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It’s my opinion but that was a very one sided view. And I need to read more on this but I don’t think the way he pointed it out is how anyone is proposing wealt

It’s my opinion but that was a very one sided view. And I need to read more on this but I don’t think the way he pointed it out is how anyone is proposing wealth tax.

fossuser 6y ago
What PG describes is basically what's proposed - the main difference is that most American proposals have a floor before it kicks in. That floor is pretty high depending on the proposal ($30-50 million), but that doesn't stop the problem of equity ownership being eaten away over time when a lot of your worth is tied up into a successful company (like Bezos). You also get other incentive problems with things like angel investing. If someone is at the wealth cap they're less incentivized to risk money when they'll either lose it because the investment fails, or lose it because it gets eaten by the wealth tax. Other proposals have low floors where you just have the problem of a lot of wealth getting taken. In general it's good for a society to incentivize wealth creation/growth and still protect the lower bound of society. A wealth tax dis-incentivizes wealth creation - and for what? It just comes across to me as a 'hate the rich' policy that creates perverse incentives. Disclosures so people don't think there's hidden motivated reasoning here: - I'm nowhere near the wealth cap and probably never will be - I think trump is an idiot and the republican party is a disaster - I voted for Hillary and will vote for Biden. I still think the wealth tax is a bad idea and bad policy.
- marcinzm 6y ago
  Why is disincentivizing the accumulation of massive wealth in a small subset of the population bad for society? What is the advantage to society of an individual accumulating tens of billions of dollars worth of wealth?
  - fossuser 6y ago
    It's dis-incentivizing wealth creation in general and taking ownership away from people that build companies. There's a compelling argument that growth (that accounts for human rights and protecting the environment) is the best way to help the most people the fastest: https://press.stripe.com/#stubborn-attachments https://press.stripe.com/#stubborn-attachments. Policy that dis-incentivizes wealth creation creates perverse incentives that limit growth. We're better off with policy that limits how wealth can be leveraged into political power, and policy that helps protect and improve the lower bound of society. That said, I think it's likely reasonable to limit how wealth can be passed down generations (to prevent things like dynastic wealth, but that's a separate issue and I don't know enough to really comment on it). Wealth creation isn't zero-sum, just because someone builds a business and creates wealth doesn't mean they're taking it from others. We want a society where people are incentivized to create and grow wealth as much as they can (within bounds for environment protection and human rights), not just to some arbitrary cap before it gets taken by the government. All of the above ignores real modern examples that directly leverage their wealth to do things that would not be done otherwise (Elon Musk: SpaceX, Tesla, Neuralink, Boring # Bezos: Amazon and Blue Origin # Gates: Health and Public Policy). I think the general argument in favor of growth is better than these specific examples though because it's a more systemic argument about incentives for the structure of a society rather than relying on individuals and their choices. There's also the implementation issues (which are real), but I'm not going to argue that bit just because a lot of good ideas are hard to implement but still worthwhile. The wealth tax though I think is both a bad idea and hard to implement. The bad idea bit is more important.
    - marcinzm 6y ago
      >We're better off with policy that limits how wealth can be leveraged into political power Has there ever been a case in history where a society has successfully limited the political impact with those of disproportionately immense wealth? edit: >There's a compelling argument that growth (that accounts for human rights and protecting the environment) is the best way to help the most people the fastest: I'd prefer to be an average or below person in most of Europe (free healthcare, free education, 6 weeks of paid vacation, various other benefits, low crime, etc.) rather than America. Yet America values growth a lot more than Europe.
      - elevenoh 6y ago
        >We're better off with policy that limits how wealth can be leveraged into political power >>Has there ever been a case in history where a society has successfully limited the political impact with those of disproportionately immense wealth? there's more ways w/ tech to covertly do such than ever.
    - ishansharma 6y ago
      I agree with most of your comment and it's making me rethink some of my opinions. But is this accurate: > Wealth creation isn't zero-sum, just because someone builds a business and creates wealth doesn't mean they're taking it from others. I'd say that's exactly the model that some of the startups are taking. Uber and Lyft come to mind. A part of their wealth is coming from the pockets of workers who have to work for lower wages than before and get hit by depreciation that they didn't account for when earning.
      - fossuser 6y ago
