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Not to sound like some crazy person with the word SOCIALIST written on the inside of my forehead in neon colors, but: It should be possible for WhatsApp to get

Not to sound like some crazy person with the word SOCIALIST written on the inside of my forehead in neon colors, but: It should be possible for WhatsApp to get "only" $18 billion and scientific research gets the remaining $1 billion. About a 5% tax. That way, venture capitalists could claim to fund innovation and would actually be truth-tellers.

yetanotherphd 13y ago
Funding science with taxes raised by income tax is socialist for me. Economic theory shows that income tax is the least distortionary kind of tax, What you are advocating is populism. You see a large transaction, and say "we could use some of that!", without thinking about the relative efficiency of different kinds of taxation.
6cxs2hd6 13y ago
Fastest. Downvote. Ever. \o/
- skybrian 13y ago
  Why? What would be the problem with taxing large acquisitions? It seems relatively painless and with little dead-weight loss compared to other taxes.
  - gnoway 13y ago
    I don't know what the parent's reasoning is, but the problem I have with "let's just tax it!" is that there's probably already taxes being taken from that money somewhere along the line. The next response is usually "well that's fine" - no, it isn't always - or "well we'll stop some or all of those others," which doesn't necessarily happen. Finally, while a tax may ostensibly exist to pay for x, there's usually nothing stopping existing funding y from being reappropriated for z once the new tax is in place. So there can be a new tax to increase funding but there's no net gain. I don't have any sources but I firmly believe that this happens. So, short answer: because politics.
  - nova 13y ago
    I think the problem is what to do with that money once collected. With taxes in general. Currently we just let politicians spend it as they see fit.
  - yetanotherphd 13y ago
    >relatively painless and with little dead-weight loss On what basis are you making this claim? Since you are familiar with the term deadweight loss, you must be familiar with the economic theory associated with taxation, and therefore the standard claim that the least distortionary tax is income tax. Taxes other than income tax are usually justified in terms of negative externalities.
  - 6cxs2hd6 13y ago
    I'm the OP. I meant I'd never had something downvoted 30 seconds after I posted it.
a3voices 13y ago
I didn't downvote you, but WhatsApp affects more people than obscure scientific research.
- ForHackernews 13y ago
  WhatsApp is just cheap text messages. If we had a sane telecom market to start with, SMS would already cost nearly nothing and there'd be no market for WhatsApp. They've done a good job filling a niche in a broken market, and delivered real value for consumers, I admit.
  - fennecfoxen 13y ago
    Monopoly profits don't get redistributed back into the consumer surplus all by themselves. Somebody's got to do it.
- 6cxs2hd6 13y ago
  I understand your point. Startups can be be obscure in the same ways as research: Interesting idea, but turned out to be wrong. Interesting, and right, but no significant application in the broad world. Or not even a very interesting idea. There's value to a system where plausible things get funded, even if only 1 turn out to pay for the 9 that suck.
- cabalamat 13y ago
  If it wasn't for obscure scientific research, WhatsApp wouldn't exist.
  - bduerst 13y ago
    Slippery Slope: If it wasn't for obscure scientific research, almost nothing we know would exist. It doesn't mean that obscure scientific research has the same market value as almost everything.
    - cabalamat 13y ago
      > It doesn't mean that obscure scientific research has the same market value as almost everything. Of course not. Food, for example, has much more immediate use. But it does mean that science is pretty valuable, and more valuable over longer periods.
ry0ohki 13y ago
There's already a tax on that $18 billion, it's at least a capital gains tax of 20% (not to mention the income taxes on all the attorney's, accountants, etc... involved in the deal). You just need to fix the allocation of the tax dollars.
- bduerst 13y ago
  That's only on cash dividends, selling equity, income on shorting, etc, right? The actual transfer of equity isn't taxed, at least until they try to pull cash out.
  - ry0ohki 13y ago
    Without knowing the exact split of stock/cash that's difficult to answer, but we can at least say the cash portion is taxed at capital gains rates.
    - bduerst 13y ago
      Facebook only had 3.3 billion in cash, and I seriously doubt they spent more than a billion on this deal.
pyrrhotech 13y ago
It's funny to me when people call companies like Twitter "tech companies". What technology has twitter invented? There are open source clones with 70% of the features in < 1k LoC. Bootstrap? give me a break. It's time we got rid of this misnomer. Just because part of your company revolves around a piece of software you wrote doesn't mean you are a tech company. Writing software is not necessarily creating technology. Otherwise anyone who's written their own html site has just progressed technology.
- silverlake 13y ago
  You can write a superficial clone of any web app. But can you handle 8000 tweets/sec in real-time? The innovation is in the back-end.
  - pyrrhotech 13y ago
    It's been done notoriously badly at Twitter, no offense if you are an employee. Sure it's gotten better since they switched to the JVM, but still scaling to that size has been done by hundreds of companies now. Once there are textbooks out describing the techniques, you are simply implementing known methodologies with perhaps a few customizations and tweaks. I don't really see much innovation there TBH.
    - silverlake 13y ago
      I'm neither an employee nor a twitter user. But I've built phone networks and appreciate the absurd complexity of very large systems. If you believe you can build twitter, you're either a brilliant programmer or ignorant of the real challenges. Look at Twitter's code on github and tell me that's just a simple tweak on a known methodology.
    - AllTheThings 13y ago
      Twitter, Facebook, and LinkedIn (along with other big tech companies) all produce a lot of academic research that documents the architectures and protocols that they use, along with their performance. These companies innovate, and the material from their research often makes it into these "textbooks ... describing the techniques".
dnautics 13y ago
How do you suppose that $1b would be allocated? Of course it will go to the top 1% of researchers, so the established top will stay at the top. Your proposal will make matter worse in exactly the way that "SOCIALISM" (OP's scare words) doesn't work.
Dewie 13y ago
> Not to sound like some crazy person with the word SOCIALIST written on the inside of my forehead in neon colors, but: Oh give me a break.
eli_gottlieb 13y ago
>Not to sound like some crazy person with the word SOCIALIST written on the inside of my forehead in neon colors Welcome to the party, comrade! Want a beer? (No, seriously, it's not bad being a socialist. Turn off the American anti-applause-lights that are designed to make us look eeeeeeviiiiil and examine what our actual positions are. We're an ideology like more-or-less any other, with plenty of valid points even outsiders acknowledge.)

