The problem I have with this idea, is the thought that somehow Govt. will use the money properly. Maybe if govt. passed a balanced budget amendment I might feel better about them getting more money. Maybe if there was a plan to pay off some debt. Maybe if they were fiscally responsible.

The fact is giving the money to the govt. does not mean that it would be re-distributed or help the poor at all. In fact history tells us just the opposite.Removing the dependency model from the equation doesn't help the politician.

tl/dr

Hey, here's an idea. Go ahead and tax the rich a bunch, and use the money to pay the poor $100k/year, so long as they get permanently sterilized and don't have any children. There shouldn't be many poor people left after a couple generations, and it will be cheaper in the long run.

<in case people can't read in the pink, this is tongue in cheek absurdity, much like taxing anyone 100% at any level>

It has also been impacted by the buy rentals and live without working philosophy. In our area the majority of starter homes are sold to cash buyers renting them out as a retirement plan. After the recession a ton of single family homes were bought by big corporations as rental conglomerates. Over 400k a year single family homes became rentals between 2006 and 2014 http://eyeonhousing.org/...1-3-of-rental-stock/

All of this is driving up the prices of people getting on the property ladder which used to be one of the bases on which the middle class was built.

It will be interesting to see what happens in a consumer economy when we push 60-70% of consumers to the point they can no longer afford to consume the stuff the companies the rich people work for and own make.

I think I remember some of this from 2008.

We are getting there very quickly. A big part of this is that, capital growth grows untaxed. The trend is simply unsustainable.



https://www.economist.com/graphic-detail/2014/11/06/some-are-more-equal-than-others

The premise in the OP is somewhat flawed. Worth is not directly related to income. Wealthy people hold things of value while people in the lower classes tend to consume most of what they earn.

Let's give Joe Sixpack some things of value instead of wages. Joe works for a builder and as a bonus is given a new house, a new work truck and all new tools. His wages are only $50K, but the value of what he's been given is $500K. At a 50% tax rate, how does Joe pay the tax when he has little cash. The house, truck and tools are of little benefit if Joe has to sell them to pay taxes. Taking loans against the value would put Joe in debt, plus what happens if the housing market crashes and the home loses a significant portion of its original value? That 50% tax could then be more like a 75% tax and Joe would be in debt. So while it would appear Joe has decent net worth, he's actually just staying afloat and barely able to keep up with the debt payments.

IMO trying to punish the wealthy through heavy taxation always results in punishing the poor because the wealthy collect the money they pay taxes with from the poor. Thus created even more inequality.

Socialism always fails because people will tend to act in their own self interest rather than doing everything for the common good. People seeing others get something for nothing are encouraged to do the same, which results in an expanding class of takers relying on a shrinking class of givers. Socialists always forget that people are not robots who can be programmed. There are no socialist utopias. There are places in the initial stages where socialism gives a false impression of working, and other places where the abject failure is readily visible.

Lifting people up by bringing others down is poor ideology.

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Don

Tri-ing to have fun. Anything else is just a bonus!

Some good points in there but I'd like to offer additional perspectives.

Socialism never really had a chance. It doesn't fail for that silly argument whereby those who work give up working because someone else is getting a shitty benefit from the government. Socialism fails because humans. Humans are corrupt and lie, cheat, and steal as much as they can get away with. The socialism experiment in the USSR was very poorly managed and fell victim to ... shitty management and human nature. Europe is trying again and some countries are doing a bit better with it now - but it's a far cry from "socialism" as described in textbooks and dictionaries.

Which brings me to a critique of the "market based solutions" crowd on the right side of the political spectrum in North America and the US in particular. We don't have capitalism any more than Sweden has socialism. We have a poorly managed relative free-for-all where information asymmetry (information being power, or resources etc.) all but guarantees that the winners keep on winning and winning bigger over time. More of that is not somehow magically going to "lift all boats" or some other bullshit. It will create something very similar to what humans have organized into for millennia. A de facto ruling aristocracy and the masses fighting for the scraps. We basically already have that but we're civil enough no to deal with defenestrations on a regular basis.

I'd also argue that a good chunk of us are already part of this 'landed aristocracy' so it is actually in our interest to do absolutely nothing about it. I sure as shit feel pretty great about being in the top-10% of income/wealth in the country which really puts me into something insane like top 1% globally. MAGA! or WE CAN DO IT! Either regime delivers the same.

I love all these divisive arguments endlessly flowing from the compassionate left. And to fix it all, the answer is a bigger centralized government and less personal freedom.

To make it more fair- How about an even bigger government a Globalist government where they could tax all 1 percent-ers at 90% to end hunger/poverty for good! Of course that would prolly mean most of, if not all of us would take a massive income hit, because if you make over $32,400 a year globally you are one of those greedy 1%ers who have too much.

It’s interesting, and noteworthy, that the peak was in 1986. It’s not just a coincidence that that was when China started modernizing and ramping up its export-driven economy—and the start of well-paying American manufacturing jobs being shipped to China (and Mexico).

