Comment by epistasis | Hacker News Reader

Comment by epistasis | Hacker News Reader

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This isn't a loophole as much as a completely designed tax break.

That's a different deal than some body squeaking around tax law; this was all about trying to change parts of the nature of capitalism's tendency to rerun money to capital more than to labor.

If you think it's misguided, I do too. Though I think it's good to invest in under invested areas, I also think we need to counteract the effects of the Henry George Theorem and also redistribute money from the land rents to people that do not own land.

Both are necessary to try to make our economic system more fair and more efficient. The fewer people that are allocating capital in capitalism, the worse it works. And pretty much all positive defenses of capitalism start with assumptions that most people are starting from somewhat similar places of wealth, or at least enough wealth that they are not destitute. Until we have that base level of security for all, we need things like massive redistribution, which includes carrots like opportunity zones, as well as sticks like taxes on land and monopolies.

> This isn't a loophole as much as a completely designed tax break.

I strongly doubt that the outcome here is the intent of the tax break, which seems to be "pump money into poor areas and we'll let you off the CGT on the amount you invested in the area".

She "re-invests" a thousand dollars by starting a company that is just a few people in some co-working spaces, and walks away a few years later with hundreds of millions extra.

If she'd started a major factory employing large numbers of people in the local area then sure, that seems like the intent.

The business is hypothetical in the article, but the hypothetical is a software business, and is making money. So they didn't "just place people in some co-working spaces", they did work as employees and got paid, which brings in economic activity to a depressed region. Seems to be exactly what the tax break is intending.

This is much better a tax break than a city bidding for an amazon HQ with a custom tax break deal that they have to compete with other cities!

> So they didn't "just place people in some co-working spaces"

It's quite literally what the article explains.

> they did work as employees and got paid, which brings in economic activity to a depressed region.

The regions are tiny, walkable across in the article. They're not bringing in workers to live, build a family and spend within a large metro area - they're "a space nearby a university". The economic activity brought in is a small number of employees buying some coffee, maybe lunch and then going home.

> Seems to be exactly what the tax break is intending.

You think that spend in co-working spaces is what the government wants to give up hundreds of millions of dollars for?

Capitalism these days feels akin to joining a game of monopoly where everything has already been purchased. But feel free to have a jolly time going around the board and paying rent :)

Well, monopoly was introduced as satire in the first place in fact! A way to showcase some absurdities of capitalism

Not exactly a critique of capitalism, but of private land ownership. The Landlord Game was created by a Georgist, and Georgists consider land and capital to be entirely different economic factors with entirely different behaviors. Marxists often consider Georgism to be capitalism's last gasp.

That was the whole point for monopoly, to show how rigged the system is.

At least in capitalism you can start a new business. The folly of the Monopoly board game is the limited spaces which makes things a zero-sum game. The world is only zero-sum when the government doesn’t let you build new stuff through artificial constraints. In a free market always get new stuff.

The gp specifically mentioned land ownership, which makes the comparison more interesting.

I can't think of a single thing that isn't inherently limited. Maybe the sun is practically infinite, though you're certainly limited by the amount of power you can capture. Land, natural resources, time, it all has limits.

The quantity of steel may be inherently limited, but we can still make more than what we have now.

Land behaves differently because of the extremely in elastic supply. And it's not very fungible; a lot in the middle of Nevavda hundreds of miles from the nearest freeway is not exchangeable with the same size lot in Palo Alto.

And the limit itself is the amount of iron ore; that would be considered economic land, but the steel may just be considered capital.

Free market != capitalism, by the way. The market for the most part in "capitalist" America, has been captured.

Second, the world is a zero-sum game. In one breath folks will say "resources are limited, so we need to allocate to those who can use them best" or "life is unfair", and then in the next claim resources are unlimited and hard work is all you need, no need to get fussy about inequality.

Even without height restrictions, limited ownership of land still has the problems exhibited in the game.

Zoning and highly restrictive building codes were invented after Georgism, and are ways to further heighten the basic unfairness of land.

Local politics are dominated by landowners, as they tend to have the most control of, and greatest interest in controlling, the local levers of power.

It is ironically why I'm less concerned about private equity buying houses to rent than I am of local small time landlords buying houses. PE firms won't control local politicians in the same way that local landlords control politicians, because it's too much work and requires ridiculously intimidate knowledge of the local patronage networks.

> That's a different deal than some body squeaking around tax law; this was all about trying to change parts of the nature of capitalism's tendency to rerun money to capital more than to labor.

No, this was a small group successfully lobbying to reduce their share of the costs of running society. AKA special interests.

> Until we have that base level of security for all, we need things like massive redistribution, which includes carrots like opportunity zones, as well as sticks like taxes on land and monopolies.

If you're going to redistribute wealth, do it in a broad, simple way (UBI/negative income tax). Not through millions of tiny special interest gifts like 'opportunity zones'.

While I think UBI is great, there still needs to be local investment to build communities, beyond just giving people money. I'm not convinced that opportunity zones are the way to do it, but in addition to giving people money, we need to build the economic infrastructure for people to use it in good ways. For example, in food deserts, getting grocery stores. That may require incentivizing businesses to take what they see as additional risks.

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