Meh, as a French person, the number of people who did this is pretty low. People hid their assets sure, but the FTB is a bit better at this than the fisc is ;-)
Put another way, the more complicated the tax, the easier it is to find loopholes. It’s basically impossible to write a simple wealth tax. If you do, you end up capturing people who shouldn’t be captured (for example a founder with illiquid stock and purely paper wealth). I’m actually all for taxing income pretty heavily especially in a progressive manner. Better yet, tax consumption. I think a luxury consumption tax, especially one that penalizes things like expensive cars, jets, boats, and similar would be a more effective way to tax the rich.
The people who would actually be subject to kind of tax would not, in an actual monetary sense, be adversely affected by this kind of tax, and we're really falling back on to crying BUT IT'S THE PRINCIPLE OF THE THING. And, fine, but also ironic -- after all, that's also the rationale for imposing the tax.
Liberal politics turn everyplace into a disaster. CA was at a high bar so it is taking a little longer.
a.k.a. the Slippery Slope.
This is like the conversation over signing NDAs, where one party pressures the other by saying it doesn’t matter...
You're mixing up to whom it's meaningful. Rich individuals will be unaffected, but it will benefit the state as the tax is collected from more than one person.
The way I see it, it is small for the taxpayer. It is not insignificant for the state.
Personally, I don't own any land and I'd be pretty happy if we stripped property tax from local government and made one uniform federal property tax set somewhere between five percent and ten percent of the market value of the property annually with the goal that you will pay about the sticker price of the property in taxes every ten or so years. In return, the state will grant a housing allowance to every eligible resident over the age of eighteen which covers two times the cost of a modest two bedroom somewhere in the US. It won't be enough for a two bedroom in mid-town Manhattan but we will have guidelines that enable you to live somewhere habitable (access to decent road/transit options, running drinking water and sewage, electricity, reliable wired Internet access).
No allowance is available to or for anyone under the age of eighteen. No provision shall be made for regional differences in cost of living. No exemption shall be made with respect to tax-exempt status or any other reason. All agreements made with local governments (like the ones corporations like Walmart make to not pay any property tax for a hundred years or something) will not affect the property tax they pay under this new tax regime.
If we implement this and close income tax loopholes, we won't need to have a wealth tax. We will also not need to vilify corrupt officials in the CCP government in mainland China and other investors for "parking" their money in empty properties in the west and driving up the cost of real estate. We will instead thank them for their contribution to our communities through property taxes.
The most important thing is there should be no loopholes in tax policy. I really think most people in the US will agree that we shouldn't be driving policy issues through tax credits/deductions. It makes no sense to me to give tax credits or deductions for buying a house, selling a car, having a child, saving money in a health saving account, investing money for retirement, or donating to charity. All credits and deductions (going forward) in personal income tax should go away forever. All of this is basically a human shield for the wealthy to hide their tax loopholes.
Well they aren't collecting it from just one person, so the number's really big on one side (in aggregate) and it's really small on the other side.
You might be interested in this nice lottery the state also offers. Some call it a tax for those who are bad at math.
So you could pay the tax, draw out $960K a year (I mean, you can live on that, right? Not a hardship?), and still have another $960K left over.
$20M * 0.004 = $80,000
Which does actually mean my numbers are off, in that I accidentally calculated the guy with $50M in wealth having to pay $800K in wealth tax, and he actually only has to pay $80K. So, thank you for pointing out that this proposed tax was even more trivial for anyone that it would have affected than I'd originally thought.
You do know that the US taxes its citizens living abroad, right? I know someone who was born in the US, moved back to their home country at the ripe old age of 1, and chose to keep his citizenship when he turned 18, thinking that an additional passport won't hurt. Whoops! When he started making money, suddenly the taxman came calling! Even though he had not set foot in the US for 20 years!
Federal tax. US citizens living abroad can still vote in federal elections. People who haven't lived in California for ten years can not vote in California elections.
This would be taxation without representation. If you're an American, you probably were educated on the proper procedure for dealing with that.
People who haven't lived in California for one year can't vote in elections. So why the additional taxes for the next 9 years??
Libya I think. Nope, sorry, even worse: Eritrea [1]
[1] https://www.taxesforexpats.com/expat-tax-advice/Citizenship-...
> Bill No. 2088 would have created a new annual tax of 0.4% on individuals with worldwide annual wealth over $30 million;
This is taken from www.irs.gov
This kind of thing just looks american to me.
What makes you so sure of that? Texas has a huge middle and working class. If asked I bet majority of Texans wouldn’t mind taxing their upper class. I think it is only a matter of time before politician is able to win over this vote share by targeting the state’s richest for taxation.
You could kill SV and create five more.
The most likely thing isn't five more valleys, it's that the valley gets { Texas, Boston, Utah, Minnesota, DC Metro, ..}-ized and there is nothing like it again.
* (I _hate_ "entrepreneur"; I've founded and exited a company but as a term it is not in-line at all with the freewheeling, let's-do-this, let's-do-it-better-than-anyone way people who drove the valley in the 70s and 80s thought of themselves. The rise of "entrepreneur" as the way of thinking about founders correlates well, imho, with the decline of the valley as the center of technology.)
[1] https://en.wikipedia.org/wiki/Kansas_experiment#Jobs_and_gro...
