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Comment by muststopmyths | Hacker News Reader

My guess: because they hope to be wealthy some day.

There are other reasons to oppose them like they historically bring in very little money, they're a pain in the ass to administer, capital flight. Some evidence for this are parts of Europe is abandoning their wealth taxes.

If you want to raise money or reduce inequality there are better ways to do it. Income tax, capital gains, inheritance, etc...

> Some evidence for this are parts of Europe is abandoning their wealth taxes.

That's not evidence. We have right-wing parties in Europe too. They introduce right-wing policies when they have power, such as the above.

Do you think that successful policies are as likely to be rolled back as unsuccessful ones?

What kind of strange reasoning is that? Policies are enacted for multiple reasons, very often without any concrete evidence that it's better or worse.

That's very reductive. You should know that the Federal Income Tax that was first collected in 1913 had a top bracket of 7%. Today, the minimum bracket is 10% and the average middle class citizen pays around 12-18% of their income to the IRS.

So sure, the wealth tax would only be on "the rich" when it first starts out but I guarantee you the middle class will be hit by it eventually.

Most people are already hit by "wealth taxes", except they are regressive - it's called "property tax".

Surely property tax is trivially easy to justify? It usually is collected by the municipality and pays for things that have ongoing operating costs— roads, fire department, schools, etc. How else should those things be paid for?

From the other taxes? Germany has vanishing property taxes compared to the US. Better roads and schools, no question.

I don't know how it works in Germany, but here in Canada, one of the big issues with that is that income taxes are only collected at the provincial and federal level. Now, a chunk of that money gets sent down to lower levels of government— Waterloo region where I live recently received $600M from upper levels of government for a light rail system that is now built and operating, and the current budget shows 27% of revenue coming from "provincial and federal grants".

The thing is, that money which comes from the upper levels is extremely subject to the whims of those governments; it can fluctuate wildly depending who comes into power and what their priorities are. So without some guarantees around it, I can understand the municipalities wanting a stable source of income over which they have some agency, and out of which they can reap immediate benefit from growing the local economy.

Anyway, I'd love to hear from someone in Germany how this is resolved there; but I'd assume there'd need to be some pretty structured, long-term agreements around minimum amounts, percentages of new growth, and so on.

Schools are funded from the federal, state and local level, plus non-government sources (churches etc.). Police is state level, AFAIK. Fire department is paid for by an extra tax on fire insurance (so, I guess you could argue it's a property tax via extra steps), and state funds. For streets, it depends, cities pay for city streets. Autobahn is mostly federal, others are state, federal.

For the taxes, it's complicated, because there are some taxes for which the cities and states can decide the amount, and others (for example VAT), from which they get a certain fraction, but the amount is decided on the federal level.

Edit: Let me add: Property taxes are very strangely regressive. You pay it whether you rent or own, and there is a minimum apartment cost, so you'll always pay, while a low income might not be taxed at all. Then, often, there is a sudden jump from apartment complex to SFH.

Doesn't everyone?

Plus, there's other reasons to be skeptical of wealth taxes, capital flight is a real thing.

Isn't that just another myth peddled by wealthy groups? This was a pretty good study and didn't find that effect[1].

Just on the face of it, sure if you're wealthier you have greater ability to move but that also means you probably like where you are because you chose to be there. Most of my high school friends dispersed around the country solely for job opportunities, not because they wanted to be somewhere.

[1] https://minnesota.publicradio.org/features/2011/02/documents...

> The New Jersey millionaire tax experiment offers a potent testing ground, given the magnitude of the policy change and the relative ease of relocating to a different state tax regime without leaving the New York or Philadelphia metropolitan areas. Using a difference-in-difference estimator, we find minimal effect of the new tax on the migration of millionaires.

>capital flight is a real thing.

Can anyone provide some examples of it happening in an economy like ours?

Not sure if "France" is an "economy like yours" but they have definitely suffered from capital flight following a wealth tax hike[0][1].

[0] https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1268381

[1] https://www.forbes.com/sites/jonhartley/2015/02/02/frances-7...

That's why you pair them with capital controls, to keep that from happening. This, unfortunately, requires significant cooperation from the international community, and ought to be done before any wealth tax is imposed.

BTW, have you seen how expensive it is for high net worth individuals to renounce US citizenship?

> Doesn't everyone?

God I hope not. How empty would we all be if we all wanted to have more money than the next guy.

> capital flight is a real thing

Yep, that's why all of the rich people have left New York and California.

You think rich people are paying those kind of taxes? Why wouldn't they leave if this wealth tax were suddenly imposed upon them?

> You think rich people are paying those kind of taxes?

Judging by the amount of wealth in New York and California: obviously yes.

> Why wouldn't they leave if this wealth tax were suddenly imposed upon them?

Because they want what the taxes get them.

Equally as valid to say you are in support because you believe you will derive additional benefits financed by taxes you will never have to pay.

So what?

I hope to be wealthy and not pull up the ladder behind me.

Also called "American dream".

A famous formulation of that is: "John Steinbeck once said that socialism never took root in America because the poor see themselves not as an exploited proletariat but as temporarily embarrassed millionaires."

So tired of reading this quote every time taxes come up like it's some profound statement. I see it so often to ridicule "silly poor people voting for lower taxes".

It's possible for someone to think that it's unfair for some people to pay a huge amount of taxes unfairly, without they themselves thinking "one day I'll be rich".

I think it's more than just "one day I'll be rich"; it's part of the mythos of where wealth comes from. If your starting point is the American Dream, that wealth comes purely from a combination of ingenuity, luck, and hard work, either from the individual or one or more previous generations, then it's easy to see being asked to pay away a share of it as unfair. But if you see wealth as something that arises at least in part from the opportunities afforded by the structures and services within a society, then it's reasonable to expect that the society is owed back a portion of it, in part to maintain those services for the benefit of others coming later.

And fairness aside, there's the purely pragmatic concern that multi-generational wealth concentration is bad for almost everything— bad for democracy, bad for fairness in media, bad for civil unrest, etc etc. Is taxing wealth an effective way to manage this? Maybe, maybe not. But anyone who wants to critique it should probably be willing to support _some_ plan for controlling wealth inequality over the long term.

It's a fallacy to believe that making the rich less rich makes the poor less poor. There are a lot of things in between which must go right.

It is typical of Americans because most of their families came to the country with the allure of becoming wealthy. So it was important for them to tell themselves this story.

And probably that was the secret to America’s success: people seeing themselves as future winners and not permanent victims.

I mean it makes sense socialism removes any real chance of your country being successful so if you think your country has a chance accepting defeat would be horrible.

Doesn't the truth of this hang on what the definition of "success" is? Is ability to produce the occasional Mark Z or Jeff B "success"? Or is success just an upward slope on broad economic indicators like GDP?

I think the picture looks quite different if you look at things like quality of life indicators— and then it's (surprise!) nations like Denmark and Switzerland which top the list. I suspect it would be even more stark if you were able to measure class mobility— the number of people who have at least +x% inflation adjusted net worth over their parents at the same age.

So yeah, it's a little bizarre (and a very US-centric view) to just assume that "success" on a national level and socialist policies are mutually exclusive.

Denmark and Switzerland are objectively capitalist systems and have little to no state control of the means of production.

Okay, but that's moving the goalposts. For the purposes of this discussion, most Americans who pull the alarm on "socialism" do so when things like wealth taxes (or single-payer healthcare, or free tuition) are mentioned.

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