15 ms·

In the Beginning, There Were Taxes

27 points by diodorus 6y ago

ObserverNeutral 6y ago
taxes aren't just a way to raise money for federal and local governments, they are also an elegant way which society has to allocate social hatred. You need a corporate tax because people hate corporations, a wealth tax is being discussed and on the horizon because people hate the wealthy...and so forth In this case, of course there was a tax on wine in ancient Egypt in order to represent the social hatred which ensued when somebody saw a wealthy person consume a luxury item such as wine
- smitty1e 6y ago
  Taxes seem more of a form of "societal sculpture" in our day, as there are carve-outs to enhance this virtue or punish that vice. Blows my mind how we can have truly great software architecture like, e.g. Netflix, and a tax system that remains a Byzantine trainwreck. Or, as Jonah Goldberg notes: "Complexity is a subsidy."
- deleted 6y ago
  [deleted]
- newacct583 6y ago
  This is an extraordinarily bad take. In the US we tax the marginal middle class dollar of income about 3x higher than we do a marginal dollar of investment income. Do we hate the middle class more than wall street? We tax canadian steel more than chinese PCBs. Do we hate the Canadians more than the Chinese? More broadly, this would seek to interpret the lowest-tax anarchies as the most tolerant and loving societies and the highest-tax liberal democracies as most hate-filled, which seems equally suspect. Your point applies to sin taxes. And... basically nothing else. In general tax policy works by starting reasonably fair and then loosening the screws on whichever demographic lobbies the best. So in fact corporate taxes are lower than personal taxes and VATs almost everywhere, etc...
  - sokoloff 6y ago
    > In the US we tax the marginal middle class dollar of income about 3x higher than we do a marginal dollar of investment income. Marginal income middle class tax rate [0]: 22%, some at 24% Marginal capital gains rate for a fairly generous set of assumptions that benefit your argument: 15%. 24% is 60% higher, not 300% higher, than 15%. That's more or less taking the best-case for your argument. Add FICA contributions (which earn credits towards your own Social Security payouts, so it's unclear exactly how to allocate this in current costs) and it's still way less than 200% higher, let alone 300%. Lots of investment income is taxed at 23.8% (20% + 3.8% surtax). 24% is 0.8% higher than 23.8%, not 300% higher. [0] - I took the first hit I could find: Pew Research defines middle class as 2/3 to 2x the median income, $40K to $120K in 2018.
    - AlexTWithBeard 6y ago
      The parent has a fair point though: why would capital gains ever be taxes at a rate different from income?
      - refurb 6y ago
        An attempt incentivize desirable behavior - long-term investment. If you invest short term it taxes like income.
    - newacct583 6y ago
      ...you're right. I was figuring a marginal tax rate of about 40% and dividing by 15%, then rounding up. In practice the number is closer to 2x, as you said. Why does that change the analysis?
      - sokoloff 6y ago
        If the magnitude of the difference doesn't change the analysis, why mention it in the first place?
        6y ago
- tomdell 6y ago
  Public benefit, not hatred, is the primary motivation behind higher taxes on corporations and the wealthy. These taxes were at their highest in America around WWII and following - the money was used to fund the war. These taxes are at historic lows in America thanks to waves of major tax cuts for corporations and the wealthy since the 80s. Social services have been defunded in parallel. Taxes are raised for corporations and the wealthy because people who push for those raises want to live in a fairer society where everybody's right to a decent life is more important than a handful of people and corporations' right to hoard far more private property and power than they have any use for. Extreme inequality destabilizes societies and progressive taxes are a lever for the government to use to try and prevent that. Europe was at its historically highest level of inequality just before the outbreak of WWI. Everyone who enjoys living in a relatively stable society should have an interest in preventing extreme inequality.
  - ObserverNeutral 6y ago
