6 ms·

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 a

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.
ouroboros1 6y ago
Billionaires often make compelling arguments for why they should get to keep their money (Paul Graham and Elon Musk being two examples). I disagree with their point of view because: 1. My neighbour having enough food to eat and a warm house is a form of wealth FOR ME. 2. If wealth that is generated is taxed, this means that it is harder to accumulate wealth, this means that the people that do manage to accumulate wealth have better qualities than the people that do so in a tax free environment. And thus they make better decisions about how to allocate their money. 3. Billionaires are not accountable to anyone for how they spend their wealth. This is fine if they are all like Musk. But they are not. Of the countless number, only two are trying to build rockets to Mars. Counter examples are Osama Bin Laden and the guys who funded the NRA. If the wealth is taxed then it is fought over in a shared space in which we all have a say, no matter how small. I like the argument that Rawls made in "A theory of Justice", where he said that when you are deciding how to make a fair society you should think from a perspective in which you do not know what role you will have in that society.
- felipemnoa 6y ago
  >>Billionaires often make compelling arguments for why they should get to keep their money Well, it is their money.
  - marcinzm 6y ago
    Money is a societal construct and as such it belongs to exactly the person society says it belongs to. That may not be the billionaire depending on the society.
    - deleted 6y ago
      [deleted]
    - felipemnoa 6y ago
      Everything in society is a social construct, implicit or explicit. Right now the social construct that we have is that you get to keep the money you worked for after paying some taxes. I do wonder if you could make something like the wealth tax work in the United States. I'm willing to be educated.
ABCLAW 6y ago
>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. You're right that wealth creation isn't zero sum, but studies make this point a bit more nuanced than your argument would suggest. Historical analysis of growth appears to indicate that equality and growth in America have been largely correlated on a decade by decade basis until the last 20-30 years. It was only in the most recent cycle of international growth that this link appears to have been broken. So it's not simple enough to pretend that pro-wealth and pro-growth policies are one and the same; the opposite appears to have been the case until very recently.
ywei3410 6y ago
> Wealth creation isn't zero-sum, just because someone builds a business and creates wealth doesn't mean they're taking it from others. It absolutely is zero sum - but not from the point of money, but from the point of view of another finite resource; human labour and talent. The fact that someone has more wealth than someone else means that the market will value their time/spend more than someone who is poor. Think about it this way, if you see money as a way for society to allocate resources - is the fact that you own more wealth than someone else mean that you can should be able to direct more of where the resource spend of human labour is? How many talented engineers work at Rolls Royce to create £250,000 cars which would be better put to use elsewhere? How many software engineers work at startups funded as a moonshot for the wealth of the founders work on CRUD apps where they could be working on something like scientific or educational tech? How much chemical engineering talent do we sink into cosmetics? Your cited examples prove the point above - the only reason why those examples exist is at the whim of those who have wealth. What about less savoury examples of the use of wealth such as Academi or Palantir?
- fossuser 6y ago
  > It absolutely is zero sum - but not from the point of money, but from the point of view of another finite resource; human labour and talent. I think your point is less about wealth creation, and more about access to capital and how that influences who can fund what work. It's a subtle distinction, but I think an important one - and yes you're right access to capital and how capital is allocated is zero sum and this influences what work is done. I don't think this is entirely a bad thing though because in a society with an effective market what makes money should be related to what people want. The incentive alignment that comes from this (and capitalism generally) has allowed the largest creation of wealth in human history (of which everyone benefits when you look at things like infant mortality, public health generally, standard of living, etc.). This doesn't mean there aren't places to improve in terms of equality of opportunity for access to capital or that there shouldn't be rules to prevent incentives that can lead to outcomes worse for individuals and the group (see the fish farming story in this: https://slatestarcodex.com/2014/07/30/meditations-on-moloch/ https://slatestarcodex.com/2014/07/30/meditations-on-moloch/), but it also doesn't mean that the wealth tax or dis-incentivizing wealth creation is a good idea. Venture Capital is important here because it gives access to money to people and ideas that would have a hard time getting it otherwise (on bets that only occasionally pay off huge). We want people to be incentivized to take risks and start companies that can create massive amounts of wealth and entire new industries. If you have a wealth tax, someone making a couple million a year as an investment banker will be less likely to leave and risk that money to create something since they'll probably get to the cap without doing that anyway. Starting a company is already a pretty hard/risky decision to make, we don't want to make it harder. > How many talented engineers work at Rolls Royce to create £250,000 cars which would be better put to use elsewhere? How many software engineers work at startups funded as a moonshot for the wealth of the founders work on CRUD apps where they could be working on something like scientific or educational tech? How much chemical engineering talent do we sink into cosmetics? The way to fix this is with incentives that encourage people to go into areas society thinks are more worthwhile, but I think you're too dismissive of things like CRUD apps. Those things provide enormous value for the companies that need them (I think even cosmetics research has led to new medical knowledge). That said, I agree with the spirit of your questions - I wish humanity was better at coordinating. There's so much we could do if we were better at coordinating. I think capitalism and incentivizing for wealth creation (with controls for human rights/environment) is the best we've got to make the most progress the fastest. It aligns human nature and rewards people that make things that people value. There's a risk of a corrupting influence on liberal democracy that needs to be controlled (https://www.ted.com/talks/lawrence_lessig_we_the_people_and_the_republic_we_must_reclaim https://www.ted.com/talks/lawrence_lessig_we_the_people_and_...), but I think this is best structure for society to efficiently allocate resources/capital in a way that encourages the most wealth creation and growth. Does this mean you end up with things like Las Vegas where human investment would be better off elsewhere? Yes, but I think that's an acceptable trade-off for everything else you get (and people like Las Vegas). Attempts to remove the capitalist incentive structure and dictate what's important for people to do (or worse control how money is allocated to people) seems to lead to massive corruption and people doing what's necessary to get the money (which is often unrelated to actual success). As far as Academi - I'm not arguing for unregulated, no-government, capitalism. Companies should provide value within society and society should enact legislation via elected representatives in some form of liberal democracy (and companies should operate within those laws). I may not agree with every action that happens here, but nobody will - and that's why we have liberal democracy to sort it out.

