I didn’t state that the rich spend more than the poors in casinos. Just that they were more likely to spend it in a casino than buying lottery tickets (because I’ve a hard time imagining a millionnaire being interested in a lottery ticket, whereas there are actually people spending fortunes in casinos). Honestly this point is not really genuine to the debate.
That’s totally absurd and you know it. They may spend a larger percentage of their income on neccesities, but that’s out of need, not altruism. It is just foolish to say that poor people are kinder, more efficient or all the other fine qualities you have imbued them with by virtue of being poor. If diamonds dropped in price in your scenario to the point where the “poor” could afford them, you can be assured they would make purchase.
Incidentally, you brought up AIDS medication in your reply to amarone. You still have not answered how it is you suppose money would get to AIDS medication. In your last post you imply it is because poor people are just better and more apt to spend their money to fund research.
I am well tired of the old saw that rich people are heartless parasites who live to feed off the souls of the less fortunate. Your entire line of reasoning seems to hinge on this premise, and it just doesn’t hold water.
Also, the reason I specifically mentioned a $15 million salary is because the OP specifically asked what would be the effect of a 100% tax. Even if it didn’t you can’t just stick your head in the sand and pretend all salaries would magically drop to $5 million without the government taxing them down first.
As others have done earlier, you are erroneously conflating money and wealth. They are most assuredly not the same. And yes, the wealth WOULD disappear in a cloud of smoke.
Well, Clair, money CAN disappear in a puff of smoke. Ever hear of the Great Depression? Suddenly people lost their jobs and couldn’t get knew ones. Businesses went broke. People started starving. How did that happen?
It wasn’t because suddenly natural resources were used up. It wasn’t because people suddenly became unskilled. It was because the economy collapsed. Suddenly everyone became poorer, even though objectively speaking nothing had changed.
So it is perfectly clear that just because someone loses their job making yachts doesn’t mean that a new job magically appears for them somewhere else. The jobs and money that were created by that yacht factory really do just disappear into nothing.
Money really does get created out of nothing, and it can disappear into nothing. How can a country with no natural resources like Japan be rich, while a country with vast natural resources like the Congo be poor? Where does the money in Japan’s GDP come from? Why don’t the people in Congo’s non-existant yacht industry have jobs building houses and AIDS vaccines?
While it is quite true that the Declaration of Independence, uh, declares that certain rights are inalienable, and that among them are “life liberty and the pursuit of happiness,” I can find no instance of the phrase “life, liberty and property” in the Constitution.
Maybe you meant that the Constitution enshrines into law certain rights, including life (due process in capital cases), liberty (in certain enumerated instances, e.g., free speech, free exercise of religion, etc) and property (fifth amendment taking clause). If so, I apologize for being too literal, but I think your initial formulation was unclear.
Property is not the same as income. Income can be taxed. See the 16th amendment.
Was that directed at me?!! Jezus Christ, all I was doing was resolving a dispute about whether “pursuit of happiness” “pursuit of property” or “property” was the language used in the Constitution.
I said jack shit about whether income and property are the same, or whether one or the other can be taxed.
But since you decide to pick a fight, you are dead… fucking…wrong. Income is property AND it can be taxed.
You see, all property can be taxed. You have heard of “property taxes,” haven’t you?
:rolleyes:
Sua
Try reading instead of just searching. The various amendments contain provisions against excessive fines, confiscation, quartering soldiers in priavte homes, etc., thus protecting property. Protections of “happiness” in any form are absent.
racekarl replied to clairobscur: *“The point is that less affluent people spend their money on things which are more necessary”
That’s totally absurd and you know it. They may spend a larger percentage of their income on neccesities, but that’s out of need, not altruism. It is just foolish to say that poor people are kinder, more efficient or all the other fine qualities you have imbued them with by virtue of being poor.*
I think this may be misinterpreting clair’s statement a bit: it seems to me to mean simply “when the poor have more money, more basic needs get taken care of.” That’s not because the poor are “kinder” or “more efficient”, it’s just because they’re the ones who have those needs currently unmet.
