8 ms·

1) set a generous threshold over which your inheritance gets taxed, inflation adjusted (e.g, 2M not including the principal residence) 2) tax 100% above it. (sh

1) set a generous threshold over which your inheritance gets taxed, inflation adjusted (e.g, 2M not including the principal residence) 2) tax 100% above it. (should only concern a fraction of a fraction of cases) 3) put all this tax's proceeds in a sovereign wealth fund 4) at 21, a citizen gets access to her redistributed generational wealth 5) profit

kachapopopow 11mo ago
I think the bigger issue is that people are hording wealth instead of spending it in general making money work for them and not for the greater economy which is the only thing giving their money substance long-term. Well, long-term is longer than human lifetime so I guess there's no real reason for them to worry about it either.
- johnnyanmac 11mo ago
  Well yes. That's why trickle down economics doesn't work in practice. Becsuwe billionaires don't stimulate the economy through spending.
- boxed 11mo ago
  I've heard this take a lot and it doesn't make much sense to me. How exactly are ultra rich "hoarding wealth instead of spending it"? Afaik most of the net worth of the ultra rich is in ownership of companies (stocks) or loans (eg bonds). That money is all out there in the world working. Isn't the fact that the ultra rich are using their wealth productively the reason we have growing wealth inequality? Because active money grows faster than inflation, which is why they get richer compared to the rest of us over time.
  - kachapopopow 11mo ago
    It's more of a problem that the money is only used to make more money rather than being used for services or productive work.
    - boxed 11mo ago
      But... money becomes more money precisely because it's invested into companies that sell products and services that people buy, and use most of that money to pay employees, office rent, factories etc. Or in other words: money grows if you use it. If you just put it in a bank account it slowly erodes away under inflation.
      - kachapopopow 11mo ago
        that's the catch-22 type deal in the end which makes wealth-inequality the only outcome as the super-wealthy will always benefit more than everyone else when that money is spent and there is no incentive to limit growth personally I think the only real solution is slowing down by reducing incentives to keep growing money (or stock value) by implementing some kind of tax ceiling in turn slowing down innovation and instead hoping that giving more people the ability to grow (easier access to education, healthcare, opportunity) eventually outweights the disadvantages of having such a ceiling
  - johnnyanmac 11mo ago
    Stock buyback is "spending" that does not in fact increase productivity nor stimulate the larger economy. But it makes them richer. Unrealized stocks that's hoarded isn't doing much of anything in the grand scheme of things. Billionaires have dozens of other things like the above that makes thos an issue
    - boxed 11mo ago
      Ok, but after that buyback makes some person richer, what happens then? They can't put that money into a bank account and hoard it because then inflation will eat it slowly. They have to reinvest it into the stock market or something for it to grow.
- skippyboxedhero 11mo ago
  I heard something on here about an investment bubble? There is some kind of bizarre world that we live in that the article has a quote from Ramaphosa, the totality of his extraordinary wealth was generated by corruption, on the terrors of inequality. Hoarding is, generally, not a real problem because it requires believing that wealthy people are not greedy. The problem is that most societies heavily incentivize irrational behaviour through disincentivizing investment. Strangely, these same places also have political cultures that focus heavily on inequality (again, there is no better example than South Africa) because genuine openness tends to be very disruptive politically. There is no way to square the circle. The solutions are known, the problem is that human nature and political culture tends to prevent those solutions being realised (as it is more politically beneficial to continue to sell people lies: it is this group of people, they are the problem, if we can take their money and give it you then you will be rich).
  - kachapopopow 11mo ago
    well that's pretty much it, people aren't letting their money go, they are only spending money with the sole purpose of making more money.
- bawolff 11mo ago
  Not really. After all that is the point of inflation, to tax people who hoard money.
  - kachapopopow 11mo ago
    They aren't hoarding it directly, they have it in stocks or other appreciating assets such as gold.
    - bawolff 11mo ago
      Stocks is spending money. You are literally giving the money to someone else to help with their business venture.
