971–980 of 1001 posts
Tax avoidance by the rich is the big elephant in the room!
Billionaire: "Name me one country where a top marginal tax rate of 70% actually worked?"
Historian: "The United States in the 1950s. .. The top marginal tax rate was 91% ."
This is simplistic to the point of absurdity, and doesn't model how any sensible wealth tax would be implemented or paid. First, any wealth tax being seriously discussed has a floor and/or has marginal rates, probably starting at 1 or 5 or 10 million (or higher). Second, taxes don't disappear into nothingness - they pay for civilization. It is clearly beneficial to everyone to live in a society where people are well…
The wealth tax does apply once it's cash, so dividends you received, or proceeds from selling (part of) the company. I would imagine a wealth tax in the US could do the same thing.
Earlier quoted context omitted.
> the idea that people [read: super rich] "will just move to another country" is very silly. This is a recurring theme in owners/investors: they always have some story that they will be forced to leave or close shop if some labour-proteaction-laws (like weekends, or 8h days, or banning of child labour), or taxes are implemented. It's a very old story, there's a history to it. Please note that we have weekends/8h work…
>>Please note that we have weekends/8h work day/ban on child labour and also still have the super rich. They never left. The fact that are still super-rich people doesn't imply that such interventions did not have a negative on the number of people who are super-rich in the US. High taxes have a well-established negative effect on capital formation, and investment in-flows. This isn't some conspiracy theory promoted…
That's interesting because in absolute numbers countries with a very high taxation are among the first for number of millionaires.
Japan is 3rd, UK is 4th, Germany is 5th, France is 6th, Italy is 7th
Compared to the population, Switzerland and Honk Kong are 1st and 2nd
In Switzerland taxes are usually low compared to the rest of Europe, but in Geneva they are 45.5%, the highest rate for Switzerland and yet is the city with the highest concentration of millionaires per square kilometer in the World, more than Monaco and SF.
Millionaires in Switzerland are almost two times those of the US compared to the population (9.5k/100k vs 5k/100k)
4th is the Netherlands, 5th is Denmark and 7th is Sweden, three countries famous for their high tax rates but equally high social and economical wealth.
This is simplistic to the point of absurdity, and doesn't model how any sensible wealth tax would be implemented or paid. First, any wealth tax being seriously discussed has a floor and/or has marginal rates, probably starting at 1 or 5 or 10 million (or higher). Second, taxes don't disappear into nothingness - they pay for civilization. It is clearly beneficial to everyone to live in a society where people are well…
Your first point doesn't really apply, because PG is talking about someone who starts a successful startup, which—at least for Silicon Valley levels of success—would be above the relevant floor. (And he specifies: "over the threshold at which the tax starts".) Your second point isn't really relevant for a founder who can choose between one developed country with a wealth tax and another one without. Unless you think…
If the real (ie inflation adjusted) rate of growth of capital is greater than the wealth tax, the wealth tax does not cause _actual loss_ to the wealthy.
The nature of the psychology of loss aversion means the distinction between "loss" and "reduced gain" matters. The loss may sting enough to cause the founder of move, but reduced gain will only matter if it prevents them from achieving a material goal.
After being one of the top-rated commenters on HN for some years, I have not commented in a long while. For what it is worth, here is my two cents on a topic - a wealth tax - that may seem on the surface to be benign but that is in fact just the opposite. Silicon Valley was founded in a spirit of freedom and flexibility but that spirit is clearly and dangerously on the wane insofar as the political environment surrou…
While I agree that AB5 stifles freedom and innovation, it just doesn't compute for me that a wealth tax (especially the example of 1% over 50mm) would damage the spirit of freewheeling invention, creation, and capitalism.
As an entrepreneur, I feel much more stifled by FAANGs or regulation than the idea I might be taxed at less than my real rate of return one day.
I agree the spirit of the valley is on the decline, and part of that is due to things like AB5, but it feels more like the tech giants are just new giants, like those of the 70s, and will trend towards preservation of establishment and gradual decline as always.
A wealth tax just seems orthogonal to all that.
Earlier quoted context omitted.
> the idea that people [read: super rich] "will just move to another country" is very silly. This is a recurring theme in owners/investors: they always have some story that they will be forced to leave or close shop if some labour-proteaction-laws (like weekends, or 8h days, or banning of child labour), or taxes are implemented. It's a very old story, there's a history to it. Please note that we have weekends/8h work…
Then why are all the manufacturing jobs in China and other countries without those labor laws? The remaining jobs in the US are salaried position where "8 hour workday" and "weekend" are often meaningless. Plus we're talking about a wealth tax in California. You can start a company in Nevada and still access the market of California just fine.
Earlier quoted context omitted.
> So he'd currently be worth $145B instead of $188B. > PG is saying Bezos would have left the US because of that? I think most human beings would do most things for $43,000,000,000. Whether they morally ought to or not is beside the point: almost anyone would do almost anything for 43 billion dollars.
When you already have another 145 billion? More than you could possibly spend in your lifetime?
Allstate's market cap is currently $30 billion. Maybe Mr. Bezos would want to buy it, and still have the rest of the money he currently has. Maybe he wants to do something else with that money.
Regardless, the fact that you or I might not be able to imagine spending that much money has no bearing on whether or not he could. To be honest, I bet you & I could figure out how to spend that much, too.
Wealth holders actually have a vested interest in money being usable.
Earlier quoted context omitted.
> the idea that people [read: super rich] "will just move to another country" is very silly. This is a recurring theme in owners/investors: they always have some story that they will be forced to leave or close shop if some labour-proteaction-laws (like weekends, or 8h days, or banning of child labour), or taxes are implemented. It's a very old story, there's a history to it. Please note that we have weekends/8h work…
Then why are all the manufacturing jobs in China and other countries without those labor laws? The remaining jobs in the US are salaried position where "8 hour workday" and "weekend" are often meaningless. Plus we're talking about a wealth tax in California. You can start a company in Nevada and still access the market of California just fine.
Good point. I'm surprised more places aren't taxing access to their consumers. That catches all players.
Earlier quoted context omitted.
Right so the government that already has enough money to fund all those good public services will suddenly stop funding the military to a ridiculous degree and finally use taxes for the best interest of the people?
Oh, I don't disagree at all! Government spending is currently not how I would allocate things. But somehow I expect that wherever taxes were going, rich people would be displeased with the amount of taxes they were being told to pay. And honestly, I don't blame them, it's a very natural feeling, I'd rather not pay taxes either. Here's my thinking: as a society, we should decide on what needs to be handled by the gove…
We already do that. It's called politics. However, you seem to want a strictly regimented "waterfall" version of politics, but in reality it has to be continuously iterated and handle the complex interplay of many factors (like different people having mutually exclusive ideas of what the government should actually do).