Why We Need a Wealth Tax

trixare4kids said:

Two things.
1)Goofy Warren will never get the nomination
2)What Goofy says she will do when elected is a moot point.

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Maybe Bill Ahole DeBlasio?

TurtleDude said:

what is especially pernicious is when this is applied to "assets" that do not generate any income. For example, I know several collectors of art who have items worth several million dollars. They paid estate taxes on those items when they were passed from prior generations to them. A wealth tax could constantly force them to pay thousands of dollars merely to keep something that has already been purchased with after-tax income and then taxed as part of an estate. The entire concept is disgusting and is designed to buy the votes of the envious

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Well said!!!

What a way to snag the votes of the hopelessly gullible.
Elizabeth Warren on Twitter: "This billionaire NFL owner just paid $100M for a "superyacht" with its own iMax theater. I'm pretty sure he can pay my new #UltraMillionaireTax to help the millions of yacht-less Americans struggling with student loan debt. https://t.co/Gk4ifAkxdT"

trixare4kids said:

Well said!!!

What a way to snag the votes of the hopelessly gullible.
Elizabeth Warren on Twitter: "This billionaire NFL owner just paid $100M for a "superyacht" with its own iMax theater. I'm pretty sure he can pay my new #UltraMillionaireTax to help the millions of yacht-less Americans struggling with student loan debt. https://t.co/Gk4ifAkxdT"

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I wonder how many people got paid for building that yacht. Reminds me of several years ago when Dems managed to tax new large yachts as a way of getting rich to "pay their fair share". What ACTUALLY happened was many either canceled their orders or decided not to buy. End result: dozens of skilled boat builders lost their jobs, and the rich made do with older yachts. Have another beer, Lizzie! :lamo

Mr Person said:

<blah blah blah>

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Xelor said:

I haven't seen the whole line the "taxation = thievery" crowd (person?) is pushing, but I don't need to because there is a fundamental difference between taxation and thievery:

• Taxation --> Done sans subterfuge/surreptitiousness; taxing bodies announce the presence of the tax and publish its terms.
• Thievery --> Undertaken with express and contrived subterfuge and surreptitiousness; thieves do not announce "we're going to steal from you and X is how much we're going to take, and 'thus and such' are the occasions when we'll do so."

The taking of resources (in this case money) combined with the attempt to clandestinely execute the taking is what constitutes stealing, theft.

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True. But hold on, there was another post. I think we're just about entirely in agreement; see the first two points on the tax-as-theft claim:

Mr Person said:

Taxation as “theft” is a silly talking point that will never go anywhere. I’ve never seen an actual argument for why it’s like other things called theft. Only declarations along the lines of "[things are thus, so be quiet because reasons]."

First, the person stolen from in every other kind of ‘theft’ is not enjoying the availability of services necessary to anything like a modern existence in return. We use roads, we pay taxes to build/maintain them. Etc.

Second, everything else we call theft is done lawlessly, willy nilly. Taxation is done according to law (that is constitutional), in an ordered scheme.

Third, and perhaps more importantly, it’s generally a pointless word game to argue it’s theft (or even to argue it’s not theft).


Word game: I could say “Know what sounds a lot more like "theft" to me? Enacting laws such that we borrow over one trillion a year so as to give the richest tax cut, knowing full well it'll be our children and grandchildren who pay the bill. "Theft" from one's future descendants.”

Just as easy as you typing a declaration that taxes are “theft”.


The pointlessness of this debate:

We have a government. We need to pay for it. Just about everyone is invested in enough programs that we're never going to agree to even cut spending much. Voluntary payment instead of lawfully required taxation cannot work (See, e.g., Articles of Confederation).

So let’s trace the results of putting your “taxes are theft” principle into action, and get rid of this criminal enterprise like we do other thieves.

First, the federal government collapses. It needs money to exist. Without a federal government we don’t have a nation or any military to defend it or any way of maintaining equipment with which to defend it. Ok, so now it’s 50 state governments. But wait. States will have to pay for services. But that requires taxation and you say that’s theft. So let’s get rid of the theft. So now state governments cannot function and dissolve. (Nevermind that collapse of a federal government would make existing currency meaningless).

Anarchists might love this (until local warlords pop up).


In other words, actually calling and treating it like “theft” – putting your principle in action – would mean the end of any coherent governance. With it, the roads you use, the water you drink, and almost certainly the forum on which you called taxes “theft”.

