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> There’s the age-old question of how we pay for this. Sanders proposed a Wall Street financial transactions tax. A 0.1 percent tax, according to a Congressiona

> There’s the age-old question of how we pay for this. Sanders proposed a Wall Street financial transactions tax. A 0.1 percent tax, according to a Congressional Budget Office estimate, could raise $777 billion over 10 years. Or we could hike taxes on corporations and the wealthiest Americans. I have no problem taxing wall street or "the wealthiest Americans", but I don't see the connection between this proposal and this funding source. It feels like taking money away from people who don't vote for you, and giving it to people who do. That's a bad direction to go down, and I'm generally skeptical about politicians who do this (which is a lot of them).

AmVess 3y ago
I have a problem with taxes in general, and this is yet another stupid idea. Increased tax loads always get passed on to the consumer. What we will end up with is higher cost of doing business and 100% for certain federally run universities will still need taxpayer bailouts every single year. Lose lose all the way around. I have an even better idea: get rid of all freebies. If someone wants something, they can get off their asses and work for it for a change.
- flashback2199 3y ago
  > Increased tax loads always get passed on to the consumer Yep, taxes are a little bit worse than that too because the cost also gets passed to the producer as well in the form of decreased demand. The result is fewer goods and services exchanged - ie less economic activity - than there would have been with a lower tax. Formally, it is called deadweight loss in microecon: https://en.wikipedia.org/wiki/Deadweight_loss?wprov=sfla1 https://en.wikipedia.org/wiki/Deadweight_loss?wprov=sfla1
  - segfaltnh 3y ago
    Is there an example of negative repercussions of this in modern society? I hear people complain about extreme taxation relative to history, but I also have plenty of access to goods and services in my region, so it seems there must be other, perhaps higher weighted, factors?
    - flashback2199 3y ago
      I learned about it in intro microecon in college. My understanding is that it is part of standard microecon curriculum.
- mseidl 3y ago
  In the 50s/60s/70s at minimum wage you used to be able to pay for a whole school year with 109 hours. Now, at minimum wage, just for 1 year is around 2250 hours. That's 13 months just to pay off 1 year of school, not including any living costs.
  - dinkleberg 3y ago
    That is remarkably depressing to see.
    - econonut 3y ago
      It's also wrong. His numbers are exaggerated and provided without any source. In 1970, it was closer to 250 hours of minimum wage for tuition alone (no living expenses) as minimum wage was $1.60 and the cost of tuition for a public university (near me) was $420 for 30 credit hours. Today, that same university is $6,270 for 30 credit hours of tuition, which is around 520 hours of work at $12/hour (which is $1.60 expressed in nominal 2023 dollars and is also the minimum wage in the state). While I realize that's still a little more than 2x the amount of working hours, it's definitely not as depressing as 20x the amount of working hours as the poster stated.
      - segfaltnh 3y ago
        What if you include living expenses?
  - mixmastamyk 3y ago
    That’s a result of govt guaranteed student loans inflating tuition. Those need to be stopped first. Then we can have cheap public universities that cost only what is required. Shouldn’t be free as it is costly and won’t be appreciated. But definitely competitive to drive down prices.
- em-bee 3y ago
  nothwithstanding all the things that taxes get used for, education is the last thing that you want to force people to pay for by themselves, because the result will be that much less people will send their kids to school because they can't afford it, and so you will end up with a large portion of uneducated and unemployable people. you really do not want to live in a country where that is the case. only education can lead to prosperity of the whole population. and the more educated people you have, the better off everyone is. i am gladly paying taxes for education, because i know in the future i and my kids will benefit from everyone around us being smarter.
  - jamesblonde 3y ago
    But would they vote for you if they were educated? Then they might understand that they are voting against their economic self-interest...
    - em-bee 3y ago
      well, if i am the one pushing for free education then i hope that those who did receive free education will recognize the benefit they received from that education and continue to vote for me, or for anyone else pushing in the same direction
- gopher_space 3y ago
