The Problem With Taxing the Rich

[hanselthecaretaker]

They almost instinctively just say well, screw that and leave.

NYSE chief warns it may exit New York if stock transfer tax is imposed

The New York Stock Exchange may leave New York State if Albany imposes a transfer tax on stock sales, the president of the Intercontinental Exchange Inc-owned (ICE.N) exchange operator said on Tuesday in an op-ed in the Wall Street Journal.

www.reuters.com

I’d like to know what percentage of the 1% (especially Fortune 500 folk and all the vocal celebrities) will legitimately abide by Biden’s impending tax increases, so that their extra contributions will lead to the betterment of society as-planned. I’d also like to know what the government will truly spend that money on, provided they are fortunate enough to get it in the first place. The other underlying problem is, it’s still likely going to hurt the lower and middle class in the process.

No, Raising Taxes on the 1% Will Not Lead to “Surprising Amounts” of Revenue

The New York Times recently published an article by Patricia Cohen, titled “What Could Raising Taxes on the 1% Do? Surprising Amounts.” The basic claim of the article is that the federal government could raise a significant amount of revenue by increasing taxes on the richest Americans. The...

taxfoundation.org

There doesn’t seem to realistically be much of a clear cut solution to our economic issues, unless we can change the worse aspects of human nature.

 

[Specter Von Baren]

Utterly shocking!

If only someone had thought of this possibility and told everyone!

 

[Silvanus]

I mean... most other Western countries have higher taxes on the wealthy. And that hasn't caused massive exoduses there.

I think this is overblown to begin with: a convenient myth for the wealthy to convince people to believe, to reduce the political pressure on themselves.

 

[dreng3]

How about telling corporations to get bent and pay their fair share or they don't get access to the market?

The only problem with taxing the rich is that you need a highly restrictive and very precise set of laws to do so. Let us not pretend that the companies are okay with turning a diminished profit into no profit at all, they just believe they can force the issue by threatening to leave, or circumvent the issue by leaving and dealing in another way.

Allow them to leave and close every passage into the market and you'll see them crawling back.

 

[Agema]

They almost instinctively just say well, screw that and leave.

To an extent. I would be pretty skeptical of businesses and the rich saying they'll leave. That's the sort of thing they say in the hope it will dissuade people off taxing them, but much more sparingly do unless the taxation is thoroughly punitive.

In the USA, states are set up to compete against each other as a means of internal competition to prevent, well, EVIL SOCIALISM. If the USA as a whole wanted to take action, where are the rich really going to go? Canada, with higher taxes? Mexico? Singapore or Monaco, thousands of miles away? It is perhaps more of a problem in Europe, due to the ease of moving to a tax haven whilst still being in easy reach of their businesses, cultural centres, etc.

But really, I suspect the failure to tax the rich is more one of political willpower than economic damage. And all that shit that needs to get done like climate legislation, cutting lobbying etc. will continue never getting done, because the rich will carry on stuffing their own pockets and bribing / manipulating government into compliance with the agenda of the rich.

 

[Specter Von Baren]

I mean... most other Western countries have higher taxes on the wealthy. And that hasn't caused massive exoduses there.

I think this is overblown to begin with: a convenient myth for the wealthy to convince people to believe, to reduce the political pressure on themselves.

Did you ever consider that maybe it isn't just this one thing that makes the laws and rules in America different and just MAYBE it's all those differences between it and other western countries that makes it different?

 

[XsjadoBlayde]

They always say this. And it's always bullshit.

 

[happyninja42]

Let us not pretend that the companies are okay with turning a diminished profit into no profit at all

That's just it though, the suggested changes to taxation, wouldn't mean they go from All the Profit, to No Profit. It just means Less Profit. Now if they conflate that in their own heads to mean "No profit!! OMG Abandon ship!!" well that's just them overreacting, and isn't actually what will happen. The fact is that the amount of money they have access to, makes even the tiniest of percentages, make a huge difference.

 

[Specter Von Baren]

How about telling corporations to get bent and pay their fair share or they don't get access to the market?

The only problem with taxing the rich is that you need a highly restrictive and very precise set of laws to do so. Let us not pretend that the companies are okay with turning a diminished profit into no profit at all, they just believe they can force the issue by threatening to leave, or circumvent the issue by leaving and dealing in another way.

Allow them to leave and close every passage into the market and you'll see them crawling back.

You're conflating companies with the rich. The taxing of rich people requires different rules than taxing rich businesses.

 

[Silvanus]

Did you ever consider that maybe it isn't just this one thing that makes the laws and rules in America different and just MAYBE it's all those differences between it and other western countries that makes it different?

I have no idea what point is being made here.

