Criticism of billionairism

[marke]

Who is talking about removing all compensation for entrepreneurs? Would people stop being entrepreneurs if they could only make millions instead of billions?

The ignorant seem to be hardly able to comprehend how badly high taxes and oppressive government regulation affect small and big businesses and the American economy. Ocasio certianly doesn't know squat about what it takes to keep the Anmerican economy healthy and neither did Obama, who crushed coal production in America during the deep recession because he felt feel-good greenie-weenie environmental issues were more important than working people's lives being affected by oppressive government shutdowns of businesses.

 

[Conaeolos]

That may be true for some, but a lot of wealth is also created for doing nothing more then what employees do all the time. Do you really think Bill Gates worked hundreds of millions of times harder then a programmer at Microsoft.

And this is why I worry about this philosophy setting tax policy.
Just to be clear $150 Billion is Jeff Bozos net worth. Much of that tied into stock in his company Amazon which he has from it creation. So although he might in any given year, at his choosing, sell some stocks making capital gains in the billions. That does not happen on every given year.

A quick search shows in 2016 for example he was paid ~$80,000 salary with benefits 1.5 M in stock options etc.

An Amazon employee was the most compensated at $179,000 in salary and a 401(k) match, plus $35.4 million in Amazon stock.

An income tax alone would punish the employee and his ability to become wealthy not Jeff Bezo.

And although it might be a good idea to tax 'Capital Gains' at a higher rate. Who does it really punish?

One of the most hard working people I know is a self employed Physiotherapist who pulls about $250,000 in revenue. She owns 100% of her capital. So dividends are used as a way to avoid corporation + compensation tax. Let say as she prepares to retire she takes a partner in her clinic, well that would have to come back as capital gains or divdents. Such a problem gets even worse for a small business.

A tax designed for social policy is not a tax on the current wealthy but those trying to strive to get there.

 

[phattonez]

The ignorant seem to be hardly able to comprehend how badly high taxes and oppressive government regulation affect small and big businesses and the American economy. Ocasio certianly doesn't know squat about what it takes to keep the Anmerican economy healthy and neither did Obama, who crushed coal production in America during the deep recession because he felt feel-good greenie-weenie environmental issues were more important than working people's lives being affected by oppressive government shutdowns of businesses.

No, we understand. We just don't understand why taking an extra billion dollars from Jeff Bezos every year would significantly impact the operations of Amazon.

 

[Obscurity]

No, we understand. We just don't understand why taking an extra billion dollars from Jeff Bezos every year would significantly impact the operations of Amazon.

It won't impact anything. In fact, he ought to have it cut from his check for all his employees on welfare, and the substandard work conditions he enforces them to labor in.

 

[marke]

No, we understand. We just don't understand why taking an extra billion dollars from Jeff Bezos every year would significantly impact the operations of Amazon.

Do you think the government can take it from his savings account? His tax-exempt foundations or trusts? His hidden offshore accounts? If they can get to his money what will the Clintons do with the tens of millions stashed in overseas accounts and in their 'charitable' foundation?

 

[Conaeolos]

We just don't understand why taking an extra billion dollars from Jeff Bezos every year would significantly impact the operations of Amazon.

It won't impact anything. In fact, he ought to have it cut from his check for all his employees on welfare, and the substandard work conditions he enforces them to labor in.

Jeff Bezos does not make income of multiple billions per year. Most of his net worth changes come on paper from an asset: 78.2 million shares of Amazon worth an estimated 129.7 billion at today’s stock price [which is often under counted in Net Worth calculations to account for volume volatility]

Yearly, Jeff Bezos does make just over a $1 Billion mostly from selling stocks to fund his Blue Origin space venture.

That amount of stock, based on today’s price, in May 2012 would have cost about $1 Million @ ROI 39.7%

So are you saying he should be punished for investing a modest amount of money wisely 21 years ago?

And if so, would those rules be more likely to punish him or the more common scenario below:
In 1997 a man invests $100,000 into a used book store. He made about $100,000 a year via salary. He wants to retire so he sells his business which makes about $1 M in revenue every year for $10,000,000 ROI: 22.25%

 

[phattonez]

Jeff Bezos does not make income of multiple billions per year. Most of his net worth changes come on paper from an asset: 78.2 million shares of Amazon worth an estimated 129.7 billion at today’s stock price [which is often under counted in Net Worth calculations to account for volume volatility]

Yearly, Jeff Bezos does make just over a $1 Billion mostly from selling stocks to fund his Blue Origin space venture.

