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American Equity

blog.samaltman.com

361–370 of 552 posts

Re: American Equity

#361
Yes, there is an old slogan, "Machines should work. People should think."

Or now maybe

"Machines should work. People should enjoy life."

Or, there is the old

"Machines should work. People should get a guaranteed basic income. If anyone wants more, then they can work for more."

All the ballpark US national arithmetic I did says that we can't yet afford a guaranteed basic income.

E.g., for something simple, supposedly Bezos is now worth $100 billion. But if divide that by the US population of, say, 333 million, then get just $300 per person, just once, and have confiscated all of the Bezos wealth. Point: Not even Bezos is rich enough to provide a guaranteed annual income for everyone in the US, not for a year and not even for just one month just once.

But, maybe when computing is doing enough of the work, then, for a simple solution for the needed revenue, tax the computing, processors and Internet data rates and nothing else. Maybe.

Or, maybe, people should manage computers that manage computers ... that manage computers that do the work for everyone. Okay -- apparently we're not there yet.

For the issue of housing costs, housing is expensive close to where there are good jobs. And there the costs are for the limited real estate close to the jobs and high taxes for K-12 schools, police, roads, etc. And the high housing costs eat up nearly all the income from the jobs because the jobs pay just enough to cover the most important employee expenses, e.g., housing.

But if get out to rural areas, then housing costs can be much lower. If people are going to have a guaranteed income, then they may want to live in areas without much in jobs and with lower housing costs.

But there is a flaw in Sam's proposal: People will still form competing interest groups, e.g., political parties. Then too many of the groups would rather fight for the interests of their group and not join for the good of all. That is, too many groups would rather fight for a bigger piece of the pie they like than for bigger pies for everyone.

In times past, such interest groups could fight in the streets. Then the ancient Greeks invented democracy: Do the fighting at a ballot box. Since a big winner at a ballot box would likely also win in the streets, it's in everyone's interests just to go with the results from the ballot box instead of shedding blood when the outcome is already known.

Basically, democracy is still important and for the same, old reasons.

Re: American Equity

#362

Earlier quoted context omitted.

Well, the real question to me is do we think of people who live in Wyoming as "Wyomingers" and those in CA as Californians? I don't think so. We just think of everyone in the USA as Americans. So why should it be that some Americans (those who live in Wyoming) having outsized voting power over national laws? A minority of Americans is controlling the country via the methods I mentioned. It doesn't seem to be working…

There are existing answers to these questions. It's not a grand mystery. Instead of merely repeating the questions, you should explain why the answers to those questions are wrong. I think you're overly consumed with the political dramas of the present and haven't really thought through questions about what a good system of governance looks like.

Here's my proposal for tweaking the USA's current government so that it better represents the will of a majority of Americans: 1) abolish the Senate 2) end the electoral college 3) end gerrymandering 4) reform campaign financing.

Re: American Equity

#363

Earlier quoted context omitted.

> From the perspective of trying to get the budget balanced, taxing wealth is probably the single most efficient way to do it. Why? As a total layman, wouldn't it be incredibly inefficient? If we tax the wealth of, say, the top 100 richest Americans, wouldn't that cause some pretty terrible downsides? If we force them to sell their holdings, wouldn't that ripple through the economy? Take Jeff Bezos--if you forced him…

The problem is that eventually you run out of other people's money.

Let me add to the tirade. Somewhere on the web I saw: Taxing income, is like 9 wolves and 1 lamb deciding what's for dinner.

Quote (by probably Winston Churchill )- Any man who is not a socialist at age 20 has no heart. Any man who is still a socialist at age 30 has no brain.

Please upvote.

Re: American Equity

#364
US GDP is just a bunch of revenue. It's also near impossible to understand the accuracy of the number because of differences in applying revenue recognition principles like cash vs accrual accounting. Also, if US business became zero margin (a thought experiment for the sake of argument), making companies pay a percentage of US GDP would create a less competitive US economy globally. A better idea would be a "US Free Cash Flow" figure, which if we could arrive at such a number accurately, would allow for such a setup, which would be cool.

