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> Globalization has played a big role in creating the massive income inequality in our country; it seems like we should fix that. Wouldn't restoring the prior

> Globalization has played a big role in creating the massive income inequality in our country; it seems like we should fix that. Wouldn't restoring the prior taxes to those with highest incomes, and adding a proper capital gains tax, address this directly? As I've started to accumulate small amounts of wealth I've realized, my capital gains are taxed lower than my income; when I sell my house, I get up to 500k of gains tax free. If I backdoor a Roth IRA, I get tax free gains there too. etc. Add additional taxes to investment properties, in the form of property taxes could be one approach as well - I personally know of one investor that owns at least 20 (SFH) properties for example. So I'd propose starting there, as it targets both the wealth gap as well as hits those who can most afford it directly. > Tariffs accomplish both of those, raising money at the same time as raising cost of goods and weakening the dollar. If tariffs significantly reduce demand, or worse cause a recession, they will have the opposite effect. It would take time to sort out the full impact. But AFAIK, the tax cuts are proposed to be pushed through immediately, without firm corresponding spending reductions nor time to sort out the impact of the tariffs; similarly the tariffs are being implemented in what seems like a haphazard way, with everyone unsure of what they would / will be, how much, etc. In general, I think if the plan were modest tax increases, esp. around capital gains policy and targeting SFH as investments, (very) modest tariffs, and well executed spending cuts, nobody would be in uproar. I will be pleasantly surprised if the current plan ends well, but it certainly feels as though only those steeped deeply in ideology are supportive of them at the present moment, and I think that is probably telling.

bluedino 2y ago
You can tax whoever you want as much as you want but the problem is the industries from the past are no longer in this country.
- greenavocado 2y ago
  This was actually the real cause of the collapse of Zimbabwe. The tax base disappeared. People think it's just because they printed into oblivion but that's not the full picture.
- TehCorwiz 2y ago
  No, but we have new ones.
- flakespancakes 2y ago
  Sure, but the industries of the future arguably are. At least for now. It's not like money isn't being made in the US today.
  - vuln 2y ago
    Regulations kill any and all profit on physical goods made in the US. It was more important to lift China out of poverty (Communism), kill a whole class worth of jobs and enact regulations to stifle any innovation because it’s okay if China pollutes, just not the US. It’s okay to buy goods from mega polluter China shipped on boats running on crude oil, instead of supporting Americans and American companies.
    - fransje26 2y ago
      As you are about to find out with a president who is busy removing as many regulations as possible, consumer/worker/health/environment-protecting regulations are not the reason why physical goods are not made in the US anymore.
    - tim333 2y ago
      Manufacturing in the US had been shooting up >Manufacturing output in the United States is at an all-time high as of 2023 https://en.wikipedia.org/wiki/Manufacturing_in_the_United_States https://en.wikipedia.org/wiki/Manufacturing_in_the_United_St...
- bayarearefugee 2y ago
  The vast majority of industries from the past are now highly automated and would be made even more so if the alternative were paying US-scale living wages to the employees. So you bring the factories back to the US, but 95% of the created jobs are for robots. Problem solved...?
  - tianreyma 2y ago
    100% this, in 2010 I briefly worked for a company that built assembly lines in the US and number one requirement for every client was reducing the number of workers needed. Almost every project going at the time reduced the number of workers by 80%+ and I imagine it's only become more automated since then.
- naijaboiler 2y ago
  in 1800, 95% of American were farmers in 1900, some 65% of Americans were farmers in 2020, it's down to like 5%. My point is some industries just die. And its okay. The solution is not to go backwards, but tax the winners of the change to subsidize and retrain the people who lost. But in America, the extreme winners have convinced the rest of us that we shouldn't tax them, and Trump is now asking us to instead tax everyone more
  - aiisjustanif 2y ago
    Caveat > and Trump is now asking us to instead tax everyone more Trump is now demanding to instead tax US residents more indirectly
  - palmotea 2y ago
    > in 1800, 95% of American were farmers in 1900, some 65% of Americans were farmers in 2020, it's down to like 5%. > My point is some industries just die. And its okay. You've got your example dead wrong. American farming didn't "just die," it got insanely more productive. And a lot of the industries people want back didn't "just die," they just got moved so the "extreme winners" could profit off them even more. And then those same winners and their defenders always go "herp derp, industries gone, nothing we can do! Don't fight it, just repeat: gone foreverrrr."
kortilla 2y ago
No, tax increases will not create better jobs to backfill the ones moved overseas by globalization.
- alpha_squared 2y ago
  What better jobs do you anticipate will be created?
  - SpaceNoodled 2y ago
    None, as they said.
- cloverich 2y ago
  The tax increase wouldnt be used to create better jobs, they would be used bolster social welfare and reduce the national debt, at the expense of wealth generation in the upper class. The primary benefit of the approach is that the pre-tarrif economy is strong, health care, high prices, and very high SFH prices are the primary ways people are hurting. Modest taxes as noted above address 2/3 without upending the economy in the process. Prices wont come down, but unlike the tarrif plan they also wont go up so... seems like a better option at least to my relatively uninformed brain.
  - mjevans 2y ago
    Increased taxes (on the wealthy) could also be used, not just to pay down debts, but to start new programs like expanding domestic production, back loans for small businesses and house construction. Heck even just 'new new deal' style jobs that build infrastructure. Though I am partial to using new revenue to increase competition (new startups) in weakly competitive markets. That's the most effective way of increasing supply, and choice, and letting a market function.
ccorcos 2y ago
Thomas Sowell makes a good argument that the government does a terrible job at redistributing wealth to lift the poor, based on their track record. And so taxing the rich more doesnt actually solve that problem — it just makes politicians and their friends richer. Also when talking about tariffs reducing demand and inflating prices, I think it’s important to note that’s partly true. It doesn’t raise prices of domestic goods and actually increases demand for domestic goods.
- no_wizard 2y ago
  He's one economist from a very conservative line of thinking. As a counter example, Thomas Piketty argues at length that taxation and wealth redistribution remain an effective way to bolster a societies resilience and lessen wealth inequality - which is still a very real issue in the world, and arguably one that the US shows can have very real negative consequences for letting it go unaddressed. As for demand and inflating prices, yeah, domestic products may be more attractive, but the economy is huge, and much of it does not have a domestic allegory. The other issue here is the tax is on all imports, not only manufactured goods, which means raw materials - which often have to be sourced elsewhere - make manufacturing more expensive even domestically
  - ericmay 2y ago
    Maybe we should raise tariffs and raise taxes on the wealthy? Does it have to be framed as an either-or? > and much of it does not have a domestic allegory Well some would argue that's the problem. Maybe now we will? Idk.
    - no_wizard 2y ago
      The way its being framed in the public - and often in discussions even in this Hacker News comments section - is its an alternative to raising other taxes. Trump is selling it that way, along with simultaneous tax cuts he wants to either extend or implement, which goes to show the tariffs are not some way of addressing the national debt concerns either. While nothing does, the actual discussion around it isn't allowing any room for non-tariff tax increases regardless.
colordrops 2y ago
It is absolutely wild to me that money gained from letting it sit is taxed less than money gained from working your ass off. A crime against the working class.
- dragonwriter 2y ago
  The system wasn't named “capitalism” because it systematically favors the working class, I mean, what do you expect?
  - colordrops 2y ago
    Where in the US constitution is capitalism mentioned?
    - thfuran 2y ago
      What's your point? The tax code isn't in the constitution either.
      - colordrops 2y ago
        The point is that this isn't some fundamental property of our society that we all agreed to. It's de facto capitalist, not de jure. Just because a bunch of people pushed it one way doesn't mean we have to throw up our arms and just go with it.
- tim333 2y ago
  The working class have property and stocks too and don't want them taxed stupidly.
  - SteveNuts 2y ago
    That's the entire reason why income tax is progressive, and there's no reason that couldn't be applied to any other implemented tax including capital gains.
  - 2y ago
timewizard 2y ago
You need to enforce monopoly laws, and more important than individual tax rates, you need to get the tax base spread out correctly again. 1950: 25% tax revenue came from personal income. 25% from social security. 25% from businesses. 25% from excise taxes. Today: 50% tax revenue from personal income. 35% from social security. 7% from business. 7% from excise taxes. This problem is never understood.

