3 ms·

Easy enough to solve: tax wealth and redistribute it with a UBI.

by beebmam 5y ago

animal_spirits 5y ago
That is not easy to do
disambiguation 5y ago
expectations: UBI utopia. reality: Corporate welfare and record levels of poverty.
HPsquared 5y ago
Have the state pay everyone's wages and (eventually, with wealth tax) own all major industries... this is supposed to reduce consolidation how?
- beebmam 5y ago
  What do you think reduces consolidation? Genuinely curious. I think there are other strategies that will work, but taxation is extremely effective at reducing variance of wealth distribution.
  - Negitivefrags 5y ago
    What reduces consolidation ultimately is a real recession. Not these fake ones we have had in recent times which get propped up with QE, but a real recession. The type that kills big companies. Then in the ashes you will get a verdant crop of new companies started by fresh people and a new period of massive growth with follow. Might not be a cost that people actually want to pay though.
AnthonyMouse 5y ago
> Easy enough to solve: tax wealth and redistribute it with a UBI. These are extremely independent problems. The problem with concentration isn't taxes, it's a regulatory environment that promotes concentration. You take money from Bezos, it doesn't change the size of Amazon. A UBI would help some by making it easier to start a small business, but unless you address the underlying regulatory problems that give every advantage to consolidated megacorps, that's not enough. One of the big problems is taxes though, specifically the taxation of dividends that get reinvested. Under the existing system, if you're Apple and you make iPhones and pay dividends to shareholders who invest them in a separate company that makes microprocessors, they pay more tax than if Apple keeps the money and makes its own microprocessors. And it works that way for everything, so corporations grow without bound and the tax system encourages that. The easy fix is to make investment a tax deduction but sale of an investment fully taxable instead of only on the gain. We already try to do this in a hundred places, 401k and Roth IRAs and not taxing gains until they're realized, because it's obviously a good idea and promotes investment. But because we specifically don't do it in the case where you take profits from one company and invest them into an independent one, we've been promoting indefinite corporate expansion for decades.
- beebmam 5y ago
  - AnthonyMouse 5y ago
    What do you think their advantage comes from? Most regulatory compliance is a fixed cost. Amazon's lawyers get paid the same hourly rate to read the same regulations as yours, but they can amortize the cost over a billion customers. The more regulations there are, the larger the advantage to big corporations. Half their advantage comes from the complexity and stupidity of financial regulations that make it so small businesses have to subject themselves to the caprice of PayPal et al to accept payment for anything, when PayPal's business model is screwing over small businesses. The biggest reason third parties sell on Amazon is so they can use Amazon as a payment service.
    - loudmax 5y ago
      > What do you think their advantage comes from? Scale. This applies to processing regulation and also to purchasing power, organizational ability and much else besides. > Half their advantage comes from the complexity and stupidity of financial regulations No doubt that excessive regulation is a burden and regulatory capture is a thing. "Half their advantage" overlooks all of their other advantages. The fact is, regulation is hard to get right. It's generally a good idea to avoid over-regulating, but there are real dangers to under-regulation as well.
      - AnthonyMouse 5y ago
        > Scale. This applies to processing regulation and also to purchasing power, organizational ability and much else besides. It's also a cumulative problem. If you have the existing level of regulation, you have Amazon and Walmart. At a lower level of regulation there might be ten of them instead of two. But wait, then they each have less scale which makes it easier for smaller competitors to enter and that turns it into twenty or fifty. There are also ways to counter non-regulatory scale, like specialization. Newegg competes successfully with Amazon because they focus on electronics. Then they buy enough electronics to have scale in electronics, even if they can't match Amazon's scale in diapers or ice melt. And some scale problems are intractable but they're also separable. If you wanted to compete with Amazon and FedEx and UPS didn't exist, you'd be screwed. No way you have enough scale to do that on your own, selling your printer toner refills or whatever. But they do exist. Which allows competition for the verticals that don't need that amount of scale to be viable. Moreover, scale has limits. Maybe you need to move ten thousand units a month to be viable in a particular market, and that takes at least ten employees. You can't do it in your garage. But that doesn't mean you have to be the size of Amazon either. And this threshold is different in every market. The higher regulatory burdens are, the more markets go on the wrong side of the line. The problem with regulatory costs is that they tend to be generic. You're stuck with every payments regulation, labor regulation, every jurisdiction's unique tax laws, regardless of what you're selling. Specialization doesn't get you out of most of them. And they can accumulate without bound. Add excessive regulatory burdens on top of all the other advantages to scale and you get what we've got, instead of some lesser scale advantage with greater competition. > The fact is, regulation is hard to get right. It's all cost benefit analysis. There are regulations that cost a negligible amount of money and have an enormous benefit. Those aren't the ones that meaningfully impair competition, because they cost a negligible amount of money and if we only had the ones with an enormous benefit then the cumulative effect would still be small. We also have some regulations with a large cost and a modest benefit. Those are hot garbage, but they're on page 7357 of a ten thousand page bill that nobody read before passing and the businesses they destroyed are already bankrupt instead of lobbying to have it repealed. But the biggest problem is the numerous, numerous regulations with a small cost and a small benefit. Because those aren't worth it. Breakeven on the regulation, if you can even do the accounting that carefully, is still a net negative because of the effect on competition. So we should keep the ones in the first category. A small cost with a large benefit. And get rid of all the others.
umvi 5y ago
Seems like an ultra-simplistic hot take that doesn't address the mountain of side effects doing those things would cause.