yetanotherphd 13y ago

Funding science with taxes raised by income tax is socialist for me. Economic theory shows that income tax is the least distortionary kind of tax, What you are advocating is populism. You see a large transaction, and say "we could use some of that!", without thinking about the relative efficiency of different kinds of taxation.

6cxs2hd6 13y ago

Fastest. Downvote. Ever. \o/

skybrian 13y ago
Why? What would be the problem with taxing large acquisitions? It seems relatively painless and with little dead-weight loss compared to other taxes.
- gnoway 13y ago
  I don't know what the parent's reasoning is, but the problem I have with "let's just tax it!" is that there's probably already taxes being taken from that money somewhere along the line. The next response is usually "well that's fine" - no, it isn't always - or "well we'll stop some or all of those others," which doesn't necessarily happen. Finally, while a tax may ostensibly exist to pay for x, there's usually nothing stopping existing funding y from being reappropriated for z once the new tax is in place. So there can be a new tax to increase funding but there's no net gain. I don't have any sources but I firmly believe that this happens. So, short answer: because politics.
- nova 13y ago
  I think the problem is what to do with that money once collected. With taxes in general. Currently we just let politicians spend it as they see fit.
- yetanotherphd 13y ago
  >relatively painless and with little dead-weight loss On what basis are you making this claim? Since you are familiar with the term deadweight loss, you must be familiar with the economic theory associated with taxation, and therefore the standard claim that the least distortionary tax is income tax. Taxes other than income tax are usually justified in terms of negative externalities.
- 6cxs2hd6 13y ago
  I'm the OP. I meant I'd never had something downvoted 30 seconds after I posted it.

a3voices 13y ago

I didn't downvote you, but WhatsApp affects more people than obscure scientific research.