That amount of stock, based on today’s price, in May 2012 would have cost about $1 Million @ ROI 39.7%

So are you saying he should be punished for investing a modest amount of money wisely 21 years ago?

Punished? By no means. I have no problem with him being wealthy. I have big issues with his obscene amount of wealth. With his yearly income and amount of wealth, do you really think it's a punishment if we take an extra billion from him? He'd be worth 128.7 billion instead of 127.7 billion. Do you think that's a big difference? You could take that money and give the workers an extra $1500. That's a big amount to someone making only around $50k per year.

And if so, would those rules be more likely to punish him or the more common scenario below:
In 1997 a man invests $100,000 into a used book store. He made about $100,000 a year via salary. He wants to retire so he sells his business which makes about $1 M in revenue every year for $10,000,000 ROI: 22.25%

He made $9.9 million in pure profit (not counting inflation). If we taxed capital gains at 50% instead of 15%, he would have $4.95 million of profit instead. That's nothing to scoff at. Instead of a 22% return, he has an 18% return. Still excellent.

 

[phattonez]

Do you think the government can take it from his savings account? His tax-exempt foundations or trusts? His hidden offshore accounts? If they can get to his money what will the Clintons do with the tens of millions stashed in overseas accounts and in their 'charitable' foundation?

Just tax his income and whatever realized capital gains he has. Why should his capital gains be taxed at a lower rate than wages?

 

[Conaeolos]

With his yearly income and amount of wealth, do you really think it's a punishment if we take an extra billion from him? He'd be worth 128.7 billion instead of 127.7 billion.

Personally yes, but it really all depends on how one approaches getting that 1 billion. Assuming only a 50% capital gains tax it’s not like the most egregious tax I’ve ever heard e.g. inheritance tax.

Do you think that's a big difference? You could take that money and give the workers an extra $1500. That's a big amount to someone making only around $50k per year.

Amazon has quite low profits as a company of its size. I’m not sure how sustainable their business model in such an environment. I’d imagine an Apple (most profitable company in the world) it being less of a deal(but then their wages are generally higher already). Assuming though we are going by stock value like with Bezos, 1B might only be 0.001% of its current market cap, but that would cannibalize the company as an overarching sustained policy.

I have always liked the idea though instead of income tax, the federal government simply owns a certain preferred (tax) share % in all companies based in the nation given at incorporation...using the value of that basket to back the national dollar. Alas I doubt we’ll move to these type of indirect taxation. I don't see cutting current system and there is barely money there in the current set-up.

He made $9.9 million in pure profit (not counting inflation). If we taxed capital gains at 50% instead of 15%, he would have $4.95 million of profit instead. That's nothing to scoff at. Instead of a 22% return, he has an 18% return. Still excellent.

I’d admit, even at five million he could certainly still have a full retirement even though that money would go even faster as his cash's invested ROI is going to lower as a result of the high dividend/capital gains tax. That said, the shoe marker who might only get $100,000-$200,000 or hairdresser $1,000,000 we’d very much be cutting into their retirement lifestyles or years covered in a world already tight for most retirees. And the lower the retirement savings threshold we discuss the more people effected. So I'm not sure my point isn't still being made.

 

[marke]

Just tax his income and whatever realized capital gains he has. Why should his capital gains be taxed at a lower rate than wages?

Most people who oppose capital gains taxes have never had to run a business. It is no wonder they do not understand why or how higher taxes and regulations slow the economy.

 

[Obscurity]

Jeff Bezos does not make income of multiple billions per year. Most of his net worth changes come on paper from an asset: 78.2 million shares of Amazon worth an estimated 129.7 billion at today’s stock price [which is often under counted in Net Worth calculations to account for volume volatility]

Yearly, Jeff Bezos does make just over a $1 Billion mostly from selling stocks to fund his Blue Origin space venture.

That amount of stock, based on today’s price, in May 2012 would have cost about $1 Million @ ROI 39.7%

So are you saying he should be punished for investing a modest amount of money wisely 21 years ago?

