The fact that a wealth tax would make everyone worse off doesn’t matter to people who want equality for its own sake. I once had a conversation with an environmentalist who was horrified that some African countries were allowing tribes to own and profit from elephant herds.
I pointed out that in those countries, elephant populations were growing, while in countries that followed his preferred approach of banning elephant hunting altogether, populations were shrinking. The problem is, elephants are incredibly destructive to crops. If local people have no incentive to protect them — and every incentive to get rid of them — then they’ll be killed.
His response was that he’d rather see elephants go extinct than see them owned and be a source of profit.
How do you reason with that kind of mindset? How do you engage with people who would rather everyone be equally poor than allow some to do better — even if that means others also end up better off?
The thing is most people don't have enough data to answer the empirical questions. But everyone has a sense of fairness! So of course the question of fairness dominates the discourse.
Billionaires are bad because they're too dangerous. Having a shitload of money is as dangerous to democracy as having a private army. Both should be prevented.
If the ceiling on personal wealth were $500 M, I don't see how that would hurt much. People still seek high status (in the military, government, academia, etc. even if doesn't lead to obscene wealth. Creating a great and famous company should be enough of a reward if it you can't own more than half a billion of it.
We don’t have great empirical evidence (from my knowledge) on this because it’s so insane that no society has tried it. Wealth concentration is dangerous to an extent, and democracy in my view is only instrumentally useful.
If you were implying that US inequality has increased than that typically isn’t the case. Same with social mobility even between quintiles as well.
As for a “100% tax over 500M” it would literally crumble any incentive to do any sort of productive capacity past 500 million. Elon Musk isn’t paid billions arbitrarily, it’s because he brings a useful skill to the table, eg he chose to enter the EV industry early and helped spur Tesla and SpaceX. To cap his income at 500K might sound good prima facie, but it would have devastating consequences for production since there would be no self interest in doing anything past 500M.
The paper you cite is about income inequality. I'm more concerned about wealth inequality. The top 10% of all households hold 60% of all US family wealth, and the top 1% as much as 1/3.
I think the trade-off you describe is worth it. It's just too dangerous to let unelected figures have as much control over our society as Musk, Murdoch, and Thiel have obtained. You have better ideas about how to geld them?
I think this is correct. I've never been a fan of Nozick-style defences of capitalism. Outcomes matter the most to me.
Side note: I think you're conflating capitalism with a market economy. In my view, capitalist systems are ones in which property is owned privately; in socialist systems, property is owned collectively. The freedom of the market is largely orthogonal to this. Under fascist and corporatist systems, the market is often very unfree and controlled by a few monopolists and an extremely powerful state; however, capital is very much held privately. On the other hand, in societies like Norway, where the majority of national wealth (~60%) is owned collectively and controlled via democratic institutions such state-owned enterprises and sovereign wealth funds, it seems that a liberal market economy is paired with mostly social ownership.
I always answer this with the response “it depends how they earned it”. Was it by adding value to billions of people's lives who voluntarily bought their product OR was it stolen from taxpayers eg Obama charging 18m per year for advice to Biden? For the former i have no issue; for the latter even a few dollars deserves jail time.
The fact that a wealth tax would make everyone worse off doesn’t matter to people who want equality for its own sake. I once had a conversation with an environmentalist who was horrified that some African countries were allowing tribes to own and profit from elephant herds.
I pointed out that in those countries, elephant populations were growing, while in countries that followed his preferred approach of banning elephant hunting altogether, populations were shrinking. The problem is, elephants are incredibly destructive to crops. If local people have no incentive to protect them — and every incentive to get rid of them — then they’ll be killed.
His response was that he’d rather see elephants go extinct than see them owned and be a source of profit.
How do you reason with that kind of mindset? How do you engage with people who would rather everyone be equally poor than allow some to do better — even if that means others also end up better off?
The thing is most people don't have enough data to answer the empirical questions. But everyone has a sense of fairness! So of course the question of fairness dominates the discourse.
Billionaires are bad because they're too dangerous. Having a shitload of money is as dangerous to democracy as having a private army. Both should be prevented.
If the ceiling on personal wealth were $500 M, I don't see how that would hurt much. People still seek high status (in the military, government, academia, etc. even if doesn't lead to obscene wealth. Creating a great and famous company should be enough of a reward if it you can't own more than half a billion of it.
We don’t have great empirical evidence (from my knowledge) on this because it’s so insane that no society has tried it. Wealth concentration is dangerous to an extent, and democracy in my view is only instrumentally useful.
https://davidsplinter.com/AutenSplinter-Tax_Data_and_Inequality.pdf
If you were implying that US inequality has increased than that typically isn’t the case. Same with social mobility even between quintiles as well.
As for a “100% tax over 500M” it would literally crumble any incentive to do any sort of productive capacity past 500 million. Elon Musk isn’t paid billions arbitrarily, it’s because he brings a useful skill to the table, eg he chose to enter the EV industry early and helped spur Tesla and SpaceX. To cap his income at 500K might sound good prima facie, but it would have devastating consequences for production since there would be no self interest in doing anything past 500M.
The paper you cite is about income inequality. I'm more concerned about wealth inequality. The top 10% of all households hold 60% of all US family wealth, and the top 1% as much as 1/3.
I think the trade-off you describe is worth it. It's just too dangerous to let unelected figures have as much control over our society as Musk, Murdoch, and Thiel have obtained. You have better ideas about how to geld them?
I think this is correct. I've never been a fan of Nozick-style defences of capitalism. Outcomes matter the most to me.
Side note: I think you're conflating capitalism with a market economy. In my view, capitalist systems are ones in which property is owned privately; in socialist systems, property is owned collectively. The freedom of the market is largely orthogonal to this. Under fascist and corporatist systems, the market is often very unfree and controlled by a few monopolists and an extremely powerful state; however, capital is very much held privately. On the other hand, in societies like Norway, where the majority of national wealth (~60%) is owned collectively and controlled via democratic institutions such state-owned enterprises and sovereign wealth funds, it seems that a liberal market economy is paired with mostly social ownership.
See Matt Bruenig's work on this issue: https://www.peoplespolicyproject.org/2017/08/05/nordic-socialism-is-realer-than-you-think/
I always answer this with the response “it depends how they earned it”. Was it by adding value to billions of people's lives who voluntarily bought their product OR was it stolen from taxpayers eg Obama charging 18m per year for advice to Biden? For the former i have no issue; for the latter even a few dollars deserves jail time.