    > Public benefit, not hatred, is the primary motivation behind higher taxes on corporations and the wealthy All taxes are essentially a re-do or a refund at the socieatal level Corporations sell a product or a service, citizens see such product/service and think they might use it to improve their lives. Then they decide to exchange some social status (represented by their net worth in USD) for the quality of life provided by that product or service. Then they collectively realize that everybody had the same idea and that the corporation and its owners accumulated so much social status in the form of net worth flowing out of citizens and into the corporation/owners coffins. Now they want all want a re-do/refund even though they voluntarily agreed to exchange part of their social status for quality of life and the corporation delivered on that. What pushes people to claim a refund is : 1) They regret that everybody had the same idea as themselves and that they contributed to socially elevate that person so much 2) Hedonistic treadmill kicks in so the quality of life provided by that product/service doesn't feel as good as the first day you used it...so you are now even more regretful that you purchased it. Witnessing the social elevation of somebody other than self (and having contributed to such social elevation) plus the hedonistic treadmill which makes the product/service not feel like something that is so special anymore compels people to come together and claim a refund in the form of taxation against those who were socially elevated
- jrochkind1 6y ago
  That doesn't even make sense. Why would you "need" taxes to "represent" social hatred?
  - ObserverNeutral 6y ago
    To avoid violent fighting. People hate those who are doing better than themselves and thus they come together to bring those anomalies down. Back in the days it was all done violently, nowadays it's done subtly via taxation
choeger 6y ago
Also, taxes are money. Essentially, a government issues money to its (armed) servants. It also demands its citizens to pay a certain tax in form of that money. This forces the citizens to work for and sell to the government's servants to obtain that money. Servants are happy, government can continue to govern, citizens, well, who cares, right?
- kaliali 6y ago
  Its like the mafia coming to your door wanting a protection fee but instead the government is much bigger and even pays to punish people for wrong-think like on this site. If you don't pay your taxes and fight back, the government will send its servants to kill you or beat you until money pops out.
  - frankbreetz 6y ago
    If you don't like taxes why wouldn't you move to a country that doesn't have taxes like Somalia? Is it because taxes pay for security and things you use everyday like infrastructure?
    - AlexTWithBeard 6y ago
      Somalia has some other issues. That being said, I would happily move to a country with 0% income tax, such as Monaco or Oman. Alas these countries do not allow free movement of people through their borders.
    - Grim-444 6y ago
      It's a common strawman argument to paint the argument as black and white, that either you want taxes or you want zero taxes. When in reality there's many shades of grey. The majority of people that complain about taxes don't want zero taxation, they just want to be taxed fairly, with proper representation, and for the government to make proper use of the money they do take, with accountability, before demanding more from the citizens.
      - 6y ago
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api 6y ago
You'll either pay the government or you'll pay a collection of security and infrastructure services that after sufficient consolidation... will become the government.
platz 6y ago
david cay johnston on the moral basis of progressive taxation (3 min) https://youtu.be/8Qsl6QUlWVc https://youtu.be/8Qsl6QUlWVc
- AlexTWithBeard 6y ago
  What he's talking about (the wealthy people of Ancient Greece voluntarily giving away some money for the greater good) sounds more like a charity.
  - platz 6y ago
    I believe he said the wealther you got, the bigger burden you owe to athens, because without Athens you wouldn't have gotten rich, and we want there to be rich people in the future in athens as well.
    - davidivadavid 6y ago
      Probably worth noting that a flat tax system would fit that description, even though it's not "progressive". I'm curious what the specifics of Athenian taxations were.
deleted 6y ago
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27 points by diodorus 6y ago