  From my perspective education isn't a "freebie", it's an investment in our nation's future. Change is coming at us really fast and we need a bunch of sharp kids out there looking at all the angles. It's the same situation with school lunches. We need a bright, healthy population to face challenges. You might look at this from a national security angle. Did you know that the largest category of recruit disqualification in both WWI and WWII was malnourishment? Did you know that our technological 'edge' comes out of public universities? We don't want a small pool of healthy Americans to call on, we want the Roman ideal of a sound mind in a sound body for every citizen.
- oh_sigh 3y ago
  Who is the consumer in the context of a tax on financial transactions?
- JetSpiegel 3y ago
  What's the "consumer" of HFT trading firms? Those would be the ones affected by it.
chaps 3y ago
An argument can be made that participating in the stock market and participating in post-HS education are participating in "peak society". Peak society arm 1 should lend a hand to peak society arm 2.
- Gibbon1 3y ago
  Argument I read from an economist was that economists want to you pretend that negative externalizes don't matter. And that positive ones don't exist. He said if you accept positive ones exist then that changes a lot. What economists hate is the idea that a society where people chose actions with positive externalities is better off than one where they are selfish. Someone going to night school to get a learn something and get a degree has large positive externalities . So think of the the reverse of a pigovian tax where you tax people doing things with negative externalizes. Here you subsidize people doing things you do want and tax everyone else who might benefit to pay for it.
darth_avocado 3y ago
It’s not a partisan issue and politics should not even be involved. Other countries do it and it’s a no brainer. For example, India has a blanket education cess that individuals and corporations pay, and in return public education (school and college) is heavily subsidized (Schools are next to free). Everyone benefits from this investment and it’s mind boggling we still are fighting over this. https://cleartax.in/g/terms/education-cess/amp https://cleartax.in/g/terms/education-cess/amp
- cscurmudgeon 3y ago
  Where do you think Indians (like me) move for higher education when given the opportunity.
  - darth_avocado 3y ago
    Let’s be really honest about this, most people don’t move for education.
    - buzzert 3y ago
      60.08% of Stanford students come from out of state, and 12.26% come from out of the country. https://www.collegefactual.com/colleges/stanford-university/student-life/diversity/ https://www.collegefactual.com/colleges/stanford-university/...
      - darth_avocado 3y ago
        I think you’re missing the context of my comment. What I meant was most people moving from India don’t move to US purely for “education”, if that was the case, they’d be going back to India after they were done. The parent of my comment was arguing that public education in India (schooling and college) is not great and therefore people move to US. In reality that’s far from the truth. Sure, there’s always exceptions and some people do purely want to pursue some specific form of education that’s unavailable in India, pretending that publicly funded education is never good is just plain disingenuous.
meristohm 3y ago
The connection is that we're alll living together on Earth. If you prefer a smaller "unit of belonging", those of us in the USA are all under the same governmental umbrella. What is a reasonable role of government? My gentics and life experiences have shaped me into a person with the opinion that, for communities beyond Dunbar's Number of members (400? The point is that beyond a particular size for each culture and group of individuals things like laws, regulations, government entities, etc become necessary because we can't settle our differences well enough), taxes are generally a good thing, especially when spent on infrastructure, health care, housing, education, and food- basic needs that benefit everyone and reduce acute stresses that bring us all down, even if they're not in your backyard. How much money or access to resources do you feel like is enough for you? What's the value proposition in caring for, and lobbying for, the collective health of all people under the USA umbrella? To what extent is it okay that we still, in 2023, benefit from legal slavery? The 13th Amendment keeps costs down for my military uniforms, for example, and keeps consumer prices lower than they might be if we paid workers a fair wage rather than assuming they're only value is as enslaved prisoners. Wall Street money games are on the backs of people who help meet our basic needs. It is a height of entitlement to think that I should be able to benefit from their labor without paying for it with a progressive tax just because I want to play the game of "amass more and more money".
jncfhnb 3y ago