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.

ouroboros1 6y ago

Billionaires often make compelling arguments for why they should get to keep their money (Paul Graham and Elon Musk being two examples). I disagree with their point of view because: 1. My neighbour having enough food to eat and a warm house is a form of wealth FOR ME. 2. If wealth that is generated is taxed, this means that it is harder to accumulate wealth, this means that the people that do manage to accumulate wealth have better qualities than the people that do so in a tax free environment. And thus they make better decisions about how to allocate their money. 3. Billionaires are not accountable to anyone for how they spend their wealth. This is fine if they are all like Musk. But they are not. Of the countless number, only two are trying to build rockets to Mars. Counter examples are Osama Bin Laden and the guys who funded the NRA. If the wealth is taxed then it is fought over in a shared space in which we all have a say, no matter how small. I like the argument that Rawls made in "A theory of Justice", where he said that when you are deciding how to make a fair society you should think from a perspective in which you do not know what role you will have in that society.

felipemnoa 6y ago
>>Billionaires often make compelling arguments for why they should get to keep their money Well, it is their money.
- marcinzm 6y ago
  Money is a societal construct and as such it belongs to exactly the person society says it belongs to. That may not be the billionaire depending on the society.
  - deleted 6y ago
    [deleted]
  - felipemnoa 6y ago
    Everything in society is a social construct, implicit or explicit. Right now the social construct that we have is that you get to keep the money you worked for after paying some taxes. I do wonder if you could make something like the wealth tax work in the United States. I'm willing to be educated.