And if so, would those rules be more likely to punish him or the more common scenario below:
In 1997 a man invests $100,000 into a used book store. He made about $100,000 a year via salary. He wants to retire so he sells his business which makes about $1 M in revenue every year for $10,000,000 ROI: 22.25%

Punished for investment? No. I do think he should be punished for the slave like labor conditions he has forced some of his employees into. I also do not see taxation as punishment, a fundamental difference between myself and someone who believes in a fairy tale kindergarten political system like libertarianism.

 

[Conaeolos]

Punished for investment? No. I do think he should be punished for the slave like labor conditions he has forced some of his employees into. I also do not see taxation as punishment, a fundamental difference between myself and someone who believes in a fairy tale kindergarten political system like libertarianism.

Just to be clear, to be a fairy tale you have to take libertarianism at its extreme ideological implementation.

I am a moderate libertarian. So I believe in principles a limited government with a large reduction in the size and scope of government. I especially believe in eliminating laws or programs based on the government social engineering. So for example unlike a conservative I would want unsustainable programs like social security phased out. Unlike a conservative I think Military should be non-interventionist mostly posted domestically. CIA should not do foreign espionage only collect intel. Etc. In fact, outside Military, state department, legislative & justice governments’ really should simply contract out most services similarly to Sandy Springs, GA.

Let me just give you a little primer: What country aims to help it citizens more Canada or US? The US in 2017 spent 6.9T across all levels of government. Canada spent 849.4 Billion CND. The exchange fluctuates. So the median income in Canada $71,336 CDN. The median income in America $59,039 USD. 0.82 CDN / 1 USD. Canada spent ~702.5 Billion USD.

Amount spent per citizen:
US: $21,270 / Citizen
Canada: $19,193 / citizen

If we estimate tax burden as that over just citizen 15-64:
US: $32,394 / tax payer
Canada: $28,673 / taxpayer

Now, the US has a real military
US military cost $2,735 / taxpayer
CA Military cost $836.73 / tax payer

So if the US simply collected the same per citizen as Canada expect military:
US : $30,572 / taxpayer. Raise 6.5 T (we raised 6.1T with 800 billion in new debt)

Now I floated in #68 a way of comparing simplified progressive taxation calculations. Spit the burden greater or less than $100,000 in two income tax rates based on their average income level 10% wright to 1% and average of bottom 99%. Lock the bottom 90% at 25%.

Actual 2017, without debt would require:
>$100,000 pay: 50.0% Tax for 5.5 T (21.3 M people)
<$100,000 pay: 25% Tax 1.4T (191.7 M people)

Actual 2017, with debt would require:
>$100,000 pay: 42.0% Tax for 4.7 T (21.3 M people)
<$100,000 pay: 25% Tax 1.4T (191.7 M people)

CAN Spending level with US military:
>$100,000 pay: 45.0% Tax for 5.1 T (21.3 M people)
<$100,000 pay: 25% Tax 1.4T (191.7 M people)


So, yes I think I am on solid ground when I say the government can be spending dollars more effectively. When a country like Canada, which according to OCED numbers has 27% more public services as part of her economy in raw dollars is still getting it done more cheaply. We have a problem. The problem is the addiction to tax revenue which disproportional effects the top 10 %(earning over $100,000)who are significantly more impacted by rate hikes. Again these numbers are all levels of government not just federal. Every 1% raised at this point is another dollar to be wasted IMHO and certainly counts as punitive. Government spending needs to be addressed.

 

[Obscurity]

Just to be clear, to be a fairy tale you have to take libertarianism at its extreme ideological implementation.

I am a moderate libertarian. So I believe in principles a limited government with a large reduction in the size and scope of government. I especially believe in eliminating laws or programs based on the government social engineering. So for example unlike a conservative I would want unsustainable programs like social security phased out. Unlike a conservative I think Military should be non-interventionist mostly posted domestically. CIA should not do foreign espionage only collect intel. Etc. In fact, outside Military, state department, legislative & justice governments’ really should simply contract out most services similarly to Sandy Springs, GA.

Let me just give you a little primer: What country aims to help it citizens more Canada or US? The US in 2017 spent 6.9T across all levels of government. Canada spent 849.4 Billion CND. The exchange fluctuates. So the median income in Canada $71,336 CDN. The median income in America $59,039 USD. 0.82 CDN / 1 USD. Canada spent ~702.5 Billion USD.