It’s probably a pretty smart idea. The “ideal tax” is probably a wealth indexed income tax. We don’t like the idea of just taxing wealth because you have it. We do tax income but it’s hard to scale it in a way that people perceive as fair. What we want is to make it harder for the rich to get richer without making it harder for the poor to get rich. That is, if you’re a billionaire, every dollar is taxed at 99 cents. If you have no money it’s taxed at 0. And if you’re middle class it’s done at a rate ballpark like today. But measuring wealth as a pre req to implement a tax is really hard. You can assume that wealthy people own the wealth generating assets though basically by definition. A 0.1% tax on financial transactions would affect very little in the average Americans life. It would matter immensely to people who derive their income largely by sitting back and collecting economic rent.
- whatshisface 3y ago
  Why does receiving rent involve more layered financial transactions than paying rent?
  - jncfhnb 3y ago
    I’m not sure what you’re referring to. Perhaps you’re not familiar with “economic rent”?
    - whatshisface 3y ago
      It's not clear to me that rent of any sort of metaphorical capacity involves a larger number of transactions per dollar than anything else. All I can see it accomplishing is getting rid of high frequency trading and to a lesser extent day trading... Neither of which are pastimes of rich people but rather are middle class jobs of questionable yet arguable value.
      - jncfhnb 3y ago
        Metaphorical? You’re asserting the volume is key here but it’s not really.
saghm 3y ago
> It feels like taking money away from people who don't vote for you, and giving it to people who do. That's a bad direction to go down, and I'm generally skeptical about politicians who do this (which is a lot of them) I'm trying to follow this logic, but I'm struggling. Do you think that people should be able to opt out of taxes by just not voting, or voting for a third party that never wins, or strategically trying to vote for the minority party in an area that heavily leans in a certain direction? I think your interpretation of this also assumes causation in a direction that isn't at all obvious; does he want to tax Wall Street because they won't vote for him, or does Wall Street not vote for him _because_ he wants to tax them? I'd argue that Wall Street isn't likely to vote for anyone who proposes a policy to tax financial transactions, but that's far from sufficient to conclude that such a tax is unreasonable.
- xboxnolifes 3y ago
  It's effectively buying votes with someone else's money. You run a campaign with a promise that amounts to: I'm going to tax 0.01% of the population and distribute it to everyone else. Do you think that impacts whether you get votes from the remaining 99.99%? It's easy to suggest taxing people who aren't in your target supporter base.
kevinsync 3y ago
This sounds pretty dumb and naive as I'm typing it, but we live in a world of massive computational models and technological progress -- instead of relying on academic pundits, think tanks and goofballs on social platforms floating economic ideas and theories on how to pay for things, why hasn't anybody modeled thousands of possible scenarios to figure out the top 10 over-optimized plans showing how to tax fairly + effectively, how to spend / divert / incentivize business effectively, and present many options on "where the money is going to come from" for many beneficial things for the greater good? "A rising tide lifts all boats", and that sort of thing. Is it due to lack of data? Politics? Greed? Pressures from business / "the rich" / orthodox academia to maintain the status quo? All of the above? I just get the feeling that the world isn't necessarily a zero-sum game anymore, but nobody whose sum is currently far greater than zero wants to admit it.
- segfaltnh 3y ago
  I would imagine all such models would rely on thousands or more factors which, when tweaked based on individual bias, show widely variable outcomes.
- semiquaver 3y ago
  This question reminds me of the computer scene from “Willy Wonka”. https://youtube.com/watch?v=tMZ2j9yK_NY https://youtube.com/watch?v=tMZ2j9yK_NY I’m imagining the computer guru presenting his plan to Congress: “my 100% infallible computer model says here’s what the tax law should be. Please overhaul society now and make sure you don’t let any of your prior opinions cloud your judgement now that the computer has told you what’s best.” Computational models are models: they work best with systems we already basically understand the rules to or can at least approximate. Like weather or physics. Economics is a social science. Economies are incredibly dynamic systems because they’re made of people. Every change to the system causes the participants to change their behavior. People are significantly more complicated than Game Of Life gliders. A model that can correctly simulate the economy requires strong AGI or magic, neither of which have been invented yet.