        Arguably wealth creation is never zero-sum, but businesses also do cause money to transfer which is - but I get what you're trying to say and won't dispute definitions. By wealth creation I mean something like this: you buy parts to build a house on land you've purchased. After you're done building the value of that house is worth more than the sum of its parts. The time you invested created something more valuable without taking anything from someone else (you now have more 'wealth' than you had when you had some land and a pile of house parts). This doesn't take wealth away from anyone else, but if you were to sell someone may choose to buy your newly created house when they might have otherwise chosen the neighbors house which is slightly older. That's a bit of a different thing. There are definitely some industries where a lot of the cut-throat nature is a result of stagnation and groups fighting each other over what profit is available via competition. (Thiel talks about this in Zero to One and why businesses in competitive markets are a bad idea). That said, the uber/lyft example is interesting. Some points: - Prior to uber and lyft a lot more people would just drive drunk, taxis were unreliable and expensive - if you had to take a taxi somewhere people would just opt not to go. - Taxi companies were pretty corrupt and (at least in NYC) relied on a medallion model that expressly limited growth and empowered organized crime groups. This led to a worse experience for everyone except the medallion holders who could extort drivers and riders (while providing bad service). - A lot of people that drive for uber and lyft were not driving for taxis before, the market maker effect of uber/lyft and people that need a ride created a much larger market for people hiring taxis. This creates wealth - both for the drivers that did not have that ability before and for the riders that would not have previously bothered to call a taxi (and clearly all the people that work at uber/lyft generally). It might also have knock on effects where people go out more which might benefit local businesses more, but that's fairly speculative. Are there people that get screwed in this? Probably - taxi companies that provided bad/expensive service are not competitive with uber/lyft. A smaller amount of people at those companies that were making more are probably making less. Is that worse for society generally? My personal view is that it's not. Anyway - on a meta note, I also appreciate the back and forth and engaging with me. I'm open to being persuaded otherwise. I've read a lot about this stuff and have tried really hard to understand the underlying truth away from politics. This is where I've currently landed.
  - navd 6y ago
    Because then you incentivize people to seek status.
- Reedx 6y ago
  > It just comes across to me as a 'hate the rich' policy that creates perverse incentives. Indeed, wealth tax sounds good because there are problems with income inequality and it's currently fashionable to hate the rich. But that's about where it ends, while second-order effects are ignored or at least not taken seriously. Andrew Yang was one of the few high-profile Democrats brave enough to push back on it. "I think the wealth tax is an idea, in spirit, that makes sense, given the wealth distribution. But in practice it would have massive implementation problems. There would be capital flight, wealthy people would renounce their citizenship. And the bigger problem isn’t even the money. It’s the annual inventorying of their assets. The truly wealthy in this country have zero interest in submitting to an annual audit of all of their assets. They barely know what all their assets are. And the last thing they’re going to do is report them every year and then pay a toll. So you would have massive compliance problems. And to me there are better ways to make this economy fair, though I understand the spirit of it and the intent of it. But I agree that it would be somewhere between problematic and a disaster in practice." https://www.cnbc.com/2019/10/02/andrew-yang-wealth-tax-plans-from-sanders-warren-could-be-disaster.html https://www.cnbc.com/2019/10/02/andrew-yang-wealth-tax-plans...
  - mattmanser 6y ago
    Easy ways to stop that, start with a huge tax on your wealth when you renounce citizenship. They built the wealth on the back of their nation, on the back of the infrastructure, education, laws and blood of their ancestors, no good reason they should keep it when they choose to leave. It's the fundamental basis behind tax. 95% tax on any wealth over, say, $500k on renouncing citizenship, total forfeit if found to be hiding assets, done.
    - felipemnoa 6y ago
      >>Easy ways to stop that, make it illegal to take your wealth when you renounce citizenship. If you have to come up with ways to stop people from fleeing your country instead of too many people wanting to enter your country then you probably have a problem. And no, I don't think it is as easy as you say. Simple sounding solutions like this can have huge disastrous consequences.
ghufran_syed 6y ago
What's the opposing view, other than "they are rich, they can afford it + we really need the money for $good-things"? I'm not sure if you are disagreeing with the math or making a separate point about why we should do it anyway?
- darkerside 6y ago
  I truly don't know the answer on whether the wealth tax is a good idea (and there probably isn't a single right answer). But, that sure is a shitty way of saying, "I don't understand, can you explain your viewpoint to me?"
  - ghufran_syed 6y ago
    I think it's an accurate summary of the arguments in favor of a wealth tax. But I would really like to hear if there are other arguments that can't be characterized that way. But it's hard to be persuaded when no-one actually presents the argument, and instead just criticizes the tone.
    - darkerside 6y ago
      I'm happy to present one as an example. If be happy to continue discussing it past that as well, as long as you are willing to converse and not argue. Wealth in the hands of a few becomes static. Jeff Bezos can only buy so many jets. When you leave it there, the entire economy stagnates.
      - janhenr 6y ago
        As most of Bezos' fortune is in Amazon stock, this money is not exactly sleeping.
        darkerside 6y ago
        Fair point, and same probably goes for other billionaires, who have their money in a variety of investments. That probably does a lot to juice the stock market, pumping up valuations, but it doesn't do as much to generate actual economic returns. Happy to be educated otherwise.