Re: American Equity

#365
post #332

Earlier quoted context omitted.

And that mechanism doesn't work, unless their salaries don't keep up with inflation. Notably, this relationship is asymmetric, since there is no corresponding way to increase labor wages without giving a pay raise.

Salaries can grow faster than inflation at other times, keeping them aligned over the long term.

you've never been poor, have you?

Re: American Equity

#366
post #25

American Equity already exists is the US Dollar currency, the problem is that the Government is always issuing new stock certificates thereby diluting the value of stockholders.

I don't think this is quite right. Currency is not equity. It does not confer ownership rights, nor command any dividends. It's really more like company scrip that can be used in the company store, that is, the portion of the economy under USG jurisdiction.

Re: American Equity

#367

Earlier quoted context omitted.

> Or that -- when asked explicitly whether the rich should pay more -- most (3/4) people, like you, say "yes", but when asked what the tax rate should be for top earners, precisely 3/4 of respondents said it should be 30% or below(2). Again, it's 43% right now. That's comparing a question people likely answered with a total effective income tax rate with the current nominal marginal income tax rate.

Not sure what evidence you're basing that off of. An alternative explanation would be people calling for taxes on the rich to be "raised" aren't really sure what they currently are.

It's literally what the question asks. It asks what rate high earners should pay: “should pay” is effective not nominal, because it asks what should be actually paid; “high-earners”, without limitation to some subset of their income, is total, not marginal.

Of course, this is reinforced by the fact that people don't even generally understand marginal tax rates all that well, but that's secondary.

Re: American Equity

#368

Earlier quoted context omitted.

I think becoming wealthy is incentive enough to become wealthy. No one is going to stop trying to be wealthy just because they might get taxed for that wealth. If anything, they will just try to hide it in another state. But the argument that a wealth tax would remove any incentive to become wealthy is not very strong.

If a lottery ticket's prices goes up, and the purse goes down and/or the odds get longer, you'll be less inclined to buy a ticket. It's the same with work. If hard work is less likely to pay off, or if you'll have to work harder, or both, you'll be less likely to work harder. Some people will work harder anyways, and many will be discouraged. Marginal effects matter. This is why dynamic analysis is important.

And the marginal effects of having 100M in the bank over 10M in the bank over 1M over 100K are all still huge for any feasible tax scheme I could imagine.

What does your world look like where you'd be too taxed to bother wanting to be financially independent?

Re: American Equity

#369

Can someone actually explain what Sam wants to do here? I've read the post 4 times and I still can't see an y sort of plan, numbers, etc to actually critique, Which is odd because he specifically ask you to give feedback but never follows through on presenting the actual idea. He does motivate why he thinks a share of the GDP is so he gets the why, but never actually gets into the what, and how. I mean the GDP isn't…

He proposes a soft version of Socialism [1]. You can own a company but you will have to pay additional 20% income tax or 20% VAT (I am not sure how to gather in taxes 20% of GDP).

[1] https://en.wikipedia.org/wiki/Socialism "There are many varieties of socialism and there is no single definition encapsulating all of them, though social ownership is the common element shared by its various forms"

Re: American Equity

#370

Earlier quoted context omitted.

There are wealth taxes in Switzerland, Norway, France, and the Netherlands, amongst others in Europe. They've been repealed in countries like Sweden and Austria, not because they were disasters, but because exceedingly wealthy people have a lot of influence. That's the only story. As such your claim that no such taxes exist is wrong; and your claim that they've been a disaster is also fallacious. p.s. your "ready for…

Can you show us a comparison of GDP growth rates, before and after wealth taxes were promulgated (and, where it happened, repealed)? Also, please, a comparison of GDP history between countries that have and lack wealth taxes. Near as I can tell Europe has lagged way behind the U.S. in economic growth since the 1980s. I remember back in the 90s when catching up to the U.S. was stated goal of the incipient EU. How did…

No, you show it.

I already showed that you were completely lying about wealth taxes not existing anymore. Only a fool would trust a proven liar like you.

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