The people that were most important and productive during the pandemic are the ones on the front-line in healthcare and essential services. We have relied on them potentially exposing themselves in order to keep society going.
On the other hand, your so called “productive people” are sitting on their hands at home watching their assets massively gain in value.
The wealth divide is already accelerating, and the crisis is making it worse. I don’t think we should worry about “agitating” a small percentage of people whom our society seems to undeservedly elevate to god status.
We should recognize these feedback loops as a bug and rectify them.
The fact that you even had a job that you could loose, means that you are NOT in that category, and (statistically speaking) never will be.
What parameters determine when someone is forced to sell equity? How about equity in non publicly listed assets, which don’t have a deep market or clear price?
If it makes it clearer, suppose the market value of the assets you own increases from $10M to $15M in a year. How would you tax this? Do you start forcing people to sell? What if the asset they own isn’t publicly traded, for example land, or privately owned companies?
It’s not a “gotcha I’m against increasing taxes on wealthier people statement”. It’s a legitimate question on how to operate society when do much of the wealth is simply from increasing asset prices and decreasing currency values.
(and contra Graham, it's only assessed at a per-mille level, not percents)
Also, at that point, you shure as hell diversify your assets, instead of having them all in a single privately held company.
That's why we need a transaction tax on stock combined with tax breaks on stocks that have societal value, together with a ban on all derivatives. Stock markets need to be first order long term srategy crowdfunding again like they were originally invented as. Otherwise computers will just chase the next peofitable microsecond and CEOs will juse try to optimise the next quarter.
I know how real estate and tangible/intangible asset values are assessed for property taxes purposes, and the problems with that are enormous, not to mention the avenues for fraud and increased paperwork. There are definitely winners and losers there based on your level of influence in society.
How and who determines what “stocks” have societal value?
It’s really easy to say these things, but I have yet to come across someone with even a half baked plan to implement them in a fair way. For example, currently startup employees get screwed with the way taxes work on options, where they owe significant taxes for nebulous gains that they may or may not benefit from.
Take Jeff Bezos, the richest man on earth, for example. His total compensation is 1.7 million and His capital gains from stock sales are about 1-2 billion per year.
The salary is is essentially negligible, and even doubling capital gains would provide an extra 200-400 million. The federal budget for 2020 was 4,790 million dollars.
Those 600 people hold $4 Trillion dollar. Which is the federal budged you mentioned (it's not million btw).
The bottom 50% of the us population have 2 Trillion.
Those 4+ trillion federal budget include that ridiculous amount of defense spending, that's essentially welfare for the rich.
Now imagine if you could increase the federal budget by 25% for 4 years, just for science and education, and as a side effect you get a continued plus through the reduced negative effects of massive political influence by a small elite of 600 people.
There would probably a positive societal impact if you took those 4 trillion and burned them. Getting to spend them means, moon colonies, mars missions, broadband internet everywhere, proper healthcare for all, and maybe a shot at surviving the climate and biosphere collapse...
They do not have $4T. They have assets which may be valued at $4T based on the most recent sale price of a small representative piece of the asset.
There is no way that the “$4T” in assets can be converted to $4T cash as selling it all would shift the supply and demand curves causing the price to drop, and hence the valuation.
As I said, even if you'd just destroy all their wealth/power, you'd still get a better society, because politicians wouldn't constantly try to do the bidding of these people and instead tackle the real problems that we have.
Yes, I’m not arguing against redistribution of wealth (or power or influence or whatever you want to call it). I’m interested in the details of how it can be accomplished. Money is simply the most technologically advanced way we have of moving “power” around, but exactly how power gets converted to money is a big question, and one that frequently involves winners and losers.
> As I said, even if you'd just destroy all their wealth/power, you'd still get a better society,
I agree, and typically this has been accomplished with violence/war. I’m just trying to see if anyone has any good (and “fair”) ideas on how to accomplish it without violence.
I have an aunt and uncle in SF Bay Area who worked their whole life and saved for retirement, but didn’t assume that the land under their house would be worth $2.5M in their old age. What should happen to them? They certainly don’t have the cash flow to afford a proportionate property tax without having to move away. I don’t know a good answer either, maybe some people just have to end up screwed.
Stop mixing billionaires and millionaires.
Having billions is unfair by definition.
What if the sale price doesn’t match up with the valuation amount? What happens if a majority shareholder is forced to sell and it results in them becoming a minority shareholder? Does that mean one is forced to give up control of their business after a certain size?
Yeah, we all agree extreme income inequality is bad. That’s the easy part.
Then you don't have to sell as much as you thought.
> What happens if a majority shareholder is forced to sell and it results in them becoming a minority shareholder?
Works as intended. Companies this size should be broken up under monopoly laws anyways.
> Does that mean one is forced to give up control of their business after a certain size?
Now you're getting the spirit! Also, monopoly laws.
I lost my job due to covid but don’t get a “stimulus” — pointing out this means it’s income redistribution not stimulus and not relief for those impacted. That is factually true.