4 ms·

Nothing new here. There is a long list of papers from the right and left that say the same. - https://theamericanleader.org/problems/income-wealth-inequality/

Nothing new here. There is a long list of papers from the right and left that say the same. - https://theamericanleader.org/problems/income-wealth-inequality/ https://theamericanleader.org/problems/income-wealth-inequal... - https://nymag.com/intelligencer/2020/09/rand-study-how-high-is-inequality-us.html https://nymag.com/intelligencer/2020/09/rand-study-how-high-.... - https://www.americanprogress.org/wp-content/uploads/2013/12/BerensteinInequality.pdf https://www.americanprogress.org/wp-content/uploads/2013/12/... For whatever reason, we felt that the techno-elite would be different than the robber barons that came before them and that the internet would lead to greater equality when all it’s done is erode unity, wealth, privacy and security. ...while they duck and dodge taxes through international shell companies and...moving to Texas

woah 6y ago
How is moving to Texas “ducking and dodging taxes”?
- Jochim 6y ago
  Probably referring to the trend of California residents making a lot of money from being located in California and then re-locate to Texas. The implication is that they do this to avoid having to continue paying back California for the wealth they amassed there.
  - ykevinator 6y ago
    Wait til their kids attend the schools only to discover they're being taught creationism. I have a feeling this whole move to Texas thing is not gonna stick.
  - slowmovintarget 6y ago
    Presumably they already paid California taxes for when they worked there. The people governing California have decided they want to take more. There's no debt there. "California" isn't owed. There's nothing to "pay back." Having a hostile tax environment makes people and businesses go elsewhere, if they can.
    - Jochim 6y ago
      I guess that depends on your point of view. If the cultural/economical environment present in California is what allows those businesses to exist/be as successful as they are in the first place then in some sense it's reasonable to see California as holding some stake in that success. Income/Business taxes don't really capture that type of value add. Especially in tech where it's much easier to relocate your business/employees. The alternative point of view is that California isn't special at all, and they should be grateful to have the valley ecosystem. In which case they should reduce the tax burden and focus on reducing cost of living. I don't know which it is for California, but I do think that society would benefit from a system that provides strong incentives for companies to stay rooted/contribute back to the societies that they benefit from before they're established enough to leverage national/international labour.
- kangnkodos 6y ago
  Capital gains tax in California - 13.3% Capital gains tax in Texas - 0% If you own stock, you don't pay tax on the stock until you sell them. On the day you sell, you have to pay taxes based on how much the stock went up in value, capital gains. You pay capital gains tax to the federal government, and usually, also to the state you are living in on the day you sell the stock. For example: If you bought $10 of stock, and then sold it for $110, you have a capital gain of $100. If you live in California on the day you sell the stock, you have to pay California $13.30. If you live in Texas on the day you sell the stock, you don't have to pay Texas anything. (I simplified a ton of stuff above such as ignoring dividends, deductions, etc. It's not all the official rules and details, just a high level introduction.)
bko 6y ago
Like any other good, taxes are subject to basic economics. People adjust behavior based on the tax level. For instance, people can choose to move. Or they can employ different tax avoidance schemes (with their own costs and risks) depending on how high the tax is. On the extreme, both a 0% tax and a 100% tax rate would result in zero income, so there exists some point in between where an increase tax rate results in lower overall revenue. This is called the Laffer Curve [0] Framing matters a lot about these discussions where "tax cuts" illicit an image of cash taken out of a vault somewhere and sent directly to wealthy people. But its just a number. What you really want to look at is total revenue. If we think of taxes as a method of paying for things we use collectively, we should try to optimize for revenue. If you look at federal tax revenue over the last 70 years, you'll see that it was remarkably stable between 15-20% of GDP, with spikes and dips being mostly affected by recessions and booms. And during that period we had significant changes to marginal tax rates. I think the framing is wrong and is meant to illicit moral outrage about percentages paid when its much more complicated than that. The top marginal rate is meaningless without context or considerations to other things. [0] https://en.wikipedia.org/wiki/Laffer_curve https://en.wikipedia.org/wiki/Laffer_curve [1] https://www.taxpolicycenter.org/briefing-book/what-are-sources-revenue-federal-government https://www.taxpolicycenter.org/briefing-book/what-are-sourc... [2] https://en.wikipedia.org/wiki/Progressivity_in_United_States_income_tax https://en.wikipedia.org/wiki/Progressivity_in_United_States...
