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Comment by irotatori | Hacker News Reader

> What is wrong, Mr. Graham, with REDUCING income inequality by taxing EXCESS wealth, and spending it on public services to maintain or even (gasp) improve social mobility?

Not Mr. Graham, but it would be hard, probably impossible to find a definition of "EXCESS wealth" which could be considered as just. This is one of the cases where majority opinion doesn't work as everyone has a significant stake in the outcome (is biased in another words).

The way to solving issues surrounding economic inequality should be to planned with a goal of as meritocratic society as possible. The ideal is a state that everyone can say whatever they own and made has has been acquired justly, without society taking part of it away, often just because it was the first practical idea, on how to fight a disease, many of them could comprehend and campaign for.

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The current structure and distribution of wealth is not meritocratic however. Whenever there is any talk of fixing the system, people want to start from the current level and declare things a meritocracy, without touching the gains anyone got from an non-level playing field before hand.

This is like saying "ok, there was a bug in World of Warcraft, that allowed a bunch of sophisticated people to level up unfairly. We've now fixed the bug, and the same is meritocratic now. However, we will not be taxing or nerfing any of the items that got duped or hacked by those who took advantage of the game flaws previously."

Saying you can't draw a line or make a definition is a fallacy. As a society, we can draw any lines we want, and what is just or ethical is defined by society. Imagine we didn't have any speed limits, would your argument be "it is impossible to define an appropriate speed limit, since the right speed limit varies by road condition, traffic, weather, etc. Is it 60 mph, or 62.49 mph? Since we can't come up with a scientific rule for this that holds, we may as well have no limit."

I'd go further and said the idea of defining the concept of "saying whatever they own and made justly" is flawed. What startup founder hasn't benefited from positive externality of others? If you invent a new drug, that is based on an insight you had reading a university journal, from a publicly financed university research center, and you make $1 billion on this insight, even though 95% of the hardc work was done by research scientists publishing openly, do you deserve to pocket this entire $1 billion while everyone else shoulders the burden of paying for the public research?

Is it too hard to just ask people not to be greedy douchebags who try to defend their earnings from a lottery ticket with libertarian philosophy, and just accept that success in this society, especially entrepreneurial success, is a complex function of many variables, only one of which is hard work, or intelligence, or coding skill? And that there are other huge pieces: your social network, your friends, where you were born, timing and plain old luck, and that it would be better to encourage a continuance of this lottery game, if more people had the resources to do it, and a social safety net to tolerate failure?

As Warren Buffet said (paraphrased), an entrepreneur isn't going to stop trying to get rich because of a 10 or 20% hike in marginal or capital gains taxes. That's absurd.

People will stop trying to get rich, if they don't have family with savings or capital to fall back on, and in which a failure will leave them destitute and broken.

> As Warren Buffet said (paraphrased), an entrepreneur isn't going to stop trying to get rich because of a 10 or 20% hike in marginal or capital gains taxes.

I think that quote is here:

http://www.businessinsider.com/warren-buffett-taxes-2011-8?o...

Speed limit is set by road condition, traffic, weather, etc. In heavy traffic, the speed limit can be 0. In rain, some highways dynamically adjust the speed limit down. Speed limits aren't set as a society, they are set by traffic engineers on a case by case basis.

And of course startup founders benefit from positive externality of others. In the case of employees, they have defined and agreed upon compensation.

In the case of medical research, you will benefit from $1 billion for a set period of time, before you lose exclusive rights to a drug and anyone can benefit from it. Then your drug contributes to the 95% of hard work for someone else's drug.

I think you actually turn around your argument in the last sentence. It seems to me you start arguing against inheritance taxes because then people will stop trying to get rich, unless what you want is for everyone to not be rich ("touching the gains" from your first sentence). If people have nothing to gain and everything to lose, since they can't get rich and they risk being destitute and broken, then for what reason will society continue to function? Society won't function, it will devolve into various groups jealously guarding arable land and water.

People won't stop trying to get rich just because they "can't take it with them" or pass on the wealth. And no one has proposed a 100% inheritance tax either, so this is a strawman that doesn't really move the conversation along.

The issue is, will higher taxes (not 100% taxes) on income and wealth stop entrepreneurial activity? I don't think so. Is someone going to quit because they'll pay capital gains of 30% instead of 20%? Doubtful.

The issue is what is the appropriate taxation level, not whether it should be 0 or 100%. Currently, most debates devolve down into extremist scenarios that no one is proposing.

Anything above median for your city is excess, anything under it is deficient. The question is at which point the excess should be taken, and the deficient subsidized. I'd roughly say 30% on either side of median.

However, not all that long ago, for ~40 years, the U.S. had a top tax bracket above 70%, for about a decade it was 94%. It was not such an exact system where to draw the line. But a line was drawn, and it was not 94% of all of your income, it was only the portion of your income that was above the previous bracket limit. It's not like you make $1 more and suddenly all your other income got hit with this much higher tax. So the fuck all for these hoarders. Start a new business, expand the current one, and you get a tax deduction. If you hoard, fuck you, we have ideas and ways to spend that money, we're taking it. Don't like it? Give up your citizenship. Go pay 70% in some other western civilized country. Or run for office and have your ideas dissected by the American public. Just quit your fucking bitching, whiners.

And meritocracy alone doesn't work. A lot of effective people are assholes who would let the world around the average person burn to the ground before they'd lift a finger. And even that would be delegated.

Politics is largely about allocating resources. There's nothing inherently more biased about the allocation decisions that lead to a more equal society.

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