Author Topic: Wealth tax and the future  (Read 14797 times)

talltexan

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Re: Wealth tax and the future
« Reply #200 on: March 04, 2019, 02:25:53 PM »
People often get caught up in stories about dynastic wealth perpetuating itself.

There are rare people who are willing to share stories of when the money runs out. Check out point #7 here:

http://blog.penelopetrunk.com/2012/03/16/8-lessons-about-money-i-learned-from-my-family/

LennStar

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Re: Wealth tax and the future
« Reply #201 on: March 04, 2019, 03:29:39 PM »
Yeah, money running out is normal.
So what?
Thats true for poor people too. Just that they don't have a choice.
And people can only get to the top, if someone from the top comes down. (More or less)

The problem is not people going up or coming down - quite contrary - it is the concentration of money (and power because money = power) that is bad. And the increasing concentration is worse.
This is a problem as old as civilization. Literally the oldest record we have ever found, 4500 year old Babylonian writings, are about debt forgiveness - because wealth had concentrated too much, poor people were sucked into debt and sold themselves into slavery.
That is a constant throughout history. As is debt forgiveness (the christian jubilee year is/was the same).

BicycleB

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Re: Wealth tax and the future
« Reply #202 on: March 04, 2019, 07:25:45 PM »
People often get caught up in stories about dynastic wealth perpetuating itself.

There are rare people who are willing to share stories of when the money runs out. Check out point #7 here:

http://blog.penelopetrunk.com/2012/03/16/8-lessons-about-money-i-learned-from-my-family/

Penelope Trunk is an interesting writer who seems to me like a weird person (yes, pot calling the kettle black. You got me.) That's what I thought from prior encounters with her writing. This link fills in a bit of the story. Curious. Good story though!

GreenEggs

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Re: Wealth tax and the future
« Reply #203 on: March 04, 2019, 09:10:18 PM »
How many mustachians RE and get into politics? 


They'd sure get my attention & likely my vote.

sol

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Re: Wealth tax and the future
« Reply #204 on: March 04, 2019, 09:42:40 PM »
How many mustachians RE and get into politics? 

They'd sure get my attention & likely my vote.

I've thought about it, but honestly it just sounds a lot like work and I already gave that up. 

Why would I go back to sitting in an office all day?  Dealing with other people's problems doesn't sound like my idea of fun.  There would be endless boring meetings, and lots of paperwork.  I hate both of those things, and right now I don't have to do them at all.  Why ruin a good thing?

Positions like my local city council or school board would be approximately as time consuming and stressful as some of my other volunteer gigs, though, so in theory I could drop out of something to make time in my retirement schedule for local politics, if I ever got motivated enough.

But honestly, if I can't even be bothered to start a blog of my own, I certainly can't be bothered to run for office.  I'm retired, man.  I suspect other retirees have similar attitudes, which is probably why you don't see any retirees entering politics.  There's a real mental transition that happens, where you breathe deeply and let all of your career's worth of pent up frustration and stress just bleed out of you, draining away all of your remaining fucks to give.  Once they're gone, the idea of gathering them back up and stuffing them back inside of you just seems ridiculous. 

BicycleB

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Re: Wealth tax and the future
« Reply #205 on: March 04, 2019, 10:24:54 PM »
How many mustachians RE and get into politics? 


They'd sure get my attention & likely my vote.

One of @Malaysia41's main activities in FIRE has been political activism. She wrote a book on her politics. Then she raised money to fund a "People's Lobbyist." Who then suggested someone with a little time should join the lobbyist in person, in DC, to lobby Congress. So she just got back from a 3 week lobbying trip.

Her journal title below came from a time when she cared about politics but struggled about arguing with family members. Over time, she found a more pleasant groove.
https://forum.mrmoneymustache.com/journals/fair-verona-where-m41-attempts-escape-from-us-politics/msg2205259/#msg2205259

So the number is at least 1!

PS. I support her energy, even if I don't follow the same exact politics myself. She shows it can be done.
« Last Edit: March 04, 2019, 10:28:22 PM by BicycleB »

Malaysia41

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Re: Wealth tax and the future
« Reply #206 on: March 05, 2019, 03:02:59 AM »
How many mustachians RE and get into politics? 


They'd sure get my attention & likely my vote.