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Our only disagreement will be if you disagree with this: it's really the second half that's the main point even though the first is true. I try to put pragmatism over most things. And if some initiative fails no matter who is right or wrong, then there's little point in worrying about whether or not it should fail.

TurtleDude said:

what is especially pernicious is when this is applied to "assets" that do not generate any income. For example, I know several collectors of art who have items worth several million dollars. They paid estate taxes on those items when they were passed from prior generations to them. A wealth tax could constantly force them to pay thousands of dollars merely to keep something that has already been purchased with after-tax income and then taxed as part of an estate. The entire concept is disgusting and is designed to buy the votes of the envious

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That's certainly an understandable perspective, but there are other ways of looking the issue too. We can imagine scenarios in which an artist creates a masterpiece for a specific person and it's never bought or sold - never commodified - but in most cases, wouldn't it be fair to say that the works of folk like da Vinci, Rambrandt and so on have become part of the cultural legacy of humanity in general? And if so there's surely many art-lovers who might think that there's something "disgusting" about such cultural treasures being hoarded into private collections, enjoyed by a few while depriving the rest of the world of their beauty purely on the basis of who happened to have the wealthier ancestors.

Rather than hurling gross invective one way or the other based on some absolutist notions of art and ownership, perhaps an annual tax/fee for the privilege of privately enjoying part of humanity's cultural legacy would be appropriate?


Edit: Mind you, personally I'm not sure about the wealth tax concept at all - whether a better approach would be that, or bringing estate taxes a little closer to parity with other income taxes.

Mr Person said:

True. But hold on, there was another post. I think we're just about entirely in agreement; see the first two points on the tax-as-theft claim:





Our only disagreement will be if you disagree with this: it's really the second half that's the main point even though the first is true. I try to put pragmatism over most things. And if some initiative fails no matter who is right or wrong, then there's little point in worrying about whether or not it should fail.

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I don't think we disagree. I merely wanted to note the subterfuge factor as an essential trait of theft.

OldFatGuy said:

At birth, yes. And many have proved it so. Certainly, for all, other factors will mitigate, but they can be conquered. That same white son of a rich law firm attorney can just as easily end up on skid row as anyone else, and that also happens. Who should be blamed for that outcome? Or what social limitations should be ascribed causation?

I am of a minority not white nor black and often on the short end of the stick when it comes to prejudices. I never let that get in my way when achieving. We each chose to live our lives to the best possible outcome, or we don't. It is an individual decision.

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Bull****. A black baby born to poor parents in the hood does not have equal opportunities as a baby born to a rich lawyer in the Hamptons.

Aristaeus said:

Bull****. A black baby born to poor parents in the hood does not have equal opportunities as a baby born to a rich lawyer in the Hamptons.

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Robert L. Johnson as opposed to Ted Ammon or Richard Decker, the latter who died at 24 from a heroin overdose three years ago, his father one of senior partners at Wulf, Decker and Bond, an arbitrage firm based in East Hampton, offices in 12 cities, now dissolved with the death of Wulf, the early retirement of Decker because of grief (his wife committed suicide), and Bond moving to another firm. 420 employees dismissed.

Johnson owned the Bobcats. America's first black billionaire, and not the last. Decker came from a long lineage of WS Lawyers working blue blood firms since before the American Revolution, his son, his last his surviving child, all his children dead from substance abuse.

How many wealthy sports figures came from the "hood?" Musicians and other artists? Business people? Those in public service? While wealthy white parents keep producing offspring that pass into obscurity. Despite your caricatures, reality proves you wrong. In every culture, only a few rise to the top, rarely do children match the success of parents, instead dissipating fortunes as quickly as they were accumulated, and many more conquer the prejudices that others use an excuse for surrendering their futures.

Let me remind you of Anti Chinese League, the "We don't hire Irish" signs, Italians are lazy, shiftless, only good for digging graves and canal ditches, Jews not allowed, and so forth and so on for every ethnic group in America except WASPs. And even they suffer the prejudices of people like you.

Many years ago, after tasting bread baked by a self taught 19 year old Puerto Rican baker in a small restaurant in the barrio of East Harlem, and meeting with him in the small kitchen, I financed his first bakery with a $5k investment. He and his family, through hard work, now own the largest privately held commercial bakery in the NYC region, supplying our entire public school system with quality bread for feeding our students, our children, and supplying countless high end restaurants with artisanal breads, plus his own 7 bakeries. His sweat made it happen. His dreams realized.