Today, China sits on $3 trillion in foreign exchange reserves, and owns about $1 trillion in U.S. government securities. Combined, that’s the equivalent of about $13,000 for every single man, woman and child in America. Every year, our $300 billion trade deficit with China is the equivalent of a family of four sending $4,000 to China. That’s a helluva lot of middle-class wealth going bye-bye, year after year.

I contend that the chart would look significantly different without this enormous transfer of wealth from the U.S. to China over the last 30+ years.

Raising tax rates is not the solution. Changing tax and trade policies to encourage domestic manufacturing and production will be far more effective.

I think you are spot on and this is where we are headed with the ultra progressives.

The utopian ideal is:

1. Everyone gets a living wage, a house, free healthcare, free education, guaranteed job and salary and 2 months vacations a year. ( this actually sounds like the plan of some progressives without the house thrown in there.)

2. Pay for it all by the fact it is immoral for any person to be a billionaire and if need be we can change that to millionaire. All the excess goes to the government.

3. We live relaxed enjoyable lives where everyone is equal.

Got to admit it doesn't sound bad on paper.

You aren't arguing for an actual free market, you are trying to maintain a status quo that intrinsically favors the wealthy. You keep ignoring obvious government subsidies which only benefit one set of people. If all goes well, I will be able to avoid realizing gains on most of my assets for my entire life, and they will simply transfer (up to $20M tax-free) to my kids.

The argument "the socialists are coming!" has been around forever. The cry, which always relied on a false binary, is far less valid at this point of historic inequality.

So does unicorns and rainbows.

Who pushes for the mortgage deduction? Everyday Americans, or the real estate/mortgage businesses?

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"Go yell at an M&M"

I can understand the issue of entrusting government with more wealth management, or any.

You can get at more equality by doing away with the laws from the 1800's protecting and favoring larger capital entities over smaller ones.

Capitalist entities with power do not want their power checked by the working populace. If we had stuck to preventing the mess of monopoly and corporations in the 1800s and held fast, the spread of power among the working populace would be much broader (a true small business America).

In that breadth of power, I believe comes more balance and more equality.

You don't have to be pro-union either, that's fine. But, you have to admit that large and organized capital interests have significantly more leverage than do workers. Also they have more leverage locally obtaining land grands, zoning permits, favortism on planning boards, etc.... that is not afforded at the same level to small businesses.

How many billions have gone in incentives to large companies in tax breaks in small areas for a few hundred jobs versus spending that money locally on small businesses? Also, the idea that 300 new jobs in one place makes 700 elsewhere in town isn't entirely always accurate at all. A lot of these incentives get rescinded when the promises are broken.

And many of those very workers give large capitalist interests that leverage because lots of us have retirement plans driving results in those companies that in turn ends up in policies that go against what some people want.

Verizon Chipotle Exxon isn't as silly as just a joke in Parks and Rec. Taco Bell was the anti-capitalist joke in Demolition Man.

Art imitates reality.

Back to the Future is real. Biff is POTUS. Cubs won. Verizon Chipotle Exxon and Taco Bell rule the world. What else has to come true?

Not only that, your kids get a "step up" in basis. So, if they immediately sold the assets, they would owe no capital gains tax.

That's not how this works. That's not how any of this works. =)

Did you transfer your wealth to China? I know that I didn't. I only purchased Chinese goods when they were the best quality/price alternative I could get. In other words I only purchased Chinese goods when the transaction increased my wealth vis-a-vis any other alternative. Did the Chinese get anything out of the transaction? Sure, they got a good deal, too. That's what makes trade so great -- we can all get good deals out of it. So the Chinese got money because they offered goods at the best price. That's on them, and that's their wealth. You and I didn't transfer squat.

Btw... Here is the growth of US wealth over the last 30+years. Looks like the Chinese really put a damper on things. [/pink]



Note: The 2017 number was a bit over $100,000 billion.

People on Alabama still get ringworm!

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Civilize the mind, but make savage the body.

- Chinese proverb

Almost looks like we can afford to pay off 20some Trillion dollars. Oh wait that's 1/3 of EVERYONES net worth.

Yeah, and what's the hurry to pay off a 3% loan (about 1% after inflation)?
Especially when that debt balance helps stabilize the world's financial system, by providing a no-risk asset for companies and governments to deposit money.

No risk? I hope you're right.

I agree with a lot of what you say. I also believe we are in the end stages of liberalism (in the classical sense of individual freedom and equality being the goal of gov't important). We emphasize individual freedom but in doing such atomize the traditional sources of community such that folks look to gov't for guarantees of freedom. The result is bigger gov't as they do more and more to interfere with our lives and make things "fair" This gov't is then captured by money interests as are the courts (by increasing the cost of due process and paying off politicians). We look to the market as well to provide opportunities for advancement but as you say it is rigged. The landed aristocracy is actually a meritocracy but is intergenerational and for the most parts limits opportunity of the underclass.