One of @Malaysia41's main activities in FIRE has been political activism. She wrote a book on her politics. Then she raised money to fund a "People's Lobbyist." Who then suggested someone with a little time should join the lobbyist in person, in DC, to lobby Congress. So she just got back from a 3 week lobbying trip.

Her journal title below came from a time when she cared about politics but struggled about arguing with family members. Over time, she found a more pleasant groove.
https://forum.mrmoneymustache.com/journals/fair-verona-where-m41-attempts-escape-from-us-politics/msg2205259/#msg2205259

So the number is at least 1!

PS. I support her energy, even if I don't follow the same exact politics myself. She shows it can be done.

Hey BB. Just saw your shout out.

Regarding lobbying in particular: During my 3 weeks meeting with ~30 reps on the hill, I realized that really anyone can lobby congress. Staffers of our reps are all quite accessible (well, to varying degrees). For example, I booked 30 min with Bernie Sander's staffers no problem. All a person needs to lobby congress is time, and a place to stay.

Well, time, a place to stay, and the ability to research, actively listen, craft persuasive arguments, and know who to target on the hill and how to entice those key players into meeting with you.

I have time, being FIREd n all.

I have a place to stay, as couchsurfing.org continually serves up amazing hosts.  My DC couchsurfing hosts were all stellar.

I can research.

I wrote a book that's pretty much all about actively listening (shameless plug); of course putting this skill back into practice took a few meetings before I hit my stride again.

With the organization lobbyists4good.org, I found a collaborator in that site's founder. We honed our pitch, and determined who to target on the hill. Part of the plan all along was to hire a lobbyists - but that proved hard at the beginning as so many of them represent mega agricultural corps. In the end, we at last hired a lobbyist with our crowdsourced funds. This lobbyists has deep history in ag committees and policy making, and with our help, he will shepherd our proposal into law (hopefully).  https://www.lobbyists4good.org/animal-ag-subsidies

For me, I need a project.  I'm 46, and passively absorbing life wears thin after just a few days. Make no mistake, I can relax and slack off like the best of them. But at some point I need something I'm creating. So I wrote a book. Then I got political. This DC lobby campaign was my latest project.  I see it as the training wheels phase of more lobbying to come.

That 3 weeks in DC confirmed in no uncertain terms the old adage, 'IF YOU'RE NOT AT THE TABLE, YOU'RE ON THE MENU'.

Just look at where we are with the environment and with the rise of CAFOs. As @sol mentioned in an earlier post here - unregulated capitalism can be counted on to exploit our shared resources. This includes the animals we raise for food. Did you know the biomass of global livestock is ~3x that of humans? You think we have an overpopulation problem? We're feeding half the food we grow to our livestock. Try multiplying our overpopulation problem by 4.  It's all connected. And yet, at our national gov't level, fixing problems associated with animal agriculture are afterthoughts at best. So, I thought I'd go have a chat. And I had 30 of them - to various degrees of success as far as I can tell. But the staffers/reps all thought on the topic for 15-30 min. All of them. dems and reps alike.

As far as I'm concerned, it's time we citizens take a seat at the table and demand those shared resources be valued properly and protected. 
We've allowed big ginormo corps and super wealthy people to occupy those seats for far too long. And now we're at a point where somehow, 'money = speech', monopolies that prey on a captured market are just fine, and unlimited $ in our political campaign election system is the norm.  It's a shit system. But it's the system we've got. In order to change it, we've got to take part in it, and steer back toward the basic principles we all learned in high school civics.  Mr. Firebaugh would be horrified if he was alive to see what our system has become. 

Drilling down to a particular topic: what we are doing to animals in our food system is a horror story. It's time for us to give voice to the voiceless at that same political table that mega corp ag companies have sat for years.  By not listening to the animals, we are driving our own species headlong into extinction. By breeding livestock in such outsized numbers, we're ripping through resources, clear-cutting carbon sinking forests, and polluting our waterways. The situation is so out of balance that the resources on this little rock hurling through space may give out soon, and it may happen in our very own life times. 

So - it's hard for me to sip my Valpolicella Superiore wine and study Italian and live the good life in FIRE when the people pulling on the political levers are screwing our future over so hard.  And by 'people pulling on the political levers' I don't necessarily mean our elected representatives.