The end of Silicon Valley’s dominance could have come much sooner had China continued its trend of opening up pre-Winnie the Poo’s reign, but that threat is gone for now. China is crippled under a dictator again
California is our state.
I wasn’t being sarcastic with my previous comment
If we’re talking about the conquistadors, can’t we lump them in with “Just very greedy overly ambitious and pretentious people”? They weren’t kind to the indigenous people. Even slavery wasn’t out of the question.
This is the type of ignorance I'm talking about.
The first people to colonize California were mestizo and mulato - generations after the conquistadores in Mexico.
“Prior to contact with Europeans, the California region contained the highest Native American population density north of what is now Mexico.“
Native Americans settled in California 19,000 years ago or earlier, at least 18,500 years before the arrival of the conquistadors.
Given your own ignorance of history, I really doubt you’re even old enough to remember Silicon Valley when it was just a bunch of orchards.
If you really want to live in a place similar to California before Silicon Valley, there are plenty of states within the US that can offer that experience right now. You don’t need patience, you just need courage to experience it; that is of course if you were pining for less development and population density. Reading what you’ve previously written again, if what you really wanted was ethnic purity (which I misread as wanting to live in less developed areas) then I have other words for you. That type of post is not welcome on HN
California indigenous who settled and mestizos who colonized share the same haplogroup d dna.
They are the same people.
And for what it's worth the massive anglo/white immigration into California has been tantamount to ethnic replacement - not just in California but all over this continent.
So excuse me if I don't cry a river over fewer transplants.
So we're playing the semantics game now? Let me guess, you didn't make a racist comment. Instead you made a comment about ethnic pride? If we're playing this game, let's be clear on the definitions:
settle - to establish in residence
colonize - come to settle among and establish political control over the indigenous people of an area.
> They are the same people.
According to the Californios article you referenced, they are not the same people as the Native Americans who first settled in CA.
"Californios included the descendants of agricultural settlers and retired escort soldiers deployed from what is modern-day Mexico. Most were of mixed ethnicities, usually Mestizo (Spanish and Native American) or mixed African and Amerindian backgrounds."
Otherwise, (using your own language), the Californios wouldn't have colonized California
> And for what it's worth the massive anglo/white immigration into California has been tantamount to ethnic replacement - not just in California but all over this continent.
Thank you for confirming my suspicions of your comments being racist and no, I am not white yet I do find it ironic for one descendant of colonizers to complain about the descendants of other colonizers. I wouldn't be surprised if you considered Asians and Pacific Islanders as "invaders" as well. Also you're proving your ignorance yet again. Since you've mentioned your imagined "ethnic replacement" of Hispanics in CA (which the majority of I'm pretty sure are not as prejudiced as you - and let's not confuse ethnic cleansing with population changes from immigration & migration), let's go over CA's current or near current ethnicity statistics ordered by the largest:
* Hispanic 39.29% (This has increased from 36.6%)
* White, non-Hispanic 36.64%
* Asian 14.525
* Black 5.51%
* Pacific Islander 0.36%
* Native American 0.35% (they are not Californios, and they are still here)
* Other
> So excuse me if I don't cry a river over fewer transplants.
I'm not going to excuse and condone what I feel are posts from a racist reminiscing about ethnic purity in California. You do NOT post this type of garbage on HN.
Do you think it's really all about taxes? It's not.
The prevailing rhetoric of California being "bad" is mostly political and has racist anti-liberal roots.
By shutting down counter views you're allowing those racist viewpoints to prosper.
And by the way, none of your rhetoric counters what is historical fact.
The plurality of California are not Hispanic by pure accident.
Lastly, it should be possible to have a rational discussion about demographics on this site without people over reacting and name calling.
From your initial post, I just thought it was about over-development. I didn't expect to be about demographics and ethnicity, specifically maintaining your idea of CA's racial "purity". Consequently, I was very confused when you asked me to leave CA.
> The prevailing rhetoric of California being "bad" is mostly political and has racist anti-liberal roots. By shutting down counter views you're allowing those racist viewpoints to prosper
Let me get this straight, by calling you out on your racist viewpoints, I am allowing racist viewpoints to fester? That totally makes sense.
Who cares if other racist viewpoints have white, conservative roots? Racism is bad, period, regardless of its origins, the ideology of the people holding those ideas, and whether or not it's systemic. As shown by your own comments, conservatives do not have a monopoly on racism either.
> And by the way, none of your rhetoric counters what is historical fact.
That's great counter-argument with no details or facts, other than the slivers you've previously provided that I've quickly shut down. I guess your newest comment isn't rhetoric either?
> The plurality of California are not Hispanic by pure accident.
Yes, CA promotes diversity, yet you lament not having a more homogeneous population. The only difference between your views and "America First" proponents' view is the ethnicity being supported.
> Lastly, it should be possible to have a rational discussion about demographics on this site without people over reacting and name calling.
Forgive me for pointing out thinly veiled racist comments on HN. It's a natural conclusion to assume that racists comments are made by a racist. I am not over reacting. I initially assumed good faith and gave you the benefit of the doubt for too long. You're just downplaying your BS.
Let's revisit your BS before you delete it:
"_You_ go to Idaho and Wyoming.
California is our state."
