[heads]

On the one hand money in an endowment has presumably already been taxed at least once. Taxing it again is double taxation and that’s bad because once you allow money to be taxed twice, you have to be ok with it being taxed many times over — O(1) to O(n) if you will. The moral position of government would be that taxing the outcome of growth and wealth creation is fine, but retaxing existing money is the government breaking its covenant with the people.

On the other hand I would accept the government’s position if it were to say aloud that there goal is for all large pools of money to be reclaimed by society. Double taxing wealth is then ok because it will, eventually, redistribute the wealth. In such a moral code, a $51bn pile of gold is quite an aberration.

It is classic right versus left: natural hierarchy versus we’re all the same.

[altcognito]

You don’t tax the money twice, you’re taxing the earnings.

[heads]

Thanks, that’s an important detail. I guess it boils down to how much private wealth is too much, and what if anything should we do about it?

An argument on Harvard’s side is that, in the grander scheme of things, they are part of a process that generates phenomenal tax revenue. The state takes their 40% cut off the top of every $150k CS and IB graduate salary after all. Is that a good enough benefit to let us tolerate Harvard’s pile of gold?

There is a related argument that if society is to be the ultimate recipient of the majority of benefits of a university system, then it should probably be state funded. Just like roads (public) trains (ish) electricity (not any more) and food (private but subsidised).

[maxerickson]

Lots of money in the endowment is investment earnings. Have those been taxed? I didn't check, but it seems like that information is important to your argument.

[naijaboiler]

I never buy this tax multiple times argument. My wages (money from labor) are taxed multiple times. But when it comes to money from capital, i start hearing this argument about double taxation being bad. What???