Look around, he is not an anomaly. He represents the few in every culture who rise by their boot heels. Cowards talk of defeat before trying to accomplish anything and any excuse will do. His father had been a plantation worker in Puerto Rico, his mother a washer woman and farm worker in season.

OscarLevant said:

Your sentiments are common among republicans. I've run businesses before, and if someone hated the job, I would fire them.

Repubs hate government, which explains why they cannot govern. All republicans should resign, therefore, they are the problem.

Let people who believe in good government run the govern, and let everyone else, get the hell out of the way.

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No, we don't HATE government. We hate leftists who, for some reason unknownst to mankind, think the government does a better job of managing our money than we do.

There is a lot to catch up on in this thread, but I think I have a lot to add. Unfortunately, internet gremlins ate my last contribution. I'll be back.

RedAkston said:

Or, you could be completely wrong on this issue, as you clearly are. If I buy a house and the land that it sits on I'm not violating anyone's rights. If I decide to buy another house and rent out the first house I'm not violating anyone's rights. If I make a donation to a political campaign I'm not violating anyone's rights. You seem to have a very convoluted idea of what actual rights are. I'm going to go out on a limb and guess that you also think health care is a "right"?

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If you drive your car at 150km/h you're not violating anyone's rights, necessarily, but if you do it on a busy city road you're violating their right to safety and security. The aggregate effect of a handful of people owning 95+% of available property would be to drastically limit where and how others can move, sleep and support themselves. That is an obvious and unequivocal fact, and trying to reduce it down to one guy buying two houses seems like obfuscation.

Healthcare, like private property, becomes a right if and when society deems it so. On the one hand, unlike private property there's no direct tension against others' rights, and as an extension of the fundamental rights to life and pursuit of happiness minimum healthcare standards are arguably a more basic and important right than property; but on the other it's a much more recent concept so arguably they're more or less comparable.

On the other hand the right to self-determination and hence an equal voice in government is pretty fundamental, I'm sure you agree. Quibbling that the serfs can petition and collectively have some sway over their baron's decisions and the barons in turn collectively have some influence on the king would obviously not legitimize monarchy as giving everyone some voice in government. But when television airtime, newspapers and other media, think tanks and academic departments and especially political 'donations' are overwhelmingly dominated by a relative few, it is again obvious and unequivocal fact that those few have a vastly disproportionate influence over the country's governance.

Although I am going to do a detailed rebuttal to this post, I don't want it to be taken as a takedown, but as an invitation to discussion.

Mr Person said:

The problem with a wealth tax beyond any broad ideological objection is an administrative one. So much property of the wealthiest is indeterminate in value, essentially being worth whatever someone buys it for. Think: art, houses, other collectibles.

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The premise of this argument is faulty - it implies that "so much property" of the wealthy is indeterminate, but does not reflect the reality that this is a minuscule proportion of typical wealth. The vast majority of wealth is easily identifiable and valuated. It is done everyday for taxes, insurance, and lending purposes that it is routine. The simplest and most common form of valuation is simply "purchase price". The administrative burden is no more significant than is already encountered by those who would be subject to the tax.

Mr Person said:

So, first, what are people supposed to do? Have all their **** appraised as an estimate, then report that? [Yup] And how do we know they're telling the truth? [Audits] They'd have to send around an army of IRS assessors to double-check reported values. [Not really] And if they didn't, people would just massively under-report and "forget" to mention various things. [As if they don't now?]

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The IRS has been systematically and seriously understaffed for its responsibilities for decades. This is a deliberate tactic by those who are most likely to be audited. Why the Rich Don’t Get Audited (NYT). The right answer is to double the IRS budget and staff so that they can properly do the job they already have. Our tax policies have been misdirected for half a century at least, to favor the wealthy and protect their wealth artificially. Consider the Capital Gains tax dodge: Why are capital gains (passive investments) given favorable tax benefits over earned wages? And not by a little, either.