Sorry if this turned into what seems like a rant. But full-tilt is pretty much my standard operating mode these days. Okay, time to write thank you emails to 5 more of the staffers we met with in Feb. Thanks for the shout out BB.
« Last Edit: March 05, 2019, 03:11:36 AM by Malaysia41 »

LennStar

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Re: Wealth tax and the future
« Reply #207 on: March 05, 2019, 06:51:31 AM »
 @Malaysia41's thanks for your post!

If you haven't read it, I strongly recommend you read "The dictator's handbook - Why bad behavior is almost always good politics".

GreenEggs

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Re: Wealth tax and the future
« Reply #208 on: March 05, 2019, 07:29:22 AM »
How many mustachians RE and get into politics? 


They'd sure get my attention & likely my vote.

One of @Malaysia41's main activities in FIRE has been political activism. She wrote a book on her politics. Then she raised money to fund a "People's Lobbyist." Who then suggested someone with a little time should join the lobbyist in person, in DC, to lobby Congress. So she just got back from a 3 week lobbying trip.

Her journal title below came from a time when she cared about politics but struggled about arguing with family members. Over time, she found a more pleasant groove.
https://forum.mrmoneymustache.com/journals/fair-verona-where-m41-attempts-escape-from-us-politics/msg2205259/#msg2205259

So the number is at least 1!

PS. I support her energy, even if I don't follow the same exact politics myself. She shows it can be done.

Hey BB. Just saw your shout out.

Regarding lobbying in particular: During my 3 weeks meeting with ~30 reps on the hill, I realized that really anyone can lobby congress. Staffers of our reps are all quite accessible (well, to varying degrees). For example, I booked 30 min with Bernie Sander's staffers no problem. All a person needs to lobby congress is time, and a place to stay.

Well, time, a place to stay, and the ability to research, actively listen, craft persuasive arguments, and know who to target on the hill and how to entice those key players into meeting with you.

I have time, being FIREd n all.

I have a place to stay, as couchsurfing.org continually serves up amazing hosts.  My DC couchsurfing hosts were all stellar.

I can research.

I wrote a book that's pretty much all about actively listening (shameless plug); of course putting this skill back into practice took a few meetings before I hit my stride again.

With the organization lobbyists4good.org, I found a collaborator in that site's founder. We honed our pitch, and determined who to target on the hill. Part of the plan all along was to hire a lobbyists - but that proved hard at the beginning as so many of them represent mega agricultural corps. In the end, we at last hired a lobbyist with our crowdsourced funds. This lobbyists has deep history in ag committees and policy making, and with our help, he will shepherd our proposal into law (hopefully).  https://www.lobbyists4good.org/animal-ag-subsidies

For me, I need a project.  I'm 46, and passively absorbing life wears thin after just a few days. Make no mistake, I can relax and slack off like the best of them. But at some point I need something I'm creating. So I wrote a book. Then I got political. This DC lobby campaign was my latest project.  I see it as the training wheels phase of more lobbying to come.

That 3 weeks in DC confirmed in no uncertain terms the old adage, 'IF YOU'RE NOT AT THE TABLE, YOU'RE ON THE MENU'.

Just look at where we are with the environment and with the rise of CAFOs. As @sol mentioned in an earlier post here - unregulated capitalism can be counted on to exploit our shared resources. This includes the animals we raise for food. Did you know the biomass of global livestock is ~3x that of humans? You think we have an overpopulation problem? We're feeding half the food we grow to our livestock. Try multiplying our overpopulation problem by 4.  It's all connected. And yet, at our national gov't level, fixing problems associated with animal agriculture are afterthoughts at best. So, I thought I'd go have a chat. And I had 30 of them - to various degrees of success as far as I can tell. But the staffers/reps all thought on the topic for 15-30 min. All of them. dems and reps alike.

As far as I'm concerned, it's time we citizens take a seat at the table and demand those shared resources be valued properly and protected. 
We've allowed big ginormo corps and super wealthy people to occupy those seats for far too long. And now we're at a point where somehow, 'money = speech', monopolies that prey on a captured market are just fine, and unlimited $ in our political campaign election system is the norm.  It's a shit system. But it's the system we've got. In order to change it, we've got to take part in it, and steer back toward the basic principles we all learned in high school civics.  Mr. Firebaugh would be horrified if he was alive to see what our system has become. 

Drilling down to a particular topic: what we are doing to animals in our food system is a horror story. It's time for us to give voice to the voiceless at that same political table that mega corp ag companies have sat for years.  By not listening to the animals, we are driving our own species headlong into extinction. By breeding livestock in such outsized numbers, we're ripping through resources, clear-cutting carbon sinking forests, and polluting our waterways. The situation is so out of balance that the resources on this little rock hurling through space may give out soon, and it may happen in our very own life times. 