      - kachapopopow 11mo ago
        with the sole purpose of making more money
onion2k 11mo ago
6) wonder why this has no real impact as it only recovers wealth from people who are over $2m in wealth but below set-up-a-trust-to-move-your-families-money-to wealth, which is a fraction of the wealth. 7) See trust-as-a-service businesses boom until there's no additional revenue.
- twoodfin 11mo ago
  8) Create tons of dead-weight loss in the economy as you attempt to regulate your way out of (7) by being clever with the tax code.
tock 11mo ago
Why make it on inheritance then? Tax wealth 100% above 2M. I do think this would doom progress but would be a fun exercise.
- blitzar 11mo ago
  Wouldnt it be easier just to tax all income above say $200,000 (minimum wage in SV) at 100%. If a net worth of $2 mil is considered outrageous then surely that kind of salary would be considered equally so.
  - evandijk70 11mo ago
    Most net worths over $2 mil are created by growth in share value, not by income/salary.
    - blitzar 11mo ago
      If you dont have any disposible income then you wont have any investments to grow in value.
    - vorpalhex 11mo ago
      Most income for high earning tech workers is in stocks and share value.
      - blitzar 11mo ago
        We can tax stock grants at 100%
        sam_lowry_ 11mo ago
        You can also tax stocks yearly at a fixed rate, e.g. 2%.
        blitzar 11mo ago
        You can also tax stocks yearly at a fixed rate, e.g. 100%.
JAlexoid 11mo ago
There's a reason why countries, like Sweden, have scrapped the inheritance tax - it doesn't work like that anymore. The benefits of wealth are exercised long before the inheritance can be applied. Your first home down payment, your education, your wealth generation while being on support by your parents, etc. - will push you off the ground faster, than any inheritance in a world where people easily live to 80-90. Most people hit retirement age, by the time their parents pass away.
- boxed 11mo ago
  I'm pretty sure we scrapped it because the conservatives got into power.
  - JAlexoid 11mo ago
    Cool. Inheritance tax doesn't work anymore, in any case. It's not the 19th century and we shouldn't try fixing 21 century issues with 19th century remedies.
    - sam_lowry_ 11mo ago
      Wealth tax is all the rage, now. A yearly tax of a few percent on all capital assets.
    - johnnyanmac 11mo ago
      If you have a better idea then I'm all ears. But dismissing a long established solution without an alternative makes it sound like you prefer the status quo.
    - boxed 11mo ago
      "doesn't work" for what purpose? It surely has SOME effect. Otherwise people wouldn't be against it.
  - SiempreViernes 11mo ago
    > Leif Pagrotsky, som då var näringsminister, har i efterhand avslöjat att avskaffandet av arvsskatten var en eftergift från Regeringen Persson till Svenskt Näringsliv Well, not quite.
bawolff 11mo ago
I think you'd have to be a bit more complex than that. Most 80 year olds know they arent going to live forever and would probably just transfer their assets a little early.
- johnnyanmac 11mo ago
  Sounds good to me. Moving that level of money already has so many stupulations. Inheritance is used because of tradition and because it's the one foolproof way to maintain generational wealth.
  - bawolff 11mo ago
    > Inheritance is used Is it though? I think most very wealthy people are already using more complex structures like trusts and whatnot. > Moving that level of money already has so many stupulations. Like what exactly?
    - johnnyanmac 11mo ago
      In the general sense that people are using ways to give money to others when they die instead of spreading the weskth, yes. I'm sure there's dozens of methods used to harbor wealth but I'm more talking on the general concept. >Like what exactly? In the very brodest sense, anything that involves turning I realizing gains into liquidity will be taxed. Investing it into assets like property will have that taxed, unless you choose to go to very specific areas. Throwing it into a business will jabr capital taxes. Exceptions are disproportionatly utilized, but there are in fact more ways to be taxed on your money than not. That's why a lot of the current mechanisms lie less in "grab money, get taxed, use it" and more "point to money, get loans, stay in 'debt' and use not your money make money".
      - bawolff 11mo ago
        > In the very brodest sense, anything that involves turning I realizing gains into liquidity will be taxed. Sure, but there is a very very big difference between capital gains tax and inheritence tax. Most proposals for inheritence tax are on the entire value of the property being inherited. Capital gains taxes are just on the difference in value between when you got it and when you sold it. If every transfer of property behaved like an inheritence tax, the economy would probably screech to a halt as you effectively couldn't sell anything without taking a huge hit.
