Re:Global minimum corporate tax: 130 nations to support U.S....
by imtringued on Friday July 02, 2021 @04:23AM
(#27709075)
>The correct goal is not to take money from the rich (which can be achieved by taxing them; this is what Bolsheviks did and it resulted in millions of deaths from starvation), but to get rid of poverty.
Getting rid of poverty requires taxing money (and taxing nothing else). This doesn't have anything to do with redistribution schemes. Rather, the act of hoarding money in a 0% interest environment is regressive and makes it harder for all other participants to do the same. When everyone saves their money, it gets harder to save money because deflation will reduce your income and thus ability to save money. New money must be created to catch up with savings demand but all the demand for loans and mortgages has been saturated at this point.
The only entity that can take on further debt is the US government but it refuses all the time, forcing unconventional monetary policy at the last remaining institution that actually cares about the economy. Remember why the Fed was founded? To prevent irresponsible government spending and fight the resulting inflation. It was not created to create inflation, that's the governments job.
Just think about a simplified real economy that produces housing and food but nothing else. At some point you have more housing and food than you know what to do with and people stop building and making food leading people to quit their job but also losing their ability to buy food and housing. The village chief (the government) then decides to just build a luxurious house for himself with the help of the surplus workers because he doesn't want to see them starve.
This is an allocation problem. We expect everyone to pay for their own living expenses but we do not guarantee that they can do so. We cannot send them welfare and be done with it because the busy people building the few housing that is actually needed feel like they should also get rewarded for simply existing (more likely they get angry at the welfare recipients). Because we want everyone to work to earn money, we must create bullshit government jobs that ensure full employment.
Only when we run into scarcity of materials and full employment do we need to cut back on spending and an institution forcing the government to cut spending already exists, it's called the Federal Reserve. Wouldn't it be better if we didn't have to rely on our politicians to do the right thing and instead we have a mechanism that kicks the private sector in the balls when it is asleep? Absolutely but it would require the above mentioned "wealth tax" on bank accounts with large amounts of money. I don't care what they do with the money, heck, I don't even want them to pay the wealth tax because then the government has to come up with a way to spend the money, defeating the purpose of the wealth tax. They can buy stocks and pass the hot potato to someone else until they find somebody who actually wants to spend the money.
Getting rid of poverty requires taxing money (and taxing nothing else). This doesn't have anything to do with redistribution schemes. Rather, the act of hoarding money in a 0% interest environment is regressive and makes it harder for all other participants to do the same. When everyone saves their money, it gets harder to save money because deflation will reduce your income and thus ability to save money. New money must be created to catch up with savings demand but all the demand for loans and mortgages has been saturated at this point.
The only entity that can take on further debt is the US government but it refuses all the time, forcing unconventional monetary policy at the last remaining institution that actually cares about the economy. Remember why the Fed was founded? To prevent irresponsible government spending and fight the resulting inflation. It was not created to create inflation, that's the governments job.
Just think about a simplified real economy that produces housing and food but nothing else. At some point you have more housing and food than you know what to do with and people stop building and making food leading people to quit their job but also losing their ability to buy food and housing. The village chief (the government) then decides to just build a luxurious house for himself with the help of the surplus workers because he doesn't want to see them starve.
This is an allocation problem. We expect everyone to pay for their own living expenses but we do not guarantee that they can do so. We cannot send them welfare and be done with it because the busy people building the few housing that is actually needed feel like they should also get rewarded for simply existing (more likely they get angry at the welfare recipients). Because we want everyone to work to earn money, we must create bullshit government jobs that ensure full employment.
Only when we run into scarcity of materials and full employment do we need to cut back on spending and an institution forcing the government to cut spending already exists, it's called the Federal Reserve. Wouldn't it be better if we didn't have to rely on our politicians to do the right thing and instead we have a mechanism that kicks the private sector in the balls when it is asleep? Absolutely but it would require the above mentioned "wealth tax" on bank accounts with large amounts of money. I don't care what they do with the money, heck, I don't even want them to pay the wealth tax because then the government has to come up with a way to spend the money, defeating the purpose of the wealth tax. They can buy stocks and pass the hot potato to someone else until they find somebody who actually wants to spend the money.