Notices


Worldly Talk

Civil discussion and debate on real world events and issues.


Society - Inequality vs. Equality

   
Don't you mean "most Americans" don't see wealth distinctions accurately? After all I can assure you *I* see them accurately, and I'm sure you can assure me you see them accurately as well. Even if we see them differently...

I have a technical issue - how do you want to decrease inequality of wealth? I mean with income that's more straightforward - you tax the rich, give the poor and pray that it would not distort economic incentives too much. Not saving it's not a matter of absolute poverty (otherwise Chinese would not have such high rate of savings). It's more a problem that person is unwilling to save. If you want to increase amount of wealth at the bottom you would not only have to give the money to poor... you would also have to force them to save. Maybe some program in which granted money is the property of o recipient, though gov can supervise it and it can not be spend, used as collateral or lost in bankruptcy?

[Yes, I'm slightly ironic, but not in 100%, theoretically something like that is possible]

Quote:
Originally Posted by TW Teczka View Post
I have a technical issue - how do you want to decrease inequality of wealth?
You could make loans not tied to an asset harder to obtain. If 18 year old kids weren't able to obtain easy credit and start racking up tens of thousands in debt by immediately entering school they wouldn't have negative wealth the first 10 or so years of their adult life.

Quote:
Originally Posted by TW Teczka View Post
I have a technical issue - how do you want to decrease inequality of wealth? I mean with income that's more straightforward - you tax the rich, give the poor and pray that it would not distort economic incentives too much. Not saving it's not a matter of absolute poverty (otherwise Chinese would not have such high rate of savings). It's more a problem that person is unwilling to save. If you want to increase amount of wealth at the bottom you would not only have to give the money to poor... you would also have to force them to save. Maybe some program in which granted money is the property of o recipient, though gov can supervise it and it can not be spend, used as collateral or lost in bankruptcy?

[Yes, I'm slightly ironic, but not in 100%, theoretically something like that is possible]
Estate taxes. These were demonstrated effective at arresting, and even reversing the perpetual and compounding accumulation of wealth in a study that examined its concentration.

Furthermore, increasing taxes on capital gains and dividends for the rich would also help as this is their primary income source; there is no good reason for secondary market gains to be so heavily tax advantaged. Keeping them tax advantaged specifically for the middle class/poor continues to encourage investment among the lower socio-economic groups. Primary market capital gains should however be exempted from these increases in all cases; tax discounts on true venture capital investments are a good thing, and conducive to growth/constructive risk taking. I personally feel taxes here should be cut further.

Loopholes that enable wealth flight and excess writeoffs/avoidance should be closed (the rich take advantage of these, the poor do not); unfortunately the former is more difficult to combat as evidenced by tens of trillions in off-shore accounts, and requires international cooperation/memorandums of understanding.

I also agree that policies/registered accounts with inflation indexed annual limits, like the Canadian Tax Free Savings Account, that encourage saving and wealth accumulation are also great tools in this regard. An opt-in tax advantaged or free escrow system with likewise limits might even be better than the more fluid TFSA. Tax deductions for financial advice/consultation among the poor-middle class might also help diminish the huge advantage the rich have when it comes to wealth management, while simultaneously encouraging saving and investment.

People will likely draw different conclusions from the data but I think it's an interesting study if anyone wishes to take a look at it.

http://www.treasury.gov/resource-cen...3-08revise.pdf

It's income, not wealth, but IMHO it's better for it.

Quote:
Originally Posted by Lord Ben View Post
People will likely draw different conclusions from the data but I think it's an interesting study if anyone wishes to take a look at it.

http://www.treasury.gov/resource-cen...3-08revise.pdf

It's income, not wealth, but IMHO it's better for it.
Seriously? 1996 to 2005? Completely outdated to the point of irrelevance. The present post-Bush reality is a reduction of income mobility (save downward for the majority), the hollowing of the middle class, and growing wealth and income inequity.

Quote:
Originally Posted by Surrealistik View Post
Seriously? 1996 to 2005? Completely outdated to the point of irrelevance. The present post-Bush reality is a reduction of income mobility (save downward for the majority), the hollowing of the middle class, and growing wealth and income inequity.
Yes, seriously. It's interesting information to have. I made no other claims about it.

Estate taxes have a tendancy to hit farmers very hard as they tend to be land rich and cash poor. Capital gains I am all in favor of, but taxing investment income too heavilly tends to contribute to unemplyment. Of course luxury taxes are also an old standby- cars worth over $60,000, Yachts, houses wourth over $450,000, etc get extra taxes applied...

of course another aspect of the question is why you really want wealth equality vs. income equality or standard of living equality. Right now the wealth tends to be concentrated into the hands of people who have made a profession out of managing it- redistributing it could easilly lead to less effective management, or you get issues like prefered stock versus common stock, and of course when you encourage people to invest without understanding tehir investments you get Bernie Maddoff and stock market crashes... there was an old stock trader who pulled everything out of the stock market right before the crash leading to the great depression- my great grandfather asked him how he knew and he said he knew it was time to get out of the market when he got a stock tip from his shoe shine boy. Because once teh amateurs were getting heavilly invested the whole thing was going to go sideways.
Kind of like when congress decided to incentivize loans for low income home ownership and teh subsequent effects on teh real estate and credit markets.

As a professional ethicist, I'm finding this conversation fascinating--and I'm impressed that it hasn't devolved into sniping and politicking any more than it has. Please continue.

Quote:
Originally Posted by PolkaBear View Post
As a professional ethicist, I'm finding this conversation fascinating--and I'm impressed that it hasn't devolved into sniping and politicking any more than it has. Please continue.
Oh yeah? Well, professional ethicists are the worst!

Quote:
Estate taxes have a tendancy to hit farmers very hard as they tend to be land rich and cash poor.
Amen brother. I live in a farming area and it's sad the number of farmers that can't pass their farms onto their kids without taking on a huge loan. I married into a family that had owned the same farm since the 1880's and they're selling it now instead of passing it onto the next generation because they just can't afford the taxes on ~500 acres of farmland +barns/cows as inheritance and still make it work.




 

Powered by vBulletin® Version 3.8.8
Copyright ©2000 - 2014, vBulletin Solutions, Inc.
Myth-Weavers Status