awakeasleep 11mo ago
There are many solutions, many ways to limit the magnitude of differences of wealth. But America is so thoroughly owned by the wealthy that implementing one of these solutions is not desirable. The legislature in America only works on behalf of the ultra wealthy and any legislation that passes will be to increase the magnitude of the wealth gap.
- jghn 11mo ago
  Also there's the aspect of how many Americans view themselves as temporarily inconvenienced millionaires. The average person doesn't want rules like this because they're sure it'll apply to them someday.
  - JAlexoid 11mo ago
    No... Most americans are just plain ignorant(not in a malicious way, just impossible to parse the signal through the noise on many topics). A lot genuinely have no idea that there's a very high lower limit on inheritance tax... at the same time they hate the ultra rich. This is genuinely a very schizophrenic country.
brianwawok 11mo ago
So people put the money in a trust or use another way to dodge it. I don’t think it’s nearly as easy to collect ad you hand wave.
- johnnyanmac 11mo ago
  GP probably spent 5 minutes writing that comment. I'm sure a proper policy naker will put more thought into it and consult lawyers/economists when making a fleshed out plan. There's always loopholes. An internet forum isn't the best place to try and close every hole.
- shoubidouwah 11mo ago
  it is already more or less the case, but I argue that it's for the benefit of the living holder, not the heirs. A lot of the incentives to have huge, untouched inheritances revolve around dynasty effects, exactly the kind of behaviour we want to curb. I'd go further and say that "unearned wealth corrupts" is a well known effect, and (apart from the small subset of rich people who do not care about their kids corruption and intrinsic worth apart from them being the vehicle of their dinasty) we see that divestment into charity / foundations are the modern preferred way for inheritance management, both sparing the kids somewhat (being downgraded to a multimillionaire is not a hellish situation) and gifting them cultural influence. A sovereign fund could scratch that itch somewhat.
koolba 11mo ago
> tax 100% above it. (should only concern a fraction of a fraction of cases) 3) put all this tax's proceeds in a sovereign wealth fund 4) at 21, a citizen gets access to her redistributed generational wealth 5) profit If you think you’ve seen zany tax schemes, just wait till they try implementing something as crazy as a 100% tax. There’s also a moral question of why you feel entitled to not just a majority of the fruits of my labors, but apparently all of them.
- slowmovintarget 11mo ago
  This. There's an unproven assumption that somehow the inequality of outcome is 1) unjust, and 2) something to be "corrected." The first has no foundation other than appeal to emotion to create in-group / out-group tribes ("eat the rich!") to then suggest what end up being power grabs that destroy the middle class and do nothing to the wealthy. The second item requires destroying value. All economic activity comes from exchanges of value, which is intrinsically tied to time; that irreducible finite quantity to which everyone is subject. We've seen over and over again, when you try to destroy the concept of value, which is subjective and circumstantial for each individual, all you end up doing is causing human misery. This obsession with taking other people's money rather than enabling opportunities to make your own is unhealthy, destructive, and immoral.
  - johnnyanmac 11mo ago
    >There's an unproven assumption that somehow the inequality of outcome is 1) unjust, and 2) something to be "corrected." There's decades of research into this if you care to look up wage theft, worker productivity vs compensation, the lobbying against unions and minimum wage and any other labor protections, and the fact that we ruled that it's okay for billionaires to buy politicians.you talk about enabling opportunities, but lobbyists have used it to pull up all the ladders and pay less back to the people. So yes, we're due for a correction. If you're a millionaire this doesn't really apply to you. Your taxes go up maybe 2-3%. "Wealth tax" is in the realm of 100m and definitely by 1b.
  - shoubidouwah 11mo ago
    I am actually advacating for something different: I am not taking your money, I am saying after some level, what you accumulate is not - your kids - money. It realigns incentives (do something with it before you die), helps your kids (unearned weath corrupts, enormous unearned wealth corrupts enormously), and actually enables opportunities through investment and redistribution at a time when most people need something like a downpayment or school debt clearing.
kfterrg67 11mo ago
[dead]

