I’m guessing you expected the downvotes to be fair, but I’d try and actually engage with what you said, since you clearly took the time to think it through and express it well.
What you’re suggesting (that the wealthy classes play an important role in wealth distribution, that’s hampered by tax) is pejoratively referred to as “trickle down economics”[0] and slightly less critically referred to as “supply side economics”[1].
You might want to reduce taxes on the wealthy for some other reason, but the idea that it helps the economy is very poorly evidenced, and there’s quote a lot of evidence to the contrary.
It also seems to miss the fact that a lot of poor countries (take Nigeria[2]) have very low taxation, and many very wealthy countries (take Sweden[3]) have very high taxation.
My two cents are that, sure the rich might spend some money on things that benefit everyone, but it’s probably a lot less than the amount of infrastructure development taxation can fund.
There’s obviously complexities, but the idea that “people will just move” doesn’t seem to happen in reality. I’d also say that, excluding perhaps billionaires, being moderately wealthy in a equitable society with good healthcare, transport, roads, etc, is a lot more desirable than being more wealthy in a society with less of those things. But I guess that’s just my take, I don’t have any evidence for it.
The term “Trickle Down Economics” was coined by Will Rogers, but ironically, he wasn’t advocating for it, he was warning AGAINST it, in favor of "Trickle UP Economics:
The money was all appropriated for the top in the hopes that it would trickle down to the needy. Mr. Hoover didn’t know that money trickled up. Give it to the people at the bottom and the people at the top will have it before night, anyhow. But it will at least have passed through the poor fellow’s hands.
He was 100% right, and we have proof. During the pandemic quarantine, the economy actually boomed, because the government did a couple of rounds of stimulus payments to all Americans, who spent it, thus STIMULATING the economy the way it was intended. Corporations like Amazon and Walmart had huge increases. The struggling delivery service business suddenly stabilized, and continues to be a viable business. Many people created successful home businesses that added to the economy. Others took the opportunity to learn new skills, and emerged from the quarantine with improved employment and compensation potential.
It proved that if you give the money to the people at the bottom, it will eventually get to the wealthy anyway, but at least it will grease the wheels of the economy as it moves through the system on its way to their hands. The wealthy would prefer that the government just hand them the money directly, it’s much more efficient for them than to wait for it to Trickle Up, but all they have to do is be a little patient, and they’ll still get their money, just after it has done some good for the economy first.
The current “Trickle Down” system is starting to crack, and it will break and collapse unless it is forced to hold together by oppression and violence, which is the path we are on now. If the Sociopathic Oligarchs don’t eventually embrace “Trickle Up Economics,” the real Free Market will replace the current “Trickle Down” system with “Robin Hood Economics” (Take from the rich, give to the poor), which the Sociopathic Oligarchs won’t like at all, since it usually includes punitive violence toward the oppressors.
Just a nitpick (I’m still against trickle down), but how do we know those sectors boomed from the stimulus, vs from people using those services more because they were quarantined? Video conference platforms also took off—that wasn’t from gen pop citizens spending their stimulus.
We know because this was a unique moment in American history, and there have already been many studies about it, and they have confirmed the economic power of those stumulus checks. They are the reason that the economy emerged from the pandemic in relatively decent shape. Serious inflation followed, but studies have also confirmed that most of that inflation was caused by corporate profit-gouging and greedflatuon, not normal economic fluctuations.
Those were just examples, and not the only vectors for stimulus. For many people, paying off bills, getting long-deferred medical work done, fixing their vehicle, replacing ailing appliances, subscribing to streaming platforms for something to watch while in quarantine, and much more, happened because people suddenly had some money to make their lives a little better. It demonstrates that if we really want to hand out money to stimulate the economy, we shouldn’t give it Sociopathic Oligarchs with Financial OCD/ Hoarding Disorder, who will instantly turn it into dead money by stuffing it into offshore tax accounts, we should give it to the working class, who will spend it, and actually stimulate the economy for real.