AmVess 3y ago

I have a problem with taxes in general, and this is yet another stupid idea. Increased tax loads always get passed on to the consumer. What we will end up with is higher cost of doing business and 100% for certain federally run universities will still need taxpayer bailouts every single year. Lose lose all the way around. I have an even better idea: get rid of all freebies. If someone wants something, they can get off their asses and work for it for a change.

flashback2199 3y ago
> Increased tax loads always get passed on to the consumer Yep, taxes are a little bit worse than that too because the cost also gets passed to the producer as well in the form of decreased demand. The result is fewer goods and services exchanged - ie less economic activity - than there would have been with a lower tax. Formally, it is called deadweight loss in microecon: https://en.wikipedia.org/wiki/Deadweight_loss?wprov=sfla1 https://en.wikipedia.org/wiki/Deadweight_loss?wprov=sfla1
- segfaltnh 3y ago
  Is there an example of negative repercussions of this in modern society? I hear people complain about extreme taxation relative to history, but I also have plenty of access to goods and services in my region, so it seems there must be other, perhaps higher weighted, factors?
  - flashback2199 3y ago
    I learned about it in intro microecon in college. My understanding is that it is part of standard microecon curriculum.
mseidl 3y ago
In the 50s/60s/70s at minimum wage you used to be able to pay for a whole school year with 109 hours. Now, at minimum wage, just for 1 year is around 2250 hours. That's 13 months just to pay off 1 year of school, not including any living costs.
- dinkleberg 3y ago
  That is remarkably depressing to see.
  - econonut 3y ago
    It's also wrong. His numbers are exaggerated and provided without any source. In 1970, it was closer to 250 hours of minimum wage for tuition alone (no living expenses) as minimum wage was $1.60 and the cost of tuition for a public university (near me) was $420 for 30 credit hours. Today, that same university is $6,270 for 30 credit hours of tuition, which is around 520 hours of work at $12/hour (which is $1.60 expressed in nominal 2023 dollars and is also the minimum wage in the state). While I realize that's still a little more than 2x the amount of working hours, it's definitely not as depressing as 20x the amount of working hours as the poster stated.
    - segfaltnh 3y ago
      What if you include living expenses?
- mixmastamyk 3y ago
  That’s a result of govt guaranteed student loans inflating tuition. Those need to be stopped first. Then we can have cheap public universities that cost only what is required. Shouldn’t be free as it is costly and won’t be appreciated. But definitely competitive to drive down prices.
em-bee 3y ago
nothwithstanding all the things that taxes get used for, education is the last thing that you want to force people to pay for by themselves, because the result will be that much less people will send their kids to school because they can't afford it, and so you will end up with a large portion of uneducated and unemployable people. you really do not want to live in a country where that is the case. only education can lead to prosperity of the whole population. and the more educated people you have, the better off everyone is. i am gladly paying taxes for education, because i know in the future i and my kids will benefit from everyone around us being smarter.
- jamesblonde 3y ago
  But would they vote for you if they were educated? Then they might understand that they are voting against their economic self-interest...
  - em-bee 3y ago
    well, if i am the one pushing for free education then i hope that those who did receive free education will recognize the benefit they received from that education and continue to vote for me, or for anyone else pushing in the same direction
gopher_space 3y ago
From my perspective education isn't a "freebie", it's an investment in our nation's future. Change is coming at us really fast and we need a bunch of sharp kids out there looking at all the angles. It's the same situation with school lunches. We need a bright, healthy population to face challenges. You might look at this from a national security angle. Did you know that the largest category of recruit disqualification in both WWI and WWII was malnourishment? Did you know that our technological 'edge' comes out of public universities? We don't want a small pool of healthy Americans to call on, we want the Roman ideal of a sound mind in a sound body for every citizen.
oh_sigh 3y ago
Who is the consumer in the context of a tax on financial transactions?
JetSpiegel 3y ago
What's the "consumer" of HFT trading firms? Those would be the ones affected by it.

