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Just Be Rich (2021)

keenen.xyz

141–150 of 320 posts

Re: Just Be Rich (2021)

#141

I live in a country with wealth tax (Norway), and I'm a bit conflicted on it. On one side, it is effectively the only real tax a many in the "ownership class" are paying - relative to their wealth. On the other side, it is a really problematic tax for entrepreneurs. It is downright horrible for startups and scaleups - critical funds that should be used to grow your company, has to be given out in dividends to founder…

The US had same problem with family farms. The farm itself was very valuable, so when being left to the children as inheritance, it was heavily taxed. But, this is a problem, because what is left is not enough for the kids to make a living. So in the act of trying to tax the rich with inheritance, there are some lower/middle layers getting hit very hard. Taxes don't have to be a flat number, there should be exemption…

> The US had same problem with family farms. [...] it was heavily taxed [...] what is left is not enough for the kids to make a living

Math or it didn't happen!

I say that because I've seen this kind of claim many times, and usually either (A) the Federal Estate Tax has no real affect on what happens or (B) their definition of "family farm" is wildly grandiose.

https://www.cbpp.org/blog/the-myth-that-the-estate-tax-threa...

Re: Just Be Rich (2021)

#142

Earlier quoted context omitted.

The US had same problem with family farms. The farm itself was very valuable, so when being left to the children as inheritance, it was heavily taxed. But, this is a problem, because what is left is not enough for the kids to make a living. So in the act of trying to tax the rich with inheritance, there are some lower/middle layers getting hit very hard. Taxes don't have to be a flat number, there should be exemption…

What is special about family farms, that doesn't apply to other family-owned businesses?

your typical business isn't working at the same level of the maslov pyramid than a farm. I don't want a world where only the wealthy can afford to give milk to their kids

Re: Just Be Rich (2021)

#143

Earlier quoted context omitted.

Sweden, France, California, Washington state and NYC have discovered once again that taxing the heck out of rich people causes them to leave. And when they leave, they take their spend/invest/hire money with them.

The US had a tax rate of over 90% for the wealthy in the 1950s (although with loopholes they could push it lower, like now). Didn't seem to have much of an effect on the wealthy, and the US working class did very well.

Very few paid those rates, because there were a large number of tax shelters available. For example, a lot of your personal expenses could be covered by your business.

Reagan, as part of the deal to lower the top rates, traded away those tax shelters.

The thing about tax shelter investing, however, is they only make sense as a tax shelter. They are poorly performing investments otherwise. A tax policy that encourages poor investments is not a good policy.

Keep in mind that the government in the 50s was far, far smaller than it is today. Funding the vast growth in government is inevitably going to get sucked out of the middle class.

Re: Just Be Rich (2021)

#144

Earlier quoted context omitted.

Presuming this is correct, what's the better alternative?

https://news.ycombinator.com/item?id=40963894 seems like a start. You don’t need to throw the entire system away and start from scratch, simply refactor the suboptimal parts piece by piece.

The solution is to redistribute power from the people to the government?

Re: Just Be Rich (2021)

#145
post #118

Earlier quoted context omitted.

Jeff Bezos famously left the state just before the Washington's new cap gains tax targeted at him was set to go into effect. I know other people with 8 figure fortunes who left, too. I didn't know it was controversial that spending a lot of money in a local economy makes it more prosperous, and when a big spender leaves, the local economy goes down. The Rust Belt is an example of the latter.

> spending a lot of money in a local economy makes it more prosperous Do these people really spend a lot of money in the local economy? Realistically, even assuming they pay a couple dozen people $100k/year for service and indulge daily in 3 $500 meals, what will be the actual influence on the local economy? > The Rust Belt is an example of the latter. The Rust Belt is an example of what happens when the state allows…

Zillionaire Paul Allen was famous for spending billions in the local economy. He transformed Seattle. He's passed away, and his projects are being sold off and closed down.

> the state allows companies to leave

If you have to build a wall around your state to keep people from fleeing, you have failed.

Re: Just Be Rich (2021)

#146

Earlier quoted context omitted.

A statement like this probably needs a source or two to first show it is true (wealth taxes actually are causing rich people to flee) second, show that they actually do take their spend/invest/hire money with them and finally that it is harmful that that happens. Leaving creates a vacuum and if the rich really are leaving then it would be a big vacuum that clearly can't be filled with someone else that is rich since…

Jeff Bezos famously left the state just before the Washington's new cap gains tax targeted at him was set to go into effect. I know other people with 8 figure fortunes who left, too. I didn't know it was controversial that spending a lot of money in a local economy makes it more prosperous, and when a big spender leaves, the local economy goes down. The Rust Belt is an example of the latter.

This isn't a feudal country and a single magnate leaving will barely affect the economy. What affected the Rust Belt, and is causing problems nationally, is that ultrawealthy people like Jeff Bezos are manipulating the government to change the laws in ways that allow him more concentration of wealth and power at the expense of the middle class. The lack of a middle class is what causes an economy to go down, and that is why the Rust Belt is suffering economically. People like Bezos, the Waltons, the Kochs are causing harm to the economy, they're not propping it up in any sense.

