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Modeling a Wealth Tax
381–390 of 1001 posts
Re: Modeling a Wealth Tax
#382Earlier quoted context omitted.
"the Silicon Valley crowd is strangely avoidant of examining evidence or explaining their opposition with real-world data. It's all 101ism and polemics." It's not strange at all. It's self-interest.
Wealth tax is majoritism and nothing else. And we all know how that ends.
Once a democracy realizes it has the keys to the treasury...
Re: Modeling a Wealth Tax
#383[deleted]
Re: Modeling a Wealth Tax
#384Perhaps notable: Switzerland has a wealth tax (of up to 0.3%), and there is zero evidence that this has any deterrent effect on wealthy people settling in Switzerland or startups being created in Switzerland. Other features of the tax system more than offset the 0.3% wealth tax. Personally, I am a bit disappointed by the lack of depth of the discourse: Wealth taxes and their effect have been studied quite a bit in ec…
One problem with a wealth tax is rich people who are not in publicly traded corporations are not extremely liquid. Often times this means having to sell off assets which is hard to do if their assets are largely in private corporations.
Re: Modeling a Wealth Tax
#385I once did a bit of napkin math for a progressive friend of mine and have used it more widely since. Most people end up shocked and unwilling to accept this, which amuses me. I ask: "Suppose the government took 100% of corporate profits every year and distributed them evenly to the people, how much will everybody make?" I do this for Canada and if you take the average of corporate profits over the last 10 years and d…
$7,500 per person per year is actually higher than I expected. I 10000% agree with the general point that people seem to think the rich and/or corporations have wildly more than they really do.
Re: Modeling a Wealth Tax
#386Earlier quoted context omitted.
Agreed. If someone's barrier to creating a startup is "but when I get unimaginably rich, the government is going to take some of my money!" then good riddance. Take that self-centered, unethical nonsense elsewhere.
>Take that self-centered, unethical nonsense elsewhere. You're the one who feels you have a right to other people's hard-earned wealth merely by virtue of being born, and you're calling other people self-centred and unethical? What on Earth is ethical about envy-driven tax policy?
It's telling that you conflate basic safety and healthcare rights with "envy". And that someone stuck in a poverty cycle, working multiple jobs for less than a living wage, is somehow less hard-working than a salaried 4-day-workweek white collar thought leader.
"hard-earned wealth" is a myth. It's a combination of luck, connections, who your parents are, and where you were born, among other factors.
Re: Modeling a Wealth Tax
#387I'm highly skeptical of the claim that such tax would discourage startup founders. Wealth tax proposals I've seen don't kick in until $50 million or $100 million. This means that there is a floor on how "poor" the government can make you via a wealth tax. This has two implications: 1. Most "successful" startup founders don't break that threshold of personal wealth. 2. For most startup founders, the startup is the onl…
I'm shocked people think a wealth tax on startup founders is OK. Let's think of a scenario for instance: ACME startup raises Series C @500M. Founder equity is worth 100M on paper . Founder needs to borrow money every year to pay 'wealth' tax. After 10 years of struggles, company sells for $100M, VCs get money back, founder makes no money. But now founder is millions in debt for past 'wealth' tax payments. Founders wi…
Won't startups just go public sooner? Or maybe private company valuations will become less ridiculous since the value of your shares would actually matter for something besides ego now? I do think that taxing paper wealth is a problem, but if you are creating billions of dollars in economic value, there is usually a solution (e.g. as part of raising that $500M, a portion of that goes towards paying wealth taxes). Anything that incentivizes people to do away with this trend of a decade plus before exiting sounds fine to me.
Re: Modeling a Wealth Tax
#388Earlier quoted context omitted.
I'm not sure european examples are a great comparison. First, most european wealth taxes (including recently defunct ones) have much lower floors than US proposals. $1m instead of $100m. That changes a lot. France did experience "capital flight," famously Gerard Depardieu. Second, "capital flight" has always been present in Europe. There's a long history of it, and practical realities make it relevant. I do agree abo…
The question if billionaires are bad for society is pretty much the same question as asking if the aristocracy was bad for previous societies. The existence of billionaires clearly undermines the core principles of democracy which is that all people have essentially the same political power. The existence of many laws which clearly aim to benefit billionaires only is enough evidence that this power balance does not e…
More precisely, attacking billionaires is attacking jobs. So you should ask, are jobs bad for society? Curbing billionaires will only curb job growth, wage growth and realized economic growth. It wont raise much revenue
Re: Modeling a Wealth Tax
#389The Chamley-Judd finding of a 0% optimal capital tax is a very sticky result in optimal taxation theory. One way to think about is you want your tax system to walk as softly as possible while getting from point A to point B. Don’t distort intertemporal decisions if you don’t have to. Don’t tax elastic things when you could tax inelastic things - impose taxes on things where the optimal allocations don’t change much w…
Is it?
> In contrast to Chamley-Judd, the optimal tax on capital is positive in our model because we have finite long run elasticities of inheritance to tax rate
Re: Modeling a Wealth Tax
#390Earlier quoted context omitted.
You're cherry picking. France imposed a wealth tax and they repealed it. "At least 10,000 wealthy people left the country to avoid paying the tax; most moved to neighboring Belgium" https://www.bloomberg.com/opinion/articles/2019-11-14/france...
s/cherry picking/showing an example with interesting properties that is different from France/g So this is actually where the discussion should go: What properties does the Swiss wealth tax have (particularly in the wider taxation system) that the French wealth tax did not have? What is needed for a wealth tax to have no negative effects? What about income and capital gains tax at the same time? Etc. etc. I am not tr…
pg already made the non-empirical argument about the compounding nature of wealth taxes.