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Comment by NitpickLawyer | Hacker News Reader

> Any tax reform that fails to reduce luxury consumption by the rich will completely fail to reduce economic inequality.

This is a weird one. I don't think the problem with rich people is that they consume luxury goods. That's actually a good thing overall. Let them have their megayachts, megacars, golden toilets, etc. Someone has to build those.

I think the problem is when they use their unlimited funds to purchase stuff they shouldn't own. Newspapers, TV stations, social media, etc. That kind of power, often flaunted openly (see the bezos scandal when they literally wrote something along the lines of "if you screw with us we have wapo at our disposal") is not something that should be in the hands of one person. Or a family. That's way way way more dangerous to society than them snorting caviar off of models' bodies, or eat gold leaf you won't believe they're not burgers with truffles on top.

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Bingo. The guy has a lot of things right, but I was floored when I read "progressive consumption tax" coming from an otherwise well written essay. Consumption taxes are regressive, and no amount of progressive lip stick will make them redistribute sufficiently to achieve the effect he wants.

I would say that any tax reform that fails to reduce asset concentration will completely fail to reduce economic inequality. Let Bezos have his newspaper, if that's all he owns. Let him game the system to evade income tax. Fine. The problem is when a very small group of people own all the newspapers plus their original business empires plus their privately owned social media companies, plus their funded PACs, their psyops, etc.

All assets must be taxed directly to such an extent that concentrated assets are redistributed naturally through market forces. Tax wealth, not work.

That isn’t what he is saying. He is saying that tax reform needs to be progressive, meaning it hits rich people more, and it hits them when they spend not when they earn.

A progressive tax will tax them more when they buy luxury items and thus make them buy fewer luxury items.

>tax reform needs to be progressive, meaning it hits rich people more, and it hits them when they spend not when they earn.

This misses the point. It needs to hit them when they own not when they spend.

>A progressive tax will tax them more when they buy luxury items

Which still wont be progressive it's the yield bearing assets Jeff Bezos buys which are the main problem not the fancy candlesticks he decorates his house with.

> meaning it hits rich people more, and it hits them when they spend not when they earn.

The parent of your comment made a pretty good case precisely against this. And it didn't talk about all spending, only about luxury one as exemplified by the following, rather misleading, quote from the OP:

>> Any tax reform that fails to reduce luxury consumption by the rich will completely fail to reduce economic inequality.

This is wrong and pointing it out is good.

It's not a good argument at all. "Earning" is a socially productive activity, far more so than directing resources towards the making of a huge luxury yacht for private consumption (or similar kinds of luxury spending). There really isn't any good argument for taxing earnings or saved/invested assets per se, as opposed to consumption.

I'm not sure megayachts have no economic downside. They create some jobs, certainly, but if the golden goose is catering to the whims of eccentric billionaires, then collectively we're losing smart and talented people who could be building things like better public transportation, or more reliable and sustainable infrastructure.

I don't think the lack of talent is preventing us from having good public transportation. Diverting smart folks from yacht building will not eliminate the problems with unions, zoning, or crime to name a few of the issues. These are difficult problems because people and their different desires are involved.

One city has a millionaire who builds a yacht for 100M dollars in a local shipyard and uses it for holidays. The neighbor city has a millionaire who spends 100M dollars to build 10 ferries he gifts to the city. The general population is clearly better off in the second case, even if it does not matter for the workers in the shipyard.

That seems very lucky of the second city. Let's hope we get lucky with some generous billionaires soon!

I don't claim that regulations are simple, and incentives couldn't be created to result in infrastructure investment by the wealthy... but I won't hold my breath.

Cute gambit to talk about ferries, the one mode of transport that doesn't have insane land-use debates. (Although they do need waterfront property on both ends.) I'll give you a point for that one.

But let's be serious. Ferries have a very limited use in only a few cities. Even then, the appeal is limited because they're relatively slow.

I submit that the most common result of replacing one yacht with $100m of public transit spending is that the unions and the bureaucracy will eat up the $100m in a few minutes.

The theory here is that diverting more smart people into "good" careers like urban planning will be great. But if we look at the last 100 years in the United States, the rise of careers like urban planning have been correlated with an explosion in construction costs.

Yet back in the bad old days when there weren't urban planning degrees and only a few effete twits went to college, private capitalism was able to build two big urban transit systems in NYC. No book smart people. Just sandhogs and profit motive. How much did it cost to add just a few stops to the NYC subway over the last two decades?

Yes, when you don't care about the environment or safety regulations or displacing people poorer than you, infrastructure is a very easy problem to solve. Fortunately for you, we seem to be heading back towards that way of thinking.

Also, I live near a city that had one of those ridiculous, way over budget projects where sure, some money was funneled to unions and bureaucracy or whatever evil monsters you've concocted here. No amount of billionaire pet projects could match the amount of good it did across the number of people it affected. Sometimes the inefficiencies of human cooperation are greased with money, and that's perfectly fine.

Is 75% of the country zoned SFH because of safety regulations or environmental reasons?

I disagree with this. Some of the more extravagant engineering prowess has divested from insane eccentric billionaires

Like the other commenter said the larger issue is the monopolization (see groq x nvidia for a glaring example) and other forms of rent seeking that clamp down on market fairness and efficiency

Mega yachts are not airplanes, computers, software or some other cutting edge or basic research technology. It's a boat that other then adding starlink hasn't meaningfully changed for decades.

Mega yachts are designed using CAD software, the prototypes are milled or even sometimes now 3d printed out of huge foam panel. Advanced hulls are constructed from a number of materials and methods. All of these things required bespoke skilled labor that cannot be replaced with robots or AI.

I think mega yachts are stupid, that doesn't mean they shouldn't exist and to act like they are the same as even 20 years ago is willfully ignorant

It feels like the quality of our eccentric billionaires has gone downhill.

