There's absolutely no reason at all for anyone to possess more than a couple of million bucks. Anything over that should be taxed at 95%.
I don't think that describes barely enough for the vast majority of people.
You mean that thing that happened when we gifted huge tracts of lands to a few private businesses so they could pay for the railroads? American railroads were NOT a private investment, but a public one!
>airports and airliners
Once again, public money during the war, creating the giant B-29 was more expensive than the Manhattan Project! America absolutely pumped cash into any building that claimed they could put out a few screws a week to support the insane amount of war material building we did. The airliner industry was further supported by Cold War warplane development, with bigger planes and bigger jet engines.
>microchips
Bell telephone had a legal monopoly for several generations. Literal government handout for free extra profit. Further improvements in computing were once again funded by military desires, simulators for planes, early computers were designed nearly entirely for computing ballistic tables for artillery, and selling a little bit of spare time on the side.
Modern America exists because in 1940, America actually invested in itself. None of those investments were private.
More examples: IBM owes a lot of it's early success to mechanizing the US census, once again public money. They even took some money from the Nazis FFS. How much did Henry Ford make building Shermans and other war material, often for the british or soviets to use? Starlink's Dishy terminal wouldn't exist without shitloads of public funds put into new phase array solid state scanned radars that were built out for the aegis system.
Or how about basically the entire country's infrastructure exists because the feds spent billions on paying poor people to dig ditches so they wouldn't starve to death. I'm sure walmart and amazon would do great with our old state roads right?
But sure, let's keep pretending these were "bets" by "private" companies.
Do huge tracts of land magically become working railroads? The word "happened" is carrying a lot of weight here.
In general, your argument handwaves the difference between basic research (often paid for by public grants to universities) and a working implementation subject to market forces. The two have radically different incentive structures and require very different competencies.
Good things don't happen by a politician's fiat, no matter how many tax dollars you throw at the problem. Behind every story of "America actually investing in itself" is men and women toiling away, breaking backs and burning midnight oil, almost always out of a profit motive.
The companies were gifted not just land for the railroads, but 100ft of land on both sides of the rail line, as well as bonus land grants for every mile of "grade" totaling about 6,400 acres (2,600 ha) for each mile of railroad built, because the desire was for the railroad companies to fund the construction by selling the land. We also gave them significant bonds at 6%, which were repaid in full and with interest. The money was free and didn't exactly have strings attached. Gifting land to private individuals or companies used to be America's favored way to set up the next generation of wealth. In total, the acts to build the transcontinental railroad gifted the private companies more land than the state of Texas covers.
The labor to build said railroads was then imported from Ireland and China. These same laborers were then treated as outsiders and "anti-american". The people who "burned the midnight oil" to build the cross country railroads were not americans working for a profit motive, but immigrants purposely encouraged to come to america with a false promise of "opportunity" so that they would be stuck here with limited opportunities outside of working for the railroad under shit conditions that often resulted in deaths, and underpaid with funds from the sale of land that was gifted to the companies by the federal government.
This was as clear cut a handout to build infrastructure as you can get, and then we let these same companies pretty much explicitly become robber barons. We paid for their capital costs and then let them eat the profits from said capital. The same acts giving railroads money also made provisions to build a cross country telegraph line, so there's some handout to future communications infrastructure.
In other words, a profit motive on the part of those immigrants. They desired to make their lives better. That the opportunities were false doesn't mean they were not being sought out.
> This was as clear cut a handout to build infrastructure as you can get, and then we let these same companies pretty much explicitly become robber barons.
I agree the grants had inadequate oversight and because of that, it's fair to call it a handout. But again, just because land and money were handed out does not mean that you get a working railroad on the other side, or that public funding is the only way to get large infrastructure works done.
Were some of the risks subsidized by the public in the case of the transcontinental railroad? Sure. The same thing happened with Solyndra, and nothing of value was produced at the end of that. So clearly government handouts aren't the necessary and sufficient precursor to success; at least the transcontinental railroad was built.
And mind you, back in those days, US government spending as a percentage of GDP was in the single-digit percent, compared to the behemoth it is now at over 35%. If the redistribution of public money through taxation really generated wealth, we should all be living like kings given current levels of government spending.
> Gifting land to private individuals or companies used to be America's favored way to set up the next generation of wealth.