In other words, given an (admittedly artificial and hypothetical) situation where there are many poor people who can’t afford some basic necessities and a few rich people who can afford to live lavishly, what happens when one or the other group gets a chunk of money? If it’s divided among the many poor, they’re apt to spend it on their currently unmet basic needs. If it’s divided among the few rich, they have no unmet basic needs—they can already afford all the food, shelter, healthcare, education, transportation, etc., required for comfortable survival—so they are apt to spend it on something that’s more of a luxury.
So if a sum of money goes to poor people, the overall level of destitution and deprivation decreases more than if the same sum goes to rich people instead. There’s no need to interpret that as a slur on rich people’s characters: it simply reflects the fact that it’s the poor who have the immediate need for more necessary things. And if we all agree on the desirability of having less destitution and deprivation, we can all see why it’s a good thing overall for the poor to have more money.
Whether it is necessary, right, or appropriate for government to regulate market forces (via progressive tax policy or any other means) to encourage that is an eternally-debated question. Personally, I think that market failures tend to make it effectively impossible for a society to provide a decently prosperous life for almost everybody unless there’s some form of mandatory income redistribution. As I’ve said, though, I think a true income cap is excessive and would probably even be counterproductive.
Ah, try reading the second paragraph of my post again. I specifically pointed this out (my example was the fifth amendment’s takings clause). I just thought Sua’s post made it sound like the phrase itself was in the Constitution, when it clearly is not.
Did I say they do that by altruism, or that they’re kinder, or even more efficient? I never attributed any fine quality to poorer people. I just stated that, indeed out of necessity, they use their money more efficiently (because they can’t afford to waste it) and to buy more necessary goods.
I believed someone else introduced AIDS at some point. But it might have been me. If so, I was probably thinking about the situation in Africa and it was only an example. And once again, I never hinted at poor people being better and spending their money to fund research. I was just stating that they would buy AIDS drugs because they would need them (which would be indeed an incentive to invest in medical research rather than on studies about the aerodynamics of yachts) Hence that the wealth would be spent on more necessary goods.
Actually, you seem to have read in my posts something I never wrote about poor being good and rich being evil.
Ok. Then, during the first year, indeed, the money above 5 millions dollar would go into the government’s pocket. But it has no bearing on the overall functionning of the system. Past the first year, why would anybody want a salary above 5 million dollars if anything above that is taxed at a 100% rate? Such a rate can only be a way to cap incomes, not to fund the budget.
If you’re paid 10 millions by your company, you can buy 10 million worth of goods. If said company pay 5 people 2 millions apiece, these 5 people can still buy 10 millions worth of goods. What’s the difference? Similarily, you can decide to buy several houses instead of a yacht. Why would it make a difference if several people buy one house each instead of you buying several houses?
And why would wealth dissapear in a cloud of smoke just because the same amount of money is distributed differently? If you give 100 dollars to your brother, does some wealth immediatly and magically dissapear somewhere?
How to cure AIDS:
Infect the 10 richest people in the world with HIV.
It happened because a speculative bubble collapsed with the usual result of such an event. Not because the incomes were distributed differently. Perhaps I’m off base, but I don’t remember the Great Depression having been caused by the implementation of a redistributive policy. I don’t think I’m off base.
Yes. In the same way that jobs dissapear in a given sector when there’s a shift of demand. If there’s less demand for wigs and more demand for hats, wigs makers lose their jobs and hat makers are recruited.
Japan doesn’t create money out of nothing. It use ressources like skilled work to produce goods which have a value. The relationship between natural ressources and wealth is teneous in modern economies.
Because they’re no more able to trade their non-existant wealth for houses than for yachts. If you can’t produce (or are prevented from producing, by say a civil war or subsidies received by concurrents in developped countries) goods or services at a competitive price, you’ve to rely on a subsistance economy.
**
I’m not claiming that the Great Depression happened because the government decided to distribute incomes differently. My point is that during the Depression incomes WEREN’T simply distributed differently. Everyone got poorer. The gross national product decreased. How could that happen? If someone was fired from their job at the steel mill, why couldn’t they just get another job at the lumberyard? Because there were no jobs at the lumberyard. Everyone was fired from the lumberyard too, because the lumberyard went broke. But why did it go broke?
