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I get annoyed when smart, wealthy people say that tax laws need to change while at the same time take advantage of the tax break becuase it’s ‘the government’s job to fix.’ Either pay the additional amount you think is fair and complain about it or take the tax break and don’t. But please don’t complain about it while simultaneously benefitting from the that which you say is wrong.
Earlier quoted context omitted.
> the rich have been getting richer since the beginning of time That's not true and we must be careful not to accept an aristocracy (or oligarchy) as inevitable. That the wealthy will inevitably hold and consolidate power is counter to the history of democracy, a specific rejection of aristocracy, and a system which has worked the other way in country after country to great success economically and politically - grea…
I’ll pick out one point that you seem to miss - when the US taxed the heck out of people with high incomes, you still had people like Howard Hughes, Warren Buffet, and John Paul Getty becoming even richer than they were before. So yes, the rich get richer, and high taxes do not stop that (but present the illusion that it stops ). I’ll gladly admit I’m wrong if you can disprove my three simple examples. Last I hexked,…
What is the modern argument for preferential tax treatment of capital gains? Arguments against it seem compelling to me: 1. The American dream is achievement through hard work. But taxation of capital gains privileges ownership over labor. That's just un-American. 2. This preferential taxation creates an anti-productive industry dedicated to re-casting ordinary income as capital gains, leading to misallocation of res…
2. Higher rates make for less efficient economics, because people will hold on to poorly performing investments longer.
3. A big chunk of capital gains are actually inflation.
Capital gains is why Mitt Romney can make 200 times as much as I do in a year, and pay half my effective tax rate. This is broad across the economy. It's a fundamentally immoral tax model. Moreover, it's a socially dangerous one - the idea that there is one set of rules for the rich and another for everyone else is already stressing our nation. Stop actually proving the point, lest you want a revolution to deal with it when society lacks the nerve.
Corporate income tax is no big loss. For one thing, it's an increasingly shrinking part of our tax base. For another, it's riddled with loopholes and borderline graft, much more so than individual taxes. This kind of stuff is biased against entrepreneurship, in favor of cozy relationships with politicians. Being connected is more important than being hardworking or imaginative.
Tax capital gains as ordinary income. It's simple and fair.
I get annoyed when smart, wealthy people say that tax laws need to change while at the same time take advantage of the tax break becuase it’s ‘the government’s job to fix.’ Either pay the additional amount you think is fair and complain about it or take the tax break and don’t. But please don’t complain about it while simultaneously benefitting from the that which you say is wrong.
Earlier quoted context omitted.
I’ll pick out one point that you seem to miss - when the US taxed the heck out of people with high incomes, you still had people like Howard Hughes, Warren Buffet, and John Paul Getty becoming even richer than they were before. So yes, the rich get richer, and high taxes do not stop that (but present the illusion that it stops ). I’ll gladly admit I’m wrong if you can disprove my three simple examples. Last I hexked,…
You do realize that you can still have some very rich people and still have a more equitable distribution of wealth than we have today, right?
Earlier quoted context omitted.
Then let hedge fund managers organize their funds as equity purchases from their investors. To use your analogy, if managers were deserving of 20% of the profits, then structure it as investors own 80% and managers own 20%. Of course, that would make many hedge funds a lot less attractive for many investors. Hedge fund managers want to have their cake and eat it too.
That is (more or less) what hedge fund managers do.
In any case, thanks very much for your explanations, really helped me think about the issue in a different way.
What is the modern argument for preferential tax treatment of capital gains? Arguments against it seem compelling to me: 1. The American dream is achievement through hard work. But taxation of capital gains privileges ownership over labor. That's just un-American. 2. This preferential taxation creates an anti-productive industry dedicated to re-casting ordinary income as capital gains, leading to misallocation of res…
We can argue rules, technicalities and definitions, but here's the overriding one: Everyone needs to pull their weight, pay their share. Nobody is more important than anyone else. Pulling your weight means equal sacrifice. It might be hard to calculate the equal sacrifice of someone making $20,000 and someone making $20,000,000, but I can tell you that $1,000 (EDIT: or 20% of income) is a heck of a lot more sacrifice…
When a large donor donates to some cause - they get their name out there. When someone pays a lot of money into federal treasury - nil. It can be very discouraging and further isolating from people actually receiving a direct benefit (even if in the grand scheme of things everyone gets better off, including these large taxpayers.)
Not saying there is a solution to that in modern states to that, but I can see how paying taxes to ambiguous treasury not very fulfilling, and when one actually cannot feel how they helped someone with it.
I have similar feelings when contributing to a large code base. Yeah, we get top management's praise one a quarter/year about how good we did as a mass, but I do not feel that. Perhaps if I could see how the code I contributed somehow actually helped someone - I would feel better. But I could not come up with some solution to that.
This I would imagine applies to many large systems. This includes so often discussed BS jobs, which most likely are not, they are just perceived this way because one who did it has no clue what effect their work had. And unless you are "superstar coder", "industry disrupter", etc - no one even remembers your name...