Also, some of these billionaires are running companies that are great at tax avoidance, probably most of them. Now what? They get to pick and choose where they get to spend there/invest money? I don't buy it.
I believe in wealth, just not this radical wealth separation .
If you raise the marginal tax rate to 99%, then you get rid of billionaires, but you also kill your economy. There are all the failures of communist countries, of course, but even the UK tried this during the 60s and 70s. The government went bankrupt and had to be bailed out by the IMF. Inflation peaked at 27%, unemployment was through the roof, etc.:
IMHO, most economies aren't able to raise the effective tax rate because the wealthy can add loopholes or shuffle their wealth elsewhere. This isn't an economic problem, but a political problem. Is there a political will to close loopholes and restrict the movement of wealth? Do people frame wealth in terms of freedom or in terms of societal obligations?
In other words, inequality can be a sign of good (upward mobility, vibrant economy) as well as bad (poor people getting poorer).
Fixing the latter is important. "Fixing" the first is harmful.
Any solutions should focus on giving the average and the poor the ability to improve their situation. Reducing the number of rich should never be the goal.
But in practice much of the wealth of super-wealthy people is actually either tide up in the value of the businesses that they own, which are often doing economically valuable things, or is invested in useful enterprises (shares), or funds useful activities (bonds). It's not as though the net wealth of Warren Buffet is all being thrown on hookers and blow.
There are already ways to direct the spending of the wealthy towards more productive uses, such as consumption taxes on luxury goods. But if they take their wealth to other countries with laxer consumption taxes, there's no a lot we can do about it. So we're back to the libertarian argument. At some point you get into questions of freedom and individual rights.
The problem is when poor or middle class people are unable to improve their situation or lose ground.
The only time rich people are a problem for poor people is when rich people are able to corrupt government to tilt the playing field their way. This is a problem of corrupt politicians and lack of anti-corruption law.
I think people underestimate how many economic difficulties are not caused by economic effects, but by corrupt politicians who are permitted to stack the deck against the average person as a way to fund their campaigns or rack up post-governance favors.
So, unless they are actively invested in some sort of productive scheme, they are just sitting there (e.g. as huge estates, savings etc.).
In any case, it's much better for the economy to have a large middle class, than the equivalent money in fewer rich persons.
No, you don't, because billionaires's source of money is almost always capital gains. They don't give a shit about income tax.
The first thing they all did was move their incorporations out of Sweden
In every country we seen have some sort of power hierarchy, therefore unequal distribution of wealth.
Further, there's never been proof it "kills your economy." I've never met a phenomenally wealthy person who said "well, if tax rates go up to x%, that's when I stop working." These folks LIKE working, money is great, but it's not their driver. And, even if they DID stop working, would it be the worst thing in the world? Honestly - do we really think there's only one Gates, Zuckerberg, Ellison, Page, etc?
The problem is one of regulatory capture - corporate vested interests control the governance process and that means peons are getting less and less each day for their tax revenues.
And the problem you state is not unique to any government in the world. Germany is better run than Italy and there are many reasons behind it.
The problems with many things, but especially the price of SF Muni's new Central Subway and the like, are more about union interests controlling the governance process than corporate. Remember that they do prevailing-wage construction (which somehow means they pay the highest wage out there, not the average/median) to their construction workers.
The millions/billions spent on environmental-review studies and lawsuits are another matter as well.
You haven't traveled much if you believe this. Try going to the northeast sometime.
http://www.businessinsider.com/the-worst-roads-in-america-20...
That there are bad roads elsewhere? I believe that too :).
The thing is it shouldn't be topping any list like this, with the amount of money and lack of north eastern weather.
What the hell have you done for society?
This story is very similar for most billionaires. They create A LOT of jobs and careers.
His billions of dollars donated to mosquito nets in Africa (among many other things) where he gets nothing back ... that's giving.
It's not clear to me whether or not that would make a big difference. I lean no, because my default assumption is that governments are really bad at spending money, but I could see it going either way.
Of course, there are also poor people outside California, and there's no particular reason to focus on the ones inside.
(I also note that 100 billionaires own considerably more than $100bn between them, but that's a minor nitpick.)
I'd also expect the total wealth among the 100 billionaires to be well over 100 billion, considering just Ellison + Zuckerberg + Page together have over 100 billion.
In a similar vein to these two figures, the richest 62 people in the world hold as much money as the poorest 50% of the world: https://www.theguardian.com/business/2016/jan/18/richest-62-... . As a direct consequence, if these 62 people gave all of their money (except for a couple million each) away immediately, 50% of the world would have twice as much money.
(edit: I'm not suggesting that billionaires instantly give all their money away as a direct cash transfer. Just providing a counterargument to "billionaires don't have that much power")
But we're not talking about the world, we're talking about spreading it over the citizens of California in particular, which have one of the highest incomes in the world.