So - it's hard for me to sip my Valpolicella Superiore wine and study Italian and live the good life in FIRE when the people pulling on the political levers are screwing our future over so hard.  And by 'people pulling on the political levers' I don't necessarily mean our elected representatives.

Sorry if this turned into what seems like a rant. But full-tilt is pretty much my standard operating mode these days. Okay, time to write thank you emails to 5 more of the staffers we met with in Feb. Thanks for the shout out BB.




Very impressive & inspiring.  I will have follow your posts. 


We're almost FIREd and my wife has always had a social "chip on her shoulder".  She enjoys participating in marches and loves to speak her mind in support against all the injustices in our country.  She is actually visiting Mongomery, AL today going ot the Civil Rights Museum, etc. today. 
I've never been enjoyed being in crowds, but I do like the idea of "having a seat at the table".  Lobbying sounds interesting.  (how many hours per month of sitting at the table is required for the $5K job?  (wink) ) 
It seems that you are in Italy at the moment.  Sounds wonderful.  When will you be heading back to DC?  I like the fact that it's possible to lobby & also take breaks to enjoy life and still have an impact. 



talltexan

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Re: Wealth tax and the future
« Reply #209 on: March 05, 2019, 08:21:49 AM »
Yeah, money running out is normal.
So what?
Thats true for poor people too. Just that they don't have a choice.
And people can only get to the top, if someone from the top comes down. (More or less)

The problem is not people going up or coming down - quite contrary - it is the concentration of money (and power because money = power) that is bad. And the increasing concentration is worse.
This is a problem as old as civilization. Literally the oldest record we have ever found, 4500 year old Babylonian writings, are about debt forgiveness - because wealth had concentrated too much, poor people were sucked into debt and sold themselves into slavery.
That is a constant throughout history. As is debt forgiveness (the christian jubilee year is/was the same).

Rather than diluting the concentration of money, I'd like to find ways to break that money = power equation. Taxing campaign contributions is easier than taxing wealth.

markbike528CBX

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Re: Wealth tax and the future
« Reply #210 on: March 05, 2019, 09:02:26 AM »
...Snip....
America is the richest country on Earth and yet we have a tiny portion of the population enjoying the vast majority of the gains.  And by enjoying, I mostly mean getting to sit on larger and larger piles of unused, un-circulated wealth. 
....snip.....

Don't know about you, but my wealth is NOT in the form of McScruge piles of gold coins that are swim-able.
 I gave my cash, indirectly, to companies that vastly increase the velocity of that money.

BicycleB

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Re: Wealth tax and the future
« Reply #211 on: March 05, 2019, 10:45:51 AM »

Rather than diluting the concentration of money, I'd like to find ways to break that money = power equation. Taxing campaign contributions is easier than taxing wealth.

That's a very interesting idea!

Are you thinking of a progressive tax - contributions under $1000/year taxed at zero percent, $1000-5000 at 10%, and so on? I'd probably vote for that. Here's a rate table for discussion:

Total Contributions/Yr     Marginal
to Federal Candidates     Tax Rate
------------------------     ----------
Under $1000                   0%
1000-4999                     10%
5000-9999                     20%
10,000-24,999               30%
25,000-99,999               40%
100,000-249,999            50%
250,000-999,999            60%
1,000,000+                    70%

Corporate Rates: 15% plus the individual rates above

Anyone want to go lobby??

PS. There is the question of what the tax should pay for. I'd say child care on voting days for recipients of TANF or EITC, but want non-parents to benefit too. Thoughts welcome...
« Last Edit: March 05, 2019, 11:14:48 AM by BicycleB »

iris lily

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Re: Wealth tax and the future
« Reply #212 on: March 05, 2019, 11:54:59 AM »

Rather than diluting the concentration of money, I'd like to find ways to break that money = power equation. Taxing campaign contributions is easier than taxing wealth.

That's a very interesting idea!

