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Are super-rich people just better at making money?

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Re: Are super-rich people just better at making money?

#281

Post by LatteLazy »

bmitc wrote: post #3

To solve all this, it's pretty simple, and the U.S. actually used to do it: heavily tax the super rich. Heavy taxation and then appropriate use of those funds for education, R&D funding, infrastructure, etc. is actual trickle-down economics. And mega corporations should be heavily taxed instead of holding the country economically hostage. They jumpstart their companies off of government funding and R&D and then act a…

The problem with this plan is that modern economies need a lot of capital.

There are three places that capital can come from:

* the state, but we have voted year in and year out for tax cuts and spending rises, so the state is bankrupt. Not only is it not a source of capital, it is a major customer for it

* normal individuals saving and those small amounts being aggregated by banks etc. But rampant (and government supported) consumerism means most people are also consumers of capital not sources of it. Incidentally an example of the opposite of this is Germany where ordinary people save a lot more and don't have OTT mortgages and credit card debt. Mysteriously they have very few billionares...

* Billionaires. Which given the US (and UK where I live need their capital AND cannot get it elsewhere are able to charge a premium for it and cannot really be taxed etc without pain spreading all over the rest of the economy.

But if you try and tell people to spend less, save more, pay their taxes and accept less services in order to have a better, fairer, more equal, ultimately richer life they bulk...

Re: Are super-rich people just better at making money?

#282

Post by LatteLazy »

smilekzs wrote: post #21
bmitc wrote: post #3

To solve all this, it's pretty simple, and the U.S. actually used to do it: heavily tax the super rich. Heavy taxation and then appropriate use of those funds for education, R&D funding, infrastructure, etc. is actual trickle-down economics. And mega corporations should be heavily taxed instead of holding the country economically hostage. They jumpstart their companies off of government funding and R&D and then act a…

One thing I've noticed consistently, is when politicians talk about "taxing the wealthy", they almost always follow that with "earning more than $xxxk a year". This is conflating wealth with income. Being within this tax bracket myself, I do not deny that I am biased, but I do hope this bullshit gets called out hard whenever someone brings up yet another underhanded measure to milk us (typical SFBay SWE) above and be…

Well said.

Re: Are super-rich people just better at making money?

#283

Post by renonce »

nmfisher wrote: post #117
WalterBright wrote: post #101

Earlier quoted context omitted.

Borrowed money is not income.

No, but it is an avoidance mechanism specifically designed to avoid tax on income. If an independent third party has deemed your stock sufficiently valuable (and stable) to lend money against, then you should be taxed on that loan. You can get a credit when you repay the loan (to offset tax on the income you used to repay).

Not familiar with the US tax code, but if Musk borrows $1b with a portion of his Tesla stocks as collateral, will he be charged capital gains tax by assuming that these stocks are now worth $1b?

Re: Are super-rich people just better at making money?

#284

Post by nobodyandproud »

543g43g43 wrote: post #269
nobodyandproud wrote: post #251

Earlier quoted context omitted.

According to the third list (Hurun), the UK is keeping pace with the US.

Shame Hurun doesn't publish its source data, or a list of those people.

Which is an irrelevant objection, unless the list is inaccurate. Hurun reports are widely cited with few (if any) questions on its accuracy.

In fact, it's an inaccurate objection proven by 1 minute of research: https://www.hurun.net/en-US/Rank/HsRankDetails?pagetype=glob...

Re: Are super-rich people just better at making money?

#285

Post by [deleted] »

nmfisher wrote: post #117
WalterBright wrote: post #101

Earlier quoted context omitted.

Borrowed money is not income.

No, but it is an avoidance mechanism specifically designed to avoid tax on income. If an independent third party has deemed your stock sufficiently valuable (and stable) to lend money against, then you should be taxed on that loan. You can get a credit when you repay the loan (to offset tax on the income you used to repay).

[deleted]

Re: Are super-rich people just better at making money?

#286

Post by nobodyandproud »

ChuckNorris89 wrote: post #203
543g43g43 wrote: post #167

Earlier quoted context omitted.

Ah, the mythical "super-rich" who could fund all of our solutions, if only we could prise their money out of their clutching hands! It's funny how they always exist, even in countries like the UK and France which in reality have taxed them out of existence, and payscales are absurdly compressed compared to the US. Careful what you wish for, you are someone else's "super rich".

