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The idea of this is that private control of companies by independent minded founders should not exist. Only large financial companies like Vanguard and Blackro
by narrator 5y ago
The idea of this is that private control of companies by independent minded founders should not exist. Only large financial companies like Vanguard and Blackrock should own large stakes in public companies. The practical effect is not to raise more tax revenue, it's to seize control from founders and give it to the financial oligarchy by forcing them to sell.
This is what happens in Russia, Eastern Europe, Saudi Arabia, and other corrupt oligarchies. When a business gets successful enough, the oligarchs of the countries show up and offer a deal that the person running the company can't refuse and force them to sell to the local oligarch gang at a bad price.
If they wanted to raise more tax revenue, they could just raise the top marginal income tax rate up to 98% or raise capital gains tax rates and not totally screw up things by forcing the confiscation of companies from their founders.
- ethbr0 5y ago> If they wanted to raise more tax revenue, they could just raise the top marginal income tax rate up to 98% or raise capital gains tax rates > If tax revenue is too low, just raise the top tax brackets. (Sweeney) That was the original proposal [0]. Republicans and moderate Democrats shot it down. Part of me thinks this is the "crazy" option, to actually get motion on increasing top rates and capital gains. Complaints about those ideas shrink when this is the current alternative. [0] https://www.nytimes.com/2021/05/28/us/politics/tax-rising-on-rich-corporations.html https://www.nytimes.com/2021/05/28/us/politics/tax-rising-on...
- flurben 5y agoThe goal of the legislation is to shift the tax burden towards high net worth individuals, and away from wage-earners. Raising cap gains rates and/or increasing top marginal income tax rates are not very effective ways to achieve this goal.
- narrator 5y agoIf you have high net worth that means you have control, not that you are necessarily living lavishly. If you want to pay for personal expenses and buy yachts and the usual kinds of things that socialist complain about, you need to take that out in income or through capital gains. Thus, they want to pay for everything by forcing founders to sell control to the country's financial oligarchs like Blackrock and Vanguard who already own large amounts of most public companies.
- flurben 5y agoBlackrock and Vanguard are just intermediaries, they do not actually own the shares in their ETFs, they manage the assets on behalf of clients.
- narrator 5y agoThey could easily exert any kind of pressure on these companies though. For example, Blackrock was given exclusive access to do wealth management in China recently[1]. It's one of the few western financial institutions allowed to do so. What kind of influence do you think the Chinese government exerts on Blackrock in exchange for this privilege? [1]https://www.nasdaq.com/articles/blackrock-expands-china-footprint-with-wealth-management-licence-2021-05-12 https://www.nasdaq.com/articles/blackrock-expands-china-foot...
- conk 5y agoOr get a loan at a very low rate using equity as collateral thereby avoiding income/cap gains.
- PaulDavisThe1st 5y agoNo, it's not. Plenty of other people in the thread have explained the contigencies in the legislative text that mean that Sweeney's claims about it are at best misleading and at worst outright wrong.