ABCLAW 6y ago

>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. You're right that wealth creation isn't zero sum, but studies make this point a bit more nuanced than your argument would suggest. Historical analysis of growth appears to indicate that equality and growth in America have been largely correlated on a decade by decade basis until the last 20-30 years. It was only in the most recent cycle of international growth that this link appears to have been broken. So it's not simple enough to pretend that pro-wealth and pro-growth policies are one and the same; the opposite appears to have been the case until very recently.

ywei3410 6y ago

> Wealth creation isn't zero-sum, just because someone builds a business and creates wealth doesn't mean they're taking it from others. It absolutely is zero sum - but not from the point of money, but from the point of view of another finite resource; human labour and talent. The fact that someone has more wealth than someone else means that the market will value their time/spend more than someone who is poor. Think about it this way, if you see money as a way for society to allocate resources - is the fact that you own more wealth than someone else mean that you can should be able to direct more of where the resource spend of human labour is? How many talented engineers work at Rolls Royce to create £250,000 cars which would be better put to use elsewhere? How many software engineers work at startups funded as a moonshot for the wealth of the founders work on CRUD apps where they could be working on something like scientific or educational tech? How much chemical engineering talent do we sink into cosmetics? Your cited examples prove the point above - the only reason why those examples exist is at the whim of those who have wealth. What about less savoury examples of the use of wealth such as Academi or Palantir?

fossuser 6y ago
> It absolutely is zero sum - but not from the point of money, but from the point of view of another finite resource; human labour and talent. I think your point is less about wealth creation, and more about access to capital and how that influences who can fund what work. It's a subtle distinction, but I think an important one - and yes you're right access to capital and how capital is allocated is zero sum and this influences what work is done. I don't think this is entirely a bad thing though because in a society with an effective market what makes money should be related to what people want. The incentive alignment that comes from this (and capitalism generally) has allowed the largest creation of wealth in human history (of which everyone benefits when you look at things like infant mortality, public health generally, standard of living, etc.). This doesn't mean there aren't places to improve in terms of equality of opportunity for access to capital or that there shouldn't be rules to prevent incentives that can lead to outcomes worse for individuals and the group (see the fish farming story in this: https://slatestarcodex.com/2014/07/30/meditations-on-moloch/ https://slatestarcodex.com/2014/07/30/meditations-on-moloch/), but it also doesn't mean that the wealth tax or dis-incentivizing wealth creation is a good idea. Venture Capital is important here because it gives access to money to people and ideas that would have a hard time getting it otherwise (on bets that only occasionally pay off huge). We want people to be incentivized to take risks and start companies that can create massive amounts of wealth and entire new industries. If you have a wealth tax, someone making a couple million a year as an investment banker will be less likely to leave and risk that money to create something since they'll probably get to the cap without doing that anyway. Starting a company is already a pretty hard/risky decision to make, we don't want to make it harder. > How many talented engineers work at Rolls Royce to create £250,000 cars which would be better put to use elsewhere? How many software engineers work at startups funded as a moonshot for the wealth of the founders work on CRUD apps where they could be working on something like scientific or educational tech? How much chemical engineering talent do we sink into cosmetics? The way to fix this is with incentives that encourage people to go into areas society thinks are more worthwhile, but I think you're too dismissive of things like CRUD apps. Those things provide enormous value for the companies that need them (I think even cosmetics research has led to new medical knowledge). That said, I agree with the spirit of your questions - I wish humanity was better at coordinating. There's so much we could do if we were better at coordinating. I think capitalism and incentivizing for wealth creation (with controls for human rights/environment) is the best we've got to make the most progress the fastest. It aligns human nature and rewards people that make things that people value. There's a risk of a corrupting influence on liberal democracy that needs to be controlled (https://www.ted.com/talks/lawrence_lessig_we_the_people_and_the_republic_we_must_reclaim https://www.ted.com/talks/lawrence_lessig_we_the_people_and_...), but I think this is best structure for society to efficiently allocate resources/capital in a way that encourages the most wealth creation and growth. Does this mean you end up with things like Las Vegas where human investment would be better off elsewhere? Yes, but I think that's an acceptable trade-off for everything else you get (and people like Las Vegas). Attempts to remove the capitalist incentive structure and dictate what's important for people to do (or worse control how money is allocated to people) seems to lead to massive corruption and people doing what's necessary to get the money (which is often unrelated to actual success). As far as Academi - I'm not arguing for unregulated, no-government, capitalism. Companies should provide value within society and society should enact legislation via elected representatives in some form of liberal democracy (and companies should operate within those laws). I may not agree with every action that happens here, but nobody will - and that's why we have liberal democracy to sort it out.