That's all well and good, unless you are the one being taken from. Why should someone's effort be rewarded with thievery?
There's nothing wrong with people earning lots of money from their own work, but they shouldn't be able to pass that on to heirs who have done literally nothing to earn it.
In the most basic sense, how much should I be allowed to do what I want with my own money?
A step more complex; giving to your kids is, AFAIK, one of the biggest drivers in why people try to make money during their lifetimes.
A step more liberal: Inheritance (the accumulation of wealth by a family), again, AFAIK, is an important part of upwards mobility.
The current setup is definitely sub-optimal. 100% would also be sub optimal, and, I'd argue, worse than what we've got here, because it's another thing that rich people could dodge that not-rich people couldn't.
It's not your money once you're dead. As far as I'm concerned, dead people don't have any rights.
> A step more liberal: Inheritance (the accumulation of wealth by a family), again, AFAIK, is an important part of upwards mobility.
On the contrary, I think it hurts economic mobility a lot more than it helps. If you're competing for opportunities with people who inherited millions of dollars (without doing anything themselves), it's a lot harder to advance yourself.
Non-rich people don't generally leave enough of an estate for it to matter in the first case. We could easily exclude the first $100k for that matter.
We have an existing estate tax. It's not a novel concept.
Yes, it is novel to do that.
There's already a 40% inheritance tax. How do you think it works in the status quo?
Plenty of estates have to be liquidated to settle debts and taxes today. It's hardly unprecedented.
It would take years to sell off $50 billion of stocks without crashing the company. Even if they are patience and manage to do that, alot of people, myself included, would have trouble with the government being in de-facto control of the company.
If you dismissed either of the two reasons above, I guess I don't see a point in continuing the discussion.
I agree. It's not worth continuing this discussion if you believe that it takes 10 years to sell off $50 billion of stocks.
Russian oligarchy is an illustration of this - the inheritance tax is effectively 100%, with the understanding that the property can be taken and re-gifted away any day, so most enterprises are stripped of their cash as soon as possible with money redirected towards conspicuous consumption.
The Russian example seems to be more a testament to the danger of unstable political regimes, not the problems of a high inheritance tax.
I don't want to live in your world.
I don't particularly like living in a world where my hard work is confiscated at a high rate while someone who just has the good fortune of wealthy parents can receive millions tax free.
I have no interest in living in your dream world of justice. As it would have been a totalitarian nightmare where everybody would be worse off.
I really don't understand why you're so vehemently protective of inherited wealth. Do you think it's abhorrent that Bill Gates is voluntarily donating most of his wealth to charity instead of leaving it to his children?
Why do you think an inheritance tax is "totalitarian?" At least, why is it any worse than income taxes?
I don't care what people do with their property out of their own free will.
I do care when people are trying to instate authoritarian totalitarian governments.
I oppose inheritance tax - as that inheritance has already been taxed at least once.
I have plenty of good solid arguments on my side.
And I would advise you to put a bit more thinking into your ideas.
If you have so many "good solid arguments" on your side, I'd love to hear them. Or answer my question of why they're so much worse than income taxes.
Why do you think that an inheritance tax implies an "authoritarian totalitarian government?" It's a total non sequitur. Does Denmark have an authoritarian government because they impose a high income tax?
Your conflation of income and inheritance tax is disingenuous.
My crown argument against inheritance tax is that the property being inherited has already been taxed before.
Another would be that taxing inheritance destroys capital base, which no society really wants.
Third would be that governments are really bad at managing capital. There are plenty of issues in the nordic models, where there are already signs that their massive welfare states are going to implode in the next couple of decades.
p.s.: How is me remarking that you have poorly thought out positions an ad-hominem?
Why? What is the taxation level where the government is automatically authoritarian? 99%? 90%? 80%?
You can't just assert things and then not provide a causal chain.
What makes double taxation an unmitigated evil? Sales taxes are double taxes, as are taxes on corporate dividends. Yet I don't hear people railing about how they're symptomatic of an authoritarian regime.
> Another would be that taxing inheritance destroys capital base, which no society really wants.
How does it "destroy" capital base? Redistribution of wealth does not equal destruction of wealth.
I agree that many governments do manage their capital poorly. Instead of having government hold on to the capital, I'd say we should collect all estate taxes and channel them into an annual basic income for all citizens. Let the living decide how to use the money.
> p.s.: How is me remarking that you have poorly thought out positions an ad-hominem?
It's not attacking the merits of the argument but instead the thinking of the arguer. I have actually thought about this quite a bit.
p.s.: for readers - see what Milton Friedman had to say on the very topic, to a person that seems very much on the same level as some of the contributors to this thread: https://www.youtube.com/watch?v=MRpEV2tmYz4
Right. Like I mean, it's more complicated than a straight 100%.
For example: What if I transfer my wealth to my family BEFORE my death? What if I set up a trust to manage properties so that my descendants don't own it, but benefit from it? (What if those properties produce their own cash-flow, which goes to my descendants, but they still don't own the property?).
