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Comment by cdolan | Hacker News Reader

Government spending is almost entirely leveraged by debt and these documents prove that these "ultra-rich" pay a large absolute dollar amount of taxes (albeit lower than 30%). That is factually non-zero.

I am all for a healthy debate on the topic, but I disagree the reporting is responsible. Responsible reporting, in my opinion, would involve nameless "there is a $5 billion Roth IRA out there... the system isn't working", rather than naming private citizens who believe their tax returns from 2005-2020 are private information.

Edit: And I think it may be of public curiosity to know about what goes on in the billionaire class. I get that, to a degree. My original point was that ProPublica is admitting that they are in control of thousands! of American's tax returns for the last decade and a half. There is no guarantee that the IT administrator or summer intern is going to keep that data safe.

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> Government spending is almost entirely leveraged by debt

What does that have to do with anything? I literally have no idea what you're trying to imply.

> these documents prove that these "ultra-rich" pay a large absolute dollar amount of taxes (albeit lower than 30%).

Yes, and they also benefit from the work of society and government many times more than I do! From courts to law enforcement to bailouts to everything else. More generally: these people are not rich in a vaccum, they are only this rich because the rest of society exists, therefore they owe a debt back to society.

Absolute values count for nothing. It's preposterous that I work my ass off and get taxed 30 or 40% and they live off capital gains and get taxed zilch.

> What does that have to do with anything? I literally have no idea what you're trying to imply.

It means that government budget can be eventually consistent, unlike our personal budgets. Wealth is a leading indicator of income, and we all know that the vast majority of the ultra-wealthy will eventually pay taxes once they liquidate their wealth. When that happens, they will pay more in taxes than you or I, especially once you factor in inflation (which is one of the reasons why the long-term cap gains tax rate is so low to begin with, everywhere around the world).

Realistically, the government is already spending the money it expects to receive in eventual income tax collections from the ultra-wealthy. The best-faith attack on wealth is mostly around concentration of power, rather than tax revenue or even "fairness" relative to the middle class (the US has by far the most progressive taxation in the developed world[1][2][3]).

[1] https://opportunitywa.org/u-s-federal-income-tax-structure-m...

[2] https://www.cnbc.com/2015/04/13/top-1-pay-nearly-half-of-fed...

[3] https://faculty.washington.edu/vmenaldo/Inequality%20Researc...

> and we all know that the vast majority of the ultra-wealthy will eventually pay taxes once they liquidate their wealth

I can't tell if you're serious, I mean it. Can you explain why you say this?

Because we tax income, rather than wealth? This is true for most of the OECD. None of this has changed, and it's true for any ultra-wealthy person who wishes to actually consume against their wealth.

By definition, the ultra-wealthy defer their consumption for the sake of investment. If they never ever choose to liquidate their wealth, then it's little more than a life high score.

One can certainly consume right now by taking on a collateralized loan against their wealth, but even if one were to do that, the loan would need to eventually be repaid. For this to happen, some gain would have to be realized somewhere. That money isn't free. No matter what, that wealth is eventually taxed.

A relevant response to an earlier ProPublica piece: https://savingjournalism.substack.com/p/propublicas-bombshel...

As for the Roth IRA, the whole point was to extend the power of deferred consumption to the ordinary person (response to this specific ProPublica piece: https://twitter.com/cundillcapital/status/140809068240169370...)

And just a side note: generally assume that I'm being serious. I try to be as earnest as possible on this forum. Going in with this assumption for anyone on here is best for its general health.

"these "ultra-rich" pay a large absolute dollar amount of taxes"

Money is power.

Because of the wealth they get to keep, these ultra rich are in many ways ruling the rest of us and turning more and more of us in to their servants, telling us how to run our lives, raise our kids, and what to believe.

Are you ok with that? I'm not.

> turning more and more of us in to their servants, telling us how to run our lives, raise our kids, and what to believe.

This is not true in the country I live in.

Voters decide, not money. And the rich usually want a free world...

I disagree. Many complain about Bezos making billions and not paying a fair share of taxes; yet they support and empower him to further do so with every purchase they make from Amazon. Sure, voters have power voting in occasional elections, but every other day they vote with their dollars—whether they see that or not.

"Many complain about Bezos making billions and not paying a fair share of taxes; yet they support and empower him to further do so with every purchase they make from Amazon."

From what I understand, the vast majority of Amazon's profit comes not from the e-commerce website but from AWS.

And the overwhelming majority of Bezos' net worth comes from the value of Amazon's stock, does it not?

So aren't the people who are most responsible for his wealth the purchasers of Amazon's stock, not the users of the e-commerce part of the business?

It’s true they’ve rewarded shareholders and shareholders have rewarded them, but the profit metrics by division are almost trivial in this context. Amazon didn’t turn a profit for nearly 15 years- and not because they couldn’t have. The e-commerce has historically been run at near-zero margin, even willfully running categories at a loss to drive out competitors. As the consumer buying diapers from Amazon you might think you’re just saving a dollar vs diapers.com, it’s low margin so who cares, maybe you’re even sticking it to them if they’re really losing money on the transaction? But then diapers.com doesn’t exist anymore, and shareholders are rewarding Amazon. A single snapshot can only begin to tell the story.

