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The biggest impediment to growth is idle wealth. Wealth tied up in art is not doing anything and should be taxed arbitrarily high at inheritance. The same with

The biggest impediment to growth is idle wealth. Wealth tied up in art is not doing anything and should be taxed arbitrarily high at inheritance. The same with slumlords' properties. Taxes on productive income can then be reduced by the same amount to encourage growth.

wronglyprepaid 4y ago
Can you cite anything to back your claim here? Why is idle wealth more of an impediment than policies that discourage investment? What does idle wealth even mean, how do you measure it? Why would anyone with wealth want it to sit idle?
- bombcar 4y ago
  An no matter how many times you sell the Mona Lisa to pay the Mona Lisa tax, it still wouldn’t drop in value. So all art would have to be owned by the government or non-profits, which can easily be abused by the rich to hold “their” art tax-free.
  - deleted 4y ago
    [deleted]
zozbot234 4y ago
There's a fallacy here. The bottom-line economic effect of having a lot of "wealth tied up in art" is incenting the preservation and/or creation of highly valued art. You can't even meaningfully take that wealth away in the aggregate, because it's pure paper wealth; it's a side effect of how much we happen to value some objects. Slumlord properties have the same theoretical problem as land, in that concentrated ownership can act as an incentive towards bad management; there's not much economy of scale when it comes to managing rental properties, so policy should incent dispersed ownership instead.
- vkou 4y ago
  Not when the price of art never reaches it's creator, and only goes stratospheric through speculation and back-and-forth trades long after his death. You can't be incentivised to create art when you will never realize that incentive. And unlike music record labels, it's not like you are giving someone else your earnings in exchange for editing and technical help and marketing. Art was a bad example, though, since it's mostly just used as a tax dodge. The real problem is rent seeking.
car_analogy 4y ago
> Wealth tied up in art is not doing anything Wealth* that is not doing anything has no effect on the economy. Suppose I had $100 trillion in cash (or art, or other useless commodity) in a vault somewhere, and never spend a dime of it. How is it impeding the economy? If I didn't tell you about it, you wouldn't even know it existed. It's only when I start spending it, to redirect labor per my wishes, that I start affecting the economy. If I spend it all on yachts, that will cause a lot of labor and materials to go to yachts that won't contribute anything to the economy once built, instead of going to something more productive. *Using "wealth" to mean fiat money, or art, or anything that has no productive use. E.g. if the wealth was instead in the form of idle farmland, that would be used to grow food if owned by someone else, then yes, that would be impeding the economy. So one must distinguish between wealth with inherent value, and wealth that only has value because people are willing to pay for it.
- hansel_der 4y ago
  > If I didn't tell you about it, you wouldn't even know it existed but it does exist and is "missing" from the economy (i.e. other peoples pockets)
  - car_analogy 4y ago
    If you add a zero to the end of every bill in circulation, there will be 10x more money, but people won't be any better off.
  - makomk 4y ago
    Not really. There is not some fixed amount of money in existence and certainly not some fixed amount of wealth. Governments and banks create money as necessary to facilitate the actual economy in producing actual stuff, and as for wealth, well... When the price that some artist's works trade at goes up, such that the value of the ones sitting in some billionaire's vault is now higher, that extra wealth clearly doesn't come from anywhere at all. It simply springs into existence from nowhere, and will spring out of existence just as easily if private ownership of art becomes effectively impossible. What is a limiting factor in the real economy's ability to make people better off is its capacity to produce actual goods and services for them to buy, and that capacity is not used in any way by wealth sitting around doing nothing.
missedthecue 4y ago
I really need you to explain to me what "tied up" means. If I buy a $100 million dollar piece of art, that $100m doesn't disappear into the ether, it goes to the person who sold me the piece, who can then spend that on whatever they want.
epistasis 4y ago
I'm not sure I agree with this. There's two key parts to wealth: producing enough stuff to make life easy for people, and distributing that to many many people tether than hoarding it for a few. The amount of production is not impacted much by how how many bushels of wheat, or days of labor of the average worker, we value the Mona Lisa. Art can be wealth, but not all wealth is a factor of production. Labor, land, capital are all factors of production that influence how much stuff is made. Making sure that everybody has enough to survive, enough to thrive, and enough to be creative and innovate or achieve what they want should be the goal. Distribution not only of wealth, but perhaps as importantly, distribution of responsibility and authority so that people can make the best possible decisions for themselves. Redistributing away from the accumulation of power/wealth into too few hands is very important for that.