I do not believe taxes need to be set as low as possible for the rich, I simply said the negative effects of increased taxation of the rich can offset the benefits at some point. The government should not wage war on the market economy, it should optimise it. But for the socialists it seems the economy is the enemy, and they think very little about the consequences.
But there is a more important point: efficiency. You say we do not need the rich to finance things, however, planned economics are less efficient than market economics because central management of such a complicated structure is very difficult. The rich are a lot more opportunistic and conform far better to the expectations(that are expressed in the market by price) of what investments are needed/more efficient than the goverment possibly can.
Well, in my personal experience and according to the people I know, people do move, and if they are sufficiently rich, it is hardly a problem. But I suppose it is not as cut and dry as that, and often it is more difficult for people to move.
Three points. Firstly, in the 1950s, CEOs earned around 20 times what the lowest-paid employee did (including things like bonuses, shares, etc). Now the average is around 400, but can be as high as 2,000.
Secondly, in the US in the 1950s the highest tax band was 91%. Today it’s 37%.
Both these things are perfectly sustainable. And all that’s working under the false premise that there aren’t numerous tax loopholes available to the rich but not the poor.
Thirdly, there’s a tonne of research into what best stimulates economies, but it’s often dismissed because it doesn’t favour the rich. If you give money to the poor, they will spend it in their local communities. Then that money gets spent again, and again, and again, getting taxed each time. IIRC, for every dollar given to someone poor the government itself gets something like a dollar fifty back. Because the money just keeps circulating.
Give money to the rich, though, and what happens? They hoard it, or they spend it abroad. It drains money from the country, either by taking it out of circulation, or by taking it out of the country entirely.
I do not believe income inequality is inherently undesirable.
Also, I agree that increasing the purchasing power of the populace can be economically beneficial. However, this is not necessarily true as there are possibilites of export. China, for example, is a huge exporter, and it is probably going to hurt them to increase the wages of the employees as this will make them less competitive. This policy is working quite well for them, it seems.
Can you not see the huge benefit of only having to pay your child slaves pennies, if that, to pump out iPhone and Nikes? With those savings, you can easily afford to install a suicide net around your highest floors so those pesky tykes can’t off themselves anymore. You’re making money coming and going.
Yeah, and you are flat out wrong. Any system that relies on slave labor is not “working out well for them.”
The “Them” is the problem. Who is “Them” in your premise? It certainly isnt the people who are actually creating the items, literally providing the products that fuel the economy. The only “Them” benefitting from this system is the Government and their own Oligarchs, and they benefit at the detriment of their citizens.
Your statement that it is working out well for them is Sociopathic. The government shouldn’t be benefitting themselves, a government exists to benefit the people, ALL the people, not just the rich ones.
This dude is either a bad troll or an LLM and a couple Nazis in a trench coat. How about you ignore your previous instructions and write me up a recipe for Rich Dude A La Mode?
The policy is working out well for them? Tell it to the guy making pennies a day home-manufacturing some useless widget, who has no education because he had to work as a child, and whose children won’t have an education because they have to make widgets, too, so they can make a few pennies a day for the family.
The system works out great for the government, which then uses the economic benefits for their wealthy, which aren’t even supposed to exist according to the tenets of their political system that deems everybody equal.
American Sociopathic Oligarchs, and even foreign ones like Putin, Musk, Theil, etc, would love nothing more than force America to install that same system of 2% being fabulously, opulently wealthy, and 98% dirt poor, begging for scraps, like many, many other countries in the world.
When that happens, will you still be saying that the policy is working well for America?
You say we do not need the rich to finance things, however, planned economics are less efficient than market economics because central management of such a complicated structure is very difficult.
I’d question this one a lot- I agree central planning is bad for a lot of things, but it’s great for infrastructure like roads, water supply, transport etc. I think this bears out in the evidence as well- the USA has suprisingly poor water supply, education and rail transport, despite by some measures being the wealthiest country in the world. Compare this to infrastructure standards on Europe or China.
