[zozbot234]

Wealth taxes are actually bad for society, and especially bad for altruistic people who care about the less fortunate. A wealth tax is a tax on capital, period - and making capital more expensive hurts everyone, but it hugely hurts those who need capital the most. If you care about lowering inequality without hurting folks more than you have to, what you want is a mildly-progressive consumption tax. (I.e. an income tax which exempts most savings and investments from counting as income.)

(Oh, and perhaps get rid of assorted insanity such as Prop 13 in CA, so that the real estate market can become functional, and those who own lots of expensive real estate pay their fair share.)

[claudeganon]

> Wealth taxes are actually bad for society, and especially bad for altruistic people who care about the less fortunate.

Maybe instead of depending on the sporadic largesse of billionaires and all the awful political and economic consequences that come along with that kind of wealth concentration, we can have a functioning safety net, like the rest of the developed world.

[zozbot234]

You can have a functioning safety net and pay for it via a progressive consumption tax. That's actually what most Western countries outside of the U.S. seem to do, broadly speaking. Some countries even tried out a wealth tax, like France - they had to reverse it real quick because the unintended effects were so dismal.

[dlp211]

France/EU is not the United States. There are structural reasons that make a wealth tax virtually impossible to implement in the EU, but aren't present in the US.

[rayiner]

Like?

[dlp211]

That if you lived in France and were subject to the wealth tax, you could simply leave France and no longer be subject to the wealth tax.

[rayiner]

You can easily do this in the U.S. (See, e.g., the wave of corporate inversions that caused U.S. companies to re-incorporate in Canada and the U.K., which often required executive teams to move to those countries.)

The Canadian corporate tax rate is just 15%, and even Trudeau is pursuing aggressive neo-liberal policies. Canada would happily take our billionaires. (So would other English-speaking countries. Ireland, the U.K., and Canada have been the destination for dozens of corporate inversions over the last couple of decades.)

The U.S. is already the least economically free country in the Anglosphere: https://www.heritage.org/index/ranking. Do we really need to test how much we can squander our prosperity by being to the left of countries like France? https://www.dissentmagazine.org/article/emmanuel-macron-cont...

Especially when it's unnecessary? Elizabeth Warren's wealth tax, even on paper, will raise a fraction of the revenue that a VAT would. (Which Ireland, Canada, New Zealand, the U.K., and Australia all have, unlike the wealth tax.)

[zzzcpan]

> A wealth tax is a tax on capital, period - and making capital more expensive hurts everyone, but it hugely hurts those who need capital the most.

This is some weird ideological bullshit. There is plenty of evidence that capital hurts markets and therefore society with those lacking capital ending up competitive and beneficial for society providing cheap high quality products and services, and those influenced by capital ending up monopolistic rent seeking monsters used against society to protect wealth.

[epistasis]

> A wealth tax is a tax on capital, period - and making capital more expensive hurts everyone, but it hugely hurts those who need capital the most.

This doesn't really follow at all, and is directly in contradiction with your desire to get rid of Prop 13. Property taxes are the most common wealth tax!

[zozbot234]

Wrong. Property taxes mostly bear on land, not capital. Especially in heavily urbanized areas with lots of land value, as we see in CA. Landed property is not "wealth", it's just undue appropriation of something that is created by the community. Land taxes reverse this undue appropriation and let the community that actually created that wealth benefit from it, as it should. It's like the opposite of a wealth tax!

[maxerickson]

I mean, lots of billionaires also essentially got lucky.

DOS and Windows weren't the most glorious software to ever stalk the Earth, they were the operating systems that happened to get popular on cheap hardware. Arguing that Bill Gates created all that wealth that comes with the network effect inherent in software and a homeowner is unduly appropriating community value is really something or other.

[perl4ever]

Some nobody told Gates exactly how to get rich with computers. I read it (the specific advice) in an old issue of Dr. Dobbs Journal of Computer Calisthenics and Orthodontia. The key is that out of millions of people saying millions of things, Gates was the one to pick up on the important one.

So, sure, he was lucky in a way, to be around and read it, but it seems unfair to say he merely appropriated value that belonged to everyone. The advice was worthless to the person giving it away, and everyone else.

[maxerickson]

That Gates is the one that succeeded is not evidence that no one else followed the advice.

I mean, there is actual historical evidence of other cheap operating systems for cheap computers and so on.

[cartoonworld]

Well said. The taxes on the value created by the labor of those involved in the production and consumption of the product of said labor(s) is indeed a fair and just re-appropriation.

Likewise, the results of hoarding the vast wealth in the forms of property, land, legal entities that operate and depend on these same communities which generated them is damagingly extractive.

We should, too, somewhat reverse the hoarding of vast wealth and let our communities reap some benefit from the treasures they are capable of producing.

[6gvONxR4sf7o]

Capital being slightly more expensive for individuals worth $50M or more, is a far cry from "capital is more expensive." Capital being cheaper for the 99.9% of people at the bottom than it is for the 0.01% at the top actually seems like a good thing.

[jogjayr]

> Wealth taxes are actually bad for society

> get rid of assorted insanity such as Prop 13 in CA

Aren't these slightly contradictory views?

Property tax is a form of wealth tax (in that it's a tax on assets rather than income) and Prop 13 puts a cap on it.

[tfehring]

Government spending in capitalist countries creates returns to capital. Financing that spending almost entirely through taxes on labor, as the US does today, means that government spending is (in part) a direct transfer from labor to capital.

Also, capital is not a scarce resource in the US today. For firms that would be worth investing in but don't have access to capital on reasonable terms, the reason for their lack of access is a combination of incentive problems and inefficiency on the part of e.g. VC firms, not because the capital isn't out there. It's true that a wealth tax would increase the cost of equity, but the Finance 101 strategy of "only initiate a project if the IRR of the expected cashflows is greater than the cost of equity" isn't really meaningful for startups since the future cashflows are so uncertain.

If by "those who need capital the most" you mean charities and not startups, a wealth tax would just incentivize giving more to charities and doing it sooner.

[zozbot234]

> Government spending in capitalist countries creates returns to capital.

Mostly, it doesn't. It boosts the value of specific, scarce assets. The increase in e.g. land values that's directly attributable to government spending is a lot more tangible than any fuzzy effect on rates of return for capital. This makes most government spending basically a transfer from the productive (labor and capital) to the rent-seekers, but that has nothing to do with capital per se.

> isn't really meaningful for startups since the future cashflows are so uncertain.

Uncertain cashflows make the effect more meaningful, not less. Few investors will be well-positioned to fund a firm with hard-to-assess future cashflow, so capital is meaningfully scarce for those firms.

[rayiner]

> Government spending in capitalist countries creates returns to capital. Financing that spending almost entirely through taxes on labor, as the US does today, means that government spending is (in part) a direct transfer from labor to capital.

You’re engaging in a slight of hand. Leaving aside capital gains taxes, returns on capital are taxed as income when companies pay dividends. So the income tax covers both returns to labor and returns to capital.

[whateveracct]

I'm impressed HN is downvoting this brutal capitalist nonsense, give what this forum is all about :)

[epistasis]

There's brutal capitalists that want to maintain the current set of winners and losers, there's brutal capitalists that want to become the kings of the hill, and then there are those who want to enable creativity throughout society and enable all those with a vision for a better future to have the tools to make it happen.

I think HN has almost zero of the first category, and some mixture of categories two and three.