It’s my opinion but that was a very one sided view. And I need to read more on this but I don’t think the way he pointed it out is how anyone is proposing wealth tax.

fossuser 6y ago

What PG describes is basically what's proposed - the main difference is that most American proposals have a floor before it kicks in. That floor is pretty high depending on the proposal ($30-50 million), but that doesn't stop the problem of equity ownership being eaten away over time when a lot of your worth is tied up into a successful company (like Bezos). You also get other incentive problems with things like angel investing. If someone is at the wealth cap they're less incentivized to risk money when they'll either lose it because the investment fails, or lose it because it gets eaten by the wealth tax. Other proposals have low floors where you just have the problem of a lot of wealth getting taken. In general it's good for a society to incentivize wealth creation/growth and still protect the lower bound of society. A wealth tax dis-incentivizes wealth creation - and for what? It just comes across to me as a 'hate the rich' policy that creates perverse incentives. Disclosures so people don't think there's hidden motivated reasoning here: - I'm nowhere near the wealth cap and probably never will be - I think trump is an idiot and the republican party is a disaster - I voted for Hillary and will vote for Biden. I still think the wealth tax is a bad idea and bad policy.

marcinzm 6y ago
Why is disincentivizing the accumulation of massive wealth in a small subset of the population bad for society? What is the advantage to society of an individual accumulating tens of billions of dollars worth of wealth?
- fossuser 6y ago
  It's dis-incentivizing wealth creation in general and taking ownership away from people that build companies. There's a compelling argument that growth (that accounts for human rights and protecting the environment) is the best way to help the most people the fastest: https://press.stripe.com/#stubborn-attachments https://press.stripe.com/#stubborn-attachments. Policy that dis-incentivizes wealth creation creates perverse incentives that limit growth. We're better off with policy that limits how wealth can be leveraged into political power, and policy that helps protect and improve the lower bound of society. That said, I think it's likely reasonable to limit how wealth can be passed down generations (to prevent things like dynastic wealth, but that's a separate issue and I don't know enough to really comment on it). Wealth creation isn't zero-sum, just because someone builds a business and creates wealth doesn't mean they're taking it from others. We want a society where people are incentivized to create and grow wealth as much as they can (within bounds for environment protection and human rights), not just to some arbitrary cap before it gets taken by the government. All of the above ignores real modern examples that directly leverage their wealth to do things that would not be done otherwise (Elon Musk: SpaceX, Tesla, Neuralink, Boring # Bezos: Amazon and Blue Origin # Gates: Health and Public Policy). I think the general argument in favor of growth is better than these specific examples though because it's a more systemic argument about incentives for the structure of a society rather than relying on individuals and their choices. There's also the implementation issues (which are real), but I'm not going to argue that bit just because a lot of good ideas are hard to implement but still worthwhile. The wealth tax though I think is both a bad idea and hard to implement. The bad idea bit is more important.
  - marcinzm 6y ago
    >We're better off with policy that limits how wealth can be leveraged into political power Has there ever been a case in history where a society has successfully limited the political impact with those of disproportionately immense wealth? edit: >There's a compelling argument that growth (that accounts for human rights and protecting the environment) is the best way to help the most people the fastest: I'd prefer to be an average or below person in most of Europe (free healthcare, free education, 6 weeks of paid vacation, various other benefits, low crime, etc.) rather than America. Yet America values growth a lot more than Europe.
    - elevenoh 6y ago
      >We're better off with policy that limits how wealth can be leveraged into political power >>Has there ever been a case in history where a society has successfully limited the political impact with those of disproportionately immense wealth? there's more ways w/ tech to covertly do such than ever.
  - ishansharma 6y ago
    I agree with most of your comment and it's making me rethink some of my opinions. But is this accurate: > Wealth creation isn't zero-sum, just because someone builds a business and creates wealth doesn't mean they're taking it from others. I'd say that's exactly the model that some of the startups are taking. Uber and Lyft come to mind. A part of their wealth is coming from the pockets of workers who have to work for lower wages than before and get hit by depreciation that they didn't account for when earning.
    - fossuser 6y ago
      Arguably wealth creation is never zero-sum, but businesses also do cause money to transfer which is - but I get what you're trying to say and won't dispute definitions. By wealth creation I mean something like this: you buy parts to build a house on land you've purchased. After you're done building the value of that house is worth more than the sum of its parts. The time you invested created something more valuable without taking anything from someone else (you now have more 'wealth' than you had when you had some land and a pile of house parts). This doesn't take wealth away from anyone else, but if you were to sell someone may choose to buy your newly created house when they might have otherwise chosen the neighbors house which is slightly older. That's a bit of a different thing. There are definitely some industries where a lot of the cut-throat nature is a result of stagnation and groups fighting each other over what profit is available via competition. (Thiel talks about this in Zero to One and why businesses in competitive markets are a bad idea). That said, the uber/lyft example is interesting. Some points: - Prior to uber and lyft a lot more people would just drive drunk, taxis were unreliable and expensive - if you had to take a taxi somewhere people would just opt not to go. - Taxi companies were pretty corrupt and (at least in NYC) relied on a medallion model that expressly limited growth and empowered organized crime groups. This led to a worse experience for everyone except the medallion holders who could extort drivers and riders (while providing bad service). - A lot of people that drive for uber and lyft were not driving for taxis before, the market maker effect of uber/lyft and people that need a ride created a much larger market for people hiring taxis. This creates wealth - both for the drivers that did not have that ability before and for the riders that would not have previously bothered to call a taxi (and clearly all the people that work at uber/lyft generally). It might also have knock on effects where people go out more which might benefit local businesses more, but that's fairly speculative. Are there people that get screwed in this? Probably - taxi companies that provided bad/expensive service are not competitive with uber/lyft. A smaller amount of people at those companies that were making more are probably making less. Is that worse for society generally? My personal view is that it's not. Anyway - on a meta note, I also appreciate the back and forth and engaging with me. I'm open to being persuaded otherwise. I've read a lot about this stuff and have tried really hard to understand the underlying truth away from politics. This is where I've currently landed.
- navd 6y ago
  Because then you incentivize people to seek status.
Reedx 6y ago
> It just comes across to me as a 'hate the rich' policy that creates perverse incentives. Indeed, wealth tax sounds good because there are problems with income inequality and it's currently fashionable to hate the rich. But that's about where it ends, while second-order effects are ignored or at least not taken seriously. Andrew Yang was one of the few high-profile Democrats brave enough to push back on it. "I think the wealth tax is an idea, in spirit, that makes sense, given the wealth distribution. But in practice it would have massive implementation problems. There would be capital flight, wealthy people would renounce their citizenship. And the bigger problem isn’t even the money. It’s the annual inventorying of their assets. The truly wealthy in this country have zero interest in submitting to an annual audit of all of their assets. They barely know what all their assets are. And the last thing they’re going to do is report them every year and then pay a toll. So you would have massive compliance problems. And to me there are better ways to make this economy fair, though I understand the spirit of it and the intent of it. But I agree that it would be somewhere between problematic and a disaster in practice." https://www.cnbc.com/2019/10/02/andrew-yang-wealth-tax-plans-from-sanders-warren-could-be-disaster.html https://www.cnbc.com/2019/10/02/andrew-yang-wealth-tax-plans...
- mattmanser 6y ago
  Easy ways to stop that, start with a huge tax on your wealth when you renounce citizenship. They built the wealth on the back of their nation, on the back of the infrastructure, education, laws and blood of their ancestors, no good reason they should keep it when they choose to leave. It's the fundamental basis behind tax. 95% tax on any wealth over, say, $500k on renouncing citizenship, total forfeit if found to be hiding assets, done.
  - felipemnoa 6y ago
    >>Easy ways to stop that, make it illegal to take your wealth when you renounce citizenship. If you have to come up with ways to stop people from fleeing your country instead of too many people wanting to enter your country then you probably have a problem. And no, I don't think it is as easy as you say. Simple sounding solutions like this can have huge disastrous consequences.