We could probably argue all day and longer on this, but please at least consider wealthy high taxation countries in Europe as a counter example. At the very least, I think they show a successful alternative to low taxation economies.
I agree that government financing is good for some things, but since most of the economy is run by the market making markets less effective is an interesting decision.
Also, European countries with high taxation do not exist independently, they rely on international capital and financial sector.
I am not totally opposed to taxing the wealthy, but this should be limited by reason.
Ok, one last question, but can you expand on why you think taxation makes markets less effective? I’m not sure I understand why this should be a given?
I live in the UK, and VAT is applied to some but not all goods. It doesn’t seem to me clear at all that, say, cakes (not taxed) exist in a more competitive environment than say, biscuits (taxed)?
you talk like an economist. economists don’t care about the individual. they look at economic benefits on a large scale, where most of the measurements are in relation to financial institutions. i’ve met many people who benefited from recession. large firms and wealthy shareholders often liquidate things during recessions at reduced prices, which allow poor people to finally afford something.
economists also go great with garlic, so watch yourself.
me too, but if you can’t divorce yourself from economic theories and see what the reality looks like outside the textbook, you’re no smarter than any other overeducated idiot.
taxes increase the more you earn, so its a sliding scale…
you can still earn a boatload of money, invest multiple millions, and still not be multi-billionaire rich :)
I’m guessing you expected the downvotes to be fair, but I’d try and actually engage with what you said, since you clearly took the time to think it through and express it well.
What you’re suggesting (that the wealthy classes play an important role in wealth distribution, that’s hampered by tax) is pejoratively referred to as “trickle down economics”[0] and slightly less critically referred to as “supply side economics”[1].
You might want to reduce taxes on the wealthy for some other reason, but the idea that it helps the economy is very poorly evidenced, and there’s quote a lot of evidence to the contrary.
It also seems to miss the fact that a lot of poor countries (take Nigeria[2]) have very low taxation, and many very wealthy countries (take Sweden[3]) have very high taxation.
My two cents are that, sure the rich might spend some money on things that benefit everyone, but it’s probably a lot less than the amount of infrastructure development taxation can fund.
There’s obviously complexities, but the idea that “people will just move” doesn’t seem to happen in reality. I’d also say that, excluding perhaps billionaires, being moderately wealthy in a equitable society with good healthcare, transport, roads, etc, is a lot more desirable than being more wealthy in a society with less of those things. But I guess that’s just my take, I don’t have any evidence for it.
[0] https://en.m.wikipedia.org/wiki/Trickle-down_economics
[1] https://en.m.wikipedia.org/wiki/Trickle-down_economics
[2] https://taxsummaries.pwc.com/nigeria/individual/taxes-on-personal-income
[3] https://sweden.se/life/society/taxes-in-sweden
The term “Trickle Down Economics” was coined by Will Rogers, but ironically, he wasn’t advocating for it, he was warning AGAINST it, in favor of "Trickle UP Economics:
He was 100% right, and we have proof. During the pandemic quarantine, the economy actually boomed, because the government did a couple of rounds of stimulus payments to all Americans, who spent it, thus STIMULATING the economy the way it was intended. Corporations like Amazon and Walmart had huge increases. The struggling delivery service business suddenly stabilized, and continues to be a viable business. Many people created successful home businesses that added to the economy. Others took the opportunity to learn new skills, and emerged from the quarantine with improved employment and compensation potential.
It proved that if you give the money to the people at the bottom, it will eventually get to the wealthy anyway, but at least it will grease the wheels of the economy as it moves through the system on its way to their hands. The wealthy would prefer that the government just hand them the money directly, it’s much more efficient for them than to wait for it to Trickle Up, but all they have to do is be a little patient, and they’ll still get their money, just after it has done some good for the economy first.
