matrix on where to establish domicile if you have the means to pick anywhere in the world is a lot larger than the unitary "how much taxes" value. The US has a lot of problems with it. No question. The US also has a relatively unique business environment that happens to intersect well with many businesses' requirements, especially those owned by individuals who want to transact business internationally. It is unique enough that many with means to offshore their wealth voluntarily choose to domicile in the US. Yes there are many who run offshore accounts, but generally speaking, you "only" need around a consistent $1M USD in annual income before some pretty sophisticated offshore tax management structures start to become attractive. There are a heck of a lot of people like that in the US, and they aren't stampeding for many of these structures, despite the best efforts of those selling them. Roughly speaking, if you value your time, it doesn't become worth it until you can afford your own private wealth management office (say around $2-5M+ expense per year depending upon your overall directives to them). Generally speaking, the juice isn't worth the squeeze. People in that income bracket and above carefully spend their time, and even with a modest say 0.01-0.1% wealth tax per year, that's not enough to spend a huge amount of hassle over. We're not talking about the finance nexus moving from NYC/Chicago to Dubai, for example. They'll make it sound like it means just that because money is money. There are people who do move out, or renounce citizenship, but using the demand for residency visas as a proxy, we're "pricing" the benefits of staying in the US too low and there is room for a wealth tax. I don't unequivocally support a wealth tax, by the way. I'm pointing out that "the sky will fall, rich and innovative people will leave/never enter" line of argument against a wealth tax is not going to win with policy makers who have the facts at their staffs' beck and call. A more likely argument that will win with these policy makers however, is along the lines of "your $10K/plate donor base will evaporate if you vote for this, and you'll never offset the loss from the increase in people-who-work-for-a-living donations". Engage the wheels of constant price deflation with increasing quality for real-estate-dirt, healthcare, insurance, finance, and education, and that will go a long ways towards addressing the ailments a wealth tax purportedly does.

justinzollars 6y ago

If we pass a wealth tax we will be able to test your theory! I believe this action is lose lose. Let's see what happens