3 ms·
> What you MEAN to say is that it is not zero sum when you look along the time variable (as in sum(t+1) != sum(t)), I think they were saying that it's not zero
by Aunche 6y ago
> What you MEAN to say is that it is not zero sum when you look along the time variable (as in sum(t+1) != sum(t)),
I think they were saying that it's not zero-sum with respect to policy rather than time. Most ideas of wealth redistribution would have disastrous effects on the economy. There's a reason why even the most progressive countries primarily fund their social programs with income taxes and VATs rather than capital gains or wealth taxes.
- oooooooooooow 6y agoThis is a very interesting perspective, I'd love to hear more about the disastrous effects.
- julienb_sea 6y agoPretty much every functional nation is fundamentally reliant on a healthy, competitive, tax-paying and stable private sector. In order for this to exist, you need people to trust that their capital is well protected and handled in a fair manner. "Fair", when talking about the global economic perspective, is a cost/benefit analysis taking account of your tax burden. Private investment is a way of putting your money at risk in exchange for a potential reward. Wealth redistribution at scale implies that you massively reduce or eliminate the rewards associated with your capital. This is a big problem as it drastically affects the incentives to put your money at risk (i.e. in a private company). This will absolutely tank the private economy, which, as mentioned, is the backbone of a modern country. No one will want to hold capital in your country or invest it in your country because it's going to be redistributed. This is why even the most "socialist" countries from the uninformed American perspective actually have very low wealth and corporate taxes: they recognize that encouraging the private economy is fundamental to the stable function of a modern country. (Instead, they heavily tax income, which has much less economic side effects)
- imtringued 6y agoThe obvious problem with your stance is that it doesn't even consider whether the investment is productive or not, just that people get richer. You don't want people to put their existing wealth into unproductive uses and still earn more money off of that than by investing it productively. Not to mention all the economic losses caused by underemployment. The idea of infinite supply side stimulus when the demand side is anemic simply makes no sense unless you love increasing wealth inequality. You need multiple tools in your toolbox.
- ClumsyPilot 6y agoWhere on earth did you get this idea? There are multiple reputable economists advocating wealth redistribution, from mahor intitutions like Oxford https://www.oxfordmartin.ox.ac.uk/blog/reducing-wealth-inequality-through-wealth-taxes-without-compromising-economic-growth/ https://www.oxfordmartin.ox.ac.uk/blog/reducing-wealth-inequ...
- Aunche 6y agoThis looks like it's intended to be high level rather than practical. There isn't so much rent income such that it would offset income tax in a meaningful way.
- imtringued 6y ago>Most ideas of wealth redistribution would have disastrous effects on the economy. I don't see it. How does increasing capital gains taxes and decreasing dividend taxes cause disastrous effects on the economy? If anything the low capital gains taxes incentivize bubbles by making it easier to make money off of selling to a greater fool than to simply let the company earn money and pay the profit out as a dividend. Tesla's market cap is going to overtake Apple. If the value of the stock was based on (future) dividends people would stop trying to hype up the stock because it went up and instead just invest based on actual and future business activity. I consider a $100 billion market cap for Tesla to be fair but optimistic. The current market cap is just illogical. Once batteries have turned into a commodity, Tesla will no longer be able to justify its valuation.