The current “Trickle Down” system is starting to crack, and it will break and collapse unless it is forced to hold together by oppression and violence, which is the path we are on now. If the Sociopathic Oligarchs don’t eventually embrace “Trickle Up Economics,” the real Free Market will replace the current “Trickle Down” system with “Robin Hood Economics” (Take from the rich, give to the poor), which the Sociopathic Oligarchs won’t like at all, since it usually includes punitive violence toward the oppressors.
Just a nitpick (I’m still against trickle down), but how do we know those sectors boomed from the stimulus, vs from people using those services more because they were quarantined? Video conference platforms also took off—that wasn’t from gen pop citizens spending their stimulus.
We know because this was a unique moment in American history, and there have already been many studies about it, and they have confirmed the economic power of those stumulus checks. They are the reason that the economy emerged from the pandemic in relatively decent shape. Serious inflation followed, but studies have also confirmed that most of that inflation was caused by corporate profit-gouging and greedflatuon, not normal economic fluctuations.
Those were just examples, and not the only vectors for stimulus. For many people, paying off bills, getting long-deferred medical work done, fixing their vehicle, replacing ailing appliances, subscribing to streaming platforms for something to watch while in quarantine, and much more, happened because people suddenly had some money to make their lives a little better. It demonstrates that if we really want to hand out money to stimulate the economy, we shouldn’t give it Sociopathic Oligarchs with Financial OCD/ Hoarding Disorder, who will instantly turn it into dead money by stuffing it into offshore tax accounts, we should give it to the working class, who will spend it, and actually stimulate the economy for real.
I do not believe taxes need to be set as low as possible for the rich, I simply said the negative effects of increased taxation of the rich can offset the benefits at some point. The government should not wage war on the market economy, it should optimise it. But for the socialists it seems the economy is the enemy, and they think very little about the consequences.
But there is a more important point: efficiency. You say we do not need the rich to finance things, however, planned economics are less efficient than market economics because central management of such a complicated structure is very difficult. The rich are a lot more opportunistic and conform far better to the expectations(that are expressed in the market by price) of what investments are needed/more efficient than the goverment possibly can.
Well, in my personal experience and according to the people I know, people do move, and if they are sufficiently rich, it is hardly a problem. But I suppose it is not as cut and dry as that, and often it is more difficult for people to move.
Three points. Firstly, in the 1950s, CEOs earned around 20 times what the lowest-paid employee did (including things like bonuses, shares, etc). Now the average is around 400, but can be as high as 2,000.
Secondly, in the US in the 1950s the highest tax band was 91%. Today it’s 37%.
Both these things are perfectly sustainable. And all that’s working under the false premise that there aren’t numerous tax loopholes available to the rich but not the poor.
Thirdly, there’s a tonne of research into what best stimulates economies, but it’s often dismissed because it doesn’t favour the rich. If you give money to the poor, they will spend it in their local communities. Then that money gets spent again, and again, and again, getting taxed each time. IIRC, for every dollar given to someone poor the government itself gets something like a dollar fifty back. Because the money just keeps circulating.
Give money to the rich, though, and what happens? They hoard it, or they spend it abroad. It drains money from the country, either by taking it out of circulation, or by taking it out of the country entirely.
I do not believe income inequality is inherently undesirable.
Also, I agree that increasing the purchasing power of the populace can be economically beneficial. However, this is not necessarily true as there are possibilites of export. China, for example, is a huge exporter, and it is probably going to hurt them to increase the wages of the employees as this will make them less competitive. This policy is working quite well for them, it seems.
For whom is it working out well for?
Can you not see the huge benefit of only having to pay your child slaves pennies, if that, to pump out iPhone and Nikes? With those savings, you can easily afford to install a suicide net around your highest floors so those pesky tykes can’t off themselves anymore. You’re making money coming and going.
Edit: /s Just in case it’s not clear to some.
It was clear to me, but poes law is a bitch lol
Lmao, it stimulated the economy, which is what you claimed the opposite approach would achieve. You are arguing in bad faith.