bluedino 2y ago

You can tax whoever you want as much as you want but the problem is the industries from the past are no longer in this country.

greenavocado 2y ago
This was actually the real cause of the collapse of Zimbabwe. The tax base disappeared. People think it's just because they printed into oblivion but that's not the full picture.
TehCorwiz 2y ago
No, but we have new ones.
flakespancakes 2y ago
Sure, but the industries of the future arguably are. At least for now. It's not like money isn't being made in the US today.
- vuln 2y ago
  Regulations kill any and all profit on physical goods made in the US. It was more important to lift China out of poverty (Communism), kill a whole class worth of jobs and enact regulations to stifle any innovation because it’s okay if China pollutes, just not the US. It’s okay to buy goods from mega polluter China shipped on boats running on crude oil, instead of supporting Americans and American companies.
  - fransje26 2y ago
    As you are about to find out with a president who is busy removing as many regulations as possible, consumer/worker/health/environment-protecting regulations are not the reason why physical goods are not made in the US anymore.
  - tim333 2y ago
    Manufacturing in the US had been shooting up >Manufacturing output in the United States is at an all-time high as of 2023 https://en.wikipedia.org/wiki/Manufacturing_in_the_United_States https://en.wikipedia.org/wiki/Manufacturing_in_the_United_St...
bayarearefugee 2y ago
The vast majority of industries from the past are now highly automated and would be made even more so if the alternative were paying US-scale living wages to the employees. So you bring the factories back to the US, but 95% of the created jobs are for robots. Problem solved...?
- tianreyma 2y ago
  100% this, in 2010 I briefly worked for a company that built assembly lines in the US and number one requirement for every client was reducing the number of workers needed. Almost every project going at the time reduced the number of workers by 80%+ and I imagine it's only become more automated since then.
naijaboiler 2y ago
in 1800, 95% of American were farmers in 1900, some 65% of Americans were farmers in 2020, it's down to like 5%. My point is some industries just die. And its okay. The solution is not to go backwards, but tax the winners of the change to subsidize and retrain the people who lost. But in America, the extreme winners have convinced the rest of us that we shouldn't tax them, and Trump is now asking us to instead tax everyone more
- aiisjustanif 2y ago
  Caveat > and Trump is now asking us to instead tax everyone more Trump is now demanding to instead tax US residents more indirectly
- palmotea 2y ago
  > in 1800, 95% of American were farmers in 1900, some 65% of Americans were farmers in 2020, it's down to like 5%. > My point is some industries just die. And its okay. You've got your example dead wrong. American farming didn't "just die," it got insanely more productive. And a lot of the industries people want back didn't "just die," they just got moved so the "extreme winners" could profit off them even more. And then those same winners and their defenders always go "herp derp, industries gone, nothing we can do! Don't fight it, just repeat: gone foreverrrr."