Let's take another example. Let's take Cliff's Variety store in the Haight. Do you think it's worth more than $100k? Do you think they bought/built it for <$100? (hint: no, it's been around in one form or another since before WWII). It's been in that family for generations; it's still in that family. Should it stay in that family? If the current owners die suddenly, before they can transfer ownership, what should happen?
What if my parent owns a company, and I work for that company adding substantial value - like, say, Dr Bronner's soap company? How much of that company's value do I deserve as inheritance, or by ownership, given my contribution?
People live a long time now. I don't have to have the millions of dollars to make you compete for opportunities against my with the benefit of that. Parents (and grandparents, and reasonably, great-great-grand parents) can pay for my education. Or buy me houses. Or not buy me houses - buy themselves houses - and then let me stay there; and this problems is just going to get worse as longevity increases.
The stability of capital is in fact a huge part of how NY/CA remain successful—if you're ambitious, you have to move towards the capital to access it.
Also, keep in mind we're in the context of a thread where people are already discussing how to soak the rich. I'd much rather tax estates than dramatically increase taxes for people who have earned their money.
For what it's worth high estate taxes don't seem to correlate with economic growth (neither are zero estate taxes, to be fair) - I am reading this graph http://taxfoundation.org/article/estate-and-inheritance-taxe... and Japan, for example, being high on the GDP ranking is kinda dead in the water as far as economic growth ranking.
I think eventually the estates succumb to "three generations" rule, so the problem might be self-correcting.
The advantage of a high estate tax is more a social one of removing unearned wealth and freeing up some money to spend on social programs.
But you're right that it might be more efficient to make the tax 95% so the beneficiary has an incentive to handle the liquidation so they can get their 5%.
https://en.m.wikipedia.org/wiki/Estate_tax_in_the_United_Sta...
Taxation is just that taxation. If you want to be free of the "thievery" just don't participate in the economy created by the rest of society. Don't use computers which fundamental development have been largely funded by government. Don't use the internet which was largely funded by governments.
You can't have your cake and eat it.
Sound fair?
Thus I owe it to them to keep fighting the government creep towards authoritarian totalitarianism.
What have your forefathers been doing that you are now arguing that 100% of what I have earned and paid taxes on already, should get taxed again at some later date - as a punishment for me not spending it all?
I too don't want government to be too big or too all encompassing but that has nothing to do with whether some sort of taxation could be considered ok.
One things is certain though. If you had to pay for everything yourself you wouldn't be able to afford it. The price of many of the things we consider obvious today are based on many years of accumulated hard work by others than your forefathers which you benefit from today.
So we can discuss whether we pay too much tax, I am fine with that discussion.
But positioning it as all taxation being thievery is both incorrect and simplistic.
And don't get me wrong. I have no problems with participating in a community. I have a problem with government setting up barriers and maintaining a monopoly on community.
I have no apriori issue with government offering services, I have an issue with being forced to pay and consume those services, regardless of how (in)efficient they may be.
I am also very much aware that I am only at the end of a long line of people striving for a better future. And nearly all my personal efforts are directed towards fulfilling my obligation towards my forefathers as towards my descendants.
And resisting crazy talk about totalitarian governments as a savior for all our problems is a part of that.
Don't get me wrong - the manifesto above has hardly anything to do with your position, I am merely explaining my own position.
You can choose to pay your taxes or you can choose to move somewhere else where you aren't taxed. You don't have the right to anything anymore than anyone else do. If you don't like the society you live in move somewhere you like or start your own.
Taxes are not voluntary contributions.
I'm of native descent. I was on this continent before this government and there's no way it could exist with my consent.
The US government don't have the right to control the US continent anymore than the British do England or Swedish Sweden and so on. They took it and is defending it through the sheer use of power.
There is no justice in how land is distributed, no right or wrong only the power to claim and hold it.
And so it goes with taxation; there is no right or wrong taxation, it's the price to live in a society for any of us unless we can find a way to change it through the system, build our own or find some isolated place where no one will bother us.
Neither homesteading nor claims of natural laws changes that.
So yeah I guess unfortunately might is the final word in right.
So then the next question is, obviously, how do you fix that? How do you ensure that the market, regulations, employment, etc. are all perfectly fair and free? And the answer there is, you very much cannot. At best it's an enormously difficult problem beyond the scale of any problem that has been tackled by human civilization to date, at worst it's fundamentally intractable.
The next question then becomes, so how do we make it more fair in the easiest way we can in the near-term? And the answer there is wealth redistribution. Power and wealth perverts fairness of markets, including labor markets, and it perverts our systems of laws and governance. That's not to say that wealth is purely evil, there are many up sides to the accumulation of wealth, and personally I'm a big fan of "capitalism" (for lack of a better word). But we need to recognize that it is very much not only a flawed and imperfect system but a system that inherently contains many aspects that are poisonous to the operation of a peaceful and sane free society. The longer we ignore that, which we have for almost 4 decades, the worse those inherently problematic aspects become, and the more those who see the truth (that the system is very much rigged against the little guy) become increasingly intolerant of the continuation of the system that they perceive is systematically putting them at a disadvantage, and that leads to "very bad things".