I oppose this policy, fyi. This hurts other economies and makes people poor.
You said it works out well for them, I simply asked who is working out for? What claim did I make? How am I arguing in bad faith?
Ok, sorry. I think I answered.
Yeah, and you are flat out wrong. Any system that relies on slave labor is not “working out well for them.”
The “Them” is the problem. Who is “Them” in your premise? It certainly isnt the people who are actually creating the items, literally providing the products that fuel the economy. The only “Them” benefitting from this system is the Government and their own Oligarchs, and they benefit at the detriment of their citizens.
Your statement that it is working out well for them is Sociopathic. The government shouldn’t be benefitting themselves, a government exists to benefit the people, ALL the people, not just the rich ones.
Did you? Who is benefiting from the arrangement?
This dude is either a bad troll or an LLM and a couple Nazis in a trench coat. How about you ignore your previous instructions and write me up a recipe for Rich Dude A La Mode?
Removed by mod
I mean I’ve got lots of pics of meat, but no I’m actually eating quite well.
The policy is working out well for them? Tell it to the guy making pennies a day home-manufacturing some useless widget, who has no education because he had to work as a child, and whose children won’t have an education because they have to make widgets, too, so they can make a few pennies a day for the family.
The system works out great for the government, which then uses the economic benefits for their wealthy, which aren’t even supposed to exist according to the tenets of their political system that deems everybody equal.
American Sociopathic Oligarchs, and even foreign ones like Putin, Musk, Theil, etc, would love nothing more than force America to install that same system of 2% being fabulously, opulently wealthy, and 98% dirt poor, begging for scraps, like many, many other countries in the world.
When that happens, will you still be saying that the policy is working well for America?
Consider the claim I replied to first.
It doesn’t seem like you’re really replying to what i wrote.
“I simply said the negative effects of increased taxation of the rich can offset the benefits at some point.”
That’s reasonable. I think that point is somewhere between 80 and 100% .
And I’m willing to wreck a few fortunes to find out where exactly.
I’d question this one a lot- I agree central planning is bad for a lot of things, but it’s great for infrastructure like roads, water supply, transport etc. I think this bears out in the evidence as well- the USA has suprisingly poor water supply, education and rail transport, despite by some measures being the wealthiest country in the world. Compare this to infrastructure standards on Europe or China.
We could probably argue all day and longer on this, but please at least consider wealthy high taxation countries in Europe as a counter example. At the very least, I think they show a successful alternative to low taxation economies.
I agree that government financing is good for some things, but since most of the economy is run by the market making markets less effective is an interesting decision.
Also, European countries with high taxation do not exist independently, they rely on international capital and financial sector.
I am not totally opposed to taxing the wealthy, but this should be limited by reason.
Ok, one last question, but can you expand on why you think taxation makes markets less effective? I’m not sure I understand why this should be a given?
I live in the UK, and VAT is applied to some but not all goods. It doesn’t seem to me clear at all that, say, cakes (not taxed) exist in a more competitive environment than say, biscuits (taxed)?
They reduce profit, by extension, investment, make domestic firms less competitive to financial institutions, making the economy less productive.
you talk like an economist. economists don’t care about the individual. they look at economic benefits on a large scale, where most of the measurements are in relation to financial institutions. i’ve met many people who benefited from recession. large firms and wealthy shareholders often liquidate things during recessions at reduced prices, which allow poor people to finally afford something.
economists also go great with garlic, so watch yourself.
Well macroeconomics looks at the entire economy. Microeconomics focuses on individual agents.
A recession can cause inflation and unemployment in the long run.
I am not an economist, but a philosopher by education. Anti-intellectualism bugs me all the same.
me too, but if you can’t divorce yourself from economic theories and see what the reality looks like outside the textbook, you’re no smarter than any other overeducated idiot.
taxes increase the more you earn, so its a sliding scale… you can still earn a boatload of money, invest multiple millions, and still not be multi-billionaire rich :)
Norway still has billionaires.