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To Understand Rising Inequality, Consider Janitors

nytimes.com

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Re: To Understand Rising Inequality, Consider Janitors

#331

Post by conanbatt »

pcrh wrote: post #296
conanbatt wrote: post #276

Earlier quoted context omitted.

In the context of evaluating a tax, the ability to avoid it and the difficulty to apply it is definitely one key design concept. A tax on people that eat their brocoli would be highly impractical!

You're correct in that it's foolish to institute an uncollectable tax, but I don't think inheritance tax necessarily falls into that category any more than, say, capital gains taxes.

Is paying for your kids education inheritance? Are pre-paid company contracts for a lifetime inheritance? etc etc.

There are some definite difficulties in implementation. But even then, my argument is that it could be a really harmful tax if it could be applied at all.

Re: To Understand Rising Inequality, Consider Janitors

#332

Post by surfmike »

erentz wrote: post #286
conanbatt wrote: post #240

Earlier quoted context omitted.

> Taxation is both effective, and far less invasive to markets than many other solutions. I don't really agree with this. Taxes are distortive and doesn't necesarily help inequality. It might even make it worse. But also, there is taxation as a progressive system of government funding, as there is taxation as in "You will never own more than X, because the government will seize it". In terms of solutions, I'm not a p…

They don't have to be. A "death tax" for example that takes 100% of a persons estate at death would be both simple, non distortive, and in terms of equality level the playing field every generation.

"Non distortive" You can't imagine a way a tax like that would change people's behavior? People would give their money to their children before they die, or spend it all on themselves, and maybe some would work less because they were previously motivated by building up assets to give to their children.

Re: To Understand Rising Inequality, Consider Janitors

#333

Post by yorwba »

JamesBarney wrote: post #259
microcolonel wrote: post #255

Earlier quoted context omitted.

> Strong social safety nets of the Scandinavian variety do reduce post-transfer poverty (less so inequality) Granted Scandinavian countries, now more just Norway and Denmark, tend to have very low potential for poverty in general. The rate would likely be comparatively low even without the programmes. Norway and Denmark have both considerably reduced entitlements over the years to relieve the enormous stress they put…

I think we can agree "when you give poor people money to spend, they don't end up spending more money" is an extraordinary claim. And so should need an extraordinary amount of evidence to back it up. Can you point me in the right direction to some more information about how this could possibly be true?

I don't see anyone upthread making that claim you are challenging. Could you point me to the comment you meant to respond to?

Re: To Understand Rising Inequality, Consider Janitors

#334

Post by jordanb »

TimPC wrote: post #327
choxi wrote: post #180

We should tax wealth, not income. [1] The majority of income the top 0.1% make is from investments and gets taxed as capital gains, only about 15% of their income is taxed as ordinary income. [2][3] We have an economic system where it's dramatically easier to make money the more money you already have. If you have $50M, you can park it in an index fund to get 4% returns and make $2M every year just off of your invest…

Taxing wealth is a deeply invasive bureaucratic nightmare. Having individuals be legally required to produce a balance sheet of all their assets for the government every year seems quite problematic. This would get into issues of having people be required to re-establish the fair price of all their collectables, etc. It's also a deeply dangerous attack on retirement. Instead of being taxed on the gains from your weal…

This is basically the point of the estate tax: people are already producing a balance sheet of all the wealth for the purpose of distrusting it to the heirs. So tax the wealth when the estate changes hands and all the accounting is going to be done anyway.

Re: To Understand Rising Inequality, Consider Janitors

#335

Post by FLUX-YOU »

peoplewindow wrote: post #319
agentdrtran wrote: post #171

Earlier quoted context omitted.

It would be insane if it did.

Why?

Oversight and mentorship doesn't exist for entry level self-taught doctors or lawyers. Everyone starting out would be learning the hard lessons the hard way, and for law and medicine, that means jail, injury, and deaths.

