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Another important fact is that the rich and poor treat resources differently. The poor tend to consume while the rich tend to invest. (This is also the justific
by yummyfajitas 12y ago
Another important fact is that the rich and poor treat resources differently. The poor tend to consume while the rich tend to invest. (This is also the justification of stimulus targeting the poor.) I.e., if you tax the hell out of some rich guy, he has less money to put into Uber or SpaceX.
- yequalsx 12y agoThis is a very simplistic view. It is also, strictly speaking, incorrect. You can't possibly argue that poor people consume more in absolute terms thus you must mean as a percent of wealth. But this is not a good measure. A person in a given society will feel the need for some base level of consumption and for a poor person this necessarily will be a higher percent of their wealth than for a rich person. Upper middle class to low end rich invest money in stocks, bonds, real estate. They aren't investing in startups or the next big thing. Taxing the "hell out of some rich guy" allows society through its elected representatives to make such investments and to invest in things that society deems useful (at least in theory). It's through this mechanism that one gets the space program in the 1960s. The Hoover dam, the highway system, clean water, etc. Private investments could not possibly have produced the moon landings, etc.
- yummyfajitas 12y agoYou can't possibly argue that poor people consume more in absolute terms thus you must mean as a percent of wealth. The relevant measure: http://en.wikipedia.org/wiki/Marginal_propensity_to_consume http://en.wikipedia.org/wiki/Marginal_propensity_to_consume ...allows society through its elected representatives to make such investments and to invest... Which is irrelevant to this conversation since we are discussing taxing people to pay for consumption.