chaps 3y ago

An argument can be made that participating in the stock market and participating in post-HS education are participating in "peak society". Peak society arm 1 should lend a hand to peak society arm 2.

Gibbon1 3y ago
Argument I read from an economist was that economists want to you pretend that negative externalizes don't matter. And that positive ones don't exist. He said if you accept positive ones exist then that changes a lot. What economists hate is the idea that a society where people chose actions with positive externalities is better off than one where they are selfish. Someone going to night school to get a learn something and get a degree has large positive externalities . So think of the the reverse of a pigovian tax where you tax people doing things with negative externalizes. Here you subsidize people doing things you do want and tax everyone else who might benefit to pay for it.

darth_avocado 3y ago

It’s not a partisan issue and politics should not even be involved. Other countries do it and it’s a no brainer. For example, India has a blanket education cess that individuals and corporations pay, and in return public education (school and college) is heavily subsidized (Schools are next to free). Everyone benefits from this investment and it’s mind boggling we still are fighting over this. https://cleartax.in/g/terms/education-cess/amp https://cleartax.in/g/terms/education-cess/amp

cscurmudgeon 3y ago
Where do you think Indians (like me) move for higher education when given the opportunity.
- darth_avocado 3y ago
  Let’s be really honest about this, most people don’t move for education.
  - buzzert 3y ago
    60.08% of Stanford students come from out of state, and 12.26% come from out of the country. https://www.collegefactual.com/colleges/stanford-university/student-life/diversity/ https://www.collegefactual.com/colleges/stanford-university/...
    - darth_avocado 3y ago
      I think you’re missing the context of my comment. What I meant was most people moving from India don’t move to US purely for “education”, if that was the case, they’d be going back to India after they were done. The parent of my comment was arguing that public education in India (schooling and college) is not great and therefore people move to US. In reality that’s far from the truth. Sure, there’s always exceptions and some people do purely want to pursue some specific form of education that’s unavailable in India, pretending that publicly funded education is never good is just plain disingenuous.

meristohm 3y ago

The connection is that we're alll living together on Earth. If you prefer a smaller "unit of belonging", those of us in the USA are all under the same governmental umbrella. What is a reasonable role of government? My gentics and life experiences have shaped me into a person with the opinion that, for communities beyond Dunbar's Number of members (400? The point is that beyond a particular size for each culture and group of individuals things like laws, regulations, government entities, etc become necessary because we can't settle our differences well enough), taxes are generally a good thing, especially when spent on infrastructure, health care, housing, education, and food- basic needs that benefit everyone and reduce acute stresses that bring us all down, even if they're not in your backyard. How much money or access to resources do you feel like is enough for you? What's the value proposition in caring for, and lobbying for, the collective health of all people under the USA umbrella? To what extent is it okay that we still, in 2023, benefit from legal slavery? The 13th Amendment keeps costs down for my military uniforms, for example, and keeps consumer prices lower than they might be if we paid workers a fair wage rather than assuming they're only value is as enslaved prisoners. Wall Street money games are on the backs of people who help meet our basic needs. It is a height of entitlement to think that I should be able to benefit from their labor without paying for it with a progressive tax just because I want to play the game of "amass more and more money".