kachapopopow 11mo ago

I think the bigger issue is that people are hording wealth instead of spending it in general making money work for them and not for the greater economy which is the only thing giving their money substance long-term. Well, long-term is longer than human lifetime so I guess there's no real reason for them to worry about it either.

johnnyanmac 11mo ago
Well yes. That's why trickle down economics doesn't work in practice. Becsuwe billionaires don't stimulate the economy through spending.
boxed 11mo ago
I've heard this take a lot and it doesn't make much sense to me. How exactly are ultra rich "hoarding wealth instead of spending it"? Afaik most of the net worth of the ultra rich is in ownership of companies (stocks) or loans (eg bonds). That money is all out there in the world working. Isn't the fact that the ultra rich are using their wealth productively the reason we have growing wealth inequality? Because active money grows faster than inflation, which is why they get richer compared to the rest of us over time.
- kachapopopow 11mo ago
  It's more of a problem that the money is only used to make more money rather than being used for services or productive work.
  - boxed 11mo ago
    But... money becomes more money precisely because it's invested into companies that sell products and services that people buy, and use most of that money to pay employees, office rent, factories etc. Or in other words: money grows if you use it. If you just put it in a bank account it slowly erodes away under inflation.
    - kachapopopow 11mo ago
      that's the catch-22 type deal in the end which makes wealth-inequality the only outcome as the super-wealthy will always benefit more than everyone else when that money is spent and there is no incentive to limit growth personally I think the only real solution is slowing down by reducing incentives to keep growing money (or stock value) by implementing some kind of tax ceiling in turn slowing down innovation and instead hoping that giving more people the ability to grow (easier access to education, healthcare, opportunity) eventually outweights the disadvantages of having such a ceiling
- johnnyanmac 11mo ago
  Stock buyback is "spending" that does not in fact increase productivity nor stimulate the larger economy. But it makes them richer. Unrealized stocks that's hoarded isn't doing much of anything in the grand scheme of things. Billionaires have dozens of other things like the above that makes thos an issue
  - boxed 11mo ago
    Ok, but after that buyback makes some person richer, what happens then? They can't put that money into a bank account and hoard it because then inflation will eat it slowly. They have to reinvest it into the stock market or something for it to grow.
skippyboxedhero 11mo ago
I heard something on here about an investment bubble? There is some kind of bizarre world that we live in that the article has a quote from Ramaphosa, the totality of his extraordinary wealth was generated by corruption, on the terrors of inequality. Hoarding is, generally, not a real problem because it requires believing that wealthy people are not greedy. The problem is that most societies heavily incentivize irrational behaviour through disincentivizing investment. Strangely, these same places also have political cultures that focus heavily on inequality (again, there is no better example than South Africa) because genuine openness tends to be very disruptive politically. There is no way to square the circle. The solutions are known, the problem is that human nature and political culture tends to prevent those solutions being realised (as it is more politically beneficial to continue to sell people lies: it is this group of people, they are the problem, if we can take their money and give it you then you will be rich).
- kachapopopow 11mo ago
  well that's pretty much it, people aren't letting their money go, they are only spending money with the sole purpose of making more money.
bawolff 11mo ago
Not really. After all that is the point of inflation, to tax people who hoard money.
- kachapopopow 11mo ago
  They aren't hoarding it directly, they have it in stocks or other appreciating assets such as gold.
  - bawolff 11mo ago
    Stocks is spending money. You are literally giving the money to someone else to help with their business venture.
    - kachapopopow 11mo ago
      with the sole purpose of making more money

onion2k 11mo ago

6) wonder why this has no real impact as it only recovers wealth from people who are over $2m in wealth but below set-up-a-trust-to-move-your-families-money-to wealth, which is a fraction of the wealth. 7) See trust-as-a-service businesses boom until there's no additional revenue.