None of the descendants of the railroad tycoons are still so rich that they're worth being written about[0]. Cornelius Vanderbilt was estimated to have been worth 1/87th of the US GDP at the time of his death. His famous heir, Anderson Cooper, is estimated at the upper end to be worth $200M. In contrast, even the poorest state in the union, Mississippi, has had a billionaire from playing music, of all things[1].
[0]: https://www.forbes.com/sites/kerryadolan/2020/12/17/billion-...
AFAIK the high tax rates of the 1950s were also coupled with high levels of deductions/tax loopholes (eg. company cars), so the effective tax rate didn't really change much.
Me? A person who actually lives in the property and NEEDS to comply? MY home certainly is a tax burden on me when every single year it's taxable value is reassessed by the county for 20 percent more, requiring immediate and prompt payment before it's lien'd.
Such a joke.
Also in my experience there has been a relatively painless path to challenge the assessment. Although I have never seen an example where the $400 appraisal is worth paying to do so.
Sure, I need to be marked as a deliquent debtor (somehow) for my property to be taken away from me.
And sure, every year, I can pay the department of revenue an appraisal fee to undo the arbitrary decision to increase my tax responsibility.
How about though, we force municipalities and departments of revenues to actually examine the assessment, reassessments, and economic impact? The idea that my home, the land it sits on, an the unconscious value associated with it is worth 40 percent more to other homebuyers is absolutely laughable
Very shortly ,my town will have population 0 with the only commercial land being the giant paper factory owned by a chinese paper congolomerate with a stranglehold over shipping products.
They also cause problems like this because their goal is the appreciation of the assets, not necessarily to live in houses.
Now you'd have to cobble together a group of investors, but if you can't find people who don't understand your vision, you're out of luck.
Or you could go to a bank, so now the banks have more power, but they probably won't invest in your risky idea anyway.
Okay so I guess, now it's up to the government to undertake this large risky project? Great.
I don't know, I like the fact that motivated individuals can take a large amount of their own capital and take on large projects.
2016 Study: A study published in the Journal of the American Medical Association (JAMA) estimated that approximately 133,000 deaths in the US annually are attributable to poverty. 2019 Study: A report by the National Academies of Sciences, Engineering, and Medicine suggested that around 300,000 deaths could be linked to social factors like poverty and lack of access to healthcare. 2020 Report: The Kaiser Family Foundation estimated that roughly 136,000 deaths in 2018 were associated with poverty-related factors like lack of access to healthcare and healthy food.
Your "please think of the rich guys" argument holds no sway with me.
For example, take Jeff Bezos. His income isn't all that much, so you'd probably want to tax his wealth. Luckily, most of his wealth is from a public company, so we can skip the difficulty of valuing it (something a lot of other billionaires would have to deal with).
But now how do you collect the tax? Do you make him sell 95% of his shares of Amazon? That would certainly tank the stock, and then you would owe him a big refund for overtaxing him.
Or does the government just take his Amazon shares? So now the government would be the biggest shareholder of Amazon. Is that good? What does the government do with that stock? Does it start giving shares to government workers instead of paychecks? Does it pay off its debts with Amazon stock? Would the government's vendors even take that as payment?
I agree that wealth inequality is a problem, and we need to do something about it. I'm not exactly sure what or how though.
Apropos of anything else, the IRS bases things on the calendar year, and then gives you to April to "settle up". It wouldn't owe him a refund in this situation, then, but his next year tax bill might be lower.
I was assuming such a law would have to have a provision for that.
If you get assessed at 100 billion, start selling off the assets and when you get to 50 billion you have nothing left because of the loss of value, you’d still owe 45 billion? That wouldn’t be fair at all.
Why? Wealth isn't zero-sum. Most of the American super-wealthy got that way by providing value to others. I'd argue that the bigger problem to societal stability is jealousy and envy, and the idea that rich people got that way by taking from the poor.
The hugely inflated net worth numbers of the likes of Bezos and Musk are fake anyway, in the sense that their assets could not be converted to that amount of dollars; and the Fed should take a large share of the blame here, because ZIRP made it so that investors could only really put their money in growth tech companies.
The super-wealthy don't get that way by providing value, they get that way by keeping as much profit from business for themselves and leveraging that money to amass more ways to make money, rinse and repeat. When you look at some of the super-wealthy what you'll find is a pattern of consolidation, wage suppression, bending public policy to benefit themselves, and consumption of public resources.