ghufran_syed 6y ago

What's the opposing view, other than "they are rich, they can afford it + we really need the money for $good-things"? I'm not sure if you are disagreeing with the math or making a separate point about why we should do it anyway?

darkerside 6y ago
I truly don't know the answer on whether the wealth tax is a good idea (and there probably isn't a single right answer). But, that sure is a shitty way of saying, "I don't understand, can you explain your viewpoint to me?"
- ghufran_syed 6y ago
  I think it's an accurate summary of the arguments in favor of a wealth tax. But I would really like to hear if there are other arguments that can't be characterized that way. But it's hard to be persuaded when no-one actually presents the argument, and instead just criticizes the tone.
  - darkerside 6y ago
    I'm happy to present one as an example. If be happy to continue discussing it past that as well, as long as you are willing to converse and not argue. Wealth in the hands of a few becomes static. Jeff Bezos can only buy so many jets. When you leave it there, the entire economy stagnates.
    - janhenr 6y ago
      As most of Bezos' fortune is in Amazon stock, this money is not exactly sleeping.
      - darkerside 6y ago
        Fair point, and same probably goes for other billionaires, who have their money in a variety of investments. That probably does a lot to juice the stock market, pumping up valuations, but it doesn't do as much to generate actual economic returns. Happy to be educated otherwise.