So apparently according to your view point, California is only for "Californios", Hispanics who originated from Mexico?
"My qualms are more with the demographic changes these massive migrations brought.
Just very greedy overly ambitious and pretentious people.
To me they make terrible neighbors and have zero regard for the land, nature or the people here.
Some I assume are good people but I haven't met any."
I don't even have to comment on this one. It speaks for itself, especially the last line. Since you're really into semantics, let's define racist:
racist - a person who is prejudiced against or antagonistic toward people on the basis of their membership in a particular racial or ethnic group with the belief that groups of humans possess different behavioral traits corresponding to physical appearance
I hate racists too which is why I prefer not having them in my state.
What does this non-sequitur have to do with anything written so far? With you alluding to be a liberal, you've just proven that racism transcends American politics of left and right.
> I hate racists too which is why I prefer not having them in my state.
I am sorry that somewhere along the way you were hurt so much that it would push you to blame all of your misfortunes on another race or ethnic group, similar to poverty stricken members of neo-Nazis and the KKK; but you need to have a hard look in the mirror and do some serious self-introspection.
Let's re-read your comments.
"_You_ go to Idaho and Wyoming. California is our state."
I didn't understand it at the time, but you were telling me that CA only belonged to members of your own ethnic group.
"My qualms are more with the demographic changes these massive migrations brought. Just very greedy overly ambitious and pretentious people. To me they make terrible neighbors and have zero regard for the land, nature or the people here. Some I assume are good people but I haven't met any."
Your comments in just a single thread, really just this specific comment, already meet the textbook definition of a racist. In fact, I can attribute what you just wrote to a white supremacist, and it wouldn't seem out of place.
racist - a person who is prejudiced against or antagonistic toward people on the basis of their membership in a particular racial or ethnic group with the belief that groups of humans possess different behavioral traits corresponding to physical appearance
If you can't reconcile this and change, then I agree with your statement. I also prefer not having racists in my state and I like diversity because life is richer with it, so it would be nice if racists like yourself left California or the United States entirely, regardless of whether they think they are conservative or liberal. In fact, please leave HN. People with your ideology need to either change or leave.
Maybe you should go educate yourself about what Liberalism is before appointing yourself the racism police on Hackernews.
I'm a liberal and I've said I prefer not having more racists in California with illiberal sentiment. That is the opposite of racist.
There is a long history of America enforcing white racial integrity which you seem to be naive to. As a native Californian I think it's fair to be weary.
I stand by not wanting more transplants in my state and it's not just me.
If you don't want to be banned, you're welcome to email [email protected] and give us reason to believe that you'll follow the rules in the future.
1. Just because you feel that you're liberal does not mean that you are actually a liberal.
2. You can identify as a liberal and still be a racist. e.g. your ideals of "egalitarianism" only seem to apply to you fellow "Californios" and no one else
> Maybe you should go educate yourself about what Liberalism is before appointing yourself the racism police on Hackernews.
I've already proven based on your comments alone that you hold racist views. Let me remind you the definition of a racist again, since you keep forgetting and ignoring it.
racist - a person who is prejudiced against or antagonistic toward people on the basis of their membership in a particular racial or ethnic group with the belief that groups of humans possess different behavioral traits corresponding to physical appearance
How do you not fit the definition of a racist based on your previous comments? Let me remind you that your very first comment for me was essentially, "Leave my home, it only belongs to my people (who are racially / ethnically similar to me)". How is that much different from "Go back to your own country?"
Maybe we should have HN decide who is right and who is wrong? Your views do not belong here.
> There is a long history of America enforcing white racial integrity which you seem to be naive to. As a native Californian I think it's fair to be weary.
You're not wrong that America has a long history of racism in favor of white Anglos. I'm not disputing that. However, I think you're the one who needs a history lesson, instead of believing in your revisionist version. While the Calfornios were mixed, being multi-generational descendants of both conquistadors and indigenous people, they were by and large culturally still the same as their conquistador ancestors. They served European royalty to take and subvert land and native peoples for the Spanish crown by any means necessary. The first Calfornios were soldiers. All of this is well documented.
"Spanish and Mexican rule were devastating for native populations. 'As the missions grew, California’s native population of Indians began a catastrophic decline.' Gregory Orfalea estimates that pre-contact population was reduced by 33% during the Spanish and Mexican regimes. Most of the deaths stemmed from imported diseases and the disruption of traditional ways of life, but violence was common, and some historians have charged that life in the missions was close to slavery."
https://en.wikipedia.org/wiki/California_genocide
The Spanish conquistadors' descendants were no better than their English counterparts when it came to colonization and brutality. "Californios" are also not the same people as California's native population.
> I stand by not wanting more transplants in my state and it's not just me.
The popularity of a belief does not guarantee that it's actually moral or ethical. Your views are not acceptable on HN and they do not belong on HN.
The place this thread really went off the rails is https://news.ycombinator.com/item?id=25482753. Your first comment was obviously in good faith, but when you got an obviously bad faith reply, you should not have fed it. This is in the site guidelines: "Don't feed egregious comments by replying; flag them instead." When flames aren't fed, they quickly die out.
- Cali has concentrates most of the entrepreneurship... of the entire world for the next century, so a bit of decentralization would be a trickle-down equivalent,
- There is already an exode to Texas,
- This rule will make people move,
- And also cancel all their meetings in Cali, to avoid reaching anywhere close to the 2 months per year threshold.