We've all seen the comic where the villian tells Spider-Man "I don't want to cure cancer, I want to turn people into dinosaurs." I would respect that a hell of a lot more than whatever Bezos/Musk/Zuckerberg/etc are doing with their money. Hell, I'd settle for Howard Hughes levels of madness-mixed-with-genius.

Everyone just buys the same Billionaire Starter Pack these days consisting of ugly yachts and mansions, and the obligatory rocket company. The change is just spent on aggressive hoard-management and political machinations. Is their heart even in any of those ventures? When they wake up, so they say "I spent the first 40 years of my life selling my soul so I can do this, and it was so worth it?"

I know if you dropped twelve figures in my lap, I'd be saying things like "who can I hire to help me engineer an army of superintelligent dragon creatures" or "let's level Peoria, Arizona and rebuild it as a car-free zone with the density of midtown Mahnattan", not "let's buy Yahoo, because all the other depressing media outlets are spoken for already."

You're imagining a nonexistent problem.

Luxury yachts and public transit make approximately 0 talent impact on the world.

Building each is an extremely tiny industry.

These are also very average talent required jobs.

And I would wonder if overpriced luxury items in general are detrimental to the economy. It feels to simple me that transacting items with subjective added values above costs shrinks economy a bit.

To me it feels that overpriced items cause less trickle downs if they cost less to make: the delta would go into an oblivion. Trickle downs don't appear to be real, but less than already immeasurable sounds bad.

Why even make a distinction of category spend.

> Someone has to build those.

Well, yes? That means those "someones" are not building something else instead.

Yes, sometimes that's indeed an opportunity cost. But it's also a catalyst for making things possible or affordable that otherwise wouldn't be.

Many technological progress are first explored in niche and luxury segments and only later fully developed for the masses with mass utility. Space exploration, motor racing sports, military, .... they all can seem like wasteful enterprises and yet a lot of new technologies come from these areas

The whole idea is to make the rich people poorer, even if just a little.

The money taken from 1000 or 2000 rich people may be used for the rest of the 130000 ones

Do we think news outlets owned by the government or the “warm collective” would be any better at unbiased reporting or not disseminating fake news or unjust influence? Is there any organization or entity structure today that is trustworthy enough to even handle those sorts of organizations. It appears fraud is rampant in our government, so why trust them any more than some random dude? Frankly it seems the odds might be better with one random guy not being on the take.

I think the odds are better if it's not a random guy who also already has a bunch of power (e.g. Bezos with his considerable influence buying up and weaponizing WaPo). I personally think that consolidation of power is a reasonable thing to prevent. I'm not sure how you could block someone like Zuckerberg who started his own new media, other than the government, which as you pointed out has its own issues.

I'll be honest, I'm not an expert on this, and I don't have a perfect solution. I just think we should try to do something, even if it's not perfect.

There are some professions with codes of conduct. Some are internal, some ar legislated (i.e. fiduciary duty for lawyers, financial advisors, etc). We also have some concepts like public utility and public interest. Maybe we should look there (again, ask the experts I'm sure there are people who study this for a living). Maybe slowly bring in duties for "public interest" related fields. Maybe at the management level. Maybe come up with ownership structures that decouple power from financial incentives (a la voting shares vs. normal shares) and impose them for such businesses.

I fully agree with you that gov ownership of media would be a disaster. I'm not proposing that in any way. Just ... better ways to do it than we do today.

Historically news outlet run as public service (with sufficient guardrails for autonomy) such as the BBC, PBS, France Television, Arte (naming only those I know well) have produce much better news coverage than the privately owned ones.

OTOH the concept of independent public institution and general checks and balances seems to have been entirely forgotten, so maybe that's not a solution for 21st century.

An alternative would be communally owned media (50/50 by readership and journalists), with simple direct tax incentive to fund them (equal amounts of $ per person)

Having first hand experience of all of the named public services, I beg to differ heavily. These corporations tend to be heavily left-leaning, with no real guardrails preventing this. The consequence is pretty biased coverage, under the guise of a "trust-us, we are here for the greater good".

Look at the handling of Middle-East by BBC, the Zucman tax at France Television, or the current allegations of fraud in some communities in the US.

My current take is that it is really hard to get a fair unbiased coverage, unless you actually state that you will strive to hire and promote both sides. If these corporations had to publish the composition/promotion/pay of their newsroom across the political spectrum (as they do for example by gender), you may start to have fair unbiased coverage. But many journalists working there see it as their job to describe "not the reality as it happens, but rather as it ought to be" (to quote the CEO of France Television). We should acknowledge that people are biased, and measure the balance of biases rather than assert there is no bias because they serve the greater good.

This is a very funny take since all of these stations are anti-communist. This is inter-right wing sectarianism.

So everyone to the right of tankies gets lumped together as "right wing" in your view of the political spectrum? That's not very helpful.

That's objectively true. They're center-left or center-right. They're certainly not democratic socialists (who are the barest left of the left). The parent is complaining that there is some objectivity at all in liberal/center-right media, that it isn't calling for pure repression by force of middle eastern people and recognizes they sometimes suffer from aggression in ways that are understandable to human beings.

None of these outlets object to this repression being meted out, they only care that it is done in a way that is respectable. A left wing take would criticize the imperialist nature of these wars of aggression and genocide and examine the economic, class, and other social dimensions that cause these events to occur and call for a social revolution via means that are electoral or otherwise. A left-leaning liberal take would say something like "man it's crazy they don't respect the UN charter or even US laws". This should give some objective sense for how rightward our discourse has been drawn.

Public interest stories are left-leaning only in that they tend to oppose the wielders of centralized power, and centralized power is generally a right-leaning construct.

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