Amount spent per citizen:
US: $21,270 / Citizen
Canada: $19,193 / citizen

If we estimate tax burden as that over just citizen 15-64:
US: $32,394 / tax payer
Canada: $28,673 / taxpayer

Now, the US has a real military
US military cost $2,735 / taxpayer
CA Military cost $836.73 / tax payer

So if the US simply collected the same per citizen as Canada expect military:
US : $30,572 / taxpayer. Raise 6.5 T (we raised 6.1T with 800 billion in new debt)

Now I floated in #68 a way of comparing simplified progressive taxation calculations. Spit the burden greater or less than $100,000 in two income tax rates based on their average income level 10% wright to 1% and average of bottom 99%. Lock the bottom 90% at 25%.

Actual 2017, without debt would require:
>$100,000 pay: 50.0% Tax for 5.5 T (21.3 M people)
<$100,000 pay: 25% Tax 1.4T (191.7 M people)

Actual 2017, with debt would require:
>$100,000 pay: 42.0% Tax for 4.7 T (21.3 M people)
<$100,000 pay: 25% Tax 1.4T (191.7 M people)

CAN Spending level with US military:
>$100,000 pay: 45.0% Tax for 5.1 T (21.3 M people)
<$100,000 pay: 25% Tax 1.4T (191.7 M people)


So, yes I think I am on solid ground when I say the government can be spending dollars more effectively. When a country like Canada, which according to OCED numbers has 27% more public services as part of her economy in raw dollars is still getting it done more cheaper. We have a problem. The problem is the addiction to tax revenue which disproportional effects the top 10 %(earning over $100,000)who are significantly more impacted by rate hikes. Again these numbers are all levels of government not just federal. Every 1% raised at this point is another dollar to be wasted IMHO and certainly counts as punitive. Government spending needs to be addressed.

I support smart government spending. I do not support any form of libertarian treatment of our social safety net, because it leads to mismanagement, abuse, monpoly and idiocy. Evidence is Chile. Immediate loss for all citizens of thousands and thousands in retirement savings due to "fees" by "free market" capitalists.

No thanks.

You can keep your libertarianism in your cushy suburb.

Not interested in kindergarten hysterics and an ideology based on greed.

 

[Neomalthusian]

I hypothesize that supporting, subsidizing, or protecting the creation or sustenance of billionaires is antithetical to supporting a strong middle class and in turn a strong consumer capitalist economy.

Your hypothesis assumes the antecedent. Why is it a fair, accurate and true statement to say that we are "supporting, subsidizing, protecting and sustaining billionaires" in the first place. It isn't. It's an extremely politically charged and biased characterization you're starting with.

Competition needs to be restored as a necessary pillar of our form of capitalism.

Too many anti-billionaire leftists like to softly and passively suggest there is cartel/monopoly power without demonstrating there is any. The fact that some people are rich does not prove there is monopoly power.

We may benefit from modernizing and strengthening anti-trust regulations and perhaps curtailing some intellectual property and other laws that enable some corporations to enrich themselves with government-sanctioned monopoly power, but doing this will not preclude people from getting rich.

 

[Pedestrian]

Is that what godless universities are teaching in America now? To stop entrepreneurship so the little guy can make more money? That is stupid. At least Trump understands that people need to take risks in starting businesses which hire people and to get those entrepreneurs to take those risks there will of necessity be the promise of wealth to obtained if successful. Only an idiot would take the risk to start a business if he knew there would be no money in it.

I want a list of the corporations that create start-ups, new jobs and take such risks. You will find they don't.

The corporate friendly tax code rewards [them] for acquiring companies already in the market the corp. wishes to pursue.

Two of the leading R & D firms in the US, IBM and Cisco since 2000 have rather than take risks, create jobs in

new markets...bought over 2000 companies. That always results in layoffs and a reduction of employment and high paying jobs too.

Get grip, the capitalist is NOT an entrepreneur. Rather, [he] is a financial vampire jumping on others work to suck the blood (profits)

out of their new buys.

 

[MTAtech]

Who is talking about removing all compensation for entrepreneurs? Would people stop being entrepreneurs if they could only make millions instead of billions?