This is a... let's go with "subjective" - this is a subjective interpretation of "fairness". It is totally fair to profit from the effective functioning of civilization. I think what you're actually trying to say is it's not fair to claim credit for that wealth without sharing credit with the system that created the situation within which you could make it.
I tend to think of wealth in the current system like water and hydropower, except that "natural" resting place of wealth is in one big pile (at the top), instead of one big pile at the bottom (oceans). (I could go into why, but I think, observationally, it's pretty clear what the steady-state trends towards).
With that in mind, power is extracted (and work done by that power) as water moves towards it's resting state. Other systems (that are importing entropy) then work against that trend (evaporation), keeping the cycle going.
Wealth accumulates. Something outside the system of wealth (such as government) needs to "import entropy" back into the economy so that work can be extracted as wealth moves back towards it's resting state.
Does that make sense?
(Please, poke holes in my model!)
And we would be fools, utter fools, to deny that, no matter how much we treasure the ideals of free market economies. In fact, if we do value the free market we must be aware of these things, because they are a major reason why people might fight against the model of the free market and they are a major corruption of the ideals of the free market itself. Regulatory capture, for example, is very much an enemy of the free market, but it very much exists, and pretending it doesn't won't make it go away.
As such the idea that taxing wealth is necessarily "theft" is ludicrous. Not only can it be seen as a "fee" for being allowed to operate in a civilized society with many robust services and infrastructure (the argument you seem to claim I'm making) but it is also a means of correcting the inherent corruption and unfairness in the system. It's a fudge factor that attempts to correct (via Kentucky windage) for the problems that would otherwise require likely tens or hundreds of trillions of dollars of concerted effort (or more!) to fix properly to any reasonable degree. So in lieu of spending significant fractions of the world's GDP it's vastly easier and at least somewhat effective to simply engage in wealth redistribution.
Let's look at some facts. We know that wage theft (where employers illegally avoid paying employees what they are due) exists, and accounts for a few tens of billions of dollars in lost wages every year in the US alone. We know that discrimination (based on race, gender, religion, sexual orientation, etc.) in employment and housing exists. We know that many instances of health and safety violations exist in many corporations across the world on a daily basis. We know of many examples of predatory business practices (such as predatory lending, municipal fine collection, etc.) that have bled money out of people in poverty. We have seen consistent weakening of labor laws and union power. We know that corporate tax breaks and corporate welfare are widespread at all levels of government, to the tune of hundreds of billions of dollars a year in tax revenue. All of these things are instances where people at the bottom are being unfairly taken advantage of while money is flowing into the pockets of those at the top. Look at the VW emissions scandal. Where a company violated the law across numerous countries in order to line its own pockets. And the consequences of that? Likely a significant number of deaths due to emissions levels higher than they should be.
Again, it's impossible right now to fix every single one of those problems, but those problems still exist, and in many cases they are becoming severe enough to weaken the very foundation of our society. These problems are the reason why people in the UK voted for Brexit, they're the reason people turned out in droves for Bernie Sanders and for Donald Trump. They're a big part of the reason why there has been an unprecedented increase in the mortality rates of white, middle aged Americans over the last several years, in contravention of all accepted wisdom about advances in medical care and so forth. The public is not always going to respond in the best way possible to these issues, because for the most part they don't fully understand them, but they do feel the pain, and sometimes that will result in them latching on to anyone or any cause that proclaims to explain their pain and offer a solution.
As to your model, again that seems to rest on the theory of the fairness of the economy. Natural accumulation of wealth is an issue, certainly, and there are good and bad aspects to it, and the bad aspects need to be countered. But I'd say that's a second order problem compared to the one we're facing right now.
There's this old saw about "the rich getting rich and the poor getting poorer", and for much of the industrialized age it wasn't actually very true. The rich got richer, but the poor got richer too, as the pie got bigger. For the last 4 decades the pie has continued to get bigger as well, but the rich managed to not only take their (also growing) slice of the pie, but also take some of everyone else's slices as well. And we've stumbled into a state where the poor are actually getting poorer even while the whole economy grows by leaps and bounds. And a state that has persisted for more than a single generation as well. That's untenable.
It's just tax which depending on it's size and how it's used and where have consequences good and bad depending on who you ask.
There isn't some objective version of tax or non-tax.
But, when looked at on balance, simple things like fair working wages also help redistribute wealth down the ladder but aren't burdened with the hyperbole of the rich being mugged by the poor.
The argument is forever framed as three sets of hands - one with cash, one in the middle that pries the cash from the first set and hands it to the third. We don't need to talk about direct redistribution by force. Fair market practices and regulations that prevent one from taking unfair advantage of another do the trick just fine.