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Comment by anm89 | Hacker News Reader

This is what I always find funny about people using billionaires as an example of failure of capitalism. Many of the ways that todays billionaires profit is more socialistic in nature than capitalistic.

This isnt a story of some ruthless baron aggressively beating his competitors in the market. He's literally just having the money handed to him as a redistribution by the government.

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How is handing the government 6 dollars instead of 10 a redistribution by the government? The entire article is about using depreciation, which is an unbelievably common tax strategy when you buy a depreciating item (tools, computers, cars, etc). In fact I’d say it’s used by nearly 90% of small and large businesses.

It’s definitely NOT something that only the rich know how to use.

I wonder in this case if they are impairing goodwill (the price paid in excess of the book value of the physical assets) or if it is truly depreciating physical assets that need to be replaced in the future. If the latter, this is what all businesses do and makes complete sense, but if the former it is just a tax deferral strategy and in the future they’ll sell to another billionaire at a higher price and have to recognize the capital gain.

When the government takes x percent of everyone's income but says that one class of people only has to pay .2x percent, it's a handout.

For the people who understand this, understand how to leverage it, and have the resources to leverage it, it's the biggest handout of all time.

The devolution of capitalism into crony capitalism is the problem.

Free and fair capitalist markets are good, but rare.

When the government are the crony capitalists, that's not really capitalism anymore.

Corporations coopting government for their own gain is not socialism, it's the logical progression of capitalism. Socialism is when labor owns the means of production. Capitalists lobbying (bribing) the government to take money from citizens and funnel it to themselves is not that.

It's not what socialists want out of socialism, I'd agree with that. But what else do you call a system of economics centered on government wealth transfers. It certainly isn't capitalism. It certainly closer to how socialism is usually defined.

I guess it would be better to say that this specific practice is "socialistic". I'm not making some binary claim that we are a "socialist country" as opposed to a "capitalist country"

> But what else do you call a system of economics centered on government wealth transfers. It certainly isn't capitalism. It certainly closer to how socialism is usually defined.

The way I defined socialism is how socialism is usually defined. Per Wikipedia "Socialism is a political, social, and economic philosophy encompassing a range of economic and social systems characterised by social ownership of the means of production".

The way you are defining socialism as "government giving money to some group" seems to stem from a misunderstanding about exactly what socialism is. But the government collecting money from citizens and giving it to one group or another is just what all governments do. This flow of money isn't happening because of socialism.

> This isnt a story of some ruthless baron aggressively beating his competitors in the market. He's literally just having the money handed to him as a redistribution by the government.

That is exactly why it's a failure of modern capitalism.

What is capitalist about the government handing out wealth as privilege?

It seems like you just don't like our society. And then label our society as capitalist so whatever you don't like about our society is therefor a failure of capitalism. I mean sure, given those definitions I'd agree with you. The problem is that "whatever the US does" is not the definition of capitalism.

If a certain state of affairs ("crony capitalism" or "socialistic handing out wealth") is a natural consequence of capitalism, as the other commenters are arguing, then does it matter what you call it? If your position is that the current state of affairs (the co-opting of the government by the ultra-wealthy class) is not the natural consequence of capitalism then you should argue that rather than no-true-scotsman-ing whether or not it is truly capitalism.

Its capitalist if the government handouts are only available to people with a considerable amount of capital, which is the case in the article.

Is it a failure though? I'm amazed I need to say this on HN, but that depends on the KPIs you choose to use to evaluate the capitalist aspect of this particular tax policy. If the goal is that the rich get richer, its a capitalism success. If the goal is that everyone in society gets more leisure time and increased quality of life, it looks like a failure to me.

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