>the UK and France which in reality have taxed them out of existence You're making it sound like billionaires are an endangered species there. :) Last time I checked there's more than enough billionaires living in the UK and France[1]. [1] https://en.wikipedia.org/wiki/Bernard_Arnault

Not the only source but https://www.hurun.net/en-US/Rank/HsRankDetails?pagetype=glob... for a full list of billionaires (according to Hurun).

Re: Are super-rich people just better at making money?

#287

Post by willcipriano »

smilekzs wrote: post #21
bmitc wrote: post #3

To solve all this, it's pretty simple, and the U.S. actually used to do it: heavily tax the super rich. Heavy taxation and then appropriate use of those funds for education, R&D funding, infrastructure, etc. is actual trickle-down economics. And mega corporations should be heavily taxed instead of holding the country economically hostage. They jumpstart their companies off of government funding and R&D and then act a…

One thing I've noticed consistently, is when politicians talk about "taxing the wealthy", they almost always follow that with "earning more than $xxxk a year". This is conflating wealth with income. Being within this tax bracket myself, I do not deny that I am biased, but I do hope this bullshit gets called out hard whenever someone brings up yet another underhanded measure to milk us (typical SFBay SWE) above and be…

The politicians make money via insider trading, so of course they propose a income tax as opposed to a capital gains tax to "tax the rich". Many of them have been in power for 40+ years, if they were going to tax themselves it would've already been done.

Re: Are super-rich people just better at making money?

#288

Post by greedo »

988747 wrote: post #140
danny_codes wrote: post #111

Earlier quoted context omitted.

Most of our money does not go to the military. Defense spending is about 700b per year, while the budget is over 4t. The government doesn't need to handle capitol allocation. We can simply shift the tax burden upwards. Poorer people get reduced tax, rich people get more.

Poor people already pay next to nothing in taxes - the bottom 60% of society, making less than $50k only contributes 7% of total tax revenue from income taxes, while 0.3% of those making more than $1M per year contributes 27%. [1] I think the US has pretty good revenue structure in that regard. In my country 62% of federal budget comes from sales taxes (e.g. 23% VAT), which disproportionately affects poor people. [1]…

Your first sentence ignores what you say in the second. In the US, poor people pay a significant portion of their income in sales tax which is regressive.

Re: Are super-rich people just better at making money?

#289

Post by nobodyandproud »

bawolff wrote: post #47
smilekzs wrote: post #21

Earlier quoted context omitted.

One thing I've noticed consistently, is when politicians talk about "taxing the wealthy", they almost always follow that with "earning more than $xxxk a year". This is conflating wealth with income. Being within this tax bracket myself, I do not deny that I am biased, but I do hope this bullshit gets called out hard whenever someone brings up yet another underhanded measure to milk us (typical SFBay SWE) above and be…

As a practical matter, it is very difficult to tax wealth (and even harder to do it fairly.) I don't think the issue is lack of will but lack of plan that actually works in the face of assets with unclear value and/or difficult to liquidate. And this doesn't just affect the ultra rich but people like SWE too. How much is the stock you have in the non-public company you work at really worth? SWE are probably one of th…

> I don't think the issue is lack of will but lack of plan that actually works in the face of assets with unclear value and/or difficult to liquidate.

At least in the world of stocks, dark pools help solve exactly this sort of problem.

Once you have enough assets there are many tricks available that are simply inaccessible and unusable by regular salaried employees.

Many of the tricks employed by the wealthiest forcefully remove transparency by a combination of legal and practical methods (e.g., Canada and Delaware share a lot in common).

Disallow opaqueness first, then the solutions will emerge.

Re: Are super-rich people just better at making money?

#290

Post by danaris »

bamboozled wrote: post #23
bmitc wrote: post #3

To solve all this, it's pretty simple, and the U.S. actually used to do it: heavily tax the super rich. Heavy taxation and then appropriate use of those funds for education, R&D funding, infrastructure, etc. is actual trickle-down economics. And mega corporations should be heavily taxed instead of holding the country economically hostage. They jumpstart their companies off of government funding and R&D and then act a…

"To solve all this, it's pretty simple," I feel if it was simple it would be fixed?

Something can be very simple, and still be very hard to achieve because of resistance to it.
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