Hereditary wealth is a specific form of rent-seeking which is something liberal economics has no explanation for. It's like one of those things that never left the feudal era whilst everything else did. But I wonder why some who follow this type of economics think this is the sole and most important issue? There are many examples of rent-seeking and this is far from the biggest contributor towards inequality.
This assumption sounds nice but isn't backed by psychology research. Extrinsic rewards can motivate and demotivate - and in general contribute to anxiety.
But inheritance tax is 40% above that.
Not that I suggest any of this in serious mind you, it's just the kind of thought experiment day-dream that gets me through my workday. What this one has taught me is this: nobody actually wants a meritocracy.
In most first world countries, there is basic free education and children can study for a job with enough pay to provide for a decent life style. That's not to say that there're no problems. There are. Often accomodating immigrants from poor countries. Also because declining population and pensions and all that.
But do you want to go full socialist because only rich family children get to the most expensive colleges? O_o
Why not? There's plenty of people arguing for exactly that mechanism when it's not about their own children. A 100% inheritance tax (with no loopholes through business or legal constructs) might force a lot of people to rethink how they vote -- because then, they can't use their wealth to shield their children from how society functions any more.
If someone else's child was run over and killed in a road, a person may pause to reflect on how sad and unfortunate the event was, but will quickly move on with their life and continue as they were. If their own child though was run over and killed though, they would be shattered, may not even be able to function well for quite some time.
As such, your suggestion is quite literally against human nature. We're not insects. This is the usual trap for people with Big Ideologies: they assume that we're all these tabula rasa entities onto which anything might be written (and should be).
Literally the whole premise on which the plot of Inception rests was to convince the child progeny of wealth to forgo it so as to prove that he could make a name for himself on his own merit and not by riding his father's coattails.
There's a very big difference between leaving a child to fend for himself (so to speak) and attempting to help a child develop his own sense of agency, including restricting access to a smaller-than-naturally-limited set of resources.
https://work.chron.com/salaries-changed-nurses-23316.html
I don't understand your skepticism.
edit: corrected wrong second link
It does not. It comes from supply and demand, and how important that job is to the cash flow that will end up paying for it.
A short article from inequality.org [1] suggests that most of the richest people in the world (Forbes 400) were born with significant financial advantages, if they weren't already wealthy.
Since there are many more rich people than the Forbes 400, that doesn't seem too representative of the usual rich person. It's hard to find anything conclusive - there are a few research memos put out by what seem to be wealth management firms claiming that most rich people are actually self-made. There's a clear conflict of interest here, so I'm not sure we can trust those results.
It seems understudied, and will take a lot more than 10 minutes of searching for relevant results.
1. https://inequality.org/research/selfmade-myth-hallucinating-...
I wouldn’t call 22% of the richest 400 people in the world having inherited more than $1M to be evidence inheritance dominates the causes of inequity.
I mean, another way to put it is “80% of the richest people in the world DID NOT inherit their wealth.”
[1] https://ips-dc.org/the_self-made_hallucination_of_americas_r...
22% received support and inherited up to a million, and a further 40% inherited at least a million - more than a lifetime's worth of income.
People outside these categories included those whose parents ran a successful business.
What's fascinating is that most of the German name-brand companies that thrived under the Nazis are still owned by the same families.
This is not true, because when you don't have hereditary nature of wealth, there is no wealth. Why would you be motivated to accumulate wealth?
Economically you want people to save money and invest, when there is no target to have wealth, people will over spend.
Spending means economically staying at same level as population, not improving.
This is just unfair to everyone. It is wrong, immoral, unethical to tax the wealth of people, if you don't account for other inequalities in life. The inequalities will persist, just that when assets, money isn't that medium of storage, people will only value looks and other things even more, because that's how you'd effectively store your wealth, untaxable. The genes of the people become the platform for storing wealth in that kind of world. The only place where breaking or taxing people' wealth is agreeable is when they become too powerful and above governments. No other excuse.
This is something seriously overlooked.
Why do some guys get all the girls and some don't. Isn't it unfair to those guys that they have their needs emotionally met just like any other successful humans? If you are so fair, fix these problems. Everyone has feelings, and it's not their fault that they're bitter about it.
Is it those men's mistake that they were born in this world? And they couldn't even do anything to rectify that problem when the baseline is so high to reach?
Everyday I read about these people and it makes me sad. Thankfully I don't have any of those problems, but I can't overlook those who do have them. Atleast they'd have a chance in todays world had they pushed themselves and become wealthier.
This isn't only about men, but women too.
When you save money and forgo pleasures, you aren't supposed to be penalized.
Western European programmers still live very well, they just aren't as rich as in the US. And the high taxes do moderate and blunt the cutthroat competition to a degree, which results in less crazy work life balance etc.
Of course these debates get very heated because everyone wants the system that would give them more. I was born to poor parents who could afford their own education because it's free here. My relatives had a social net to bounce back from during rough times (primary school teacher). It's not good for a society to have a large portion who feel existential dread and that the only way up is taking huge risks that often require initial capital.
The reason it is like this in the US is because it's not a nation. It's just atomic families and people from all over the world, tolerating each other and minding their own business. There is no feeling of solidarity, especially across races.
But then again, I have not had children of my own, so I can't relate to the need to defend my offspring.
And from friends I know that parenting is really hard with lots of sleepless nights. Perhaps the parent commenter just had a bad day.
Perhaps it's just your laconic phrasing, but I can not stop reading your replies in Arnold Schwarzenegger's voice. Maybe I would see them in a different light if I read them with Wall-E's voice.
Best of luck to your child.
The paper being discussed talks about there being a threshold under which someone might be in a poverty trap. Would simple subsidies and programs to support children's economic future suffice, such as some of the policies advocated for by American progressives?
(Of course, this would require taxes or some other source of funding, but doesn't require confiscation of all inherited wealth)
I guess it's good that you are honest with yourself about it though, that's better than constructing some elaborate justification around some clearly insufficient core "principles".
Of course, the idea that taxation is theft and a fence isn't doesn't hold.
If you have capitalism, you end up with communist revolution, if you have communism, you end up with capitalist system.