twoodfin 11mo ago
8) Create tons of dead-weight loss in the economy as you attempt to regulate your way out of (7) by being clever with the tax code.

tock 11mo ago

Why make it on inheritance then? Tax wealth 100% above 2M. I do think this would doom progress but would be a fun exercise.

blitzar 11mo ago
Wouldnt it be easier just to tax all income above say $200,000 (minimum wage in SV) at 100%. If a net worth of $2 mil is considered outrageous then surely that kind of salary would be considered equally so.
- evandijk70 11mo ago
  Most net worths over $2 mil are created by growth in share value, not by income/salary.
  - blitzar 11mo ago
    If you dont have any disposible income then you wont have any investments to grow in value.
  - vorpalhex 11mo ago
    Most income for high earning tech workers is in stocks and share value.
    - blitzar 11mo ago
      We can tax stock grants at 100%
      - sam_lowry_ 11mo ago
        You can also tax stocks yearly at a fixed rate, e.g. 2%.
        blitzar 11mo ago
        You can also tax stocks yearly at a fixed rate, e.g. 100%.

JAlexoid 11mo ago

There's a reason why countries, like Sweden, have scrapped the inheritance tax - it doesn't work like that anymore. The benefits of wealth are exercised long before the inheritance can be applied. Your first home down payment, your education, your wealth generation while being on support by your parents, etc. - will push you off the ground faster, than any inheritance in a world where people easily live to 80-90. Most people hit retirement age, by the time their parents pass away.

boxed 11mo ago
I'm pretty sure we scrapped it because the conservatives got into power.
- JAlexoid 11mo ago
  Cool. Inheritance tax doesn't work anymore, in any case. It's not the 19th century and we shouldn't try fixing 21 century issues with 19th century remedies.
  - sam_lowry_ 11mo ago
    Wealth tax is all the rage, now. A yearly tax of a few percent on all capital assets.
  - johnnyanmac 11mo ago
    If you have a better idea then I'm all ears. But dismissing a long established solution without an alternative makes it sound like you prefer the status quo.
  - boxed 11mo ago
    "doesn't work" for what purpose? It surely has SOME effect. Otherwise people wouldn't be against it.
- SiempreViernes 11mo ago
  > Leif Pagrotsky, som då var näringsminister, har i efterhand avslöjat att avskaffandet av arvsskatten var en eftergift från Regeringen Persson till Svenskt Näringsliv Well, not quite.

bawolff 11mo ago

I think you'd have to be a bit more complex than that. Most 80 year olds know they arent going to live forever and would probably just transfer their assets a little early.

johnnyanmac 11mo ago
Sounds good to me. Moving that level of money already has so many stupulations. Inheritance is used because of tradition and because it's the one foolproof way to maintain generational wealth.
- bawolff 11mo ago
  > Inheritance is used Is it though? I think most very wealthy people are already using more complex structures like trusts and whatnot. > Moving that level of money already has so many stupulations. Like what exactly?
  - johnnyanmac 11mo ago
    In the general sense that people are using ways to give money to others when they die instead of spreading the weskth, yes. I'm sure there's dozens of methods used to harbor wealth but I'm more talking on the general concept. >Like what exactly? In the very brodest sense, anything that involves turning I realizing gains into liquidity will be taxed. Investing it into assets like property will have that taxed, unless you choose to go to very specific areas. Throwing it into a business will jabr capital taxes. Exceptions are disproportionatly utilized, but there are in fact more ways to be taxed on your money than not. That's why a lot of the current mechanisms lie less in "grab money, get taxed, use it" and more "point to money, get loans, stay in 'debt' and use not your money make money".
    - bawolff 11mo ago
      > In the very brodest sense, anything that involves turning I realizing gains into liquidity will be taxed. Sure, but there is a very very big difference between capital gains tax and inheritence tax. Most proposals for inheritence tax are on the entire value of the property being inherited. Capital gains taxes are just on the difference in value between when you got it and when you sold it. If every transfer of property behaved like an inheritence tax, the economy would probably screech to a halt as you effectively couldn't sell anything without taking a huge hit.