Are you thinking of a progressive tax - contributions under $1000/year taxed at zero percent, $1000-5000 at 10%, and so on? I'd probably vote for that. Here's a rate table for discussion:

Total Contributions/Yr     Marginal
to Federal Candidates     Tax Rate
------------------------     ----------
Under $1000                   0%
1000-4999                     10%
5000-9999                     20%
10,000-24,999               30%
25,000-99,999               40%
100,000-249,999            50%
250,000-999,999            60%
1,000,000+                    70%

Corporate Rates: 15% plus the individual rates above

Anyone want to go lobby??

PS. There is the question of what the tax should pay for. I'd say child care on voting days for recipients of TANF or EITC, but want non-parents to benefit too. Thoughts welcome...
How about reducing the damn deficit spending insanity of our elected leaders?

Naw, thats no fun. No one cares about that.

Norioch

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Re: Wealth tax and the future
« Reply #213 on: March 05, 2019, 03:19:19 PM »
Per SCOTUS, campaign contributions are speech and can't be taxed. And bribery isn't bribery unless the money is paid in a sack with a large cartoon dollar sign on it.

BicycleB

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Re: Wealth tax and the future
« Reply #214 on: March 05, 2019, 06:37:29 PM »

PS. There is the question of what the tax should pay for. I'd say child care on voting days for recipients of TANF or EITC, but want non-parents to benefit too. Thoughts welcome...
How about reducing the damn deficit spending insanity of our elected leaders?

Naw, thats no fun. No one cares about that.

Hmm, that's a good purpose. If either party stuck to that purpose when in office, I'd be tempted to vote for them for a very long time.

EscapeVelocity2020

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Re: Wealth tax and the future
« Reply #215 on: March 05, 2019, 07:22:57 PM »
...Snip....
America is the richest country on Earth and yet we have a tiny portion of the population enjoying the vast majority of the gains.  And by enjoying, I mostly mean getting to sit on larger and larger piles of unused, un-circulated wealth. 
....snip.....

Don't know about you, but my wealth is NOT in the form of McScruge piles of gold coins that are swim-able.
 I gave my cash, indirectly, to companies that vastly increase the velocity of that money.

We are talking about people with 50 Million+ here, people like Kylie Jenner - https://ew.com/celebrity/2019/03/05/kylie-jenner-forbes-youngest-self-made-billionaire/

Quote
“My parents told me I needed to make my own money, it’s time to learn how to save and spend your own money, stuff like that,” she said. “What I’m trying to say is I did have a platform, but none of my money is inherited.”

LennStar

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Re: Wealth tax and the future
« Reply #216 on: March 06, 2019, 12:20:07 AM »
Per SCOTUS, campaign contributions are speech and can't be taxed. And bribery isn't bribery unless the money is paid in a sack with a large cartoon dollar sign on it.
In Germany we are more advanced. Here not directly monetary advantages are are considered bribes - as long as you pay them to the person directly.
Giving his wife a ten thousand dollar pearl is not bribery. O.o

bwall

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Re: Wealth tax and the future
« Reply #217 on: March 06, 2019, 04:19:36 AM »

PS. There is the question of what the tax should pay for. I'd say child care on voting days for recipients of TANF or EITC, but want non-parents to benefit too. Thoughts welcome...
How about reducing the damn deficit spending insanity of our elected leaders?

Naw, thats no fun. No one cares about that.

Hmm, that's a good purpose. If either party stuck to that purpose when in office, I'd be tempted to vote for them for a very long time.

I know, right? Wars of choice just don't pay for themselves. Taxes must be raised to pay for them OR benefits lowered for society.

I prefer to ask a fabulously wealthy individual to contribute a bit more as opposed to asking 1000 needy people to be in even more need. YMMV.

talltexan

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Re: Wealth tax and the future
« Reply #218 on: March 06, 2019, 07:27:55 AM »
...Snip....
America is the richest country on Earth and yet we have a tiny portion of the population enjoying the vast majority of the gains.  And by enjoying, I mostly mean getting to sit on larger and larger piles of unused, un-circulated wealth. 
....snip.....

Don't know about you, but my wealth is NOT in the form of McScruge piles of gold coins that are swim-able.
 I gave my cash, indirectly, to companies that vastly increase the velocity of that money.

We are talking about people with 50 Million+ here, people like Kylie Jenner - https://ew.com/celebrity/2019/03/05/kylie-jenner-forbes-youngest-self-made-billionaire/

Quote
“My parents told me I needed to make my own money, it’s time to learn how to save and spend your own money, stuff like that,” she said. “What I’m trying to say is I did have a platform, but none of my money is inherited.”