That’s scary.
No, you fix it. Law is code, and needs tuning.
When people as so inclined to give up on first failing, then I feel it says more about their underlying worldview than it does about what's possible in the world.
Entee is just outlining why this approach probably won't work, not saying we shouldn't adjust laws at all to serve all people. TBH, I think your comment says more about your worldview than his.
> Thing is we’ve done the experiment and it doesn’t work.
My main reaction was discomfort with one observation of a legislative failure being used to advocate discarding a hypothesis * shrug *
EDIT: But thanks for reply to my lazy and poorly framed comment!
Hardly a comparison. Can't do an easy commute to the office with that. Most people with that wealth won't burn the money on uprooting their companies.
Couldn't they just limit the amount you can emigrate from the country with.
So if you emigrate, you can only take a maximum of, say, €10 mill.
i.e. earn it in France, using French laws, a French education and French infrastructure, it stays in France.
Obviously it clashes with EU free movement, but basically the problem seems to be we can't tax the rich because they take advantage of globalism to move their money around.
Isn't the solution to stop them moving it, rather than giving up?
Is a tiny distillation of one of the most difficult problems facing legislators intending to mitigate wealth inequality across their society: if the rich get upset, they can just take their toys and leave.
This is, from the perspective of legislative generations, a very new problem that has crystallized in the past 40 years with the expansion and standardization of international trade law.
The problem is that different places have different values and policies and compete with each other? The problem is that people have the audacity to disagree with governments and seek out different ways of living? Sorry but any proposal that disincentivizes or punishes free movement is atrocious and totalitarian. And I mean that literally.
If California was well run, clean, and had otherwise lower tax, then .4% might be easy to ignore. But if you’re already on the fence, and not happy with things, and have been talking to real estate agents in Seattle, Austin, Miami, or Singapore, then this just the kick in the butt you might need to go through with leaving.
Getting arrested is a bit much, but what's the redeeming quality of spitting on the sidewalk?
California has problems, but individual liberties and lives are treated with respect.
city states are like sleek yachts while nations are like ferry shuttles.
I believe one of the differences is that in California, this would be on top of federal and state capital gains taxes, whereas in Switzerland, there is no tax on investment gains (from stock gaining value - dividends do count as income, and once ETFs with dividend-paying stocks get involved, it gets messy but TLDR you still pay the income tax on dividends).
https://wallethub.com/edu/states-with-highest-lowest-tax-bur...
If at least Prop 13 benefits could not be passed as inheritance, that would go a long way to balance things.
I'm happy I moved to WA now where my property taxes do get reassessed every year, but it balances out with no state income taxes.
That's like citing the average rent in San Francisco. Great if you've been living in a rent controlled apartment for 30 years, but irrelevant if you've moved there recently.
That cohort of Californian is dying off now, and it may be better for all involved if companies pull out and disrupt the status quo. California’s incompetence shouldn’t drag down everything.
just stopping foreign investment in california real estate will make an enormous difference. removing the prop 13 waiver for those who inherit property with the old tax rate will also help. with older people on the clock to die sometime within the next decade, ca will see a flood of plumped up property taxes when the homes change hands. but just the two measures is a good short term relief. million dollar homes are bought sight unseen and then flipped for 40-60% markup by foreign investors and people who dont even reside in california. making it a speculative rodeo circus. let the Gov. fix THAT first.
California can be California, but the problem is more than some junk ranch house is selling for $3M. It’s bullshit that the whole country is essentially held hostage by “too big to fail” California mortgages that homeowners cab just walk away from.
Property taxes are paid EVERY year. What asset do you own that you keep on paying sales tax on?
The real estate market should be stable and for free market forces to aid that, we have to make many more fundamental changes before even touching prop 13.
1. Starting with children and grandchildren who inherit property not benefiting from the prop 13.
2. Secondly, a moratorium on all foreign investments in the real estate market in California.
3. A tiered tax rate for homes left empty while enjoying prop 13 benefits. Additionally, the primary home can also be entirely tax free wrt recurring annual taxes.
California’s problem is not low taxation. Our problem is our state budget and gross mismanagement of our tax dollars by our elected representatives.
I would like to see how they manage our current levies and with more transparency before we hand over a bigger portion of our pay check. If people don’t have disposable income to spend, the economy will crumble and collapse.
An owner with an identical property should be paying identical tax.
California property values rose dramatically. NY and NJ are the worst places to own property. The whole housing depends on landlords and rent controlled apartments. Where they make money from insanely expensive utilities by strangling the poorest people. It’s a different kind of scam. Upstate NY is a whole different kind of hell with seven months of gray and knee high snow.
This is why there was no Silicon Valley in NY. This is why NY didn't create as many millionaires out of middle class and provide upward mobility to citizens as well as opportunities to immigrants. What’s NY’s GDP? What’s NY’s population? What’s NY’s total state tax revenue?
I’ll tell you. NY’s GDP is comparable to South Korea and is at 1.7 trillion. CA’s GDP is comparable to Great Britain and is at 2.97 trillion(highest in USA) NY population is 8.5 million vs CA’s 39.5 million. As an aside: our Ag income alone is in excess of 50 billion and that’s just 2% of our economy. We also have non millionaires and retired people on fixed income. NY’s taxes were around 73 billion vs CA’s total taxes were close to 450 billion.