jncfhnb 3y ago

It’s probably a pretty smart idea. The “ideal tax” is probably a wealth indexed income tax. We don’t like the idea of just taxing wealth because you have it. We do tax income but it’s hard to scale it in a way that people perceive as fair. What we want is to make it harder for the rich to get richer without making it harder for the poor to get rich. That is, if you’re a billionaire, every dollar is taxed at 99 cents. If you have no money it’s taxed at 0. And if you’re middle class it’s done at a rate ballpark like today. But measuring wealth as a pre req to implement a tax is really hard. You can assume that wealthy people own the wealth generating assets though basically by definition. A 0.1% tax on financial transactions would affect very little in the average Americans life. It would matter immensely to people who derive their income largely by sitting back and collecting economic rent.

whatshisface 3y ago
Why does receiving rent involve more layered financial transactions than paying rent?
- jncfhnb 3y ago
  I’m not sure what you’re referring to. Perhaps you’re not familiar with “economic rent”?
  - whatshisface 3y ago
    It's not clear to me that rent of any sort of metaphorical capacity involves a larger number of transactions per dollar than anything else. All I can see it accomplishing is getting rid of high frequency trading and to a lesser extent day trading... Neither of which are pastimes of rich people but rather are middle class jobs of questionable yet arguable value.
    - jncfhnb 3y ago
      Metaphorical? You’re asserting the volume is key here but it’s not really.

saghm 3y ago

> It feels like taking money away from people who don't vote for you, and giving it to people who do. That's a bad direction to go down, and I'm generally skeptical about politicians who do this (which is a lot of them) I'm trying to follow this logic, but I'm struggling. Do you think that people should be able to opt out of taxes by just not voting, or voting for a third party that never wins, or strategically trying to vote for the minority party in an area that heavily leans in a certain direction? I think your interpretation of this also assumes causation in a direction that isn't at all obvious; does he want to tax Wall Street because they won't vote for him, or does Wall Street not vote for him _because_ he wants to tax them? I'd argue that Wall Street isn't likely to vote for anyone who proposes a policy to tax financial transactions, but that's far from sufficient to conclude that such a tax is unreasonable.

xboxnolifes 3y ago
It's effectively buying votes with someone else's money. You run a campaign with a promise that amounts to: I'm going to tax 0.01% of the population and distribute it to everyone else. Do you think that impacts whether you get votes from the remaining 99.99%? It's easy to suggest taxing people who aren't in your target supporter base.

kevinsync 3y ago

This sounds pretty dumb and naive as I'm typing it, but we live in a world of massive computational models and technological progress -- instead of relying on academic pundits, think tanks and goofballs on social platforms floating economic ideas and theories on how to pay for things, why hasn't anybody modeled thousands of possible scenarios to figure out the top 10 over-optimized plans showing how to tax fairly + effectively, how to spend / divert / incentivize business effectively, and present many options on "where the money is going to come from" for many beneficial things for the greater good? "A rising tide lifts all boats", and that sort of thing. Is it due to lack of data? Politics? Greed? Pressures from business / "the rich" / orthodox academia to maintain the status quo? All of the above? I just get the feeling that the world isn't necessarily a zero-sum game anymore, but nobody whose sum is currently far greater than zero wants to admit it.

segfaltnh 3y ago
I would imagine all such models would rely on thousands or more factors which, when tweaked based on individual bias, show widely variable outcomes.
semiquaver 3y ago
This question reminds me of the computer scene from “Willy Wonka”. https://youtube.com/watch?v=tMZ2j9yK_NY https://youtube.com/watch?v=tMZ2j9yK_NY I’m imagining the computer guru presenting his plan to Congress: “my 100% infallible computer model says here’s what the tax law should be. Please overhaul society now and make sure you don’t let any of your prior opinions cloud your judgement now that the computer has told you what’s best.” Computational models are models: they work best with systems we already basically understand the rules to or can at least approximate. Like weather or physics. Economics is a social science. Economies are incredibly dynamic systems because they’re made of people. Every change to the system causes the participants to change their behavior. People are significantly more complicated than Game Of Life gliders. A model that can correctly simulate the economy requires strong AGI or magic, neither of which have been invented yet.