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The points Sacks makes there contain some truth but, make no mistake, they are selectively chosen and completely self-serving. 1. Talk of inflation doesn't me

by jmyeet 4y ago

The points Sacks makes there contain some truth but, make no mistake, they are selectively chosen and completely self-serving. 1. Talk of inflation doesn't mention a way more effective tool for tackling it: taxation. Inflation is offhandedly blamed on the government too for not being "transitory". Sacks is actually torn here. Non-zero interest rates hurt the VC model but as a rich guy he certainly doesn't want, say, a corporate windfall profits tax; 2. He claims he wanred about pumping trillions of dollars into the economy. Why 2 years ago and not 14-15 years ago when the zero-interest QE started? What's the difference? Oh, who got the money in 2020? This is part of a consistent narrative from rich people that it's only ever a problem when poor people get government money. Then it's a moral hazard. 3. Further to the "2 years ago" narrative, we should remember that Covid relief started under Trump, not Biden. So why not "3 years ago"? Is Sacks trying to avoid criticizing Trump? Weird. I wonder why. 4. Not one mention of deregulation. Weird.

zeroonetwothree 4y ago
Inflation is caused by printing too much money. Taxation does not directly reduce inflation (I suppose you could argue some indirect effect since it means the government will need to print less but then there are other secondary effects we would need to include, etc)
- jmyeet 4y ago
  Interest rates hurt everyone. Taxation targets only those who are profiteering. The inflation we have now is opportunistic and self-referencing. "We have to raise prices because prices are rising". In truth it's really "we're raising prices because we can". At least taxation would encourage companies to use those profits to invest in the business, possibly even pay people more (God forbid) and not necessarily profiteer. All instead of just using those huge profits for share buybacks.
  - junofan 4y ago
    You believe charging businesses more will lower prices? That doesn’t sound right.
    - jmyeet 4y ago
      It's a tax on profits. That's the point. This is the money they have left over after paying all costs. Interest rates increase the cost of everything. They will cause businesses to fail. I mean just look at SVB. And even if increased taxation changes nothing price-wise, it will fill government coffers and allow the government to help those most impacted. It is literally the best solution for absolutely everyone except for about 500 billionaires.
AnimalMuppet 4y ago
Is taxation an effective way to tackle inflation? Inflation is too much money chasing too little stuff. Taxation is less money that the people have, but more money that the government has. If the government just set the money on fire, that would help with inflation, but they won't. They'll spend it. At that point, we will have the exact same amount of money chasing the exact same amount of stuff; the only difference will be who has the money. So we'll have the same amount of inflation, but people (and businesses) will have less money to try to deal with the inflation. That doesn't sound like an answer at all.

by jmyeet 4y ago

zeroonetwothree 4y ago

Inflation is caused by printing too much money. Taxation does not directly reduce inflation (I suppose you could argue some indirect effect since it means the government will need to print less but then there are other secondary effects we would need to include, etc)

jmyeet 4y ago
Interest rates hurt everyone. Taxation targets only those who are profiteering. The inflation we have now is opportunistic and self-referencing. "We have to raise prices because prices are rising". In truth it's really "we're raising prices because we can". At least taxation would encourage companies to use those profits to invest in the business, possibly even pay people more (God forbid) and not necessarily profiteer. All instead of just using those huge profits for share buybacks.
- junofan 4y ago
  You believe charging businesses more will lower prices? That doesn’t sound right.
  - jmyeet 4y ago
    It's a tax on profits. That's the point. This is the money they have left over after paying all costs. Interest rates increase the cost of everything. They will cause businesses to fail. I mean just look at SVB. And even if increased taxation changes nothing price-wise, it will fill government coffers and allow the government to help those most impacted. It is literally the best solution for absolutely everyone except for about 500 billionaires.

AnimalMuppet 4y ago

Is taxation an effective way to tackle inflation? Inflation is too much money chasing too little stuff. Taxation is less money that the people have, but more money that the government has. If the government just set the money on fire, that would help with inflation, but they won't. They'll spend it. At that point, we will have the exact same amount of money chasing the exact same amount of stuff; the only difference will be who has the money. So we'll have the same amount of inflation, but people (and businesses) will have less money to try to deal with the inflation. That doesn't sound like an answer at all.