ForHackernews 13y ago
WhatsApp is just cheap text messages. If we had a sane telecom market to start with, SMS would already cost nearly nothing and there'd be no market for WhatsApp. They've done a good job filling a niche in a broken market, and delivered real value for consumers, I admit.
- fennecfoxen 13y ago
  Monopoly profits don't get redistributed back into the consumer surplus all by themselves. Somebody's got to do it.
6cxs2hd6 13y ago
I understand your point. Startups can be be obscure in the same ways as research: Interesting idea, but turned out to be wrong. Interesting, and right, but no significant application in the broad world. Or not even a very interesting idea. There's value to a system where plausible things get funded, even if only 1 turn out to pay for the 9 that suck.
cabalamat 13y ago
If it wasn't for obscure scientific research, WhatsApp wouldn't exist.
- bduerst 13y ago
  Slippery Slope: If it wasn't for obscure scientific research, almost nothing we know would exist. It doesn't mean that obscure scientific research has the same market value as almost everything.
  - cabalamat 13y ago
    > It doesn't mean that obscure scientific research has the same market value as almost everything. Of course not. Food, for example, has much more immediate use. But it does mean that science is pretty valuable, and more valuable over longer periods.

ry0ohki 13y ago

There's already a tax on that $18 billion, it's at least a capital gains tax of 20% (not to mention the income taxes on all the attorney's, accountants, etc... involved in the deal). You just need to fix the allocation of the tax dollars.

bduerst 13y ago
That's only on cash dividends, selling equity, income on shorting, etc, right? The actual transfer of equity isn't taxed, at least until they try to pull cash out.
- ry0ohki 13y ago
  Without knowing the exact split of stock/cash that's difficult to answer, but we can at least say the cash portion is taxed at capital gains rates.
  - bduerst 13y ago
    Facebook only had 3.3 billion in cash, and I seriously doubt they spent more than a billion on this deal.

pyrrhotech 13y ago

It's funny to me when people call companies like Twitter "tech companies". What technology has twitter invented? There are open source clones with 70% of the features in < 1k LoC. Bootstrap? give me a break. It's time we got rid of this misnomer. Just because part of your company revolves around a piece of software you wrote doesn't mean you are a tech company. Writing software is not necessarily creating technology. Otherwise anyone who's written their own html site has just progressed technology.

silverlake 13y ago
You can write a superficial clone of any web app. But can you handle 8000 tweets/sec in real-time? The innovation is in the back-end.
- pyrrhotech 13y ago
  It's been done notoriously badly at Twitter, no offense if you are an employee. Sure it's gotten better since they switched to the JVM, but still scaling to that size has been done by hundreds of companies now. Once there are textbooks out describing the techniques, you are simply implementing known methodologies with perhaps a few customizations and tweaks. I don't really see much innovation there TBH.
  - silverlake 13y ago
    I'm neither an employee nor a twitter user. But I've built phone networks and appreciate the absurd complexity of very large systems. If you believe you can build twitter, you're either a brilliant programmer or ignorant of the real challenges. Look at Twitter's code on github and tell me that's just a simple tweak on a known methodology.
  - AllTheThings 13y ago
    Twitter, Facebook, and LinkedIn (along with other big tech companies) all produce a lot of academic research that documents the architectures and protocols that they use, along with their performance. These companies innovate, and the material from their research often makes it into these "textbooks ... describing the techniques".

dnautics 13y ago

How do you suppose that $1b would be allocated? Of course it will go to the top 1% of researchers, so the established top will stay at the top. Your proposal will make matter worse in exactly the way that "SOCIALISM" (OP's scare words) doesn't work.

Dewie 13y ago

> Not to sound like some crazy person with the word SOCIALIST written on the inside of my forehead in neon colors, but: Oh give me a break.

eli_gottlieb 13y ago

>Not to sound like some crazy person with the word SOCIALIST written on the inside of my forehead in neon colors Welcome to the party, comrade! Want a beer? (No, seriously, it's not bad being a socialist. Turn off the American anti-applause-lights that are designed to make us look eeeeeeviiiiil and examine what our actual positions are. We're an ideology like more-or-less any other, with plenty of valid points even outsiders acknowledge.)