Entrepreneurs are not motivated by lower tax rates to start companies. People start companies for many reasons: a compelling idea, ambition for fame and fortune, a desire to be one’s own boss, frustration with one’s employer. Do you remember when Bill Gates and Steve Jobs said: “I wouldn't have started my company if tax rates were too high”? Me neither.

Do you really think Gates wouldn't have started Microsoft or Jobs wouldn't have started Apple if personal and corporate tax rates were high? Do you think that they even knew what the tax-rates were when they started their companies?

 

[phattonez]

Personally yes, but it really all depends on how one approaches getting that 1 billion. Assuming only a 50% capital gains tax it’s not like the most egregious tax I’ve ever heard e.g. inheritance tax.

This is generally the approach that I take, a high tax rate on unearned income.

Amazon has quite low profits as a company of its size. I’m not sure how sustainable their business model in such an environment. I’d imagine an Apple (most profitable company in the world) it being less of a deal(but then their wages are generally higher already). Assuming though we are going by stock value like with Bezos, 1B might only be 0.001% of its current market cap, but that would cannibalize the company as an overarching sustained policy.

Amazon makes $2.5 billion in profits every quarter. It's a small profit margin, yes, but there is still plenty of room to increase compensation to employees. And remember, this wouldn't be specific to Amazon. When all wages go up, spending goes up, and profit goes up.

I have always liked the idea though instead of income tax, the federal government simply owns a certain preferred (tax) share % in all companies based in the nation given at incorporation...using the value of that basket to back the national dollar. Alas I doubt we’ll move to these type of indirect taxation. I don't see cutting current system and there is barely money there in the current set-up.

I'm all for a monetary system other than our current one based on debt.

I’d admit, even at five million he could certainly still have a full retirement even though that money would go even faster as his cash's invested ROI is going to lower as a result of the high dividend/capital gains tax. That said, the shoe marker who might only get $100,000-$200,000 or hairdresser $1,000,000 we’d very much be cutting into their retirement lifestyles or years covered in a world already tight for most retirees. And the lower the retirement savings threshold we discuss the more people effected. So I'm not sure my point isn't still being made.

It's an interesting point, which ultimately should have been covered by social security, to provide a minimum standard of living in retirement. If we have that, then I don't think that this is as big of a deal.

By the way, thanks for making this interesting as opposed to the other discussions I've had on here!

 

[phattonez]

Most people who oppose capital gains taxes have never had to run a business. It is no wonder they do not understand why or how higher taxes and regulations slow the economy.

So if Bezos is worth $124 billion instead of $125 billion, he's going to run his company into the ground? I don't think so.

 

[phattonez]

Entrepreneurs are not motivated by lower tax rates to start companies. People start companies for many reasons: a compelling idea, ambition for fame and fortune, a desire to be one’s own boss, frustration with one’s employer. Do you remember when Bill Gates and Steve Jobs said: “I wouldn't have started my company if tax rates were too high”? Me neither.

Do you really think Gates wouldn't have started Microsoft or Jobs wouldn't have started Apple if personal and corporate tax rates were high? Do you think that they even knew what the tax-rates were when they started their companies?

That's my point. We can stand a higher tax rate on unearned income, especially given that much of it is taxed at a lower rate than wages. Entrepreneurs are already more than adequately compensated. Our current system is leading to not increased production, but rent-seeking, which lowers wages for our poorest citizens.

 

[marke]

I want a list of the corporations that create start-ups, new jobs and take such risks. You will find they don't.

Most small businesses create new jobs by normal growth, not by corporate raids. Small businesses are the backbone of this nation and the absolutely largest type of businesses which fuel the American economy. When some Obama-like jerk comes along and thinks the small business has made enough money and works the government to take away what he sees as "excess cash," that business is stopped cold from expanding. Obama tried that sort of thing in his failed "three years or done" economic stimulus plan, but he failed miserably. Trump came along and cut taxes and regulations and the economy shot up like a rocket. Why can't more Americans see the simplicity in these facts?

 

[MTAtech]

Most small businesses create new jobs by normal growth, not by corporate raids. Small businesses are the backbone of this nation and the absolutely largest type of businesses which fuel the American economy. When some Obama-like jerk comes along and thinks the small business has made enough money and works the government to take away what he sees as "excess cash," that business is stopped cold from expanding. Obama tried that sort of thing in his failed "three years or done" economic stimulus plan, but he failed miserably. Trump came along and cut taxes and regulations and the economy shot up like a rocket. Why can't more Americans see the simplicity in these facts?