Mr Person said:

Go back to Clinton income tax/corporate tax rates and reassess. Before we begin talking about this kind of stuff we should start paying for what we have. But for the last few decades, the GOP has been happy to have us borrowing a pile of cash so that their richest donors can have tax breaks that in no way cause said donors to meaningfully invest. It's just a handout sold to fools by inverting reality, that is, that borrowing more to give a tax cut to the richest isn't a handout but is "letting them keep more of their money"....just... :doh

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NWRatCon said:

Although I am going to do a detailed rebuttal to this post, I don't want it to be taken as a takedown, but as an invitation to discussion.The premise of this argument is faulty - it implies that "so much property" of the wealthy is indeterminate, but does not reflect the reality that this is a minuscule proportion of typical wealth. The vast majority of wealth is easily identifiable and valuated. It is done everyday for taxes, insurance, and lending purposes that it is routine. The simplest and most common form of valuation is simply "purchase price". The administrative burden is no more significant than is already encountered by those who would be subject to the tax.

The IRS has been systematically and seriously understaffed for its responsibilities for decades. This is a deliberate tactic by those who are most likely to be audited. Why the Rich Don’t Get Audited (NYT). The right answer is to double the IRS budget and staff so that they can properly do the job they already have. Our tax policies have been misdirected for half a century at least, to favor the wealthy and protect their wealth artificially. Consider the Capital Gains tax dodge: Why are capital gains (passive investments) given favorable tax benefits over earned wages? And not by a little, either.

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If I may say there may have been a lot of words used but very little "detail" to your rebuttal.

Talking about taxes and the IRS when discussing a wealth tax shows a lack of understanding IMO. Changes in wealth are simply not taxed.

For example you may own a piece of a start-up that folks say is worth a billion while the company is losing money. The company gets taxed on what they earn, in this example zero. The IRS has no reason to look at the value of the company.

Aristaeus said:

Bull****. A black baby born to poor parents in the hood does not have equal opportunities as a baby born to a rich lawyer in the Hamptons.

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Placing a 2% "wealth tax" on the uber rich will not change that in any meaningful way. The most that adding $2.75B/year in additional federal revenue will do is to (temporarily?) reduce the annual federal deficit by about 30%. It is primarily a 'foot in the door' measure to establish a new (constitutional?) federal power to tax "wealth from all sources".

OscarLevant said:

Sen. Warren has the right policy proposal

Republicans today are against a wealth tax which is another reason to vote for a Democrat in 20/20



I've been for this idea long before Senator Warren even brought it to the national attention. It's the only way to thwart the Dynasty-ism that is growing

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WHY? So we could have another 'rousing' success like ACA, of course, which destroyed everyone's heath care for the benefit of 20 percent, or so, of the population?:lamo

Oops, half my previous post went "poof". Here's the gist:

There is a misperception about the misnamed "Estate" tax. What we actually have is an "integrated gifts and estates tax" - which means that gifts made during your lifetime and at death both have tax implications. Everyone currently has a lifetime gifts and estate "exemption" of $11.4 million.. That was doubled by the Trump Tax Giveaway, and had been previously inflated as well. That's a lot of dough. But, wait, that's not all! A well-to-do individual can also give away $15,000 a year to as many people as he wants, tax free. In effect, a wealthy couple can "double up" and "double up again" by each giving $15k to each of their married children and their spouses ($60,000/year without taxes! Woot!). If they have kids, $30k to each kiddy (and their cats!)! (I used to do estate planning for a living.) And that's if they do it all honestly and legally. Anything over that $15k/year per person, though, is deducted from the "lifetime exemption", and will be accounted for when the estate is passed.

There are, however, a lot of sketchy (and even more than sketchy) tax dodges employed by those with more money than they know what to do with it (literally). The Trump Family’s Tax Dodging Is Symptomatic of a Larger Problem (New Yorker).

[T]he Times article ... asserted that much “of this money came to Mr. Trump because he helped his parents dodge taxes,” especially estate taxes. “He and his siblings set up a sham corporation to disguise millions of dollars in gifts from their parents. . . . Records indicate that Mr. Trump helped his father take improper tax deductions worth millions more. He also helped formulate a strategy to undervalue his parents’ real estate holdings by hundreds of millions of dollars on tax returns, sharply reducing the tax bill when those properties were transferred to him and his siblings.” Many wealthy families go to great lengths to minimize their estate-tax liabilities, of course. But the Times article claimed that some of the Trump family’s schemes amounted to “instances of outright fraud.”

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washunut said:

If I may say there may have been a lot of words used but very little "detail" to your rebuttal.

Talking about taxes and the IRS when discussing a wealth tax shows a lack of understanding IMO. Changes in wealth are simply not taxed.

For example you may own a piece of a start-up that folks say is worth a billion while the company is losing money. The company gets taxed on what they earn, in this example zero. The IRS has no reason to look at the value of the company.

