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It's already almost impossible for anyone who isn't born into wealth to become a billionaire. How exactly would taxing ultra-high net worth individuals make it

It's already almost impossible for anyone who isn't born into wealth to become a billionaire. How exactly would taxing ultra-high net worth individuals make it harder for everyone else to get rich?

WalterBright 6y ago
In America it's very possible. For example, Oprah Winfrey went from welfare to billionaire.
- jedberg 6y ago
  She is literally the only person on the billionaires list who was born in the bottom quintile. She is the most outlier of outliers.
  - WalterBright 6y ago
    10 billionaires who grew up dirt poor: https://www.cnbc.com/2017/09/11/10-billionaires-who-grew-up-dirt-poor.html https://www.cnbc.com/2017/09/11/10-billionaires-who-grew-up-...
    - TheOtherHobbes 6y ago
      Compared to how many who didn't?
      - WalterBright 6y ago
        Bruno Mars is already worth $175m. Won't be long till he's a billionaire.
    - jedberg 6y ago
      Given that JK Rowling's parents were a scientist and an aircraft engineer and she went to an elite elementary school, I question that entire articles' definition of dirt poor. Yes, she was on the dole when she wrote Harry Potter, but that doesn't mean she grew up poor.
      - WalterBright 6y ago
        You're moving the goal posts. Rowling was on welfare. Another the list doesn't mention: Paul McCartney. Michael Jackson's estate is now over $1 billion.
        jedberg 6y ago
        How did I move the goalposts. I said Oprah was the only one born in the bottom quintile. JK Rowling was most definitely not born in the bottom. She had the advantage of a great education growing up. And here is an article saying neither was Shultz: https://www.washingtonpost.com/politics/howard-schultz-says-he-grew-up-in-a-poor-rough-place-those-who-lived-there-called-it-the-country-club-of-projects/2019/03/13/4f26b800-39e9-11e9-a06c-3ec8ed509d15_story.html https://www.washingtonpost.com/politics/howard-schultz-says-...
        WalterBright 6y ago
        Rowling was on welfare. She describes herself as "Rowling signed up for welfare benefits, describing her economic status as being "poor as it is possible to be in modern Britain, without being homeless." https://en.wikipedia.org/wiki/J._K._Rowling https://en.wikipedia.org/wiki/J._K._Rowling And Shultz was still in a government housing project. Steve Jobs wasn't poor, but was certainly lower middle class.
        jedberg 6y ago
        > Rowling was on welfare. As a middle aged single mother. She wasn't born that way. She still had her elite education and family connections as advantages. And she's not even American (this thread is about American billionaires). > And Shultz was still in a government housing project. Described by the residents as "middle class government housing". The point is that Oprah is the only one who was born in the lowest quintile, the only who who didn't grow up with any advantages that helped her become a billionaire.
        6y ago
    - md_ 6y ago
      This sort of debate is always difficult because of definitional challenges. When we talk about inequality, are we talking about billionaires? About the top 0.01%? The top 1%? The top decile? Interestingly—and I don’t know what to make of this—the US seems to have a fairly high percentage of “ultra rich” whose wealth is not primarily inherited (https://www.forbes.com/sites/niallmccarthy/2016/10/10/where-the-super-rich-inherit-their-wealth-infographic/ https://www.forbes.com/sites/niallmccarthy/2016/10/10/where-...). On the other hand, across the entire population, the US does relatively poorly on inter generational earnings elasticity (i.e., in the US, what your parents earn is a very good predictor of what you will earn) (https://www.oecd.org/centrodemexico/medios/44582910.pdf https://www.oecd.org/centrodemexico/medios/44582910.pdf). I think any such debate thus needs a stronger foundational discussion of what metrics matter.
      - WalterBright 6y ago
        High marginal tax rates do have the effect of impeding people moving up. > what your parents earn is a very good predictor of what you will earn This makes perfect sense to me, as peoples' state in life is the sum of their choices. Successful parents proactively teach or passively show their kids habits and methods to being successful. This is why I've advocated that the public schools should teach, as part of the core curriculum, basic accounting and finance. And even how to run a business. This would be a very cost-effective way to help the poor.
        md_ 5y ago
        High income tax rates vs taxes on capital earnings do that, irrespective of how progressive the income tax rate is, no? I assume the point you are making is that taxing income at a higher rate than returns on capital favors earnings from already-accrued wealth over wealth accural. As to heritability of earnings, I think there are a number of potential causes: * Parents pass on knowledge, skills, and values that are valuable. * Parents pass on actual wealth, or social standing that can help accrue wealth (like helping their kids make business contacts or find internships). * Parents buy their kids improved education or similar (e.g. childhood nutrition, college test prep, etc). * Structural biases (racism, classism) tend to reflect attributes that are somewhat or fully inherited (ethnicity, accent, perceived social class). * Earnings reflect things that are biologically inherited (intelligence, greed, etc). I don't find the last point very compelling but I'm including it for completeness. But what I think this list demonstrates is that it's somewhat hard to understand just how pernicious the causes of low intergenerational social mobility may be—the first and last points seem kind of "working as intended" (in a meritocracy); the second and third points are troublesome, and the fourth point is deeply problematic.
- kelnos 6y ago
  Possible, but still vanishingly unlikely. An outlier generally does not prove a trend.
  - WalterBright 6y ago
    There are 614 American billionaires. 56 were added in 2020. Of course, with Biden's inflation, everyone will be a billionaire soon!
- TheOtherHobbes 6y ago
  No, it is not "very possible". That is simply not a statement that aligns with reality. A tiny sample of outliers doesn't define a probability distribution. It's just plain wrong to suggest it does.

