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Comment by dundarious | Hacker News Reader

I think everyone, including the writer of the article, understands the mechanism at play. The point is that you can't justify something by just stating the mechanism. The article already states very clearly what is going on.

> That’s in significant measure because she was able to transform money her company was compelled to spend cleaning up the oil spill into a perfectly legal nine-figure tax write-off for herself.

OP's post was essentially a re-wording of this quotation, and as such, doesn't make a case beyond I guess an implied "that's legal so it's good, or at least just the way it has to work".

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> I think everyone, including the writer of the article, understands the mechanism at play.

That is the most interesting aspect of these articles. They are optimised for the title, not the content. Ignore the oil spill: if you lose $100m, you won't pay tax on that..."Billionaire pays no tax" is a better headline than "Billionaire loses lots of money". If you think that a wealth tax is a good idea, fine just say that...don't bother with the article. But the reason most journalists don't write about wealth taxes is because they lack the actual knowledge to understand why we don't have wealth taxes, they just write misleading bullshit about income taxes instead.

This isn't just splitting hairs either. There is enough real information on inequality in the US (this is something that most journalists are very clever about...this is an article about inequality because journalists know that the target audience will interpret it that way). You don't need the bullshit articles. These articles misinform the public, they don't need to be written.

The articles spends the majority of its time going over:

- the mechanism for the tax write-off, by paying costs for cleanup rather than a fine

- how wealthy the players involved really are

- another mechanism for avoiding tax (transferal of property to a spouse on death avoids capital gains -- I'm not really interested in this one, but the article goes into it)

- yet another mechanism (possibly unilaterally inflating company valuation after the transferal, then selling "for a loss" that perhaps is illegitimate -- remember the damaged rig was not part of the sale)

- how sole-proprietership means the first write-off is a personal tax write-off too (I have no real objection to this)

- how the company has dragged its feet tremendously in actually doing the cleanup (ample detail in the article)

- how the estimate on the extent of the spill was perhaps 20 times too small (according to a government law suit)

- how the Coast Guard had to hire its own contractor to finally install the protective dome

The article definitely has some "look how wealthy these people are, they're not like us" aspects to it, especially in the first quarter or so, but the substance of it is about the triangulation of fire to "push for settlement with a trust for costs (tax write-off), push for that settlement to be based on an estimate that underestimates the true cost, push back on doing any of the actual work". (That being said, and maybe I missed it, but I don't think the article does a good job of explaining how that last part improves their bottom line -- do they get to recoup unspent funds from the trust?)

But I don't see how you're getting to (paraphrasing) "just say you want a wealth tax, instead of this misleading bullshit". Seems like a reasonably good article on "doing bad things and largely getting away with it".

So you are saying that they attempted to write off taxes and also attempted to minimise the estimate...you should not go into finance my friend.

And yes, your response is the kind of misconception that I think the journalists banked on.

I spent the last 10 years of my engineering career working at a well-known prop trading firm, on the low-level and algorithmic side. Stonewalling, fucking the dog (pretending to work, but really doing nothing), being sued into some kind of compliance, and having your counterparty forced to hire contractors to do the work you "promised ;)" to do is not merely an honest attempt to minimise costs.

You still don't understand the mistake you have made. Again, don't go into finance. You don't understand basic elements of what is going on here.

Happy to have it explained to me beyond "you still don't understand", to be told how prop trading (market making and taking, hedging, theo generation, risk analysis, etc.) is not "finance", to read why I'm wrong despite the points I made about how the article has substantive complaints and wasn't merely a Trojan horse for a wealth tax.

I explained it already. The reason why you don't think it has been explained is the same reason you don't understand. I said nothing about prop trading...but you don't are missing knowledge that you get taught first year in a finance course, and you were a engineer...as I said, I don't think you have any awareness about the limits of your knowledge.

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