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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

#181

Post by thrance »

bawolff wrote: post #173
insane_dreamer wrote: post #170

Earlier quoted context omitted.

because r > g (see Piketty[0]) if returns on inherited wealth outperform growth, then the percentage of growth captured by the wealthy grows over time, exacerbating inequality estate taxes can help mitigate that, but they are "anti-American" [0] https://en.wikipedia.org/wiki/Capital_in_the_Twenty-First_Ce...

Yes, but how does inheritence affect that? Its not like inheritence makes money appear out of nowhere. Every inherited dollar is taken from a rich person who died. The amount of inequality should stay roughly the same as you are just transfering money between rich people. You aren't creating any new money, nor are you concentrating it in fewer hands. Why would inequality increase after inheritence instead of just sta…

Death is often called the great equalizer. By reducing/nullifying inheritance taxes you ensure wealth concentration will escape it, and aggravate the issue. We already live in a country (world, really) where more income is gained through owning capital than through working. However you look at it, it is really hard to justify.

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

#182

Post by johnnyanmac »

kachapopopow wrote: post #26
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

I think the bigger issue is that people are hording wealth instead of spending it in general making money work for them and not for the greater economy which is the only thing giving their money substance long-term. Well, long-term is longer than human lifetime so I guess there's no real reason for them to worry about it either.

Well yes. That's why trickle down economics doesn't work in practice. Becsuwe billionaires don't stimulate the economy through spending.

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

#183

Post by AnimalMuppet »

prmph wrote: post #108

Why is this post buried, I wonder? It's in the 263th position, alongside posts from 4 days ago, and keep rapidly going down. Really weird.

77 points, 178 comments. When comments are more than points, it trips the flamewar detector (if I understand correctly).

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

#184

Post by johnnyanmac »

boxed wrote: post #36
kachapopopow wrote: post #26

Earlier quoted context omitted.

I think the bigger issue is that people are hording wealth instead of spending it in general making money work for them and not for the greater economy which is the only thing giving their money substance long-term. Well, long-term is longer than human lifetime so I guess there's no real reason for them to worry about it either.

I've heard this take a lot and it doesn't make much sense to me. How exactly are ultra rich "hoarding wealth instead of spending it"? Afaik most of the net worth of the ultra rich is in ownership of companies (stocks) or loans (eg bonds). That money is all out there in the world working. Isn't the fact that the ultra rich are using their wealth productively the reason we have growing wealth inequality? Because active…

Stock buyback is "spending" that does not in fact increase productivity nor stimulate the larger economy. But it makes them richer. Unrealized stocks that's hoarded isn't doing much of anything in the grand scheme of things.

Billionaires have dozens of other things like the above that makes thos an issue

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

#185

Post by thrance »

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…

I disagree, wealth inequality is an intrinsic bad. Just look at the power wielded by the likes of Musk, Ellison, Thiel... They are able to bend the rules in a way that negatively impacts the general population's material conditions, and are leading the country straight into authoritarianism.

Don't be fooled, those people don't create any value. They could disappear tomorrow and the world would be none the poorer. Quite the contrary in fact. Wealth is created by working, not owning, never forget this basic fact.

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

#186

Post by bawolff »

johnnyanmac wrote: post #177
bawolff wrote: post #60

Earlier quoted context omitted.

I think you'd have to be a bit more complex than that. Most 80 year olds know they arent going to live forever and would probably just transfer their assets a little early.

Sounds good to me. Moving that level of money already has so many stupulations. Inheritance is used because of tradition and because it's the one foolproof way to maintain generational wealth.

> Inheritance is used

Is it though? I think most very wealthy people are already using more complex structures like trusts and whatnot.

> Moving that level of money already has so many stupulations.

Like what exactly?

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

#187

Post by johnnyanmac »

vorpalhex wrote: post #127
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…

Or building companies that employ tens or hundreds of thousands.

And then they lobby to reduce protections and layoff haphazardly to male sure there's no career progression. Then when that's exhausted you move everything overseas because that's still too expensive.

Yup, altruistic job nakers, huh?

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

#188

Post by johnnyanmac »

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…

>The real question is for most people today its easier than ever to invest and then give it to their children. Why aren't people doing it?

I've been out of full time work for 2.5 years now and had to slowly dwindle my 401k when emergencies popped up.

I didn't think this community was this isolated from the economy given the hundreds of thousands of tech workers displaced these past few years alone. Take a look at what it's like for non-tech workers and come back to ask that question.

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

#189

Post by bawolff »

thrance wrote: post #181
bawolff wrote: post #173

Earlier quoted context omitted.

Yes, but how does inheritence affect that? Its not like inheritence makes money appear out of nowhere. Every inherited dollar is taken from a rich person who died. The amount of inequality should stay roughly the same as you are just transfering money between rich people. You aren't creating any new money, nor are you concentrating it in fewer hands. Why would inequality increase after inheritence instead of just sta…

Death is often called the great equalizer. By reducing/nullifying inheritance taxes you ensure wealth concentration will escape it, and aggravate the issue. We already live in a country (world, really) where more income is gained through owning capital than through working. However you look at it, it is really hard to justify.

I again fail to see how that is an argument that inheritence will increase wealth inequality.

The headline is that wealth inequality will go up due to inheritence. Why would it go up over the alternative situation where nobody died and everyone just kept their money.

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

#190

Post by johnnyanmac »

aids_bomb wrote: post #156
ZeroGravitas wrote: post #48

> If poor people knew how rich rich people are, there would be riots in the streets. -- Chris Rock

Eh, their entire pedophile paradise got exposed and the most it’s done is cause some political beefs.

The information is highly compromised. Some believe it's a hoax. So that doesn't help.

But yes it will be sad seeing how many will still defend the rich once there's irrefutable evidence. There's still Holocaust deniers 80 years later after all.

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