Easy enough to solve: tax wealth and redistribute it with a UBI.

animal_spirits 5y ago

That is not easy to do

disambiguation 5y ago

expectations: UBI utopia. reality: Corporate welfare and record levels of poverty.

HPsquared 5y ago

Have the state pay everyone's wages and (eventually, with wealth tax) own all major industries... this is supposed to reduce consolidation how?

beebmam 5y ago
What do you think reduces consolidation? Genuinely curious. I think there are other strategies that will work, but taxation is extremely effective at reducing variance of wealth distribution.
- Negitivefrags 5y ago
  What reduces consolidation ultimately is a real recession. Not these fake ones we have had in recent times which get propped up with QE, but a real recession. The type that kills big companies. Then in the ashes you will get a verdant crop of new companies started by fresh people and a new period of massive growth with follow. Might not be a cost that people actually want to pay though.

AnthonyMouse 5y ago

> Easy enough to solve: tax wealth and redistribute it with a UBI. These are extremely independent problems. The problem with concentration isn't taxes, it's a regulatory environment that promotes concentration. You take money from Bezos, it doesn't change the size of Amazon. A UBI would help some by making it easier to start a small business, but unless you address the underlying regulatory problems that give every advantage to consolidated megacorps, that's not enough. One of the big problems is taxes though, specifically the taxation of dividends that get reinvested. Under the existing system, if you're Apple and you make iPhones and pay dividends to shareholders who invest them in a separate company that makes microprocessors, they pay more tax than if Apple keeps the money and makes its own microprocessors. And it works that way for everything, so corporations grow without bound and the tax system encourages that. The easy fix is to make investment a tax deduction but sale of an investment fully taxable instead of only on the gain. We already try to do this in a hundred places, 401k and Roth IRAs and not taxing gains until they're realized, because it's obviously a good idea and promotes investment. But because we specifically don't do it in the case where you take profits from one company and invest them into an independent one, we've been promoting indefinite corporate expansion for decades.

beebmam 5y ago
- AnthonyMouse 5y ago
  What do you think their advantage comes from? Most regulatory compliance is a fixed cost. Amazon's lawyers get paid the same hourly rate to read the same regulations as yours, but they can amortize the cost over a billion customers. The more regulations there are, the larger the advantage to big corporations. Half their advantage comes from the complexity and stupidity of financial regulations that make it so small businesses have to subject themselves to the caprice of PayPal et al to accept payment for anything, when PayPal's business model is screwing over small businesses. The biggest reason third parties sell on Amazon is so they can use Amazon as a payment service.
  - loudmax 5y ago
    > What do you think their advantage comes from? Scale. This applies to processing regulation and also to purchasing power, organizational ability and much else besides. > Half their advantage comes from the complexity and stupidity of financial regulations No doubt that excessive regulation is a burden and regulatory capture is a thing. "Half their advantage" overlooks all of their other advantages. The fact is, regulation is hard to get right. It's generally a good idea to avoid over-regulating, but there are real dangers to under-regulation as well.
    - AnthonyMouse 5y ago
      > Scale. This applies to processing regulation and also to purchasing power, organizational ability and much else besides. It's also a cumulative problem. If you have the existing level of regulation, you have Amazon and Walmart. At a lower level of regulation there might be ten of them instead of two. But wait, then they each have less scale which makes it easier for smaller competitors to enter and that turns it into twenty or fifty. There are also ways to counter non-regulatory scale, like specialization. Newegg competes successfully with Amazon because they focus on electronics. Then they buy enough electronics to have scale in electronics, even if they can't match Amazon's scale in diapers or ice melt. And some scale problems are intractable but they're also separable. If you wanted to compete with Amazon and FedEx and UPS didn't exist, you'd be screwed. No way you have enough scale to do that on your own, selling your printer toner refills or whatever. But they do exist. Which allows competition for the verticals that don't need that amount of scale to be viable. Moreover, scale has limits. Maybe you need to move ten thousand units a month to be viable in a particular market, and that takes at least ten employees. You can't do it in your garage. But that doesn't mean you have to be the size of Amazon either. And this threshold is different in every market. The higher regulatory burdens are, the more markets go on the wrong side of the line. The problem with regulatory costs is that they tend to be generic. You're stuck with every payments regulation, labor regulation, every jurisdiction's unique tax laws, regardless of what you're selling. Specialization doesn't get you out of most of them. And they can accumulate without bound. Add excessive regulatory burdens on top of all the other advantages to scale and you get what we've got, instead of some lesser scale advantage with greater competition. > The fact is, regulation is hard to get right. It's all cost benefit analysis. There are regulations that cost a negligible amount of money and have an enormous benefit. Those aren't the ones that meaningfully impair competition, because they cost a negligible amount of money and if we only had the ones with an enormous benefit then the cumulative effect would still be small. We also have some regulations with a large cost and a modest benefit. Those are hot garbage, but they're on page 7357 of a ten thousand page bill that nobody read before passing and the businesses they destroyed are already bankrupt instead of lobbying to have it repealed. But the biggest problem is the numerous, numerous regulations with a small cost and a small benefit. Because those aren't worth it. Breakeven on the regulation, if you can even do the accounting that carefully, is still a net negative because of the effect on competition. So we should keep the ones in the first category. A small cost with a large benefit. And get rid of all the others.

umvi 5y ago

Seems like an ultra-simplistic hot take that doesn't address the mountain of side effects doing those things would cause.