So should we have been buying from Amazon's competitors instead, even if they have a worse selection, worse customer service, few if any reviews, slower delivery, and are much more inconvenient to buy from?

Variety, choice, and a healthy competitive ecosystem are definitely desirable and to be missed with Amazon's dominance, but there are many reasons Amazon is ahead of other e-commerce sites and brick-and-mortar stores.

It'll be interesting to see if/when Amazon finally starts to seriously increase its prices once the rest of its competition are dead and there's no where else for consumers to go.

Will there be a reckoning? Will Amazon be split up?

Notice what the 'fair share' is, is never stated, and at the same time want to encourage behavior via the tax code, but then get mad when people use the incentives.

I see this article and thread as a general exploration/discussion of these concepts. I’d have suggested we could probably peg ‘fair share’ anywhere between zero and average American tax rate for the sake of this argument, but let’s just go ahead and say 24%. Do you believe an individual should be able to earn billions, and should able to pay less in taxes than individuals making under 100k? If you agree I’ll bet you can find several billionaire (and many more on their payroll) that’d agree. Look, I admit Ive made my share of contributions to the Bezos machine. Now I could vote for Bernie all the while, but ultimately my point in response above is/was that we vote with more than bumper stickers, social posts, and… well, votes. I might be hypocritical, but I’m not mad or delusional.

Also I don’t hate Bezos or Thiel for playing this game, and I’m not saying you should hate either, but heck I think it’s okay to say at some point, it’d be okay to look at the policy and say okay you made a billion tax free, nice one, but that’s enough we tap out.

And yeah I’d love to divorce business/financial decisions from politics/voting, but you know, Citizens United…

"it’d be okay to look at the policy and say okay you made a billion tax free, nice one, but that’s enough we tap out"

I'd make the taxation retroactive.

I don't recall ever reading such a naive statement x)

I don't recall ever reading such bland, uninteresting statement.

If you want to claim democracy doesn't work, post some explanation of your position. You might feel like your opinion is shared amd known by everyone, but that's just a social bubble.

I'm more towards your side than you probably think, btw.

"Voters decide, not money."

The voters are told what to believe by the likes of Peter Thiel and Cambridge Analytica, or by the likes of Hearst, Bezos, and Rupert Murdoch owning newspapers.

The rich very often have the ears of politicians, with which (if they don't directly bribe) they can easily have lunch any day of the week to lobby for their special interest, or propose quid-pro-quo plans.

How often does the average voter have lunch with their elected representatives? For almost all of them the answer is never.

The rich also donate to foundations (if they don't own some outright) that lobby the government for their interests, they fund ads to the tune of millions of dollars, they sometimes use millions of their own money to fund their own campaigns for office (Trump being exhibit #1, and Bloomberg #2), etc.

>the rich usually want a free world...

There are plenty of Kleptocrats that aren't concerned with the world being free and fair; they're just happy to sit atop the pile, regardless of what the pile is.

Given the enormous reliance on advertising in US elections and the mindblowing sums that parties, candidates and PACs burn on them: money buys votes.

> Government spending is almost entirely leveraged by debt and these documents prove that these "ultra-rich" pay a large absolute dollar amount of taxes (albeit lower than 30%). That is factually non-zero

These are such non points. Who cares about the absolute amount? We measure it in points for a reason, and the effective number of points the ultra rich pay is <1, while I pay ~25. You can't denormalize that away.

I'm pretty open to the ethical version of this article omitting Thiel's name.

I also think it would be interesting to talk about what it is in this reporting that materially harms Thiel. That he is a billionaire and that he owns PayPal stock was previously public knowledge. This only seems to introduce information about how much tax his Roth is sheltering him from - which the anonymous version of the article would also cover.

Forbes thought his personal wealth was 2 billion.

This reveal puts his ROTH IRA alone at $5 billion (it owns stock in companies other than PayPal and Palantir)

That is a material change in Mr. Thiel’s privacy.

In principle it seems unfair. Case-by-case I have a hard time being against this sort of reporting because of how much influence that money might have. How is it that an individual has so much money? My feeling is that it was enabled in part by tax-funded infrastructure and insufficient government regulation. Too much individualism is trouble (see the USA response to COVID-19). Likewise too much central control.

If we’re collectively being exploited and some publicity is what is effective at change, so be it. I still see the super-rich as individuals, intrinsically no better or worse than anyone else, worthy of empathy, and answerable for their actions, which generally feel unethical.

Where might we cap wealth? What is a better way to go through life than playing the acquisition game and feeling like we’re not adults until we have the fancy, humorless luxury things? How do we otherwise meet the needs of those who thirst for more and more power and resources?

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