Hardly. But there is lots of interest in making him look like he is.Damn Biden's going hard on the rich.
Hardly. But there is lots of interest in making him look like he is.Damn Biden's going hard on the rich.
Don't rich people have all their assest tied up in a 'company' so they dont have any capital.Good. I was afraid they were going to be stupid jerks, raise the corporate taxes, and pretend that actually targets the rich.
It's almost exclusively in investment funds or stocks otherwise you lose money(tax, inflation and now negative interest rates). Hedge funds don't exactly represent the milkman.Don't rich people have all their assest tied up in a 'company' so they dont have any capital.
If you're talking about the phenomenon of people like celebrities setting up companies to not pay personal tax on all their income, that's rather limited, and raising all corporate income taxes to punish specifically that is like mowing your lawn with a nuclear bomb.Don't rich people have all their assest tied up in a 'company' so they dont have any capital.
Yes and no.If you mean that wealth is generally invested in something, then yes, and that's a good thing. But capital gains taxes is how you tax those people. Take Jeff Bezos: he's worth like $150 billion. The vast, vast majority of that wealth is in Amazon stock. How does one tax that? His regular income is a tiny percent of his wealth, income tax isn't going to target him. Corporate income taxes on Amazon don't either, because those taxes are on profits, and Amazon "doesn't profit", it puts all excess revenue into R&D, which means they don't pay dividends on the stock anyway. Bezos' personal money comes mostly from liquidating his stock holdings, which is what capital gains taxes.
I mean, "sitting on stock" is also "maintaining consistent ownership", which isn't a bad thing. It's not like there's a pile of money in a mattress they aren't spending.In practice, people like Bezos don't liquidate most of their stock, they sit on it. And they have lots of way of putting it into protected forms such that they can pass it on without actually selling it and making it due for capital gains - most obviously, transfer it to a trust. Capital gains tax will indeed effectively hit the rich in ways corporation tax will not, but many of them will still have plentiful loopholes.
yeah, they're just taking the value produced by others for themselves. such merit!I mean, "sitting on stock" is also "maintaining consistent ownership", which isn't a bad thing. It's not like there's a pile of money in a mattress they aren't spending.
You're gonna have a tough time arguing that people owning something they don't liquidate while it creates no profit and they receive no payment for their ownership are taking the value produced by others for themselves.yeah, they're just taking the value produced by others for themselves. such merit!
Not that hard a time. Stock has value. They have the ability to liquidate it at any time, meaning it constitutes a part of their wealth by any reasonable metric.You're gonna have a tough time arguing that people owning something they don't liquidate while it creates no profit and they receive no payment for their ownership are taking the value produced by others for themselves.
Indeed so: companies need long-term institutional investors. I just mean to point out CGT isn't going to tax some people we in ways we might find desirable.I mean, "sitting on stock" is also "maintaining consistent ownership", which isn't a bad thing. It's not like there's a pile of money in a mattress they aren't spending.
Amazon has never, in its entire existence, paid a dividend (!!). It's barely ever made a profit: nearly all its spare income is funding expansion.Imagine thinking that stock doesn't create profit. I've got like 6 stocks in some stable Swedish industry that makes me a regular 3-4 bucks every year in dividends and payouts. For a guy like Bezos sitting on hundreds of thousands of Amazon stock the yearly shareholder payout will be in the millions, easy.
Seanchaidh is doing the communist thing and suggesting the wealth of owners of corporations is effectively stolen wealth, generated by other people. It's usually a dumb enough argument in the general sense, but it's extra dumb here when we are talking about capital gains rather than corporate profits. The wages of the workers and the money made selling stock don't pull from the same pool of money. Those things aren't in competition with one another.Not that hard a time. Stock has value. They have the ability to liquidate it at any time, meaning it constitutes a part of their wealth by any reasonable metric.
Arguing that because it hasn't been liquidated and spent right now, and thus it doesn't count as value/ wealth, is a bit like arguing that money doesn't constitute value because it hasn't been spent. It's just an extra step, it's immaterial.
I'll defer to Agema's response.Imagine thinking that stock doesn't create profit. I've got like 6 stocks in some stable Swedish industry that makes me a regular 3-4 bucks every year in dividends and payouts. For a guy like Bezos sitting on hundreds of thousands of Amazon stock the yearly shareholder payout will be in the millions, easy.
So: Where does the shareholder payouts come from? Company profit. Where does company profit come from? The labor of its workers. That wasn't even close to hard, it isn't even econ 101.
That's fair. I would say fixing capital gains taxes is a step in the correct direction, and if closing that faucet causes some leaks to spring, we address those next. The outcome I find undesirable is "Raise the corporate income tax! That'll get those rich people!", so any talk about taxing the wealthy other than that is good by me.Indeed so: companies need long-term institutional investors. I just mean to point out CGT isn't going to tax some people we in ways we might find desirable.
He knows that he's a one-term POTUS and that he likely doesn't have a lot of years left to live anyway. He's in it for the legacy.
Increase in capital gains tax proposal.
Damn Biden's going hard on the rich.
How exactly would that threaten U.S. solvency?but in this case one that could threaten U.S. solvency.
It wouldn't. As a nation-state with control over its own currency, it's debatable if the US even can become insolvent, and even if we assume it could, it's also debatable whether it actually would mean anything. The US (and other similarly situated countries) aren't people, households, or even corporations; the "normal rules" regarding income and debt don't apply.How exactly would that threaten U.S. solvency?
By massively shorting those bonds the hedge funds have managed to lower the price of debt securities but the federal reserve can repurchase those bonds and print money in unlimited supply. The hedge funds speculate that those bonds will lower in value due to Biden's spending spree and that this will lead to inflation and increase the interest rates. The problem is that hedge funds do it so massively that it creates a self fulfilling prophecy making the state deficit astronomically expensive. The federal reserve will obviously try to prevent that ie print more and more money. As a result investors might lose faith. And for a nation that thrives on credit..How exactly would that threaten U.S. solvency?
How so? The amount the state is in debt is based on the bond's face value; not the market value.The problem is that hedge funds do it so massively that it creates a self fulfilling prophecy making the state deficit astronomically expensive
No, it's based on inflation and interest rates. That determines the cost. The height of the debt securites is what the hedge funds managed to lower by massively shorting those bonds. They managed an efficiency increase from 0,9 to 1,6% in just four months. With Biden creating another thousands of billions of dollars of debt they expect inflation and interest rates to increase. The hedge funds can massively short again creating this downward spiral.How so? The amount the state is in debt is based on the bond's face value; not the market value.
Which means...They managed an efficiency increase from 0,9 to 1,6%
they own something that increases in value because of the work of others. it doesn't matter if it's a bank account or a collection of stocks or, indeed, huge CEO compensation in the fashion of money or more stock.You're gonna have a tough time arguing that people owning something they don't liquidate while it creates no profit and they receive no payment for their ownership are taking the value produced by others for themselves.