Re: Just Be Rich (2021)

#147

Earlier quoted context omitted.

That is the notion that the only value in a business is that of labor, i.e. the labor theory of value. Business needs two other things: 1. capital 2. taking a risk in order to function. To get capital requires a source of capital, which are investors. Investors take a risk in exchange for possible gain. No gain => no investors => no capital => no business Let's say you want to start a business. Where are you going to…

> taking a risk You are only taking a significant risk in production investment in an unplanned economy. So it is tautological, circular reasoning. Capitalists want an unplanned economy and then say they deserve their profits for the risks of an unplanned economy. (Theroretically - of course, the US economy is not unplanned, but semi-planned - we type on chips paid for by US military spending sent to Fairchild, over…

> You are only taking a significant risk in production investment in an unplanned economy.

Any investment that is a "sure thing" is going to have a very low payoff. Sure things also tend to have a track record of imploding.

Re: Just Be Rich (2021)

#148

The part everyone always glosses over is: If the rich are taxed more, will the government equitably distribute that money to the middle class? Defense contractors make hundreds of millions of dollars from government funds. We just assumed that tax money will go to the middle class but it's also likely to go to another rich person.

Even worse, it'll be spent buying votes (Biden's student debt relieve).

Billions will be allocated for building electric chargers and almost no chargers will be built.

Billions will be allocated for connecting poor people to internet and no people will be connected.

Hundreds of millions will be spent on homeless and will result in increasing homelessness.

A public toilet will be built for $2.5 million.

McKinsey will be paid $4 million for a study telling NY that garbage bins are better than plastic garbage bags.

$11 billion will be spent on 57 miles of rail tracks.

Those are just examples of government waste I can recall from memory.

Discussing levels of taxation is just a sideshow. Sound and fury signifying nothing.

The real problem is that government grows without bounds, more of our money goes to just paying the salaries of bureaucrats and contrary to what you might expect, more bureaucrats leads to making things more difficult and costly for non-government and to just breath-taking inefficiencies and waste of money by government.

Re: Just Be Rich (2021)

#149
post #66

Earlier quoted context omitted.

There's copious amounts of ink spent on why wealth inequality is bad for a country. The author doesn't need to rehash all of those arguments to make his point.

Tell us one of them. I'll give an example where everyone was equal. The USSR. That worked out great, right?

Why smart people continue to say this is beyond me. There were so many problems with the USSR - central planning, corruption, bureaucracy, secrecy, misaligned incentives - and it's just not true that everyone was equal. Very few rational people would agree that the USSR is something that we should aspire to.

As far as I can tell, "look how well it worked for the USSR" is just a trope that's trotted out by people who don't want to accept that alternatives to the status quo might be possible.

Re: Just Be Rich (2021)

#150

This article feels like an attempt to morally wash one's hands of the moral stink of capitalism. Do you really think that because you're in tech and not mining, that the accumulation of wealth is any less driven by exploitation? By the way, I don't know the answer to this. I myself am a landlord. But if we're getting into morality, let's fully examine this. 11.5% of Americans are below the poverty line. The same econ…

> By the way I'm pulling punches here. Out of curiosity where can I find the unabridged version of this?

I haven't personally written anything beyond this comment, but what I'm getting at is the economic concept of externalities. These are the economic results to the environment/people/society as a whole, that are difficult to measure.

A liquor store opens up next door to your home– economic activity goes up, but drunks sing sea shanties at 2am keeping your family awake, resulting in you losing your job due to bad performance, then property values plummeting.

An oil company moves into town and starts fracking. Quarterly profits are high, and the town's economic activity rises, because it has more patronage at the local pub. There are more jobs, and everyone buys themselves a new pickup. But people get sick, and the water goes brown. A charity purchases hundreds of thousands of plastic bottles of water. Economic activity goes up. Microplastics, people start taking extra time to shower/bathe, wash dishes, and health problems. Profits are up, but did society actually benefit? In the long run, people will move away from the town, leaving it in economic ruin. All because the company did not care about externalities.

One example of this concept is Broken Window Economics. If you broke a window, economic activity/GDP would go up because someone would be employed to fix the broken window. But was anything of value produced? Did society truly benefit?

OP is essentially ignoring externalities. He is making the most of a system designed to benefit him at the expense of poorer people, and washing his hands of any guilt because the effect is invisible to him. But that's a fallacy. The rich get advantages that nobody else gets, like being able to avoid tax in totality (essentially getting a free ride, while everyone else pays for society). There are many other ways that society is wholly optimised to make things better/easier for the rich.

I digress. To answer your question, without pointing out socialist authors (who are right on the money with their criticisms of capitalism), I can really only tell you my own thoughts about it.

I'll leave you with this quote on the tragedy of the commons:

> Therein is the tragedy. Each man is locked into a system that compels him to increase his herd without limit – in a world that is limited. Ruin is the destination toward which all men rush, each pursuing his own best interest in a society that believes in the freedom of the commons. Freedom in a commons brings ruin to all. -- Garrett Hardin, The Tragedy of the Commons

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