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You can say whatever you want, it doesn't mean you're correct.

Changes in wealth are not generally taxed, it is true, but transfers of wealth are (e.g., estate taxes, gifts taxes, capital gains), when the gain is "realized". Moreover, the point of the wealth tax is to capture, annually, the "wealth" that has been accumulated. While complicated, it is not "complex".

NWRatCon said:

You can say whatever you want, it doesn't mean you're correct.

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Pretty weak rebuttal even by the standards of this site.

Perhaps one of your classes will teach you the difference between income and wealth.

washunut said:

Pretty weak rebuttal even by the standards of this site.

Perhaps one of your classes will teach you the difference between income and wealth.

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Makes no difference. A person’s income does not belong to you, neither does their wealth.

washunut said:

Pretty weak rebuttal even by the standards of this site.

Perhaps one of your classes will teach you the difference between income and wealth.

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When you make an actual contribution, I'll give you credit.

NWRatCon said:

When you make an actual contribution, I'll give you credit.

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Well I tried. A basic understanding of the difference between income and wealth creation seems important if you want to "debate" in this thread.

There is far too much dreck in this thread to respond to most of it. So, I'll concentrate on where we started and where we are.

The proposal of a wealth tax is, in my view, pretty moderate. 2% is not going to "break the bank" of anyone it is imposed on, and if they don't have that much in liquid assets they are doing something wrong. And the administrative difficulties raised are, in my view, greatly exaggerated. As I and others have noted earlier, "valuation of assets" is a routine activity for those with wealth. If you want insurance, you get an evaluation - that becomes a record that can be used in an audit. If you want a loan and offer collateral, you get an evaluation - that becomes a record that can be used in an audit. If you make a purchase of an asset - that creates a record that can be used in taxation - or an audit. It was mentioned that changes in value are not captured most of the time, but they can be. Estates are valued all the time at death. A date is determined (usually the date of death, but it can vary), and all the assets are valued as of that date. Tax schemes can do the same. Publicly traded stocks and bonds are easy, real estate is a little more complicated, but doable. Other assets are subject to other procedures, but these are routine.

Most people have difficulty comprehending how different being rich is from ordinary living. Ordinary people don't have access to hedge funds and other "investment vehicles" that wealth is parked in. I have worked with a lot of forensic accountants, and it is amazing how these things can be unwound if one knows the tricks. Just because they are way ahead of us doesn't mean we can't catch up, or that we shouldn't try. The point is that there is a great deal of revenue that should be made available to the government on behalf of all of us. That is what government is - the administration for all of us. Just because it hasn't been operated that way, doesn't mean it shouldn't be. I think this is a start in the right direction.

washunut said:

Well I tried. A basic understanding of the difference between income and wealth creation seems important if you want to "debate" in this thread.

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I'm sorry, but can you point to where you"tried"? Seriously, if there is a post I missed, I'm happy to read it and respond. I admit I quit trying to catch up the thread after 20 pages.

RedAkston said:

I don't have a problem with property taxes or sales tax. In fact, as I stated previously in this thread, I'm all for a flat tax on when one spends their money. I have a serious problem with a so-called "wealth tax" as it's a money redistribution grab on money that has already been taxed.

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I have to respond to this one, because it is based upon a myth. Most "wealth" is never taxed.

Another basic misconception that is rife in this discussion is that this is somehow a "novel" idea. Income tax is something that is "novel" - it was introduced in this country in 1861. Prior to that various forms of "wealth" - principally land - were the main method of taxation.

The history of taxation in the United States begins with the colonial protest against British taxation policy in the 1760s, leading to the American Revolution. The independent nation collected taxes on imports ("tariffs"), whiskey, and (for a while) on glass windows. States and localities collected poll taxes on voters and property taxes on land and commercial buildings. In addition, there were state and federal excise taxes. State and federal inheritance taxes began after 1900, while the states (but not the federal government) began collecting sales taxes in the 1930s. The United States imposed income taxes briefly during the Civil War and the 1890s. In 1913, the 16th Amendment was ratified, permanently legalizing an income tax.

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(Wikipedia)

Personally, I have always advocated for a generalized "transfer" tax. How one gains their income is of no importance to revenue generation. If it is inherited, gained by trade (e.g., sales of assets or of stock), by wages, or any other means, it should be subject to tax. Put simply, if on January 1 you have $x and on December 31 you have $x+1, the +1 should be taxed. The rest is details.