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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

#211

Post by shoubidouwah »

tock wrote: post #35
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

Why make it on inheritance then? Tax wealth 100% above 2M. I do think this would doom progress but would be a fun exercise.

incentives. It's okay to be successful and enjoy the fruits of your wealth, and you want people to strive towards wealth. but transmission across generations is a true societal poison.

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

#212

Post by shoubidouwah »

brianwawok wrote: post #73
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

So people put the money in a trust or use another way to dodge it. I don’t think it’s nearly as easy to collect ad you hand wave.

it is already more or less the case, but I argue that it's for the benefit of the living holder, not the heirs. A lot of the incentives to have huge, untouched inheritances revolve around dynasty effects, exactly the kind of behaviour we want to curb.

I'd go further and say that "unearned wealth corrupts" is a well known effect, and (apart from the small subset of rich people who do not care about their kids corruption and intrinsic worth apart from them being the vehicle of their dinasty) we see that divestment into charity / foundations are the modern preferred way for inheritance management, both sparing the kids somewhat (being downgraded to a multimillionaire is not a hellish situation) and gifting them cultural influence. A sovereign fund could scratch that itch somewhat.

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

#213

Post by shoubidouwah »

dienstbier wrote: post #137
tock wrote: post #35

Earlier quoted context omitted.

Why make it on inheritance then? Tax wealth 100% above 2M. I do think this would doom progress but would be a fun exercise.

This is, quite literally, the silliest thing I may have ever read. Cool, cool. Work for 30 years, save up and have say $3M to retire on, based on stock market at an all-time high. You're not a robber baron or investment banker, just someone who worked a long time and saved and invested. Govt takes $1M away from you, you have $2M now. Market drops 25%. Now you have $1.5M. Congrats, your "plan" resulted in someone like…

I am talking inheritance, not weatlth tax, and have actually written I'm for reducing said taxes. you truly do not need the extra million when you're dead. Maybe read my comment again with more charity and re-engage?

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

#214

Post by shoubidouwah »

slowmovintarget wrote: post #148
koolba wrote: post #79

Earlier quoted context omitted.

> 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 fro…

I am actually advacating for something different: I am not taking your money, I am saying after some level, what you accumulate is not - your kids - money. It realigns incentives (do something with it before you die), helps your kids (unearned weath corrupts, enormous unearned wealth corrupts enormously), and actually enables opportunities through investment and redistribution at a time when most people need something like a downpayment or school debt clearing.

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

#215

Post by boxed »

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.

"doesn't work" for what purpose? It surely has SOME effect. Otherwise people wouldn't be against it.

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

#217

Post by rsynnott »

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…

While Sweden does fairly well on income inequality, it has _extremely_ high wealth inequality for a developed country; it's pretty much the worst in Europe and just a little behind the US.

So it's, er, probably not a great model case here.

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

#218

Post by prmph »

rsynnott wrote: post #216

Why would it widen economists? Are extra-wide economists particularly a problem?

I see what you did there.

But, maybe more inequality does indeed increase the waistlines of economists, as they they find more fodder for paid "analysis".

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

#219

Post by b3lvedere »

antisthenes wrote: post #153
b3lvedere wrote: post #66

Earlier quoted context omitted.

European countries did not get wealthy just because of their social democracy system. There is a lot of very painful history as well.

Interestingly enough, when detractors like to point out countries where communism "failed", it's always countries that did not have a rich history of colonialism and exploitation of cheap labor forces around the world. Just a thought.

It's almost as if countries, companies and super rich people are adored by the people in group 1 for their wealth by people while simultaneously are despised by the people in group 2 for the tactics they used to get that wealth. Some peope are both members of group 1 and group 2 which makes it even more strange.

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

#220

Post by phplovesong »

blarg1 wrote: post #150
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.

Afaik you can "abandon it", or when you decline an inheritance its automatically going to the gov, hence you would be illegal trespassing after this point.
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