NY is swimming in red ink due to deficits shortfalls ..2.8 billion in 3 months due to covid. Our tax income increased. I don’t think NY’s budget modeling is something for CA to emulate ..with all due respect. NY should do what it does and leave CA to Californians to vote and decide. CA is not NY. We are a country on our own. Our problems can’t be solved by anything that works for other states. The struggle is real.
Blind comparison is not useful or helpful.
Note: California’s government probably could be leaner, but there is also broad bipartisan support for more prisons, police and firefighters. The California republican party’s focus on cutting spending overlooks the deeper problem that we aren’t getting good value on a lot of the spending and budget cuts only exasperate the problem. More meaningful institutional reforms are needed.
A commonly repeated falsehood. Is totally incorrect. https://www.sfchronicle.com/bayarea/heatherknight/article/Bu...
San Francisco absolutely has a Homeless industrial complex that isn't trying to solve the problem but just keep their cash flowing.
It seems pretty fair to say that being off by 10x is "totally incorrect".
SF is expensive for sure, but that expensive? Where is the money going to?
https://www.reuters.com/article/us-california-rent/palo-alto...
It sounds dumb but IIRC it's an attempt to have teachers and police and city employees able to live there...
I live in SoCal so I thought you would even see more homeless migrants because of the weather. However, from speaking with homeless I would say in my experience most have lived in the area for a long time, with only one beach bum guy I spoke with who actually was "fresh off the bus". Until I saw the statistics though I was also under this misconception.
Anyway, hospitality isn’t really a question of weather as Alaska for example has relatively high rate of homelessness and NYC one of the highest. Mississippi on the other hand has the lowest rate despite mild winters and significant poverty.
The stigmatization and criminalization of not paying taxes to lease a deed of property is a big problem, this planet as a whole belongs to all forms of life inhabiting it, not just the primates that choose to play that game.
This problem was working much better in the 70s and 80s when their was a national framework for it. While SF and LA's government is flawed, this blame state/city is like blaming the individual ushers when the fans run on the field after a football upset. It was more of a structural failure than a local.
Or, the same data with a very hard to read circular bar graph visualization:
https://howmuch.net/articles/federal-budget-receipts-and-exp...
The numbers are actually pretty straightforward. "Expenditures is a broad category and covers a variety of things, including direct payments to people like Social Security, contracts for local governments, wages for federal workers and sub-contracting work."
From an accounting standpoint, gross money in be money out is what matters. Per capita makes sense to compare relative benefit, but realistically Montana is small potatoes on the Federal Balance sheet. Measuring per sq mile seems like some ludicrous ploy by Alaska’s senator to screw over New Jersey.
Infrastructure costs are U shaped where extreme density is expensive, but so very low density. Mail delivery is a clear example where ultra low density just makes things more expensive.
The selective "my tax dollars would never" is anti-american
Unfortunately I don't believe something like that is practical unless it's done on a national level.
See this recent documentary by KOMO News in Seattle about their problems, which are pretty similar to Portland's, SF's, LA's and a lot of other major cities with larger homeless populations. Crime is soaring. Most are homeless due to drug addiction. Until that part is solved and they can think clearly and rationalize normally again, giving them cash will likely only fuel the problem and keep them right where they're at. And with everyone walking around with $50k cash in their pocket, because they don't have bank accounts, crime would be even more rampant as they steal it from each other.
I don't really buy that money would fuel the problem, is there any study that indicates that? They'd still be drug addicts, but they'd be more comfortable, well fed drug addicts which makes things better for everyone.
If anything I think money for a place, clean clothes, and food would make it much easier to get off drugs.
Anyway, saying it's a mental health problem is really reductive. Plenty of people with the same problems aren't homeless; some of these people can potentially dig themselves out if given a chance, most importantly a place to live.
More money isn't always the answer. Maybe the answer lies elsewhere...
So move to Texas or the south east. They clearly need an influx of ... something.
> On the one hand, the people who live there are genuinely horrible.
> So move to Texas or the south east. They clearly need an influx of ... something.
No, we don't. Please stay the fuck out of Texas. Its clear that what you really mean is, "These people don't share my radical political and social viewpoints, so they're bad."
Don't come anywhere close to our state. Californians are already fucking up Texas, starting with Austin. I've only met one California couple that were likable, and he grew up in a desert city of 317 and she grew up in Northern California.
(I say this as someone who doesn't live in Texas, and doesn't actually know. It's just my impression from afar. Add the appropriate amount of salt...)
Eliminating deductions for high-income earners while reducing tax rates on that income is revenue neutral, and generally preferable as a policy.
Many people, especially at HN for some reason, don’t realize that the Tax Reform Act of 1986 made tax rates more transparent which is why the “sticker rate” was lower.
Interestingly, the former tax rates often times screwed the middle class much more, because they couldn’t afford an accountant and/or engage in the wide range of financial maneuvers that could substantially reduce one’s tax burden.
No higher earner ever paid sticker price tax rates when they were that high.
Source: My mother. She has been a tax accountant since the 70s. The Tax Reform Act changed the field considerably.
https://turbotax.intuit.com/tax-tips/small-business-taxes/is...
