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Over $70T of inherited wealth over next decade will widen inequality, economists

theguardian.com

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Re: Over $70T of inherited wealth over next decade will widen inequality, economists

#111

Post by blitzar »

JAlexoid wrote: post #100
blitzar wrote: post #65

Earlier quoted context omitted.

Wouldnt it be easier just to tax all income above say $200,000 (minimum wage in SV) at 100%. If a net worth of $2 mil is considered outrageous then surely that kind of salary would be considered equally so.

We have to reframe how taxes are viewed, by the wealthy. There should be no wealth tax, but above a certain threshold - there should be a maintenance fee associated with the wealth. I get charged maintenance fee by my mutual funds, for example. One of the purposes of the government is to protect and secure property... and that is what ultra wealthy are getting for a fraction of what they should be paying.

Capital gains should be taxed like income. Fuel for private jets should be taxed like fuel for a car. The corporations that generated large quantities of wealth for their owners should pay decent wages for their employees.

There is a lot of low hanging fruit.

Re: Over $70T of inherited wealth over next decade will widen inequality, economists

#112

Post by u_sama »

andrepd wrote: post #61
u_sama wrote: post #25

Earlier quoted context omitted.

I would not cite Piketty, Zucman or Saez who are the hardest fighters of the wealth inequality thesis as they usually mix political advocacy and have been criticized in their methodology and have been under a fair share of controversies. Btw I have grouped them because this is how they are usually treated, both by the fact they are all French economists but also on the fact they all push for the same inequality thesi…

Economics is political, so it should come as no surprise that economists have political opinions about what should be done at the level of the economy. Or is only that which is vaguely left-wing that is "political" or "ideological", and mainstream neoliberal politics and economics are simply "objective" and "technocratic"? I think it's important to separate the empirical and analytic part, to which you can apply obje…

Yes it is, and I because economics is political, I would appreciate putting an adjective describing the politics of the specific economists who are cited. If I cited a Hayek, as an "economist" it would be incredibly dishonest as his works are deeply libertarian and considered right wing. Mainstream neoliberal politics is right wing but not libertarian, very interventionist. But Piketty is left-wing, and it is dishonest leaving that part unsaid when citing him.

I agree, there is a difference between the technical and political parts. Sorry if I seemed dishonest, but I cited both the 2014 critique as well as a more general 2024 PSZ critique (from right wing POVs) including other economists who usually post on the same subject of income inequality. I will edit my original comment to include Piketty's rebuttals.

Re: Over $70T of inherited wealth over next decade will widen inequality, economists

#113

Post by JAlexoid »

boxed wrote: post #97
JAlexoid wrote: post #42

Earlier quoted context omitted.

There's a reason why countries, like Sweden, have scrapped the inheritance tax - it doesn't work like that anymore. The benefits of wealth are exercised long before the inheritance can be applied. Your first home down payment, your education, your wealth generation while being on support by your parents, etc. - will push you off the ground faster, than any inheritance in a world where people easily live to 80-90. Mos…

> The benefits of wealth are exercised long before the inheritance can be applied. Agreed. But isn't that an argument FOR a strong inheritance tax? Because inheritance doesn't actually help your children anyway? That seems like it was your argument. With that argument taking 100% of the inheritance as tax and taking 0% is exactly the same, as the wealth transfer was done before anyway.

The only thing that I personally care about is the ability of ordinary people to build and retain wealth.

Wealth disparity doesn't grow because wealthy people are allowed to retain their generational wealth or not, it grows because the rest can't build and retain their wealth.

This isn't a zero sum game.

PS: I would also not trust the government or any political body to handle income from the inheritance taxes. So I would rather the children of wealthy people squander their wealth, than a politician transfer that wealth to their patron.

Re: Over $70T of inherited wealth over next decade will widen inequality, economists

#114

Post by einszwei »

philipallstar wrote: post #103

Wealth inequality is not an intrinsic bad, and it's not even worth striving to reduce. The only thing that matters is the average (pick your average) standard of living. There's no point paying a fortune to have all the people who created the most value leave your country just so you can reduce a pointless metric, especially when all it does is get the state more money to spend on itself rather than reduce your costs…

Where do you think the money that is accrued by the most wealthy will be spent/invested/parked? What will its effects be on the broader economy?

Assuming that the money is all used for altruistic purpose, I could agree with your point. But we know that this money is often used for not so altruistic purposes like investing in PE which asset strip the productive parts of economy or use the money to influence politics and elected representatives via lobbying.

Re: Over $70T of inherited wealth over next decade will widen inequality, economists

#115

Post by Bissness »

andrepd wrote: post #22
u_sama wrote: post #8

Earlier quoted context omitted.