Re: To Understand Rising Inequality, Consider Janitors

#336

Post by rglovejoy »

kirsebaer wrote: post #16

Gail Evans worked as a janitor at Kodak in the 1980s. "She received more than four weeks of paid vacation per year, reimbursement of some tuition costs to go to college part time, and a bonus payment every March... A manager learned that Ms. Evans was taking computer classes while she was working as a janitor and asked her to teach some other employees how to use spreadsheet software to track inventory... Less than a…

> Less than a decade later, Ms. Evans was chief technology officer of the whole company.

So was she partly responsible for Kodak missing the boat on digital cameras?

Re: To Understand Rising Inequality, Consider Janitors

#337

Post by kofejnik »

RobertoG wrote: post #317
nnfy wrote: post #292

Earlier quoted context omitted.

Yes, I look forward to being barred from sharing the wealth that I've accumulated with my children and other loved ones. Why should they have any advantage, right? After all, you probably think I didnt do anything myself, right? Who are you to make that decision for someone? And, frankly, you're delusional if you think an estate tax is non distortive. The entire meaning of wealth would change for the elderly. One can…

I think you are right about leaving something to our children. It's a very natural human (mammal!) instinct, but there are a lot of middle ground between don't leave anything and leave them an empire. About merit, I think I know about merit. If you take the public transport at 5:30 in the morning you will see a lot of people that go to work for years for a ridiculous small pay and, that if they stopped doing that, so…

basically, your argument is that you know better than the market. Let me assure you, this isn't so. Source: grew up in the USSR.

Re: To Understand Rising Inequality, Consider Janitors

#338

Post by aoeuasdf1 »

eli_gottlieb wrote: post #287
RyanHamilton wrote: post #204

Earlier quoted context omitted.

Are you sure? The earth has finite resources. Wealth is a zero sum game. Even if you want to look at things like entertainment that can be reporduced cheaply, musicians and directors need fed, food is limited, therefore even films/music are limited.

The only non-finite resource is knowledge, and even that runs into asymptotes of diminishing marginal utility.

Everything is finite when you have a fixed amount of information and mass in the universe. That doesn't mean the common economic definitions of wealth are useless. The act of creating capital such as a piece of art, a new algorithm, or a manufacturing tool all change the total amount of wealth in the world.

Re: To Understand Rising Inequality, Consider Janitors

#339

Post by conanbatt »

erentz wrote: post #286
conanbatt wrote: post #240

Earlier quoted context omitted.

> Taxation is both effective, and far less invasive to markets than many other solutions. I don't really agree with this. Taxes are distortive and doesn't necesarily help inequality. It might even make it worse. But also, there is taxation as a progressive system of government funding, as there is taxation as in "You will never own more than X, because the government will seize it". In terms of solutions, I'm not a p…

They don't have to be. A "death tax" for example that takes 100% of a persons estate at death would be both simple, non distortive, and in terms of equality level the playing field every generation.

Two arguments against a death tax: the inability to apply it, and the results of an effective one:

In Argentina, the state collects a heft tax on property transfers when the propietor dies. So basically all property is donated from parents to children in-life.

Poorer property owners that cant afford or dont know better, or people stricken with tragedy in an early death are likely the ones that pay the most of that tax.

Conclusion, 'death taxes' are paid by the poorer half and hence worsens inequality.

On results: lets say that I were to tell you that all the money in your bank account is going to be worth 0 tomorrow. Are you going to invest that money in long term capital growth? Are you going to donate it to the government? I'd say the most reasonable reaction is drugs and hookers all the way!

The latter is definitely not great economic policy.

Re: To Understand Rising Inequality, Consider Janitors

#340

Post by alexbecker »

peatmoss wrote: post #28

One of my pet peeves is when articles such as this use averages exclusively to talk about incomes. Averages are sensitive to outliers, and thus may obscure what's the typical condition. If you're going to pick one measure to talk about incomes, median may give a better picture of what's typical.

It's not just incomes, it seems like news articles almost always use averages no matter how inappropriate they are. I've complained about this at some length: https://alexcbecker.net/blog.html#the-cult-of-averages
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