You gotta love that argument eh? It's kind of like borrowing money from a bank so that you can hire yourself to do useless work until you collapse under the increasingly large interest payments.

You have to right? Because if you don't borrow money to pay yourself to do useless stuff, well then you can't afford to eat... At least this way you're buying some time to figure out a way to get someone else to borrow money and pay you.

"But if people stop throwing rocks to break windows, how will the window makers make a living?"

In this case the window makers are probably web startups. If college kids weren't buying all these iphones what would be the value of geolocated picture dating services or whatever?

It's interesting to hear what people consider window breaking and window making. Even in the canonical example of lawyers (who only "split the pie"), some provide a social good by defending innocent people against what some people consider a corrupt body of laws.

I recently finished reading John Brunner's "Shockwave Rider" and found the taxation proposal near the end intriguing, if a bit alien. Tax rates are adjusted based on scoring of profession on three axes: training/talent, drawbacks (like unpredictable hours and dirty working conditions), and social indispensability. On all three axes, advertisers would score a zero, thereby qualifying for a 90% tax rate. I wonder where people would score people who work in a lot of these startups? I suppose it would depend heavily on what the startup was doing.

If you start following the consequences of the existence of any profession or product to the logical conclusion you can come up with some surprising things. Which is probably why such a tax scheme would be fairly unworkable in practice and would incentivise industries to introduce unnecessary training or overcomplicate their work.

In the case of web startups you can go from "college students all have smartphones so let's build a social network for them to share their most banal thoughts" to "almost everyone in the US will have a smartphone within 5 years and a social networking profile, how can we use this information to provide more efficient public services?". So frivolous spending can accidently create opportunity for much more valuable work.