Look, you are assuming that given a certain amount of natural resource inputs, and a certain amount of skilled labor, the total GDP of a country will be constant. But that is obviously false, otherwise we wouldn’t have depressions.
**
But what happens if there’s less demand for wigs AND less demand for hats? The example of the Great Depression proves that a given amount of capital, a given amount of natural resources, and a given amount of skilled labor don’t always result in the same amount of production.
But WHY doesn’t Congo have wealth? Look, there are no yachts factories in Congo. But they also aren’t producing consumer goods for the poor either. There are plenty of smart, hard-working people in the Congo. Why can’t they just up and decide to build factories? This is the other side of why did factories close down during the depression.
Why did the factories get built before the depression, and why did they go bankrupt, when there was the same amount of skilled labor, the same natural resources as before? The point is that if factories must close simply because other factories are closing, then the converse is also true…factories can get built because other factories are built.
A factory producing luxury goods for the rich does not take one crumb from the mouths of the poor. Shut down the factory and you have done nothing for the poor. Those workers will be out of a job, and you have done nothing to find them another job.
Dewey, you are right; I phrased it poorly. I used quotations when they weren’t appropriate, in order to ape the form being used by the parties debating over “pursuit of property,” etc. The point I was trying to make was that property replaced pursuit of happiness in the formulation of fundamental rights in the Constitution.
I have read some historians who claim that this change marked a major shift in the focus of the FFs, from a radical revolutionary spirit during the war to a more conservative view after victory.
I didn’t explore this much, so I don’t know if there is credence to the claim.
Sua
On “taking food from poor people’s mouths”:
A chief executive of a company with 10,000 employees being paid minimum wage who takes a $100 million salary does take the food from the poor people who work for his business. If he accepted a $10 million salary (which is, by no means, a pittance) and distributed the $90 million difference amongst the 10,000 employees, each of them would earn $9000 more a year, which would roughly double their wages – and make them a lot less poor.
I realize this is hyperbole to argue a point, but the point is absurd.
It is like arguing that you can teach a man to fly by pushing him off the roof.
You can’t solve every problem by throwing money at it. Otherwise, rich women would never be fat.
Regards,
Shodan
I believe that property and the protection of property rights is fundamental to our freedom. Think about it…who is easier to evict? A homeowner or a rental tenant? Who is easier to fire? A manager or a partner (partial owner)? Having a personal stake in the game helps cement your rights. Also, people tend to work harder when they are working for themselves instead of the boss man.
So in other words I agree that having the majority of the real wealth and property owned by a few is inherently bad for democracy. That is not to say that I thinks it’s wrong for 1% to live in luxurious mansions and the rest of us owning decent brownstones and split-level ranches.
Problem is that the pro-max wage people mean well but they are going about it backwards. Have the government confiscate all the extra wealth from the wealthy? Why? Even at its most altruistic, I would expect the government to mismange assets worse than any robber barron ever could.
msmith: *So in other words I agree that having the majority of the real wealth and property owned by a few is inherently bad for democracy. That is not to say that I thinks it’s wrong for 1% to live in luxurious mansions and the rest of us owning decent brownstones and split-level ranches.
Problem is that the pro-max wage people mean well but they are going about it backwards. Have the government confiscate all the extra wealth from the wealthy? Why?*
Most of us can agree on this, I think: increased wealth equality (and even more progressive taxation) is one thing, but mandating absolute equality, or even capping maximum wealth, is quite another, and a lot more dubious.
Even at its most altruistic, I would expect the government to mismange assets worse than any robber barron ever could.
Well, Enron and WorldCom etc. have lowered that bar a lot, of course.
Actually no. The CEO then does enough to make $5 million. Why should he make any more? It is just going to be taken away? And then the GDP suffers, because people don’t strive to make as much money as they can. That money is usually invested or spent, making other people money.
If you cap incomes, then you will cap the economy.
Not really…I think that is a good example of market forces actually working to remove unprofitable companies. Problem is that they were kept going artifically through corruption and deciet. But eventually they had to fail.
Government is under no such obligation. An inefficient government operation can theoretically run indefinitely.