Her mother is her company's CFO.

LennStar

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Re: Wealth tax and the future
« Reply #219 on: March 06, 2019, 08:29:45 AM »
Here is a short video about the incredible differences in wealth and what a wealth tax could pay for.
https://boingboing.net/2019/03/05/animated-video-shows-staggerin.html

GreenEggs

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Re: Wealth tax and the future
« Reply #220 on: March 06, 2019, 10:26:47 AM »
Here is a short video about the incredible differences in wealth and what a wealth tax could pay for.
https://boingboing.net/2019/03/05/animated-video-shows-staggerin.html




It "shouldn't" be hard to get the votes for that. 


If both parties chose to promote it that we could all benefit from it regardless of our other politics.  Too bad nothing so simple is so simple to get passed. 




talltexan

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Re: Wealth tax and the future
« Reply #221 on: March 06, 2019, 12:51:24 PM »
I consider myself fairly progressive, but I found that video wildly unpersuasive. It only seemed to make the case for the wealth tax based on targeting a few very wealthy people to pay for some progressive programs. It didn't acknowledge any problems with people reclassifying wealth in ways to avoid the tax. And it claimed this hasn't been done before in the US, when we had something like it in Florida for a long time.

Malaysia41

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Re: Wealth tax and the future
« Reply #222 on: March 07, 2019, 10:22:28 AM »
@Malaysia41's thanks for your post!

If you haven't read it, I strongly recommend you read "The dictator's handbook - Why bad behavior is almost always good politics".

I'm downloading The Dictator's Handbook now. Thanks for your recommendation LennStar. I read through a couple reviews and it sounds like the authors make a compelling case.

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Re: Wealth tax and the future
« Reply #223 on: March 07, 2019, 10:53:23 PM »
The only concern I have to a wealth tax is that by being FIRE’d you have latent wealth earning potential you don’t exploit because, well, all the reasons you struggled to become FIRE’d in the first place.  We are not long from living in a society where not leveraging such latent wealth earning potential could be considered greedy and selfish. Or even is already.   “How dare he bicycle around, collect guns, raise kittens, insert pasttime, etc. when he could be working to make money we can tax to build an equitable society?  We need to tax that ‘stache so he has to struggle like the rest of us!”

.

LennStar

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Re: Wealth tax and the future
« Reply #224 on: March 08, 2019, 12:07:25 AM »
The only concern I have to a wealth tax is that by being FIRE’d you have latent wealth earning potential you don’t exploit because, well, all the reasons you struggled to become FIRE’d in the first place.  We are not long from living in a society where not leveraging such latent wealth earning potential could be considered greedy and selfish. Or even is already.   “How dare he bicycle around, collect guns, raise kittens, insert pasttime, etc. when he could be working to make money we can tax to build an equitable society?  We need to tax that ‘stache so he has to struggle like the rest of us!”

Ha?
First of all "just sitting around" is already seen as incredibly bad. This can only change to the bettter.
 
And in regards to the money, it is the opposite: How can he have all that money and not use it? With a wealth tax it is used.

talltexan

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Re: Wealth tax and the future
« Reply #225 on: March 08, 2019, 07:33:00 AM »
The only concern I have to a wealth tax is that by being FIRE’d you have latent wealth earning potential you don’t exploit because, well, all the reasons you struggled to become FIRE’d in the first place.  We are not long from living in a society where not leveraging such latent wealth earning potential could be considered greedy and selfish. Or even is already.   “How dare he bicycle around, collect guns, raise kittens, insert pasttime, etc. when he could be working to make money we can tax to build an equitable society?  We need to tax that ‘stache so he has to struggle like the rest of us!”

.

Seems to me like a lot of working people are collecting guns and raising animals. The use--through working--of latent earning potential is already discouraged by the income tax.

EscapeVelocity2020

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Re: Wealth tax and the future
« Reply #226 on: March 08, 2019, 08:03:00 AM »
The only concern I have to a wealth tax is that by being FIRE’d you have latent wealth earning potential you don’t exploit because, well, all the reasons you struggled to become FIRE’d in the first place.  We are not long from living in a society where not leveraging such latent wealth earning potential could be considered greedy and selfish. Or even is already.   “How dare he bicycle around, collect guns, raise kittens, insert pasttime, etc. when he could be working to make money we can tax to build an equitable society?  We need to tax that ‘stache so he has to struggle like the rest of us!”
The whole premise of the wealth tax is Thomas Piketty's work which, among other things, is concerned that the after tax return on equity is greater than gdp growth (roughly correlating to after tax income gains).  In short, working for income is less effective in growing wealth than having wealth and watching it passively grow.  Therefore, wealth inequality will inevitably increase over time and ultimately threaten democracy.

