Norway’s Wealth Tax Is Backfiring
aier.org
aier.org
So the problem is revenue from wealth tax will only be $90M instead of $150M? As opposed to $0M without the wealth tax? How does having these billionaires physically located in Norway benefit the average citizen? Capital investments should happen wherever they're physically located because economics, big corpos have their HQs wherever they want anyway. Is trickle down economics the entire argument here?
Capital flight is a form of class warfare. Controls against it are the majority, workers who don’t own capital, enforcing a social contract against those who do.
Of course, that will only happen in states where workers are in power. In most countries that isn’t the case and, unsurprisingly, there are weak capital flight controls.
Maybe you wouldn’t want to move to a country where the working class is in charge, as opposed to your own class. I don’t dispute that.
In fact, in two of the countries that presently have significant capital controls (China and Russia), even your human capital is controlled with internal passports that limit where in your own country you can move to.
Of course, I likewise don't dispute that I don't know what your preferences are. My original statement ("you likely wouldn't want to") was intended to be a general statement, not for you in particular as an individual.
Voluntary association and participation of individuals should be a baseline understanding.
Individuals associating voluntarily is a liberal fiction. Such freedom only exists if you are already wealthy. Otherwise you have to work for an owner of capital or starve.
I don't think being hungry negates voluntary association.
Being hungry should not compel another to association any more than being horny should.
Is that voluntary association? Seems to me like the owners of capital exploit the labour of workers, because they have the ability to compel it.
The laws (and even the liberal ideology you adhere to) exist to favour the ruling class. Why would the ruling class do anything else? When the ruling class are the owners of capital, the laws and culture disfavour workers.
Ultimately it’s not worth discussing this to death yet again, it has been done countless times in the last couple hundred years.
The only real violence you mentioned is if police attack striking workers, which is exceedingly rare in most developed countries with the rule of law. What percentage of striking workers do you think are physically harmed by police in the us? If you think that is a likely or common outcome, we are probably living in different realities. You say that laws just favor the workers, but I wouldn't want to be a worker in a society without property rights. There is no point in working if any value you create can be stolen with impunity.
Now you want to sleep.. need I continue?
In short, the violence is not in "letting someone starve". Most people aren't out there trying to starve themselves. The violence is in preventing someone from saving themselves. Being homeless/penniless is an eyesore for those that aren't. The actions taken to fix the eyesore are the source of violence. What happens to a panhandler if they refuse to comply with police's arbitrarily justified order to "relocate"?
Also noticed that a lot of people are suggesting laws against capital flight, but this is also a very risky idea. Having capital that can't be moved inheritly decreases its value. You might be able to capture short term value, but you risk future investment, which could lead to a death spiral.
This is the tricky part of "just raise it a few percent" for these wealthy entities. It seems a small increase won't make a large difference". But if they go from 2% to 2.5%, for instance, but there is a country, somewhere which, has a 2.1% tax, they'd all start feeling. So, in some ideal situation, when we consider only one particular country in a vacuum, it should work. But, it's a lot tricker when there are other countries to consider. Even more interesting, other countries could specifically target these wealthy entities by lowering their wealth tax to 2.4%. That's not unheard of with US states and companies: if one state raise their taxes, some state might start courting companies headquartered in that first state and promising tax cuts if they move their headquarters.
Separately, every institute or person that has published anything has an agenda; so the fact that this particular institute has a mission that you perceive to align with their words doesn't mean that their words are wrong. It is by definition an ad hominem fallacy.
A child of a poor single mother, Barack Obama, made his way to the highest office of the land (not to mention significant personal wealth), whereas a child of a billionaire, John du Pont, died in prison as a convicted murderer. Both had equal opportunities to make something of themselves in a cultural, legal, and economic framework that values the individual.
In this land of equality of opportunity, 93% of people born to parents in the bottom quintile of incomes ended up earning more than their parents, with 57% ending up in a higher quintile; and a full 60% of people born to parents in the top quintile of incomes ended up in a lower quintile[0].
Meanwhile, in Norway, famed for its egalitarian attitudes and highly redistributive policies, a higher percentage were able to climb out of the bottom quintile, but a similar percentage held on to their parents' top-quintile ranking[1]. The country has more billionaires per capita than the US, and still has a legally separate and privileged group of people, the monarchy, who by definition are unequal from the rest of the populace; and it's only a few generations removed from having legal privileges for the aristocracy.
[0]: https://www.pewtrusts.org/~/media/legacy/uploadedfiles/pcs_a...
[1]: https://www.brookings.edu/wp-content/uploads/2016/07/02_econ...
If this is to be achieved it is going to require a lot of money.
We are a long way from having a child growing up in social housing sharing the same opportunities as a billionaires child.
And there's nothing wrong with that. It's pretty good that they stated their beliefs upfront, so at least we can see where the bias (if any) comes from.
Kind of predictable.
What exactly wealth they create and for whom? They're guilty of hyper-centralizing all services, assets, and resources. Your yacht will not fit in Lugano Lake, Mr. Viking. Try Marbella or Malaga, the places for Scandinavian success people.
The article is about wealth taxes. In addition to income taxes, Norway has a wealth tax, which taxes net wealth above $170k (NOK 1.7M) at 1% [0]. So, if your net wealth is $200k, you are taxed 1% on $30k every year.
Separately, it is a myth that the wealthy don't pay taxes. This isn't Reddit. Wealthy pay taxes but they also maximize the value of any benefits already included in the tax code. AMT is an attempt to fix this but has its own problems.
It is only comes into play if you have investment assets that have gone up since purchase, and you have paid no taxes on them because they are taxed at the time of sale.
The "system" isn't the government, though it's easy to muddle that line, considering some developed countries have government spending that's over half of the GDP (with Norway sitting at around a fifth as of 2021); and the existence of a government that facilitates the "system", which is in reality the private activities of the people, does not make it that without that particular government the system will not exist at all.
Imagine a parent who tells a fully-grown child well into his adulthood that they have an ever-increasing claim on what the child produces by virtue of having given birth to and raised him. Does that not sound abusive? That's not the kind of relationship I want with my government. The government, or at least the American one, is meant to serve the people, not rule over them and allow the people to keep whatever scraps the government allows them to keep.
Every time you perform a service for somebody or make a widget for somebody -- basically any economic activity -- you are paying back into the system by fulfilling a demand that someone else has. And not just remunerative efforts: every time you pick up a cigarette butt off the street that you didn't smoke, or every time you watch someone else's kid for a night, or you volunteer at a local soup kitchen. Those are all ways that people pay back into the system.
Let's not make the mistake of thinking taxation is the only way, or even the most important and effective way. Many roles that are currently performed by government funded via taxation have only been that way very recently in human history, and I'm in no way convinced that this is either optimum or necessary.
Thank you for putting that into words, I’ve struggled to succinctly frame the unease that this way of thinking makes me feel.
These are reasonable questions.