awakeasleep 11mo ago

There are many solutions, many ways to limit the magnitude of differences of wealth. But America is so thoroughly owned by the wealthy that implementing one of these solutions is not desirable. The legislature in America only works on behalf of the ultra wealthy and any legislation that passes will be to increase the magnitude of the wealth gap.

jghn 11mo ago
Also there's the aspect of how many Americans view themselves as temporarily inconvenienced millionaires. The average person doesn't want rules like this because they're sure it'll apply to them someday.
- JAlexoid 11mo ago
  No... Most americans are just plain ignorant(not in a malicious way, just impossible to parse the signal through the noise on many topics). A lot genuinely have no idea that there's a very high lower limit on inheritance tax... at the same time they hate the ultra rich. This is genuinely a very schizophrenic country.

brianwawok 11mo ago

So people put the money in a trust or use another way to dodge it. I don’t think it’s nearly as easy to collect ad you hand wave.

johnnyanmac 11mo ago
GP probably spent 5 minutes writing that comment. I'm sure a proper policy naker will put more thought into it and consult lawyers/economists when making a fleshed out plan. There's always loopholes. An internet forum isn't the best place to try and close every hole.
shoubidouwah 11mo ago
it is already more or less the case, but I argue that it's for the benefit of the living holder, not the heirs. A lot of the incentives to have huge, untouched inheritances revolve around dynasty effects, exactly the kind of behaviour we want to curb. I'd go further and say that "unearned wealth corrupts" is a well known effect, and (apart from the small subset of rich people who do not care about their kids corruption and intrinsic worth apart from them being the vehicle of their dinasty) we see that divestment into charity / foundations are the modern preferred way for inheritance management, both sparing the kids somewhat (being downgraded to a multimillionaire is not a hellish situation) and gifting them cultural influence. A sovereign fund could scratch that itch somewhat.

koolba 11mo ago

> tax 100% above it. (should only concern a fraction of a fraction of cases) 3) put all this tax's proceeds in a sovereign wealth fund 4) at 21, a citizen gets access to her redistributed generational wealth 5) profit If you think you’ve seen zany tax schemes, just wait till they try implementing something as crazy as a 100% tax. There’s also a moral question of why you feel entitled to not just a majority of the fruits of my labors, but apparently all of them.

slowmovintarget 11mo ago
This. There's an unproven assumption that somehow the inequality of outcome is 1) unjust, and 2) something to be "corrected." The first has no foundation other than appeal to emotion to create in-group / out-group tribes ("eat the rich!") to then suggest what end up being power grabs that destroy the middle class and do nothing to the wealthy. The second item requires destroying value. All economic activity comes from exchanges of value, which is intrinsically tied to time; that irreducible finite quantity to which everyone is subject. We've seen over and over again, when you try to destroy the concept of value, which is subjective and circumstantial for each individual, all you end up doing is causing human misery. This obsession with taking other people's money rather than enabling opportunities to make your own is unhealthy, destructive, and immoral.
- johnnyanmac 11mo ago
  >There's an unproven assumption that somehow the inequality of outcome is 1) unjust, and 2) something to be "corrected." There's decades of research into this if you care to look up wage theft, worker productivity vs compensation, the lobbying against unions and minimum wage and any other labor protections, and the fact that we ruled that it's okay for billionaires to buy politicians.you talk about enabling opportunities, but lobbyists have used it to pull up all the ladders and pay less back to the people. So yes, we're due for a correction. If you're a millionaire this doesn't really apply to you. Your taxes go up maybe 2-3%. "Wealth tax" is in the realm of 100m and definitely by 1b.
- shoubidouwah 11mo ago
  I am actually advacating for something different: I am not taking your money, I am saying after some level, what you accumulate is not - your kids - money. It realigns incentives (do something with it before you die), helps your kids (unearned weath corrupts, enormous unearned wealth corrupts enormously), and actually enables opportunities through investment and redistribution at a time when most people need something like a downpayment or school debt clearing.

kfterrg67 11mo ago

[dead]