wronglyprepaid 4y ago

Can you cite anything to back your claim here? Why is idle wealth more of an impediment than policies that discourage investment? What does idle wealth even mean, how do you measure it? Why would anyone with wealth want it to sit idle?

bombcar 4y ago
An no matter how many times you sell the Mona Lisa to pay the Mona Lisa tax, it still wouldn’t drop in value. So all art would have to be owned by the government or non-profits, which can easily be abused by the rich to hold “their” art tax-free.
- deleted 4y ago
  [deleted]

zozbot234 4y ago

There's a fallacy here. The bottom-line economic effect of having a lot of "wealth tied up in art" is incenting the preservation and/or creation of highly valued art. You can't even meaningfully take that wealth away in the aggregate, because it's pure paper wealth; it's a side effect of how much we happen to value some objects. Slumlord properties have the same theoretical problem as land, in that concentrated ownership can act as an incentive towards bad management; there's not much economy of scale when it comes to managing rental properties, so policy should incent dispersed ownership instead.

vkou 4y ago
Not when the price of art never reaches it's creator, and only goes stratospheric through speculation and back-and-forth trades long after his death. You can't be incentivised to create art when you will never realize that incentive. And unlike music record labels, it's not like you are giving someone else your earnings in exchange for editing and technical help and marketing. Art was a bad example, though, since it's mostly just used as a tax dodge. The real problem is rent seeking.

car_analogy 4y ago

> Wealth tied up in art is not doing anything Wealth* that is not doing anything has no effect on the economy. Suppose I had $100 trillion in cash (or art, or other useless commodity) in a vault somewhere, and never spend a dime of it. How is it impeding the economy? If I didn't tell you about it, you wouldn't even know it existed. It's only when I start spending it, to redirect labor per my wishes, that I start affecting the economy. If I spend it all on yachts, that will cause a lot of labor and materials to go to yachts that won't contribute anything to the economy once built, instead of going to something more productive. *Using "wealth" to mean fiat money, or art, or anything that has no productive use. E.g. if the wealth was instead in the form of idle farmland, that would be used to grow food if owned by someone else, then yes, that would be impeding the economy. So one must distinguish between wealth with inherent value, and wealth that only has value because people are willing to pay for it.

hansel_der 4y ago
> If I didn't tell you about it, you wouldn't even know it existed but it does exist and is "missing" from the economy (i.e. other peoples pockets)
- car_analogy 4y ago
  If you add a zero to the end of every bill in circulation, there will be 10x more money, but people won't be any better off.
- makomk 4y ago
  Not really. There is not some fixed amount of money in existence and certainly not some fixed amount of wealth. Governments and banks create money as necessary to facilitate the actual economy in producing actual stuff, and as for wealth, well... When the price that some artist's works trade at goes up, such that the value of the ones sitting in some billionaire's vault is now higher, that extra wealth clearly doesn't come from anywhere at all. It simply springs into existence from nowhere, and will spring out of existence just as easily if private ownership of art becomes effectively impossible. What is a limiting factor in the real economy's ability to make people better off is its capacity to produce actual goods and services for them to buy, and that capacity is not used in any way by wealth sitting around doing nothing.

missedthecue 4y ago

I really need you to explain to me what "tied up" means. If I buy a $100 million dollar piece of art, that $100m doesn't disappear into the ether, it goes to the person who sold me the piece, who can then spend that on whatever they want.

epistasis 4y ago

I'm not sure I agree with this. There's two key parts to wealth: producing enough stuff to make life easy for people, and distributing that to many many people tether than hoarding it for a few. The amount of production is not impacted much by how how many bushels of wheat, or days of labor of the average worker, we value the Mona Lisa. Art can be wealth, but not all wealth is a factor of production. Labor, land, capital are all factors of production that influence how much stuff is made. Making sure that everybody has enough to survive, enough to thrive, and enough to be creative and innovate or achieve what they want should be the goal. Distribution not only of wealth, but perhaps as importantly, distribution of responsibility and authority so that people can make the best possible decisions for themselves. Redistributing away from the accumulation of power/wealth into too few hands is very important for that.