kortilla 2y ago

No, tax increases will not create better jobs to backfill the ones moved overseas by globalization.

alpha_squared 2y ago
What better jobs do you anticipate will be created?
- SpaceNoodled 2y ago
  None, as they said.
cloverich 2y ago
The tax increase wouldnt be used to create better jobs, they would be used bolster social welfare and reduce the national debt, at the expense of wealth generation in the upper class. The primary benefit of the approach is that the pre-tarrif economy is strong, health care, high prices, and very high SFH prices are the primary ways people are hurting. Modest taxes as noted above address 2/3 without upending the economy in the process. Prices wont come down, but unlike the tarrif plan they also wont go up so... seems like a better option at least to my relatively uninformed brain.
- mjevans 2y ago
  Increased taxes (on the wealthy) could also be used, not just to pay down debts, but to start new programs like expanding domestic production, back loans for small businesses and house construction. Heck even just 'new new deal' style jobs that build infrastructure. Though I am partial to using new revenue to increase competition (new startups) in weakly competitive markets. That's the most effective way of increasing supply, and choice, and letting a market function.

ccorcos 2y ago

Thomas Sowell makes a good argument that the government does a terrible job at redistributing wealth to lift the poor, based on their track record. And so taxing the rich more doesnt actually solve that problem — it just makes politicians and their friends richer. Also when talking about tariffs reducing demand and inflating prices, I think it’s important to note that’s partly true. It doesn’t raise prices of domestic goods and actually increases demand for domestic goods.

no_wizard 2y ago
He's one economist from a very conservative line of thinking. As a counter example, Thomas Piketty argues at length that taxation and wealth redistribution remain an effective way to bolster a societies resilience and lessen wealth inequality - which is still a very real issue in the world, and arguably one that the US shows can have very real negative consequences for letting it go unaddressed. As for demand and inflating prices, yeah, domestic products may be more attractive, but the economy is huge, and much of it does not have a domestic allegory. The other issue here is the tax is on all imports, not only manufactured goods, which means raw materials - which often have to be sourced elsewhere - make manufacturing more expensive even domestically
- ericmay 2y ago
  Maybe we should raise tariffs and raise taxes on the wealthy? Does it have to be framed as an either-or? > and much of it does not have a domestic allegory Well some would argue that's the problem. Maybe now we will? Idk.
  - no_wizard 2y ago
    The way its being framed in the public - and often in discussions even in this Hacker News comments section - is its an alternative to raising other taxes. Trump is selling it that way, along with simultaneous tax cuts he wants to either extend or implement, which goes to show the tariffs are not some way of addressing the national debt concerns either. While nothing does, the actual discussion around it isn't allowing any room for non-tariff tax increases regardless.

colordrops 2y ago

It is absolutely wild to me that money gained from letting it sit is taxed less than money gained from working your ass off. A crime against the working class.

dragonwriter 2y ago
The system wasn't named “capitalism” because it systematically favors the working class, I mean, what do you expect?
- colordrops 2y ago
  Where in the US constitution is capitalism mentioned?
  - thfuran 2y ago
    What's your point? The tax code isn't in the constitution either.
    - colordrops 2y ago
      The point is that this isn't some fundamental property of our society that we all agreed to. It's de facto capitalist, not de jure. Just because a bunch of people pushed it one way doesn't mean we have to throw up our arms and just go with it.
tim333 2y ago
The working class have property and stocks too and don't want them taxed stupidly.
- SteveNuts 2y ago
  That's the entire reason why income tax is progressive, and there's no reason that couldn't be applied to any other implemented tax including capital gains.
- 2y ago

timewizard 2y ago

You need to enforce monopoly laws, and more important than individual tax rates, you need to get the tax base spread out correctly again. 1950: 25% tax revenue came from personal income. 25% from social security. 25% from businesses. 25% from excise taxes. Today: 50% tax revenue from personal income. 35% from social security. 7% from business. 7% from excise taxes. This problem is never understood.