What these people will come to terms with is a pretty age-old lesson - there are things more important than just how rich you are, and most of those are human. So long as they can maintain their lifestyle, I think many will want to stay. Needing to find 20K in a couch cushion to pay for your 5M in assets each year that you make 300K on won't be the thing that makes you move.
Of course, the rich today also have many legal shields and layers that will protect them from real french revolution violence. But I think anyone can feel the shift right now. Go on Tiktok and see just how many young people are getting real into eating the rich :)
I think this is probably true once someone has a career and a family, but the college part doesn't pass the sniff test for me. the "just graduated college" group is probably the most mobile slice of the overall population. especially if you chose a college away from your hometown, you are pretty likely to either move back home or pursue a career somewhere else entirely at the end. I think other folks are also more mobile than you give them credit for. unless they currently have children in school, I find people are pretty likely to move if they see an opportunity for a significantly better combo of salary/COL/taxes.
If we're comparing high-tax states, I think NY is better run, and more interesting overall than California. The only think Cali has going for it is tech (relatively unimportant to the super rich), and warm weather.
https://www.seattletimes.com/business/rich-americans-increas...
https://variety.com/2020/dirt/moguls/ex-google-ceo-eric-schm...
I know that the uberrich get away with dodging taxes all the time, but there are potentially high costs, like having your assets confiscated, or having to hide out in your island fortress and never return to the US lest you end up in prison.
I would say this isn't any different than any other greed at any other place or time. It's simply a cost-benefit tradeoff decision. If people perceive that being in California makes more money than the wealth tax costs, they will stay. If not, they will leave. There doesn't have to be any moral or principled component to this, just simple self-interest.
Also don't overlook the deterrence factor. The wealthy currently in CA may stay there if moving represents a greater overall cost. But anyone not currently in CA would have a great disincentive to never move there.
What I do not understand is why not just implement a more aggressive estate tax on people and close the "trust" and "foundation" loopholes for avoiding the estate tax.
Let's take Jeff Bezos as an extreme example (who isn't even a California Resident). At least until we figure out immortality, Jeff Bezos will die someday. Let him enjoy the wealth that he has earned by creating a company that has benefited society as a whole. When he dies, his wealth should return to the society from which it came. He was rewarded for his work/ingenuity/effort during his life, and now that he is gone, society reclaims the rewards it had given him. What is wrong with that?
The way I see it, once you are dead you don't get a vote, and you don't get a say in the affairs of the world so you shouldn't be able to direct that wealth through any kind of inheritance, foundation or trust. His children have done nothing to earn or create that wealth themselves so why should they deserve any of it? They will have the same opportunities to create and earn wealth that he did, and they will benefit from the society he contributed to.
If they are able to build equivalent wealth via another Amazon.. Great! They earned it! if not that is fine too. You want to help your kids? Teach them how to fish for themselves instead of giving them an unlimited supply of fish.
Passing down wealth from generation to generation or directing wealth long after you are dead through foundations and trusts is directly opposed to any effort to give "equality of opportunity" for future generations.
There are essentially 4 ways to spend money:
1) You can spend your own money on yourself.
2) You can spend your own money on someone else.
3) You can spend somebody else’s money on yourself.
4) You can spend somebody else’s money on somebody else.
All this is not to say that inheritance and wealth taxes should not be collected. I think they should and should be done to help fund the essential functions of government, but I think dialing that percentage up to a 100% of someone's wealth when they die would be a mistake.
Sorry, but this stance is outright ignorant. What do you mean return to society ? His wealth is Amazon, the company, dozens of warehouses and an incredible logistics chain.
His wealth currently provides a pretty damn good service to society, in the form of being able to get items delivered fairly quickly and contact-less in the time of a pandemic.
Are you proposing we take his Amazon holdings after his death and give every person in the county a fractional share? Or however many shares it comes out to?
That's certainly a possibility, but the realistic outcome of that is that most people try to sell their shares for cash right away, thereby crashing the price, and most shares ending up in institutional investment banks and funds within the first year.
I'm not against a stronger estate tax either, but you have to be real careful when you're trying to divvy up massive amounts of wealth on a short time scale and think of the second order effects.
That is not an easy question to answer. The approach you suggested is certainly one that could be considered. You mention that most people would sell those shares for cash.. well that is cash in their hands then. That is money they didn't have before that they now have, that they can then spend on goods and services correct? Is it not redistribution of the wealth of the deceased within society?
It sounds like you agree with the principle, but are worried about the implementation. I would likely consider myself to be in the same boat. However, I am not even seeing any public conversation about it, or an attempt to move in that direction. I think the conversation should be
"This is what we want to do, this is fair wealth redistribution.. now let us come up with ideas on how we can make this work".
Because if sold quickly, it will crash the price of shares. So instead of a share being worth $3000 like it is now, it could cause a short term event where the people that need cash the most would only be able to get $100 for a share, which will get swooped by people who have disposable income to blow on investments.
It would just re-consolidate the wealth in the hands of wealthy people.