I don't think anyone will get upset about our tiny FIRE effects on society, other than anectdotally, considering that we are FI well below 50 million dollars and will never see this wealth tax.  We are hardly 'impoverishing' the country by ER'ing vs. the tax cuts for the wealthy and not taxing their net worth growth.  In fact, AI is going to do far more 'reduction in taxable income' than the FIRE movement.

talltexan

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Re: Wealth tax and the future
« Reply #227 on: March 08, 2019, 09:38:26 AM »
Indeed I have read Picketty's work, and particularly his book Capital.

He is a deep thinker, and I know he's aware of many of the problems with the wealth tax, including the political realities that may well foreclose its implementation. But Picketty also acknowledges the phenomenal progress made in the twentieth century by giving households the ability to own their own homes and build equity there. Indeed the period since 1980 has seen some revanchism, but the state of play now is still sooooo much better than where it was for much of history before WW I.

EricL

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Re: Wealth tax and the future
« Reply #228 on: March 08, 2019, 10:25:22 AM »
The only concern I have to a wealth tax is that by being FIRE’d you have latent wealth earning potential you don’t exploit because, well, all the reasons you struggled to become FIRE’d in the first place.  We are not long from living in a society where not leveraging such latent wealth earning potential could be considered greedy and selfish. Or even is already.   “How dare he bicycle around, collect guns, raise kittens, insert pasttime, etc. when he could be working to make money we can tax to build an equitable society?  We need to tax that ‘stache so he has to struggle like the rest of us!”
The whole premise of the wealth tax is Thomas Piketty's work which, among other things, is concerned that the after tax return on equity is greater than gdp growth (roughly correlating to after tax income gains).  In short, working for income is less effective in growing wealth than having wealth and watching it passively grow.  Therefore, wealth inequality will inevitably increase over time and ultimately threaten democracy.

I don't think anyone will get upset about our tiny FIRE effects on society, other than anectdotally, considering that we are FI well below 50 million dollars and will never see this wealth tax.  We are hardly 'impoverishing' the country by ER'ing vs. the tax cuts for the wealthy and not taxing their net worth growth.  In fact, AI is going to do far more 'reduction in taxable income' than the FIRE movement.

Certainly the wealth of the super rich growing in investments outstrips the average person's earning power (for those super rich smart enough to grow their net worth investing vs. frittering it away).  But if Mustachianism becomes more popular the aggregate numbers of mini-millionaires will outstrip their earning abilities.  Though perhaps the tax on mustachianism might not come all at once after becoming FIRE'd like my hypothetical example, but in larger taxation on equity profits on the run up to trying to get FIRE'd.  This type of policy hurts small investors (FIRE'd wanna be's as well as potentially average people's IRAs and 401Ks) and not so much large investors.  I should add that large investors would have much more leverage on the government to protect themselves from such taxation vs. FIRE'd wanna be's and even the successfully FIRE'd. 

robartsd

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Re: Wealth tax and the future
« Reply #229 on: March 08, 2019, 11:26:32 AM »
Perhaps a wealth tax could be implemented as a wealth based Alternate Minimum Tax. Net worth over a certain threshold (perhaps the same as the estate tax) would have a wealth based AMT of about 1%. This would be calculated along side the regular income tax and the current income based AMT with the highest value being the taxes owed for the year. For the wealthy who end up owing more taxes due to this wealth ATM, there would likely be a lot more realization of capital gains so that at least they'd get the benefit of resetting the tax basis of investments that they are being taxed on.

Malaysia41

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Re: Wealth tax and the future
« Reply #230 on: March 09, 2019, 04:57:49 AM »
@Malaysia41's thanks for your post!

If you haven't read it, I strongly recommend you read "The dictator's handbook - Why bad behavior is almost always good politics".

I'm downloading The Dictator's Handbook now. Thanks for your recommendation LennStar. I read through a couple of reviews and it sounds like the authors make a compelling case.

FYI @LennStar - I'm nodding all the way through the first few chapters. Thank you so much for this recommendation.