- CraigJPerry 6y ago
  >> taxes are subject to basic economics Economics is a social science. It's stories we tell each other rather than a fundamental unassailable truth like gravity. That means that no matter how good the economic idea - it's also immeasurably a bit wrong. We can say behaviours and outcomes are extremely likely without ignoring they don't always hold true. But what does that mean for your suggestion that the framing is wrong here? You've based an opinion based on something potentially untrue. To make it more concrete, you cite the laffer curve. Where do communists exist on the laffer curve? Right where the curve suggests 0% income they're getting 100% income. What's exactly wrong or off by the full 100% - the laffer curve or that communists exist? To give another concrete example, you said: >> People adjust behavior based on the tax level Irrational actors do exist. They can be irrational (in the economic sense) for more reasons than just a lack of information too. I've become really concerned by the certainty i see expressed in some economic views, some of them are really persuasive, if you ignore that they're built on a metaphorical foundation of sand.
sleepysysadmin 6y ago
>There is a long list of papers from the right and left that say the same. Each of your links appear to be left biased. From my observations, the right-wing love trickledown. Curious if you could provide me an example where right-wing are against this. The reality is that the economy is very complex. At the same time as 'trickle down economics' you had hyperglobalization from china's free trade zones and adoption of capitalism. You had global egalitarianism greatly increasing the supply of labour. You also have the reality that trickle down economics never fully implemented. How can a study control for all of these gigantic variables? If the study cannot, they cannot come to any conclusions. Lets step back for a second and look at globalization alone. When china implemented capitalism and their free trade zones attracted heavy foreign investment whose goal was to obtain cheap labour in china. Every big corp moved there, remember nike and their slave child labour? Or for that matter all the others as well. Factories dont exist in north america anymore except for costly transportation markets. In order to attract those jobs back, you must compete with the tax rates of those places with very low taxes. globalization means tax rates must reduce.
- tonyedgecombe 6y ago
  In order to attract those jobs back, you must compete with the tax rates of those places with very low taxes. globalization means tax rates must reduce. No, you need to compete with the labour rates which isn't the same thing. Interestingly total tax take vs GDP isn't much different between China (20%) and US(24%)[1]. It's somewhat easier to compare two similarly sized countries in Europe. The UK and Germany for instance. Germany has a total tax take of about 45%, the UK is at 35%. Yet German exports are much higher than the UK[2]. globalization means tax rates must reduce. Globalisation means taxes will shift away from corporations and towards consumption, dividends and land value which are much harder to avoid. [1] https://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_to_GDP_ratio https://en.wikipedia.org/wiki/List_of_countries_by_tax_reven... [2] https://en.wikipedia.org/wiki/List_of_countries_by_exports https://en.wikipedia.org/wiki/List_of_countries_by_exports
  - sleepysysadmin 6y ago
    >No, you need to compete with the labour rates which isn't the same thing. could you point to me 1 government in north america who has lowered minimum wage? That's how you would compete with labour rates. >Interestingly total tax take vs GDP isn't much different between China (20%) and US(24%)[1]. I'm not sure we're comparing apples to apples here. Tax to GDP while also looking at the entire country. The free trade zones are certainly not 20%. Mainland is around 20% for sure. In fact some of the zones are lower than hong kong on purpose. Which according to that source is 13% but that seems high. >It's somewhat easier to compare two similarly sized countries in Europe. The UK and Germany for instance. Germany has a total tax take of about 45%, the UK is at 35%. Yet German exports are much higher than the UK[2]. I believe we're missing the forest through the trees though. so many missing factors, for example Germany also has very low debt but they also benefit greatly from the Balkan countries. Germany sits well because Crotia and neighbours are the ones heavily in debt. >Globalisation means taxes will shift away from corporations and towards consumption, dividends and land value which are much harder to avoid. they may shift but the balance is what matters. What's more important is what's about to happen. The governments of the world are increasingly bankrupt. No politician will consider dynamically changing the fundamentals of how taxes are collected. If land value taxes come about, it will be a new tax that is in addition. they will be raising taxes. The exact opposite of what they need to be doing.

woah 6y ago

How is moving to Texas “ducking and dodging taxes”?