It's already almost impossible for anyone who isn't born into wealth to become a billionaire. How exactly would taxing ultra-high net worth individuals make it harder for everyone else to get rich?

WalterBright 6y ago

In America it's very possible. For example, Oprah Winfrey went from welfare to billionaire.

jedberg 6y ago
She is literally the only person on the billionaires list who was born in the bottom quintile. She is the most outlier of outliers.
- WalterBright 6y ago
  10 billionaires who grew up dirt poor: https://www.cnbc.com/2017/09/11/10-billionaires-who-grew-up-dirt-poor.html https://www.cnbc.com/2017/09/11/10-billionaires-who-grew-up-...
  - TheOtherHobbes 6y ago
    Compared to how many who didn't?
    - WalterBright 6y ago
      Bruno Mars is already worth $175m. Won't be long till he's a billionaire.
  - jedberg 6y ago
    Given that JK Rowling's parents were a scientist and an aircraft engineer and she went to an elite elementary school, I question that entire articles' definition of dirt poor. Yes, she was on the dole when she wrote Harry Potter, but that doesn't mean she grew up poor.
    - WalterBright 6y ago
      You're moving the goal posts. Rowling was on welfare. Another the list doesn't mention: Paul McCartney. Michael Jackson's estate is now over $1 billion.
      - jedberg 6y ago
        How did I move the goalposts. I said Oprah was the only one born in the bottom quintile. JK Rowling was most definitely not born in the bottom. She had the advantage of a great education growing up. And here is an article saying neither was Shultz: https://www.washingtonpost.com/politics/howard-schultz-says-he-grew-up-in-a-poor-rough-place-those-who-lived-there-called-it-the-country-club-of-projects/2019/03/13/4f26b800-39e9-11e9-a06c-3ec8ed509d15_story.html https://www.washingtonpost.com/politics/howard-schultz-says-...
        WalterBright 6y ago
        Rowling was on welfare. She describes herself as "Rowling signed up for welfare benefits, describing her economic status as being "poor as it is possible to be in modern Britain, without being homeless." https://en.wikipedia.org/wiki/J._K._Rowling https://en.wikipedia.org/wiki/J._K._Rowling And Shultz was still in a government housing project. Steve Jobs wasn't poor, but was certainly lower middle class.
        jedberg 6y ago
        > Rowling was on welfare. As a middle aged single mother. She wasn't born that way. She still had her elite education and family connections as advantages. And she's not even American (this thread is about American billionaires). > And Shultz was still in a government housing project. Described by the residents as "middle class government housing". The point is that Oprah is the only one who was born in the lowest quintile, the only who who didn't grow up with any advantages that helped her become a billionaire.
        6y ago
  - md_ 6y ago
    This sort of debate is always difficult because of definitional challenges. When we talk about inequality, are we talking about billionaires? About the top 0.01%? The top 1%? The top decile? Interestingly—and I don’t know what to make of this—the US seems to have a fairly high percentage of “ultra rich” whose wealth is not primarily inherited (https://www.forbes.com/sites/niallmccarthy/2016/10/10/where-the-super-rich-inherit-their-wealth-infographic/ https://www.forbes.com/sites/niallmccarthy/2016/10/10/where-...). On the other hand, across the entire population, the US does relatively poorly on inter generational earnings elasticity (i.e., in the US, what your parents earn is a very good predictor of what you will earn) (https://www.oecd.org/centrodemexico/medios/44582910.pdf https://www.oecd.org/centrodemexico/medios/44582910.pdf). I think any such debate thus needs a stronger foundational discussion of what metrics matter.
    - WalterBright 6y ago
      High marginal tax rates do have the effect of impeding people moving up. > what your parents earn is a very good predictor of what you will earn This makes perfect sense to me, as peoples' state in life is the sum of their choices. Successful parents proactively teach or passively show their kids habits and methods to being successful. This is why I've advocated that the public schools should teach, as part of the core curriculum, basic accounting and finance. And even how to run a business. This would be a very cost-effective way to help the poor.
      - md_ 5y ago
        High income tax rates vs taxes on capital earnings do that, irrespective of how progressive the income tax rate is, no? I assume the point you are making is that taxing income at a higher rate than returns on capital favors earnings from already-accrued wealth over wealth accural. As to heritability of earnings, I think there are a number of potential causes: * Parents pass on knowledge, skills, and values that are valuable. * Parents pass on actual wealth, or social standing that can help accrue wealth (like helping their kids make business contacts or find internships). * Parents buy their kids improved education or similar (e.g. childhood nutrition, college test prep, etc). * Structural biases (racism, classism) tend to reflect attributes that are somewhat or fully inherited (ethnicity, accent, perceived social class). * Earnings reflect things that are biologically inherited (intelligence, greed, etc). I don't find the last point very compelling but I'm including it for completeness. But what I think this list demonstrates is that it's somewhat hard to understand just how pernicious the causes of low intergenerational social mobility may be—the first and last points seem kind of "working as intended" (in a meritocracy); the second and third points are troublesome, and the fourth point is deeply problematic.
kelnos 6y ago
Possible, but still vanishingly unlikely. An outlier generally does not prove a trend.
- WalterBright 6y ago
  There are 614 American billionaires. 56 were added in 2020. Of course, with Biden's inflation, everyone will be a billionaire soon!
TheOtherHobbes 6y ago
No, it is not "very possible". That is simply not a statement that aligns with reality. A tiny sample of outliers doesn't define a probability distribution. It's just plain wrong to suggest it does.