Consider Walmart. Walmart stores drove small businesses out of towns across the country. The wages paid by Walmart are typically lower than the small businesses they killed. Walmart seeks tax benefits for plopping a store in an area, so doesn't return the same kind of money to the public coffers that the collective small businesses did and the jobs offered are worse and they're harder on suppliers than the small business because of the predatory way Walmart works with suppliers.
Walmart workers are some of the largest consumers of Medicare and SNAP benefits -- because they don't pay enough for people to live on. So the public foots the bill for the difference.
What the American super-wealthy have provided, more often than not, is convenience and temporary lower prices -- not quite the same thing as value. It's easier to do all your shopping at Walmart. It's easier to shop with Amazon. They're cheaper until they've sufficiently snuffed out competition.
Source ? Wealth can and is in many case a zero sum game.
> Most of the American super-wealthy got that way by providing value to others.
Source ? Making money and providing value are not the same thing.
> I'd argue that the bigger problem to societal stability is jealousy and envy
Sure let's not address the problem but instead focusing on the emotion of the people affected. Jealousy and envy are human emotions. They are only a problem for society who fail to adequately provide for their citizen.
> the idea that rich people got that way by taking from the poor.
Every time a someone doesn't pay the adequate amount of taxe, or a company loobies for certain privilege. Where do you think that money come from ?
Yes, there are many rich people who are rich directly or indirectly thanks to wealth redistribution: the state is very powerful in taking wealth using force (violence) from the poor and giving it to some wealth people.
But the natural course of how people become wealth is by generating wealth in a way that is positive for everyone!
There's nothing wrong with being wealthy. Poverty is a real problem, and the states are partly responsible for driving people to misery through wars, and the evils of forcing their own fiat currency with inflation and taxation.
Or when netflix raises it's price, they definitely have way more content and more reliable distribution right?
Tell me again how a company making more profit while everyone else suffers is magically not zero sum
None of the top 10 richest Americans got to that place via inheritance. Of the next 10, there are heirs of the Walton, Koch, and Mars families, none of whose source of wealth goes back more than two generations. Contrast that to the egalitarian, redistributive European system which allowed the richest families in Florence 700 years ago to still remain the richest families today.
Pure Ad Hominem. What is the implication here? You think people are faking their (right or wrong) arguments to cover up jealousy? You think it's not possible to be wronged and envious at the same time? It's not an argument.
Of course it is. We live on a planet with finite resources; everything here is zero-sum. I don't buy the myth that we can create value from nothing. Some people are just better at socializing their harmful byproducts.
Previously we had some lumber worth $10 and now we have a chair worth $250 dollars.
Where did the $240 dollars come from? Was it stolen from somebody else?
All of those factors have hidden externalities baked into them that erode the net value you're creating. My argument is that it's all just a shell game where we're passing costs down the line to future generations while telling ourselves we're creating something valuable from nothing because it's what we need to do to sleep at night. We just don't perceive the longer-term externalities in a lot of cases.
But let's just say that you priced all of the externalities perfectly. In this hypothetical example, can you really make an argument that all of that adds up to more than, say, 100 dollars?
And if you can't, then you still have a lot of "value" to account for.
In an oversimplification, when Peter decides to do business with Paul and Paul is interested in taking his business it's because both believe they'll be better off after that.
Now you could [prematurely] argue that there might be externalities and so on, but you must recognize that that action of trading in itself can be seen as something that is going to increase the overall wealth of both as they'll be more satisfied after the fact (assuming everything goes well).
This isn't even true at a cosmic scale, let alone in human scales. Planet Earth receives exogenous energy from the sun.
You want an example of creating value from nothing? Say your choice this evening was to sit on the couch and do nothing versus charge your neighbor $20 to clean up his yard of fallen leaves. By choosing the latter, you have created $20 of value for your neighbor where none existed before.
> Some people are just better at socializing their harmful byproducts.
This is trivially true, but you make the great leap of equating all wealth creation to an arbitrage in externalities.
I do indeed. I think on a long-enough timeframe, all human activity is just externality arbitrage.
Why would it tank the stock if the ownership of those shares was transferred from Bezos to a social wealth fund?
Stocks always drop when the biggest holder sells for any reason. People don’t understand the nuance they just see the headline.
When the CEO of Netflix had to sell because his options expired, the stock still dropped because the headline said he sold.
that's were the solutions need to be implemented
but I find it impossible to have good conversations about this. the last time I was able to discuss this I ended up concluding that somehow euler's constant is basically the same as the gravitational constant but people tell me I'm misscalibrated, so my only retort is I'm mister calibrated....