Jochim 6y ago
Probably referring to the trend of California residents making a lot of money from being located in California and then re-locate to Texas. The implication is that they do this to avoid having to continue paying back California for the wealth they amassed there.
- ykevinator 6y ago
  Wait til their kids attend the schools only to discover they're being taught creationism. I have a feeling this whole move to Texas thing is not gonna stick.
- slowmovintarget 6y ago
  Presumably they already paid California taxes for when they worked there. The people governing California have decided they want to take more. There's no debt there. "California" isn't owed. There's nothing to "pay back." Having a hostile tax environment makes people and businesses go elsewhere, if they can.
  - Jochim 6y ago
    I guess that depends on your point of view. If the cultural/economical environment present in California is what allows those businesses to exist/be as successful as they are in the first place then in some sense it's reasonable to see California as holding some stake in that success. Income/Business taxes don't really capture that type of value add. Especially in tech where it's much easier to relocate your business/employees. The alternative point of view is that California isn't special at all, and they should be grateful to have the valley ecosystem. In which case they should reduce the tax burden and focus on reducing cost of living. I don't know which it is for California, but I do think that society would benefit from a system that provides strong incentives for companies to stay rooted/contribute back to the societies that they benefit from before they're established enough to leverage national/international labour.
kangnkodos 6y ago
Capital gains tax in California - 13.3% Capital gains tax in Texas - 0% If you own stock, you don't pay tax on the stock until you sell them. On the day you sell, you have to pay taxes based on how much the stock went up in value, capital gains. You pay capital gains tax to the federal government, and usually, also to the state you are living in on the day you sell the stock. For example: If you bought $10 of stock, and then sold it for $110, you have a capital gain of $100. If you live in California on the day you sell the stock, you have to pay California $13.30. If you live in Texas on the day you sell the stock, you don't have to pay Texas anything. (I simplified a ton of stuff above such as ignoring dividends, deductions, etc. It's not all the official rules and details, just a high level introduction.)

bko 6y ago

Like any other good, taxes are subject to basic economics. People adjust behavior based on the tax level. For instance, people can choose to move. Or they can employ different tax avoidance schemes (with their own costs and risks) depending on how high the tax is. On the extreme, both a 0% tax and a 100% tax rate would result in zero income, so there exists some point in between where an increase tax rate results in lower overall revenue. This is called the Laffer Curve [0] Framing matters a lot about these discussions where "tax cuts" illicit an image of cash taken out of a vault somewhere and sent directly to wealthy people. But its just a number. What you really want to look at is total revenue. If we think of taxes as a method of paying for things we use collectively, we should try to optimize for revenue. If you look at federal tax revenue over the last 70 years, you'll see that it was remarkably stable between 15-20% of GDP, with spikes and dips being mostly affected by recessions and booms. And during that period we had significant changes to marginal tax rates. I think the framing is wrong and is meant to illicit moral outrage about percentages paid when its much more complicated than that. The top marginal rate is meaningless without context or considerations to other things. [0] https://en.wikipedia.org/wiki/Laffer_curve https://en.wikipedia.org/wiki/Laffer_curve [1] https://www.taxpolicycenter.org/briefing-book/what-are-sources-revenue-federal-government https://www.taxpolicycenter.org/briefing-book/what-are-sourc... [2] https://en.wikipedia.org/wiki/Progressivity_in_United_States_income_tax https://en.wikipedia.org/wiki/Progressivity_in_United_States...

