[randyrand]

Yet many want to 'solve' the problem of the 0.1% being so wealthy and as a result let the government do most of the charity work instead. I think this would be a huge mistake. The mega wealthy donate a larger percent of their income than any other income group (which makes complete sense). We would be losing a ton of donation money.

Yes this is a tangent. But I think its an important point to make. On top of that, even if it were true that most of the 0.1% are very wasteful spenders, there are some who's donations are irreplaceable with government charity. Irradiating the worlds malaria is an example of this. Getting rid of the wealth in the 0.1% would be a huge loss for important donations.

[JumpCrisscross]

There's a difference between someone who went from upper middle class to billionaire, like Gates, and someone who inherited most of their wealth, like other people. I don't think lumping them together into a monolithic N% is productive for purposes of discussing policy.

[olewhalehunter]

Bill Gates was not upper "middle class", his household was solidly in the 1%, he had computer programming access at his private school (this is 1968), and his mother's friendship with the president of IBM at the time was the reason he got contracted to write DOS.

https://en.wikipedia.org/wiki/Mary_Maxwell_Gates#Career

[dragonwriter]

> Bill Gates was not upper "middle class", his household was in the 1%

Seems to have been a successful petit bourgeoisie, or upper middle class, family. In traditional understanding of class relationships in capitalist society, the middle class isn't mostly middle income but well above; the majority of society is the working class dependent on wage-labor. The upper (capitalist or haut borgeoisie) class is a very thin layer.

The modern American media generally uses a different model which where “class” would more accurately be called “income group”, rather than focussing on relation to the economic system; this gets confusing in conversation when people could be using either model. In that model, Gates family was clearly upper class.

[olewhalehunter]

That archaic nobility distinction is useless to the conversation, especially when the most powerful men in the world we're discussing about have the background I'm talking about.

https://www.dailysabah.com/columns/taha-meli-arvas/2017/05/0...

[dragonwriter]

> That archaic nobility distinction is useless to the conversation,

It's not a mobility distinction,it's the classical distinction of classes in the capitalist economy (the bourgeoisie is a class in the preceding feudal economy, but there the whole bourgeoisie is the middle class, and the upper class is the nobility, not the haut bourgeoisie.)

[Jaruzel]

Sorry to nit-pick, but I didn't know the exact definition of 'petit bourgeoisie' and Google says it's actually lower middle class:

https://www.google.co.uk/search?q=petit+bourgeoisie&oq=petit...

[mborch]

It most certainly isn't. The Wikipedia article has an accurate description. Google pulls a wrong definition for some reason.

[rusk]

The petite bourgeoisie is economically distinct from the proletariat and the lumpenproletariat social-class strata who rely entirely on the sale of their labor-power for survival; and also are distinct from the capitalist class haute bourgeoisie (high bourgeoisie) who own the means of production, and thus can buy the labor-power of the proletariat and lumpenproletariat to work the means of production. Though the petite bourgeoisie can buy the labor of others, they typically work alongside their employees, unlike the haute bourgeoisie.

I think "lower middle-class" is a reasonable apropos of this. That said, I don't think the Gateses would fit this definition either ...

[undersuit]

I've heard the same confused argument in the barrage of anti-Zuckerberg comments that came out after the most recent "Will Zuckerberg run for president?" articles. Gates and Zuckerberg lived in wealthy households with parents who worked. They may have been 1% in income, but their riches now place them so much higher on the income scale it's ludricrous to try and compare their incomes to their parents. To attack their childhood as privileged discounts all the other people who were less well off during childhood who had made similar gains in wealth and perpetuates a very limited argument that all the 1% are bad. Essentially Bill Gates and Mark Zuckerberg as children were closer to the rest of the nation financially then they are now. You want to attack the privileged; wait until their children start doing things.

[randyrand]

88% of the very wealthy ($30+ million) in the USA made their wealth themselves.

https://www.forbes.com/sites/niallmccarthy/2016/10/10/where-...

[nebabyte]

> Yet many want to 'solve' the problem of the 0.1% being so wealthy and as a result let the government do most of the charity work instead. I think this would be a huge mistake.

...You don't see the problem in relying on the charatibility of a tiny few to work towards the well-being of billions?

[Retric]

I don't want to 'take it back.' But, I feel donations should not be tax deductible. Why should I subsidize anything someone feels is worth donating for?

[randyrand]

I edited my comment. By take back I did not mean the current wealth from of the current generation of wealthy. But take-back over generations using very large marginal tax rates. E.g. 'solve' the problem of the 0.1% being so rich.

[Retric]

Confiscating wealth is counter productive. But, so is a large group with unearned wealth where nobody they know actually earned anything.

IMO, the balance point is setting things up so the default is wealth is not maintained across several generations (3+), even though it can be passed down 1 or 2 generations and can be maintained with care past that point.

PS: I say this with many wealthy friends and family. It's surprisingly destructive and I don't want to setup multi generational wealth for my great grand children.