Where is the evidence that higher taxes businesses stopped them cold from expanding? I'll save you time -- there isn't any. Below is a graph of net business investment over the last 28 years. There is no correlation between investment and taxes. What business investment correlates to is the business cycle.

You asserted that Obama's stimulus "failed miserably." That is false. Once enacted, the stimulus reversed the decline in the economy.

You also asserted that "Trump came along and cut taxes and regulations and the economy shot up like a rocket." That's both bad history and bad economics. Below is the graph of GDP growth since 2009. Obama clearly reversed the economic downturn. The periods under Trump display no particular "rocket" activity but merely statistical variation. Trump relaxed coal regulations and coal usage and employment still fell.

 

[uptower]

I hypothesize that supporting, subsidizing, or protecting the creation or sustenance of billionaires is antithetical to supporting a strong middle class and in turn a strong consumer capitalist economy.

If you get the idea that removing a middle man from a supply chain could lower cost and enrich the whole thing, you should also get that removing the billionaire at the top could do something similar. By not having to appease the billionaires big ROI, income instead is dispersed at lower levels amongst more people and spent much more efficiently in the economy.

Yes it is true white collar crime needs to be properly handled but it is not just evil billionaires twirling their moustaches and looking for ways to screw over the middle class. For very Koch, there's a Branson, a Gates, a Cuban, or Buffett who tries to do good with their money. They recognize 'it takes a nation to raise a billionaire' and that they owe something for the rest of us for buying their junk.

Also large corporations are often run by boards who are beholden to shareholders who are made up of lots of little guys like you and me. The boards are well-paid for earning dividends for the shareholders but those thousands, sometimes millions of people cannot be to blame for wanting their retirements to go a little more smoothly. In that way corporations become big machines that yes, coldly suck up cash, but are not doing it out of any real malice.

The only solution I can suggest, not being an economist, is proper enforcement of tax codes; fewer loopholes and write-offs and seeing to it that companies and wealthy individuals pay their share. They don't even need to be in a higher bracket as OAC recently suggested. As long as they pay they can pay the same percentages as the rest of us. The problem is when they don't pay at all.

 

[marke]

So if Bezos is worth $124 billion instead of $125 billion, he's going to run his company into the ground? I don't think so.

Democrats and leftist commie liberals will always have their eyes on other people's money and will always be thinking of ways to get their hands on that money to pay for excesses they have promised their faithful deluded followers from the bloated big government they have built to support themselves and their crooked party.

 

[marke]

Where is the evidence that higher taxes businesses stopped them cold from expanding? I'll save you time -- there isn't any. Below is a graph of net business investment over the last 28 years. There is no correlation between investment and taxes. What business investment correlates to is the business cycle.

You asserted that Obama's stimulus "failed miserably." That is false. Once enacted, the stimulus reversed the decline in the economy.

You also asserted that "Trump came along and cut taxes and regulations and the economy shot up like a rocket." That's both bad history and bad economics. Below is the graph of GDP growth since 2009. Obama clearly reversed the economic downturn. The periods under Trump display no particular "rocket" activity but merely statistical variation. Trump relaxed coal regulations and coal usage and employment still fell.

The guys with the glowing charts must have missed the suffering experience by Americans under the recession that turned a major corner once Trump got elected. I call some charting of cropped data "democrat porno graphs."

 

[Pedestrian]

So if Bezos is worth $124 billion instead of $125 billion, he's going to run his company into the ground? I don't think so.

The 20% tax on long term [sic] (1 year) capital gains is immoral...prime facie.

Plus something Orwellian too, called 'carried interest' [sic] and on stock dividends.

Every explanation or attempt at justification could also apply to wage, salaries and tips.

I couldn't care less about incentives or risk as they too apply to labor.

Plus we are taught that the incentives are in the marketplace...not the tax code.

The tax code is to have no responsibility to reduce or subsidie risk or provide incentives.

It is a tax regime purchased from congress via the US plutocracy.

It has firmly entrenched into the American capitalist culture, venality, avarice and greed...there's your explanation.