5 ms·
> A lower rate for the same amount of income in capital gains compared to salary makes sense. Why? This argument is often given as an axiom without any reasoni
by rswail 4y ago
> A lower rate for the same amount of income in capital gains compared to salary makes sense.
Why? This argument is often given as an axiom without any reasoning behind it.
There is often handwaving about "risk", but a worker has risks due to not being able to supply the labor that they are selling. They invested in their labor through paying for education and training.
Why is their "risk" not considered the same as capital "risk"?
- kortilla 4y ago> but a worker has risks due to not being able to supply the labor that they are selling. Modern worker agreements (a.k.a most normal jobs) do not have downside risk if you can’t deliver. You just lose your job and stop gaining money. With capital investments you can easily undo 5 years of gains in 1 bad year.
- chii 4y ago> Why is their "risk" not considered the same as capital "risk"? a worker gets paid when they worked - there's no capital risk. They took a risk when they invest in skills for the job, but that risk isn't capital risk. If you are saying that their job should compensate for the initial risk they took getting educated, then i would say this risk pay-off is embedded in the salary of the job they took.