taxes aren't just a way to raise money for federal and local governments, they are also an elegant way which society has to allocate social hatred. You need a corporate tax because people hate corporations, a wealth tax is being discussed and on the horizon because people hate the wealthy...and so forth In this case, of course there was a tax on wine in ancient Egypt in order to represent the social hatred which ensued when somebody saw a wealthy person consume a luxury item such as wine

smitty1e 6y ago
Taxes seem more of a form of "societal sculpture" in our day, as there are carve-outs to enhance this virtue or punish that vice. Blows my mind how we can have truly great software architecture like, e.g. Netflix, and a tax system that remains a Byzantine trainwreck. Or, as Jonah Goldberg notes: "Complexity is a subsidy."
deleted 6y ago
[deleted]
newacct583 6y ago
This is an extraordinarily bad take. In the US we tax the marginal middle class dollar of income about 3x higher than we do a marginal dollar of investment income. Do we hate the middle class more than wall street? We tax canadian steel more than chinese PCBs. Do we hate the Canadians more than the Chinese? More broadly, this would seek to interpret the lowest-tax anarchies as the most tolerant and loving societies and the highest-tax liberal democracies as most hate-filled, which seems equally suspect. Your point applies to sin taxes. And... basically nothing else. In general tax policy works by starting reasonably fair and then loosening the screws on whichever demographic lobbies the best. So in fact corporate taxes are lower than personal taxes and VATs almost everywhere, etc...
- sokoloff 6y ago
  > In the US we tax the marginal middle class dollar of income about 3x higher than we do a marginal dollar of investment income. Marginal income middle class tax rate [0]: 22%, some at 24% Marginal capital gains rate for a fairly generous set of assumptions that benefit your argument: 15%. 24% is 60% higher, not 300% higher, than 15%. That's more or less taking the best-case for your argument. Add FICA contributions (which earn credits towards your own Social Security payouts, so it's unclear exactly how to allocate this in current costs) and it's still way less than 200% higher, let alone 300%. Lots of investment income is taxed at 23.8% (20% + 3.8% surtax). 24% is 0.8% higher than 23.8%, not 300% higher. [0] - I took the first hit I could find: Pew Research defines middle class as 2/3 to 2x the median income, $40K to $120K in 2018.
  - AlexTWithBeard 6y ago
    The parent has a fair point though: why would capital gains ever be taxes at a rate different from income?
    - refurb 6y ago
      An attempt incentivize desirable behavior - long-term investment. If you invest short term it taxes like income.
  - newacct583 6y ago
    ...you're right. I was figuring a marginal tax rate of about 40% and dividing by 15%, then rounding up. In practice the number is closer to 2x, as you said. Why does that change the analysis?
    - sokoloff 6y ago
      If the magnitude of the difference doesn't change the analysis, why mention it in the first place?
      - 6y ago
tomdell 6y ago
Public benefit, not hatred, is the primary motivation behind higher taxes on corporations and the wealthy. These taxes were at their highest in America around WWII and following - the money was used to fund the war. These taxes are at historic lows in America thanks to waves of major tax cuts for corporations and the wealthy since the 80s. Social services have been defunded in parallel. Taxes are raised for corporations and the wealthy because people who push for those raises want to live in a fairer society where everybody's right to a decent life is more important than a handful of people and corporations' right to hoard far more private property and power than they have any use for. Extreme inequality destabilizes societies and progressive taxes are a lever for the government to use to try and prevent that. Europe was at its historically highest level of inequality just before the outbreak of WWI. Everyone who enjoys living in a relatively stable society should have an interest in preventing extreme inequality.
- ObserverNeutral 6y ago
  > Public benefit, not hatred, is the primary motivation behind higher taxes on corporations and the wealthy All taxes are essentially a re-do or a refund at the socieatal level Corporations sell a product or a service, citizens see such product/service and think they might use it to improve their lives. Then they decide to exchange some social status (represented by their net worth in USD) for the quality of life provided by that product or service. Then they collectively realize that everybody had the same idea and that the corporation and its owners accumulated so much social status in the form of net worth flowing out of citizens and into the corporation/owners coffins. Now they want all want a re-do/refund even though they voluntarily agreed to exchange part of their social status for quality of life and the corporation delivered on that. What pushes people to claim a refund is : 1) They regret that everybody had the same idea as themselves and that they contributed to socially elevate that person so much 2) Hedonistic treadmill kicks in so the quality of life provided by that product/service doesn't feel as good as the first day you used it...so you are now even more regretful that you purchased it. Witnessing the social elevation of somebody other than self (and having contributed to such social elevation) plus the hedonistic treadmill which makes the product/service not feel like something that is so special anymore compels people to come together and claim a refund in the form of taxation against those who were socially elevated
jrochkind1 6y ago
That doesn't even make sense. Why would you "need" taxes to "represent" social hatred?
- ObserverNeutral 6y ago
  To avoid violent fighting. People hate those who are doing better than themselves and thus they come together to bring those anomalies down. Back in the days it was all done violently, nowadays it's done subtly via taxation

choeger 6y ago

Also, taxes are money. Essentially, a government issues money to its (armed) servants. It also demands its citizens to pay a certain tax in form of that money. This forces the citizens to work for and sell to the government's servants to obtain that money. Servants are happy, government can continue to govern, citizens, well, who cares, right?

kaliali 6y ago
Its like the mafia coming to your door wanting a protection fee but instead the government is much bigger and even pays to punish people for wrong-think like on this site. If you don't pay your taxes and fight back, the government will send its servants to kill you or beat you until money pops out.
- frankbreetz 6y ago
  If you don't like taxes why wouldn't you move to a country that doesn't have taxes like Somalia? Is it because taxes pay for security and things you use everyday like infrastructure?
  - AlexTWithBeard 6y ago
    Somalia has some other issues. That being said, I would happily move to a country with 0% income tax, such as Monaco or Oman. Alas these countries do not allow free movement of people through their borders.
  - Grim-444 6y ago
    It's a common strawman argument to paint the argument as black and white, that either you want taxes or you want zero taxes. When in reality there's many shades of grey. The majority of people that complain about taxes don't want zero taxation, they just want to be taxed fairly, with proper representation, and for the government to make proper use of the money they do take, with accountability, before demanding more from the citizens.
    - 6y ago

deleted 6y ago

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deleted 6y ago

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api 6y ago

You'll either pay the government or you'll pay a collection of security and infrastructure services that after sufficient consolidation... will become the government.

platz 6y ago

david cay johnston on the moral basis of progressive taxation (3 min) https://youtu.be/8Qsl6QUlWVc https://youtu.be/8Qsl6QUlWVc

AlexTWithBeard 6y ago
What he's talking about (the wealthy people of Ancient Greece voluntarily giving away some money for the greater good) sounds more like a charity.
- platz 6y ago
  I believe he said the wealther you got, the bigger burden you owe to athens, because without Athens you wouldn't have gotten rich, and we want there to be rich people in the future in athens as well.
  - davidivadavid 6y ago
    Probably worth noting that a flat tax system would fit that description, even though it's not "progressive". I'm curious what the specifics of Athenian taxations were.

deleted 6y ago

[deleted]