[w10-1]

True enough, but it doesn't address the motivation or the issues presented by California's proposed wealth tax.

It's a big democracy red flag when a majority wants to take a lot from a tiny minority; the moral hazard of the unfairness is that it's unclear where this ends. (Saying "one-time" and "1%" are trying to limit that risk)

It's a democracy red flag when an unpopular minority is vilified as the cause of society's problems. It short-circuits real policy making and distracts from real issues.

The bargain of private wealth is that it's better at innovation that should spread widely -- if it's subject to competition and does not export costs.

One problem is that one of the best investments is to change the law to reduce competition, increase market power, and export costs -- i.e., to weaken politics.

Another is that wealth used to mostly invest locally (information and transaction costs), so locals would see some benefit. No longer.

Finally, as an accelerant, enterprises are made of legions of managers and experts, who now compete more than ever; they would lose that competition by supporting less extractive policies or gentler politics.

Net result is that wealth seems not productive but extractive, and there is no negative feedback to reduce that.

Once the grand gambit of goodwill is lost, it cannot be recovered for at least a generation, but there's no real feedback to prevent that. The political viability of something like a wealth tax is just an early indicator.

[mbgerring]

Wealthy people are taking food out of my mouth by driving up asset prices, and deploying capital in ways that will never benefit me, either in employment or in quality of life. The premise of reducing taxes on wealthy people was that everyone would broadly benefit. This has not happened. The contract is broken. I want my money back.

[larme]

> It's a big democracy red flag when a majority wants to take a lot from a tiny minority

It’s not “taking”. The rich give out some money so the society has a higher probability to stay peaceful. or a violent revolution may happen.

This is really a win win situation

[sometimelurker]

> It's a big democracy red flag when a majority wants to take a lot from a tiny minority

not to forget that the inverse is also bad; generally people shouldn't take from each other

[atmavatar]

> It's a big democracy red flag when a majority wants to take a lot from a tiny minority; the moral hazard of the unfairness is that it's unclear where this ends. (Saying "one-time" and "1%" are trying to limit that risk)

In the absence of any other considerations, I'd agree with you. However, the last half-century has seen that same tiny minority taking nearly all productivity gains from the rest, to the point that wealth inequality is greater now than during the first gilded age, so I have somewhat less sympathy for the tiny minority when the rest want to claw some of that back.

> It's a democracy red flag when an unpopular minority is vilified as the cause of society's problems. It short-circuits real policy making and distracts from real issues.

It's less of a red flag when that unpopular minority is the cause of society's problems. The ultra-wealthy have commandeered government to enrich themselves at the expense of the rest of us.

We have massive consolidation of markets and media due to lobbying for deregulation and against enforcing anti-trust laws. We have further wealth concentration, the likes of which exceeds even the first gilded age at the hands of massive tax cuts and loopholes predominantly benefiting only the wealthiest, while also cutting tax enforcement personnel, making it easier to get away with tax evasion. Of course, in the face of the massive budget deficits resulting from those tax cuts, we make cuts to important social programs affecting many (and with largely positive ROI) while protecting subsidies to some of the most profitable businesses on the planet and leaping at any chance to start wars abroad whenever we need to distract from embarrassments at home. We have lax enforcement of labor laws which would allow workers to organize and demand higher wages, while at the same time passing unconstitutional laws at the state level which try to prevent organized labor in the first place. We have not only allowed the federal minimum wage to lag significantly behind inflation, but we have lobbying groups coming out of the woodwork to stop any proposed increase. When we have large economic crises caused by the malfeasance of the wealthiest of the wealthy, our corrupt Congress passes large bail-outs for the culprits while telling the majority of us to suck it up and tighten our belts. Of course, our consolidated media landscape increasingly obfuscates the real problems, presenting alternate boogeymen like immigrants so the downward spiral continues.

Allowing so much wealth to concentrate in the hands of a tiny minority is itself a giant democracy red flag. The US is on the cusp of losing its democracy as a direct result, damaging global security and markets in its death throes. The mere existence of billionaires and their corrupting influence on government is the issue.