Sure, that's probably somewhat better than having it in the hands of 1 person, e.g Bezos, but is it better than other alternatives? Like just giving people stimulus checks in cash?
the kind of A type personality who is a wealth creator..by luck or intent..is likely uber A type that will not submit to dictatorship by legislation. if Jack Dorsey was forced to pay more taxes, he'd probably leave CA for Austin too. (twitter was in SF only for the time they have the tax break. right after it elapsed..coinciding with the covid SAH order, Jack was more vocal about going 100% remote..but the plan to move out of SF was always there even before pre-covid).
A type personalities like to follow rules because it makes it easier to compete in the game. because when you have rules for the game, it means everyone who is playing with you also acknowledge the rules of the game. there will be less conflict, more order and they thrive in such environments because it offer sufficient stability to focus on their goals.
they also want to be recognised and feted. some humbly and others crave it openly. even those who dont realise it enjoy it. california's environment will no longer foster what it did before.
have you ever been pickpocketed? have you ever given money to charity? which feels better? we are still pleasure seeking, rationalising apes. we like to say the words but we will still act with our ape instincts.
california should eliminate ALL taxes. and institute a flat consumption tax. and stop their dirty politics of turning their people against each other. inequalities exist for a reason. i have seen beggars in india with one limb and living in a shack with three children boiling pebbles for soup who are happier than millionaires in california.
We've got yachting communities in the US where some of the natives are surviving off of food banks and charity too because of high taxes, and they're still happy compared to the perceived grumpiness of California billionaires.
So i guess it's all relative, extreme inequality can be so unfair.
What a bullshit idea. Different people start with different advantages in life. Some with wealth, some with looks, some with none. In your bid to make an equal society, will you throw acid on attractive people so they become less attractive?
Attractive people, men and women have a significantly higher advantage in life, maybe call it an asset. Looks are an asset.
Wealth tax is a tax on your fucking assets. You gonna tax looks too?
If I consume less, I should pay less tax. A tax on wealth is a tax on hardwork and savings. People should be rewarded for spending wisely, not penalized.
Once you have a solution for other inherent advantages in life apart from money, and how to account for them, come back.
https://www.mcsweeneys.net/articles/i-will-do-anything-to-en...
San Francisco has a city budget larger than most other countries. This election, it voted to pass all nine measures for new taxes!
https://sfelections.sfgov.org/november-3-2020-election-resul...
The difference, however, is that today's rich people can easily move their residence, and with remote-work; maybe their companies.
In the old times, it was not quite easy to move to another country. I can imagine the difficulties (selling your assets, taking your fortune, figuring out the new kingdom, wars and instability, etc...). This is no longer an issue with city-states like Dubai or Panama; and the fact that your wealth is floating online on some stocks, banks, bitcoin, derivatives, or real-estate scattered around the world.
This doesn't concern the average joe, however. Which is why he continues to carry most of the tax bill and is cash-strapped.
California issue, however, is not the rich are greedy; but that its government is corrupt and inefficient. Raising taxes doesn't help but only grow the corrupt bureaucracy.
Hatred towards the ultra-rich is not based in jealousy but in a moral stance. The argument is not "I want your 30M" it is that "people having this much wealth is bad for all of society".
See: https://www.nytimes.com/2019/02/06/opinion/abolish-billionai...
There's much debate to be had over where that line of "too much wealth that it can't possibly be moral" is, but this is where the cultural conversation is. You're missing the point if you think it's jealousy.
As an example, I never plan to have more than about 2M (in today's dollars) of personal wealth. I'm not supporting this tax because I want the 30M, I'm supporting it because I think it may have positive effects on reigning in the human instinct for greed by aligning societal incentives with personal ones.
I'm trying to keep this narrow as I'm not trying to claim I'm correct that this specific iteration of the tax will work, or even of the form, but hopefully my point about the targeted issue is clear!
This idea that poor people need to shut up and stop complaining because "you have TikTok!" when there are tens of millions of people who don't know where their next meal will come from is, frankly, sickening to me.
I don't understand your perspective at all, and I don't know how you can look at the lives of the millions of people in the in the richest country in the world who can't afford medicine, food, safe housing, good education and say that "they should stop being so jealous."
Please, please change my mind. Tell me how your point makes any kind of moral sense.
"Eat the rich" is not about jealousy, as the parent comment explained, and as the replies all immediately ignored.
"Wealthy people create good things, so why are you mad at wealthy people" is a phenomenally backwards way of looking at things. People who create good things often become wealthy in our capitalist society. That doesn't mean that the accumulation of literal mind-boggling generational wealth is somehow a good and natural thing.
I am so tired of this idea that the natural goal for everyone in the U.S. should be to become a billionaire. If you wanna get radical about it, in my opinion there should not be billionaires. I think the accumulation of that much wealth is inherently immoral. No one person could ever, ever, ever spend that money on themselves, so why should it be theirs?
The phones and the internet and the jobs are great. Why are you taking it for granted that the people who created those things should have more money than most countries do?
i dont understand what you mean. can you expand?
He's just highlighting a fact of life.
You can't have people starving next to people having 7 course meals.
I can't complain about my financial situation and this is precisely why I would support a fairer redistribution. I'm willing to sacrifice a bit so that others have a decent life, too. Because otherwise you can step on others only for so much, and at some point losing your possessions is the least of your concerns.
If you're a true conservative (not in the US sense of the term), you should understand this. Heck, Bismark, the grandfather of conservatives understood this.
Confiscationist: “he’s attacking me!”