Shares are not money, shares are a percentage you own of a company, that's it. It's when you sell said shares and turn it into money that it becomes taxable. It's not rocket science. If you hold the shares forever, that's fine. But as soon as your future son sells them, they get taxed.
I really don't know why everyone always says stuff like that, it's really not a difficult concept. Money is money, stuff that is not money is obviously not money. A house worth 1 million is not equal to 1 million until someone gives you 1 million for it. Before that it's just a pile of wood.
Now this would promote not selling shares, but maybe transferring them. Okay you can't transfer shares.
We just don't try, there is no attempt at anything. If we wanted too, we could.
I am not saying we'll get everything, but even 1% more of what we get right now is worth probably the same tax we collect from all of the poorer tax payers.
I personally don't think we should tax income, I am a proponent of a higher sales tax and zero income tax personally. I think that's easier. You want to buy a jet? Ya you're paying 40% tax, but you get to keep all of your millions.
For example, I was listening to a discussion on how Bill Gate's philanthropic organization causes many problems. They've basically taken over the field of malaria research by virtue of spending a ridiculous amount of money, and Gate's personal influence has limited the directions of that research. There are people in Africa that are trying to tell the Gates foundation to leave because their solutions are poorly suited to the on the ground situation, but the neo-colonial nature of this organization means you have many "smart" people in Washington and Geneva dictating how the global poor should run things. The influence of the organization has on public education apparently been disastrous, with the charity reorganizing public schools in ways that are unproven and harmful to students. The foundation is a revolving door for corporate actors like pharmaceutical employees, and they take and use public tax dollars in ways that are unaccountable to the public. All of this is because one man has more money than god. It's anti-democratic and ineffective.
If Bill Gates wasn't allowed to have so much money, I assume the government would have taken it at truly confiscatory tax rates. Then you have the same problem of meddlesome "aid" to Africa, except that the entity writing the check would be the US government, not Bill Gates.
A democratically accountable entity is very much preferable.
I think your perspective on capitalism is grossly unfair.
And who is the arbiter?
The dictation of what should or shouldnt be is power.
Now, exactly where you draw the line between "rich people earned every penny on their own" and "rich people did nothing and deserve nothing", well, that's politics, along with "who is rich and who is not" and "why do we trust these government chaps to use that money to improve society?".
Before widespread public education, large companies would sponsor the education of the engineers they needed (think locomotives), with contractual obligations to work for the organization for a certain time or repay the cost of education. This is how military college works today, and seems pretty high-functioning.
> exactly where you draw the line
Pretty easy, once you've paid for all the stuff you directly use, the rest is yours free and clear.
a member of the same democratic society
I don't see a moral justification in the use of force to shackle the capable and the fortunate, forcing them to toil in maintenance of the incapable and the unfortunate. The ideal I'm describing was more or less the case in the US before United States v. Butler (1936), which changed the interpretation of the general welfare clause of the constitution.
What you get with this kind of system is powerful people meddling with the government to reinforce their power using anti-democratic means. A plutocracy. You also have to contend with the toxic economics of monopoly.
I bet you want unregulated utilities too because you a) don't understand macroeconomics and b) subscribe to anti-social and psychopathic economic theories.
This was successful for centuries, but the constitutional protections of this order eventually eroded. Were they stronger and more explicit (say there was no general welfare clause), we could well be living in such a liberal order today.
As the other commenter alluded to, the solution to this is to limit the power of the government so that even if they meddle and gain influence, the harm they can do is limited because the government itself isn't allowed to do whatever it is the plutocrats want to do.
1) government was instrumental in the creation of this wealth: you needed the legal system to enforce contracts, the common language taught in schools to communicate with employees, suppliers and consumers, regulators to make sure your suppliers were giving you legit stuff, roads for transport, postal service, etc
2) governement is instrumental in helping you keep this wealth: police forces, general property law enforcement.
edit: if you're very cynical, you can argue that high income tax + welfare is still cheaper than suppressing a violent revolution by poor people.
I take from you what ever I need to ensure those conditions persist.
You are nothing. You are a cog. I am the government, representative of the majority here, not the few lucky ones who won the lottery (that I created.)
Good for those who were smart & lucky enough to have taken advantage of this revolution.
But there was definitely some unhealthy excess & wealth gathering that's gotten very extreme & we can consider if we find this healthy and benificial for society as a whole.
