[rayiner]

Unrealized wealth is just a number on a ledger. To actually do anything with the wealth (not just buying yachts or New York investment properties, but paying for lobbyists or campaign contributions) you have to realize those gains.

[pytester]

>Unrealized wealth is just a number on a ledger.

Be serious.

[rayiner]

I’m completely serious. Jeff Bezos’s billions mostly just represents the right to receive a share of Amazon’s profits in the future. If AMZN goes up, he gains billions in “wealth.” But to actually have any impact on the external world with that wealth, he has to either receive dividends, which are taxed as income, or realize the gain. Even if he takes a loan with Amazon stock as collateral, at some point he has to realize some gain somewhere to have cash to pay back the loan.

Even to the extent we should care how rich a billionaire gets, surely we only care to the extent they can actually do things with that wealth. Bloomberg has to realize gains to pay for his campaign ads. Bezos has to realize gains to buy WaPo (in his personal capacity). Why on earth should we care about illiquid wealth that can’t be used to do anything?

[xyzzyz]

Why on earth should we care about illiquid wealth that can’t be used to do anything?

You can watch here[1] how Larry Summers asks Emmanuel Saez, the leading proponent of wealth taxes, how liquid wealth gives individuals power in their personal capacity. Given how extremely underwhelming Saez's response is, I can't imagine any of the wealth taxes proponents having a good answer for the illiquid situation.

[1] - https://youtu.be/oUGpjpEGTfE?t=3869