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Comment by buboard | Hacker News Reader

I m sure Piketty has the best of intentions, and his arguing about a wealth tax on the face of growing inequality has merit. The problem is how these funds are going to be spent. EU is already subsidizing a number of sectors, with less than spectacular results. EU funds are great for governments because they offer jobs and make them look good. But look at how agriculture is doing in the countries that received most of the subsidies. EU already spends a lot in research, yet research materializes into products on the other side of the atlantic. Maybe if there was a more tight dependence on returns of investments these funding schemes would make sense. I think piketty himself knows that the proposal is naive, but i guess he agreed to be co-opted by the populist left.

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Government is excellent - BEYOND excellent - at policing others. In most every 1st world country, when the government goes after an industry, things change. See the recent Australian Royal Commission for an example: https://en.wikipedia.org/wiki/Royal_Commission_into_Miscondu...

The problem is when Government is a player as well. Government struggles to play both referee and player - as anyone would. Just imagine Michael Jordan refereeing his own games. Every drive would be a foul.

The problem with government is there is no creative destruction. When a company turns bad, it dies. When government turns bad, we elect a new one and all the same shitty institutions remain. And the good ones to be fair, but certainly all the shitty ones.

Government should stick to what it does well, hold other entities accountable, and not get too involved in things that can fail that they can't then kill off.

I read Capital in the 21st Century. I can't speak to this group in particular, but I think what Picketty argues for is wealth redistribution. Picketty proves that the poor are much worse at investing money than the wealthy -- which is actually the biggest factor behind increasing inequality.

Sane people can argue that taking money from good investors and giving it to bad investors is a bad investment strategy.

But it's quite clear that if we don't do /something/ about inequality, it's only going to get worse and at quickening rate. Wealth redistribution is pretty much the only option.

The only way that seems sustainable to me is: you take the average rate of return and subtract that from each individuals rate of return. If that's a positive value, you're taxed at some percentage of the difference.

I.E. if the average rate of return is 4%, and yours is 90%, you're taxed at 86%*X -- where X is some value or a function of 86%.

If you tax wealth at some arbitrarily progressive rate, that could easily disensentivise people from creating wealth or from working as hard to create it.

> the poor are much worse at investing money than the wealthy

i disagree. wealthy people have better investment options by virtue of the fact that they have more money. any banker can confirm that. Taxation is not the only solution. full employment is another way , but yeah there are no magical solutions.

Ditto.

Also when someone is barely getting by, assuming they are not dealing with addiction or violence and generally just subsisting, you can bet they know exactly what to do with that last $20. E.g. groceries with the highest calories per dollar, how many bus passes to get at a time, etc.

If budgeting is what is meant by investment (since obviously we're not talking about saving if there's nothing to be saved), from what I have seen poor people are incredibly good at it.

Contrast that with money managers who are generally just bad and can't outperform the market, not for lack of trying. Is "investment" really the right idea, and who says it's the number one importance compared to basic human needs?

Why does everything have to be about abstract efficiency and cost? It's not like there's a shortage of business opportunities for techno-luxuries that are fun to produce and trade, that we absolutely must go after basic rights via austerity. Lousy rentier mindset, we should have to be creative to profit. Once monopolies emerge they should be broken up, and once technologies become necessary for daily life, access to them should become a right. Tax incentives to invest in R&D instead of hoarding wealth could be expanded. So many things can be done to mitigate issues within "social democracy" without going full public ownership or eliminating private property. Question is, once these things are implemented, how can their repeal be prevented? Time to open up and revise constitutions.

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