Counter-example: All the European, and world countries who have implemented the various inheritance, wealth taxes and heavy redistribution yet the inequality is still widening. Take France, Norway or Sweden as the ideal social democracies. Argentina (the end game of social democracy) pre-Milei had a huge array of taxes and regulations which lead to the state misusing that money to actually enrich a small elite of pol…

Unlike people, capital has no nation. It can just move effortlessly from France to Switzerland to the Cayman Islands. That's why single-country initiatives to e.g. tax wealth (or even tax extremely profitable companies) are doomed to failure: those assets are easy to transfer and hide; if the UK passes a progressive wealth tax, all those global billionaires will just sell their empty houses in London and buy empty ho…

https://en.wikipedia.org/wiki/Expatriation_tax

Re: Over $70T of inherited wealth over next decade will widen inequality, economists

#116

Post by silexia »

JAlexoid wrote: post #42
shoubidouwah wrote: post #16

1) set a generous threshold over which your inheritance gets taxed, inflation adjusted (e.g, 2M not including the principal residence) 2) tax 100% above it. (should only concern a fraction of a fraction of cases) 3) put all this tax's proceeds in a sovereign wealth fund 4) at 21, a citizen gets access to her redistributed generational wealth 5) profit

There's a reason why countries, like Sweden, have scrapped the inheritance tax - it doesn't work like that anymore. The benefits of wealth are exercised long before the inheritance can be applied. Your first home down payment, your education, your wealth generation while being on support by your parents, etc. - will push you off the ground faster, than any inheritance in a world where people easily live to 80-90. Mos…

Pointing out here this comment wants to hold the successful back, not advance the poor. It's not a zero sum game.

Re: Over $70T of inherited wealth over next decade will widen inequality, economists

#117

Post by u_sama »

CogitoCogito wrote: post #39
u_sama wrote: post #8

Earlier quoted context omitted.

Counter-example: All the European, and world countries who have implemented the various inheritance, wealth taxes and heavy redistribution yet the inequality is still widening. Take France, Norway or Sweden as the ideal social democracies. Argentina (the end game of social democracy) pre-Milei had a huge array of taxes and regulations which lead to the state misusing that money to actually enrich a small elite of pol…

Sweden has no inheritance or wealth tax.

There was one until 2007, many countries had wealth taxes. Also in 2005 inheritance tax was repealed.

In France wealth tax was repealed in 2017 I think but will be soon reintroduced under a new form.

Re: Over $70T of inherited wealth over next decade will widen inequality, economists

#118

Post by JAlexoid »

blitzar wrote: post #111
JAlexoid wrote: post #100

Earlier quoted context omitted.

We have to reframe how taxes are viewed, by the wealthy. There should be no wealth tax, but above a certain threshold - there should be a maintenance fee associated with the wealth. I get charged maintenance fee by my mutual funds, for example. One of the purposes of the government is to protect and secure property... and that is what ultra wealthy are getting for a fraction of what they should be paying.

Capital gains should be taxed like income. Fuel for private jets should be taxed like fuel for a car. The corporations that generated large quantities of wealth for their owners should pay decent wages for their employees. There is a lot of low hanging fruit.

> Capital gains should be taxed like income.

Arguably capital gains should be taxed at a higher rate than income. But that's not going to happen, because your home's change in value is capital gains.

Re: Over $70T of inherited wealth over next decade will widen inequality, economists

#119

Post by einszwei »

317070 wrote: post #33
christkv wrote: post #6

Inheritance is in most cases the only way young people in a lot of European countries can even own their own home

That sounds like a lottery for housing, with extra steps? Hypothetical scenario: we have 100 houses, and 200 young families looking for one. Your solution in effect is: let's give 100 houses to the 100 young people with an inheritance. That sounds arbitrary. Lack of housing is a disconnected problem from inheritance taxes.

Your analogy is plain wrong. To start with people with inheritances can and do own multiple homes.

Re: Over $70T of inherited wealth over next decade will widen inequality, economists

#120

Post by JAlexoid »

silexia wrote: post #116
JAlexoid wrote: post #42

Earlier quoted context omitted.

There's a reason why countries, like Sweden, have scrapped the inheritance tax - it doesn't work like that anymore. The benefits of wealth are exercised long before the inheritance can be applied. Your first home down payment, your education, your wealth generation while being on support by your parents, etc. - will push you off the ground faster, than any inheritance in a world where people easily live to 80-90. Mos…

Pointing out here this comment wants to hold the successful back, not advance the poor. It's not a zero sum game.

It would be nice if you didn't put words in my mouth, but even HN is the internet
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