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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

#141

Post by walls »

kamaal wrote: post #134
einszwei wrote: post #114

Earlier quoted context omitted.

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 a…

>>Where do you think the money that is accrued by the most wealthy will be spent/invested/parked? In most advanced economies today, that's equity. The ordinary person thinks of wealth as money lying around in the bank, which the rich person refuses to spend on anything useful. And instead either hoards, or spends on luxury things which cause resentment to the remainder. The real question is for most people today its…

Your mistake is thinking that the ordinary person is sitting on a pile of cash.

The median person in the US has about $8k, which is basically enough to cover one emergency.

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

#142

Post by ckemere »

Looking at the discussion I’m struck by how there are really two “goods” that are conflicting in people’s minds. Many of those of us who are parents embrace the idea of sacrificing to make our kids lives easier and better than our own. We recognize how what our parents have provided us has helped us and want to give even more to our own children/grandchildren. It seems to be a general principle of society that we should enact policies that encourage people to sacrifice for their children?

But also the accumulation of wealth drives so many negative issues in society that we want to lessen. And extreme wealth seems to make things even worse.

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

#143

Post by MangoToupe »

u_sama wrote: post #105
MangoToupe wrote: post #47

Earlier quoted context omitted.

The entire concept of economics without politics is nonsensical. They are one and the same.

I completely agree, thus no article should say "economists" but libertarian economist, social-democratic economist etc Because the politics precede the findings

Eh, you're either honest with yourself or you're not. There's no need to add ideology.

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

#144

Post by sam_lowry_ »

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…

Sweden is on of the most unequal countries in the world )

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

#145

Post by sam_lowry_ »

analog31 wrote: post #88
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…

A straightforward wealth tax would address this.

Something akin to a Zucman tax, a yearly tax on capital.

EU made this easy with the UBO register, it takes just political will.

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

#146

Post by jake200 »

jongjong wrote: post #55

What terrifies me most about this is that those in power will keep getting younger, dumber and more complacent. I feel like communism is inevitable at this point. People know communism isn't the solution, but they will still vote for it because at least it pretends to stand for equality. We're going to reach a point of such extreme inequality that even the pretense of equality provided by communism would be welcomed…

> People know communism isn't the solution, but they will still vote for it because at least it pretends to stand for equality.

Genuinely curious - why isn't communism the solution? And in your opinion, what are some better solutions? I haven't studied much about political/economic ideologies and at this point don't even know where to start. I do agree with some of what you are saying, but I don't understand why communism wouldn't be be a step in the right direction.

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

#147

Post by sam_lowry_ »

JAlexoid wrote: post #83
boxed wrote: post #58

Earlier quoted context omitted.

I'm pretty sure we scrapped it because the conservatives got into power.

Cool. Inheritance tax doesn't work anymore, in any case. It's not the 19th century and we shouldn't try fixing 21 century issues with 19th century remedies.

Wealth tax is all the rage, now.

A yearly tax of a few percent on all capital assets.

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

#148

Post by slowmovintarget »

koolba wrote: post #79
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

> 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 If you think you’ve seen zany tax schemes, just wait till they try implementing something as crazy as a 100% tax. There’s also a moral question of why you feel entitled to not just a majority of the fru…

This.

There's an unproven assumption that somehow the inequality of outcome is 1) unjust, and 2) something to be "corrected."

The first has no foundation other than appeal to emotion to create in-group / out-group tribes ("eat the rich!") to then suggest what end up being power grabs that destroy the middle class and do nothing to the wealthy.

The second item requires destroying value. All economic activity comes from exchanges of value, which is intrinsically tied to time; that irreducible finite quantity to which everyone is subject. We've seen over and over again, when you try to destroy the concept of value, which is subjective and circumstantial for each individual, all you end up doing is causing human misery.

This obsession with taking other people's money rather than enabling opportunities to make your own is unhealthy, destructive, and immoral.

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

#149

Post by ryandrake »

ckemere wrote: post #142

Looking at the discussion I’m struck by how there are really two “goods” that are conflicting in people’s minds. Many of those of us who are parents embrace the idea of sacrificing to make our kids lives easier and better than our own. We recognize how what our parents have provided us has helped us and want to give even more to our own children/grandchildren. It seems to be a general principle of society that we sho…

Society and policy makers seem to have a lot of trouble understanding scale and orders of magnitude. We declare some broad principle, like "It's good to make our kids lives easier and better than our own." and we apply it regardless of whether the dollar value is $10K, $10M, or $10B. But someone passing down $10B to their children is totally different than someone passing down $10K, and needs to be handled differently by the law. We have coarse, ham-fisted step functions like "inheritance tax only affects inheritances over $X" but you can't have a single threshold for these things. It has to be progressive with a sliding scale, otherwise you get all the negative issues around wealth accumulation.

Other Example: why can't we have income tax thresholds that go all the way up to $1T/year? Why is the absolute top income tax bracket something like $600K? Really? Are we really saying that we should tax someone who makes $600K exactly like we tax someone who makes $600M? or $6B?

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

#150

Post by blarg1 »

phplovesong wrote: post #7

This is just wrong. If we skip the ultra rich totally and focus on normal families inheritance is THE way to help you decendants. Right now (where i live) you pay a big tax on inheritance, this is ok if you only inherit cash. In 99% of inheritances this is not the case. You inherit family home, a cottage etc. Then you must sell because you cant afford to pay for it. Now the asset is gone forever and the next generati…

I wonder what would happen if your parents didn't leave the house to anyone, and you don't claim it but squat it.
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