Most of the companies at this size use a bunch of anti-competitive practices. See the wikipedia list of anti-competitive practices here: https://en.wikipedia.org/wiki/Anti-competitive_practices
So something like microsoft trying to get people to use microsoft-teams and nagging people to set up onedrive for malware protection, is a clear example of market-distortion through anti-competitive practices.
Given that no one gets to be a company this size by playing "fair" then it seems perfectly "fair" to lay claim to that that excess wealth. We assume almost all profit was gathered anti-competitively since in a "fair" market competition forces you to lower your price to the bare minimum.
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I mean that's mostly bullshit for a lot of reasons, but it seems to me like just as valid a take as the atlas-shrugged "it's my money, keep your government hands off".
Plenty of companies have accomplished the above while playing fair, simply because of the value their products add to their consumers. And once they have added this value, how much they nag you doesn't matter. If you didn't like it, you'd go back to DOS and IRC. The fact that you don't demonstrates my point.
>you've already added tremendous value.
Or you've just filled a niche that already exists in the world, and that could have been filled by someone better, but you're more connected or more ruthless. See also "Multiple discovery" https://en.wikipedia.org/wiki/Multiple_discovery as compared to the "heroic theory" of invention and discovery.
You're not special, sure you might have invented whatever 20 years before someone else, but most great discoveries of big shifts would have been done by someone.
I guess my question is, what if the thing you invented was a better more addictive casino? Sure, you're preying on psychological weaknesses and misleading people, but you're still making money.
Most business lie somewhere in between "more addictive casino" and "genuinely add value to the world". I'd argue the difference between them is where almost all of the profit comes from for most companies.
> but you're more connected or more ruthless
This stuff still counts though. Those are just as valid differentiators in a competitive ecosystem as any others. In fact I'd argue you can't separate them from "merit".
> You're not special, sure you might have invented whatever 20 years before someone else
This seems almost a contradiction in terms. The fact that you got somewhere 20 years before anyone else surely entitles you to the fruits of your success. Or rather, it entitles you more than any other person - what is the basis for your moral claim on the success of another?
> what if the thing you invented was a better more addictive casino?
That still counts. If you agree that we are fundamentally decision-making agents, then it doesn't matter what motivates our decisions. Who are you to decide that a better casino has less merit than a better space ship? What criteria do you use to differentiate "genuine value" from "value"? Why are you so sure these criteria are somehow universal?
Ethics isn't a solved problem, but capitalism definitely isn't an ethics system.
The whole point I'm making is that there is no such thing. People disagree axiomatically. There is no oracle. Ethics isn't just unsolved, it's unsolvable. The closest thing to a universalizable value we have is consent. You say that it's not an ethical system, but you don't say why exactly, and you don't point to an alternative "ethical" system.
> Your logic allows for desperate people to sign themselves into slavery
Not necessarily, it depends on the kinds of contracts that are legally enforceable. I favour monetary penalties only, protected by bankruptcy. The ethics are complicated, but it boils down to how much "present you" is entitled to impose on "future you". In either case, you've not elaborated why exactly that would be "wrong".
> capitalism definitely isn't an ethics system
I agree. Capitalism is a description of the emergent properties of a liberal order. It happens when free people are allowed to interact consensually and resolve disputes via due process. Winners win and losers lose. It's you who is asserting that these emergent properties, which are common to all ecosystems, and totally inescapable wherever living organisms interact, are somehow "wrong".
Who are you to decide how capitalism works? Sure, people disagree axiomatically, but instead of basing everything off a best-effort preference-utilitarianism you've decided to base it off of consent, without accounting for how reality, and especially capitalism, are inherently coercive. Why does consent matter if you can coerse someone into giving it?
Consider a random thing that you are grateful for, trace down who actually made it possible for you to enjoy, and then consider whether those persons all get equal gratitude.
There are lots of stats that disagree. The overwhelming majority of fortunes are made and squandered within three generations. Raising capable people in an environment of extreme wealth is very hard.
Most famous fortunes are self-made, in the sense that turning a few 100k into billions is something that clearly takes a lot of merit to accomplish. I would also argue that morally, your good fortune in domestic environment (which is the main predictor of economic outcomes) is entirely your own. I don't see a moral claim by a third party over my upbringing as any more valid than a claim over my organs.
people keep saying this but I can't find a rigrous source when I google it, it's always just LinkedIn puff pieces or Quora... would you have a link to the original by any chance?