If you want to talk about it in the scope the entire world, divide their wealth by 7 billion instead of 40 million to see what it gets everyone. Also, almost nobody in the US is for taxing the rich in the US to just give to citizens of other countries.
Yes, you'll see them spend $3K more per student. You won't actually see any improvements in the students, though.
http://washington.cbslocal.com/2014/04/07/study-no-link-betw...
The public schools have many problems; lack of money is not one of them. Having any idea what to do with it is.
It's worth noting that Maciej forgot that the tech barons he hates actually tried this: https://www.washingtonpost.com/opinions/how-newark-schools-p...
well if you put it like that, the world ...
Source: https://en.wikipedia.org/wiki/List_of_U.S._states_by_poverty...
http://www.forbes.com/sites/chuckdevore/2016/09/28/why-does-...
A question people don't ask enough is: given that we give vast trillions of dollars to the government, most of which is spent on various kinds of social programs (health care, education, social security, etc), why is there STILL so much poverty, joblessness, homelessness, drug use, crime, and other kinds of suffering in the US?
wow, they're awesome.
It seems possible to me that the technology to turn money into less poverty not only doesn't exist, but that the social structures that make men like Bill Gates rich also make it difficult to create such technology.
Your implicit argument is that todays rich somehow care more about improving society than yesterday's did, which will cause these concentrations of wealth to lead to a different outcome. I'm not sure I see much of a difference between Gates and Carnegie. Different ideas about what the world needs, but not a particularly different approach to capital.
And how are the actions of a few billionaires relevant to what the industry does as a whole? Does Google, Facebook, or, God forbid, Uber, address the problems of poverty and inequality (which are separate problems) as a company?
To a very large extent, charity is irrelevant; charity is a way of buying oneself a conscience without actually changing anything in the world; without even addressing the problems or thinking about them.
The Giving Pledge requires that the money be given to philanthropy, which may improve the lives of others around the world, rather than Californians.
Which is not to say they don't do some good work with it, the Bill and Melinda Gates foundation has done some great work fighting malaria and bringing fresh water to poor communities.
But these same foundations also do a lot of other work, like furthering charter schools which benefits wealthy families to the detriment of poor communities here in the US.
If setting up a foundation that actually helps a ton of people means that their families can get a fraction of that money back, that's fine with me...
Unless you are implying that they are getting more money back through the salaries than they are in donating. In which case i'd love to see a source.
Most rich people that are mega wealthy pay minimal tax by taking loans against their foundations/trusts. As you know there are no taxes on loans but a percentage, that may or may not just go right back to them. They essentially use the trusts/loans and the fact that they are essentially zero risk to take out other loans that get interest rates below inflation, sometimes very minimal interest[2]. That is essentially free money. Should the interest rates ever adjust if not fixed they can buy outright quickly.
The same thing happens with trusts/foundations. They have this hoarded money sitting there as a base they can leverage. Yes it is nice some will go to others when they pass but ultimately they would not do this if they could not use this leverage advantage. It is essentially a hack on lowering or even completely removing any taxable income as long as you have it.
[1] http://www.cnbc.com/id/46236916
[2] http://www.wsj.com/articles/SB100014241278873235270045790791...
I suppose the poor are no longer subject to long-distance fees during daytime.
There's tons of stuff on this, but, eg., here's a poster from USAID:
https://s-media-cache-ak0.pinimg.com/originals/09/35/2d/0935...
To be clear, it's good that people have access to the internet and all the interconnectivity that it brings. I'm not slamming the basic premise.
What I'm angry about is the opportunity cost. Telecoms & ISPs roll out bare minimums and say "hey look, now poor people can [cherry-picked thing that doesn't alleviate poverty]" when the real question is how we live in the most prosperous nation of all time, in an era when we have solved every basic necessity, and kids still experience food insecurity in American cities. Meanwhile, telecom CEOs merge back into monopolies.
Dramatic improvement in the lives of the poor would yield better metrics than a 30% increase in Haitians using mobile banking. Christ, half of that increase could be from unconnected citizens dying from endemic disease & reducing the denominator.
http://www.ictworks.org/2016/06/27/yes-farmers-do-use-mobile...
Etc. And that's just easily measured benefits. There's good reasons why more people in Africa have access to cell phones than to clean water.
This is trivially false. Over a hundred billionaires have now pledged to donate the majority of their wealth, and the list includes many tech people like Bill Gates, Larry Ellison, Mark Zuckerberg, Elon Musk, Dustin Moskovitz, Pierre Omidyar, Gordon Moore, Tim Cook, Vinod Khosla, etc, etc.
https://en.wikipedia.org/wiki/The_Giving_Pledge
Google has a specific page for its charity efforts in the Bay Area: https://www.google.org/local-giving/bay-area/
This only includes purely non-profit activity; it doesn't count how eg. cellphones, a for-profit industry, have dramatically improved the lives of the poor.