[tankerdude]

The sad part is that that's what is happening in the world today. The rich, when they fund their money correctly, stay rich due to tax policy, gray areas, and loopholes. (Insurance polices as one example for the ultra rich.)

If we don't tax people when they pass away, the money goes straight to their kids, and then a permanent upper class forms and we know what happened to France...

The US has been about meritocracy, and not an aristocracy. But people want to change that, to the detriment of the country, IMO.

[randyrand]

When I said "But take-back over generations" I was not referring to an inheritance tax. I was referring to preventing new people from becoming as wealthy as today's wealthy by changing to a very large marginal income tax rate. It would be clearer if I said "widdle down the size of wealthy class over time". By far most of the wealthy today are new money, so an inheritance tax would do little in that regard anyway.

But back to inheritance:

> not maintained across several generations (3+)

You're inventing problems. Inheritance decreases exponentially. Multi 3+ generational wealth is already divided by 64 times (assuming 2 children + spouses). It is not possible without the children putting in significant work themselves. You're inventing problems.

At least we have common ground. Being able to pass on our successes to our children is a large and important motivator in life - one that would be incredibly unwise to remove.

[Retric]

You assume the spouse is not wealthy. Wealthy spouse turns 1:2 into 2:2 which is stable. Interest can also slow for the occasional al 2:3+ growth. Europe has family's that have maintained wealth over the past 500+ years.

"That’s according to a recent study by two Italian economists, Guglielmo Barone and Sauro Mocetti, who compared Florentine taxpayers way back in 1427 to those in 2011. Comparing the family wealth to those with the same surname today, they suggest the richest families in Florence 600 years ago remain the same now."

England has also had wealth maintained for 28 generations and other old money examples are not hard to find.

[randyrand]

> That’s according to a recent study by two Italian economists, Guglielmo Barone and Sauro Mocetti, who compared Florentine taxpayers way back in 1427 to those in 2011. Comparing the family wealth to those with the same surname today, they suggest the richest families in Florence 600 years ago remain the same now.

I recall that study. They were still a multiple orders of magnitudes less wealthy, and that ignores any wealth/money/work children added themselves since that time. If anything, this study proves my point.

>Europe has family's that have maintained wealth over the past 500+ years.

>England has also had wealth maintained for 28 generations and other old money examples are not hard to find.

That's an excellent example of survivorship bias. Again also not acknowledging any work the kids have put in to maintain that wealth.

For every example of a rich family whose money has been kept for 3+ generations, I could find you 100 examples that dont (not actually, I should probably be getting back to work).

This is a non-issue.

[pc86]

Well, only certain kinds of donations are tax deductible. You can donate $10,000 to me right now but you're not getting a penny back from the IRS if you do.

The bar to become a charity could be a lot higher but it's not exactly a rubber stamp.

[Retric]

If I pay you 10,000$ you and I pay a tax. But, there is a separate gift tax deduction and small gifts. https://www.irs.gov/businesses/small-businesses-self-employe...

Donations are really a 3 way tax break, I don't pay taxes on the gift, you don't pay taxes on the gift, and I don't pay income taxes on the money I use as a gift. (The arguable forth deduction is I don't need to realize capital gains before giving a gift.)

PS: The only way to actually lower taxes is to lower spending. Anything else is just shifting the burden to someone else.

[adventured]

> Donations are really a 3 way tax break

That doesn't make sense given the sums we're talking about. If I give someone $100 million (non-charitable), I don't have to pay an extra tax on the giving, I only pay taxes on the income. You're referring to a very specific gift tax scenario.

The majority of the Gates Foundation giving is not within the US. The people on the end receiving should not pay taxes on that as it pertains to the US. Further, the Gates Foundation giving within the US will frequently end up taxed after the gift via income taxes on salaries (whether we're talking about scientists, secretaries or in the field workers receiving foundation dollars to operate as part of a charitable organization).

The scope to the triple tax premise is, in reality, dramatically more narrow.

[Retric]

According to the US tax code you really do have to pay millions in taxes on a 100 million dollar gift to someone else. If they are in another country then that country's tax code applies and they might need to pay even more money.

Here is the actual form: https://www.irs.gov/pub/irs-pdf/f709.pdf

19 If line 18 is less than line 17, enter balance due

[RhysU]

How is not taking his money subsidizing him? Tax credits would be subsidizing him.

[Retric]

Tax breaks for specific activities are by dentition a subsidy by lowering costs.

If people with blue eyes suddenly did not have to pay taxes then that would be a massive subsidy. If you get a pay check and the taxes are already taken it it's just as much 'your money' as if you got the full paycheck then had to pay taxes after the fact. The point is more money goes out of your paycheck because the US government subsidizes other and often very rich people.

[rusk]

Sorry for my ignorance but is this merely a technical distinction? I would have thought tax-credits, and non-deduction are effectively equivalent?