But there are certainly a huge number of attractive elements for a company to set up shop in the US. Access to the world's largest economy; an enormous market; relatively wealthy consumers, and lots of them; a huge number of other producers to go into business with. This is why companies are not likely to just up the stakes and move out if the government taxes them a little more. There are so many other reasons it's beneficial for them to stay.

 

[Agema]

Did you ever consider that maybe it isn't just this one thing that makes the laws and rules in America different and just MAYBE it's all those differences between it and other western countries that makes it different?

There is a theorised concept of "tax morale": effectively the willingness of people to be taxed. In large part, these are due to political rhetoric, societal attitudes. Tax morale in the USA is "low", and in France it is "high". Obviously some people in France resent taxation and some people in the USA are happy to pay lots of tax, but on average, in the current day the French are more willing to pay tax than Americans.

 

[Specter Von Baren]

There is a theorised concept of "tax morale": effectively the willingness of people to be taxed. In large part, these are due to political rhetoric, societal attitudes. Tax morale in the USA is "low", and in France it is "high". Obviously some people in France resent taxation and some people in the USA are happy to pay lots of tax, but on average, in the current day the French are more willing to pay tax than Americans.

Exactly!

 

[Eacaraxe]

It's a shame we don't live in an age in which we can deploy guillotines anywhere in the world with the mere push of a button...

The CIA’s Blade-Wielding 'Flying Ginsu' Missile Strikes Again

The missile kills its targets using pop-out steel blades instead of explosives.

www.popularmechanics.com

Lotta billionaires that love to sail around in international waters aboard their yachts, doing god knows what in isolated areas beyond the reach of federal law and in convenient locations where there'd be no witnesses.

Just sayin'.

 

[Worgen]

To an extent. I would be pretty skeptical of businesses and the rich saying they'll leave. That's the sort of thing they say in the hope it will dissuade people off taxing them, but much more sparingly do unless the taxation is thoroughly punitive.

In the USA, states are set up to compete against each other as a means of internal competition to prevent, well, EVIL SOCIALISM. If the USA as a whole wanted to take action, where are the rich really going to go? Canada, with higher taxes? Mexico? Singapore or Monaco, thousands of miles away? It is perhaps more of a problem in Europe, due to the ease of moving to a tax haven whilst still being in easy reach of their businesses, cultural centres, etc.

But really, I suspect the failure to tax the rich is more one of political willpower than economic damage. And all that shit that needs to get done like climate legislation, cutting lobbying etc. will continue never getting done, because the rich will carry on stuffing their own pockets and bribing / manipulating government into compliance with the agenda of the rich.

Normally I would agree that businesses are just talking out of their ass when they say they will leave. But, we saw Tesla do just that when Cali wouldn't open soon enough for their tastes. They already have a stupid factory being built down here.

Considering how easy it is to work almost anywhere now because of the internet and that states will compete for big businesses we have to take into account they might just fuck off and move to a more compliant state. Which is why we kinda have to do taxation on a more federal level.

 

[stroopwafel]

Normally I would agree that businesses are just talking out of their ass when they say they will leave. But, we saw Tesla do just that when Cali wouldn't open soon enough for their tastes. They already have a stupid factory being built down here.

Considering how easy it is to work almost anywhere now because of the internet and that states will compete for big businesses we have to take into account they might just fuck off and move to a more compliant state. Which is why we kinda have to do taxation on a more federal level.

Isn't California going down the drain in general though? Lots of businesses are leaving and they also have a gigantic homeless problem. The prospects of the state look pretty grim. Tesla was probably already planning to leave and used covid as an excuse.

Taxing the rich is merely symbolic. How is that going to help people who need assistance the most? What helps is increasing minimum wage, providing affordable housing and training programs. All of these are political choices which can be afforded by maybe pulling 1% away from the military industrial complex. The amount of tax revenue is not the problem it's how it's spent.

Billion dollar companies hardly even care if tax rates are increased across the board. They only care about disadvantage relative to their competitor. That is why Amazon pays it's workers like shit. If the minimum wage in general is increased they will just accept it. It's a much more structural approach than an additional tax on Bezos' private wealth that is mostly Amazon stock and investments in Blue Origin. Both pretty innovative companies.

 

[Generals]

It's a shame we don't live in an age in which we can deploy guillotines anywhere in the world with the mere push of a button...

The CIA’s Blade-Wielding 'Flying Ginsu' Missile Strikes Again

The missile kills its targets using pop-out steel blades instead of explosives.

www.popularmechanics.com

Lotta billionaires that love to sail around in international waters aboard their yachts, doing god knows what in isolated areas beyond the reach of federal law and in convenient locations where there'd be no witnesses.

Just sayin'.

But what if the Billionaire is a Russian Oligarch with anti missile defence systems?