I find that a hard statement to square with the founding principles of American culture. The USA was a country that declared independence and fought a war over taxation. The colonies as a whole were a magnet for opportunistic pioneers -- in fact, for much of history, "opportunistic pioneer" (for better or worse) was and is what people think of when they think of American.
So while you're correct that it is a certain kind of greed and self-interest, where I can't understand what you're trying to say is "how far X has gone." What does how far mean? The greed has been at this level since nation's conception. And ostensibly, it was the whole /point/ of the nation.
This is a bandaid over Prop 13. We should tax land more instead of having high income taxes, economists agree the land value tax is the most efficient tax.
It's not because of a .4. As you said, barely anyone will pay it. And still people are leaving.
It's because it's now a fact:
That California politicians are unable to spend wisely.
That California politicians have great appetite for raising taxes, and inventing new ones.
So it's not a .4 that drives people out. It's because they know what's next.
What? Y-combinator takes in lots of people for more than 60 days and they're on track to make a lot of money given the success rate of YC startups.
>> When people are getting 5-6% returns on investments (minimum), 0.4% is still not even stopping the rich get richer effect.
How is that relevant to taxing people who dont live there?
The 99th percentile wealth vs 99th percentile taxable income suggests that many very wealthy people are making lower returns in fact.
If people are generating those returns, however, there is no need for a wealth tax: the returns are already taxed (and could be taxed at a higher rate without a whole new invasive tax regime).
I couldn't find what the tax was supposed to go towards but I also didn't make it beyond the paywall.
Where is the explanation for how the money was spent, why it hasn’t paid off, and what would be different?
As far as I can tell it’s not ‘earmarked’ it’s just more tax for the general fund.
Also, Earmarks have never been trustworthy so it wouldn’t matter even if it were earmarked.
Reports here go back over 10 years, so there's plenty of data to analyze.
It doesn’t have any data about what the goals of spending that money was, not what the outcomes have been relative to those goals.
On it’s own it’s essentially useless for determining whether more or less money should go to any of those departments, let alone the state as a whole.
People want to know how their tax money is going to address society's problems. Is that so much to ask?
Gas tax is the most cited counterexample, but even there roads get money from general revenues.
California doesn’t have a money problem. They have a lack of political will problem and an incompetence (or corruption) problem. The state is held hostage by NIMBYs and is chronically unable to build infrastructure. Look at the high speed train disaster for an example of the latter.
NIMBYs ensure that any money or effort put into the homeless problem is also wasted, as there is no affordable housing for these people to inhabit even if their mental health issues are dealt with.
More money won’t fix these things. It will probably go into the pockets of the people who created these problems.
Note that much of what I wrote applies to the USA broadly. We are taxed not much less than Canadians, but have the infrastructure and social services of a “developing” nation.
Give me either low taxes at e.g. Costa Rica levels OR shiny infrastructure, free college for my kids, and universal healthcare.
Oh wait Costa Rica has universal health care...
We are great at setting money on fire in this country.
You do realize a wealth tax is one way to bring in income to try to fix these problems right? You guys don't even have universal healthcare in the middle of a global pandemic. Laughably sad.
california is huge. if they fixed transport problem(HST failed), we have plenty of space to build homes. its not like we are the australian bush or something..these are perfectly buildable areas..its just not san francisco or the bay area or wherever there is high density and everyone want to flock to the nicest place to live as cheaply as possible.
Can anyone remind me what the rich when ending this racket is on the ballot?
At some point the most rational thing becomes to leave California if you are not a homeowner, or to never go there in the first place, and to geographically diversify the industries that are located there. All these things seem to be happening already. Ship may have sailed.
More money won’t fix a broken government any more than more revenue fixes dying companies.
IMHO one of the roots of all evil was proposition 13, which created a kind of property owners caste with a vested interest in actually making the housing problem worse. From that flows the homeless crisis, as housing costs start at upper middle class income levels anywhere in the state that also has jobs.
The problem is that proposition 13 is a hole from which it would be really hard to dig the state out from. Any politician who challenges it is voted out instantly by the landed caste as well as by the financially vulnerable younger folks who over-leveraged themselves into unaffordable homes and would be ruined if housing fell.
The infrastructure problem is also partly related to the housing problem. Nobody dares change anything because it might pop the housing bubble.
Prop 13 was a Republican thing, which shows that this isn’t just a Democrat or “too much liberalism” problem. It’s deeper than that.
I highly doubt it's that rather than the fact special interest are prioritized over 'effective government' in large parts due to some conservatives and neoliberals promoting the idea of corruption == freedom. When there's a thousand ways to legally bribe politicians, of course there's no incentive for effective government.
It's good for Californians to enforce their values. They'll keep their country unique, while the rest of the world homogenizes into a capitalist dystopia.
> that's a real sign of just how far American greed has gone
Glib support of expropriation shows just how far American collectivism has gone. Naked envy and resentment hiding behind a fig leaf of public mindedness.
If you're going to move where you live or significantly alter where you spend you time because of 0.4% of things above 30M, that's a real sign of just how far American greed has gone. The rich will drive themselves right into another french revolution unless they start realizing that taxes need to return to where they were from the 1930's-1970's. Trickle down economics is a known failure and at this point it's a question of when the pendulum will start swinging the other way.