CraigJPerry 6y ago
>> taxes are subject to basic economics Economics is a social science. It's stories we tell each other rather than a fundamental unassailable truth like gravity. That means that no matter how good the economic idea - it's also immeasurably a bit wrong. We can say behaviours and outcomes are extremely likely without ignoring they don't always hold true. But what does that mean for your suggestion that the framing is wrong here? You've based an opinion based on something potentially untrue. To make it more concrete, you cite the laffer curve. Where do communists exist on the laffer curve? Right where the curve suggests 0% income they're getting 100% income. What's exactly wrong or off by the full 100% - the laffer curve or that communists exist? To give another concrete example, you said: >> People adjust behavior based on the tax level Irrational actors do exist. They can be irrational (in the economic sense) for more reasons than just a lack of information too. I've become really concerned by the certainty i see expressed in some economic views, some of them are really persuasive, if you ignore that they're built on a metaphorical foundation of sand.

sleepysysadmin 6y ago

>There is a long list of papers from the right and left that say the same. Each of your links appear to be left biased. From my observations, the right-wing love trickledown. Curious if you could provide me an example where right-wing are against this. The reality is that the economy is very complex. At the same time as 'trickle down economics' you had hyperglobalization from china's free trade zones and adoption of capitalism. You had global egalitarianism greatly increasing the supply of labour. You also have the reality that trickle down economics never fully implemented. How can a study control for all of these gigantic variables? If the study cannot, they cannot come to any conclusions. Lets step back for a second and look at globalization alone. When china implemented capitalism and their free trade zones attracted heavy foreign investment whose goal was to obtain cheap labour in china. Every big corp moved there, remember nike and their slave child labour? Or for that matter all the others as well. Factories dont exist in north america anymore except for costly transportation markets. In order to attract those jobs back, you must compete with the tax rates of those places with very low taxes. globalization means tax rates must reduce.

tonyedgecombe 6y ago
In order to attract those jobs back, you must compete with the tax rates of those places with very low taxes. globalization means tax rates must reduce. No, you need to compete with the labour rates which isn't the same thing. Interestingly total tax take vs GDP isn't much different between China (20%) and US(24%)[1]. It's somewhat easier to compare two similarly sized countries in Europe. The UK and Germany for instance. Germany has a total tax take of about 45%, the UK is at 35%. Yet German exports are much higher than the UK[2]. globalization means tax rates must reduce. Globalisation means taxes will shift away from corporations and towards consumption, dividends and land value which are much harder to avoid. [1] https://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_to_GDP_ratio https://en.wikipedia.org/wiki/List_of_countries_by_tax_reven... [2] https://en.wikipedia.org/wiki/List_of_countries_by_exports https://en.wikipedia.org/wiki/List_of_countries_by_exports
- sleepysysadmin 6y ago
  >No, you need to compete with the labour rates which isn't the same thing. could you point to me 1 government in north america who has lowered minimum wage? That's how you would compete with labour rates. >Interestingly total tax take vs GDP isn't much different between China (20%) and US(24%)[1]. I'm not sure we're comparing apples to apples here. Tax to GDP while also looking at the entire country. The free trade zones are certainly not 20%. Mainland is around 20% for sure. In fact some of the zones are lower than hong kong on purpose. Which according to that source is 13% but that seems high. >It's somewhat easier to compare two similarly sized countries in Europe. The UK and Germany for instance. Germany has a total tax take of about 45%, the UK is at 35%. Yet German exports are much higher than the UK[2]. I believe we're missing the forest through the trees though. so many missing factors, for example Germany also has very low debt but they also benefit greatly from the Balkan countries. Germany sits well because Crotia and neighbours are the ones heavily in debt. >Globalisation means taxes will shift away from corporations and towards consumption, dividends and land value which are much harder to avoid. they may shift but the balance is what matters. What's more important is what's about to happen. The governments of the world are increasingly bankrupt. No politician will consider dynamically changing the fundamentals of how taxes are collected. If land value taxes come about, it will be a new tax that is in addition. they will be raising taxes. The exact opposite of what they need to be doing.