A Luxury Yacht with submarine and missile defences

Russian billionaire Roman Abramovich’s new $400 million, 555-ft. Eclipse, designed to be the world’s biggest (and so named because Abramovich desires that it overshadow all other boats at sea) will have a military-grade missile defense system to keep the oligarch safe. Abramovich owns three...

www.luxuo.com

 

[Generals]

They almost instinctively just say well, screw that and leave.

NYSE chief warns it may exit New York if stock transfer tax is imposed

The New York Stock Exchange may leave New York State if Albany imposes a transfer tax on stock sales, the president of the Intercontinental Exchange Inc-owned (ICE.N) exchange operator said on Tuesday in an op-ed in the Wall Street Journal.

www.reuters.com

I’d like to know what percentage of the 1% (especially Fortune 500 folk and all the vocal celebrities) will legitimately abide by Biden’s impending tax increases, so that their extra contributions will lead to the betterment of society as-planned. I’d also like to know what the government will truly spend that money on, provided they are fortunate enough to get it in the first place. The other underlying problem is, it’s still likely going to hurt the lower and middle class in the process.

No, Raising Taxes on the 1% Will Not Lead to “Surprising Amounts” of Revenue

The New York Times recently published an article by Patricia Cohen, titled “What Could Raising Taxes on the 1% Do? Surprising Amounts.” The basic claim of the article is that the federal government could raise a significant amount of revenue by increasing taxes on the richest Americans. The...

taxfoundation.org

There doesn’t seem to realistically be much of a clear cut solution to our economic issues, unless we can change the worse aspects of human nature.

I am truly amazed at how slowly you reach the top income bracket

But yes taxing the ultra rich alone is usually not enough to fund extensive welfare programs. But based on the bracks mentioned in the link you gave I think the upper middle class and "simply" rich have some tax dollars to spare. Especially if all that taxation will give them access to cheaper healthcare.

As for Rich people and big companies moving. It's always a risk but there are trade offs. Usually the further they have to move the less likely they are to do it. So in the case of the US it's mainly a matter of ensuring it happens on a Federal level.

 

[dreng3]

That's just it though, the suggested changes to taxation, wouldn't mean they go from All the Profit, to No Profit. It just means Less Profit. Now if they conflate that in their own heads to mean "No profit!! OMG Abandon ship!!" well that's just them overreacting, and isn't actually what will happen. The fact is that the amount of money they have access to, makes even the tiniest of percentages, make a huge difference.

I might not have made it entirely clear, my point was that we should make it clear that either you play by our rules or you don't get access to our market. The idea that the companies or rich people can just up and leave is predicated on them retaining access to the market. If you ensure that there is no access to the market for outside forces they won't be willing to leave.

You're conflating companies with the rich. The taxing of rich people requires different rules than taxing rich businesses.

I am not, both the rich and the companies can get bent. Both look for loopholes and avoid paying the same share as the rest of us. If either want to operate within the various nations they need to play by the rules, and the rules need to be so strict that they can't play games.

 

[Specter Von Baren]

I might not have made it entirely clear, my point was that we should make it clear that either you play by our rules or you don't get access to our market. The idea that the companies or rich people can just up and leave is predicated on them retaining access to the market. If you ensure that there is no access to the market for outside forces they won't be willing to leave.




I am not, both the rich and the companies can get bent. Both look for loopholes and avoid paying the same share as the rest of us. If either want to operate within the various nations they need to play by the rules, and the rules need to be so strict that they can't play games.

Do you not understand how laws work?

 

[Worgen]

Isn't California going down the drain in general though? Lots of businesses are leaving and they also have a gigantic homeless problem. The prospects of the state look pretty grim. Tesla was probably already planning to leave and used covid as an excuse.

No, those are just memes that have been around forever. Pretty much every state has a homeless problem and a lot of businesses are closing because of covid. I mean some of the wealthier ones might be leaving for tax reasons but Cali is huge monetarily. It would take a lot for it to go down the proverbial drain and its no where near.

Billion dollar companies hardly even care if tax rates are increased across the board. They only care about disadvantage relative to their competitor. That is why Amazon pays it's workers like shit. If the minimum wage in general is increased they will just accept it. It's a much more structural approach than an additional tax on Bezos' private wealth that is mostly Amazon stock and investments in Blue Origin. Both pretty innovative companies.

Actually if I remember right Amazon was one of the earlier big companies to jump on the $15 an hour band wagon.

The problem isn't that there are billionaires, the problem is there are billionaires when a lot of people make $50k or less a year. Its the income inequality that creates the problems since finite things like land and housing will tend to match the price that the wealthiest is willing to spend on it and that shuts out and strains those that can't hope to match that amount and it takes awhile for prices to fall back to a less dumb level. So you either need to bring up the majorities earning power or reduce the total amount that the highest up have.