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They constantly try to escape from the darkness outside and within
Dreaming of systems so perfect that no one will need to be good T.S. Eliot

You should read a bit of history... particularly about China's economic trajectory in the last 100 years. Rich people were seen as a scourge and, prior to 1978, the government ran (in a round about way) a 100% marginal tax rate on anyone who existed above subsistence (keep in mind this was a completely arbitrary level, just as your $300,000 level). As a result there was no capital formation and the entire country was incredibly poor. After 1978 the Chinese government basically said "hey, we're not going to confiscate everything, we want a profit motive, we want some rich people, we want capital formation." China had its first millionaires by the early 1990s and its first billionaires by the early 2000s. Today China has ~500 billionaires and a burgeoning middle class.

Every economist and historian no matter their political, national, or ideological stripe describe China's transformation in the 30 years from the 1980s through the 2000s as an "economic miracle". There is no other way to describe it. Profit motive works. Take away profit motive and very clever, intelligent, innovative and otherwise skilled people will simply choose not to work. Or at least not work hard or fully utilize their abilities.

Capitalism creates excesses and imbalances, no doubt, and progressive taxation can tame those but they will never be eliminated.

Trickle down economics has been hugely successful. The amount of money trickling down to the Cayman islands is pretty impressive!

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Long Chile was a silly place.

   Just out; Wal-mart (okay, kinda) responds to your LR abuse in a WAPO piece looking at some recent AOC claims:
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Here’s where Ocasio-Cortez starts to go off the rails. Both Walmart and Amazon do pay more than the minimum wage. (Disclosure: Jeffrey P. Bezos, Amazon’s chief executive, owns The Washington Post.)
As of Nov. 1, Amazon pays at least $15 an hour to its hourly workers — even more in other places — and, in fact, supports efforts to raise the minimum wage. When Amazon made the announcement that it was raising wages, it even earned kudos from a longtime critic, Sen. Bernie Sanders (I-Vt.)
At Walmart, entry-level workers earn at least $11. Total compensation for those workers, including benefits, a discount on Walmart purchases, health care and 401(k) contributions bring that figure to $17.50 an hour, according to Walmart spokesman Kory Lundberg.
Ocasio-Cortez’s office did not address her flub on the minimum wage, but to defend her comment about a wealth transfer, her spokesman supplied a Washington Post article about a proposal by Sanders that would require large employers such as Amazon and Walmart to fully cover the cost of food stamps, public housing, Medicaid and other federal assistance received by their employees. The article cited a report that as many as 1 in 3 Amazon employees in Arizona — and about 1 in 10 in Pennsylvania and Ohio — receive food stamps.
The companies say the figures are misleading and reflect the fact that either the employees are choosing to work part time or that the entry-level workers may have been on public assistance when they first started. “We think we help move more people off public assistance than any company out there,” Lundberg said.
Even if Ocasio-Cortez were right about the minimum wage, her contention that those companies are benefiting from a wealth transfer is dubious. Economic theory generally assumes all costs and benefits of labor-related taxes and benefits are borne by labor — i.e., the worker, not the employer. So wages would be largely unaffected if taxes went up or public assistance went up. And the worker would still get paid the same, even if they had to carry the burden of new taxes or received enhanced benefits.
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The Pinocchio Test
Ocasio-Cortez deserves credit for using her high profile to bring attention to income inequality. However, she undermines her message when she plays fast and loose with statistics. A lot of Americans do not earn enough for a living wage, but we cannot find evidence that it is the majority. Amazon and Walmart pay well above the minimum wage, contrary to her statement, and it is tendentious to claim those companies get some sort of a wealth transfer from the public when such benefits flow to all low-wage workers in many companies. Overall, she earns Three Pinocchios.
Three Pinocchios
https://www.washingtonpost.com/...m_term=.fe67210db8d7

I suspect I live somewhere where the disparity between those 26 and the rest of the planet is pretty evident.

The King of Saudi has a home down the road and they close public beaches for him.

MBS the heir apparent dropped north of 500m one afternoon 2-3 years ago on a little boat

A 30-40m yacht barely counts these days. The real money is in 100m plus

This week as far as I can tell Ken Griffin has dropped 130m on a pied a terre in London and 220m on a weekend place overlooking Central park

I have great reservations about the state removing wealth but I think its apparent from simply witnessing those attending Davis that the threat that these individuals and businesses leverage is that if they do not receive preferential treatment they walk.

Ireland Corp tax rate is a joke, Singapore offers breaks for long term investors, the middle east is a tax free zone and its apparent that those with significant wealth are mobile

I think that there is an argument for paying a living wage, not using contracted labour to avoid offering benefits and paying the tax due

Beyond that, these individuals should be free to determine how best to dispose of their wealth as they see fit

For every arse hole, there are a bill and Melinda gates who are doing far more good with their money than any government would