But tell me, how are you going to tax the super rich? It's incredibly difficult to tax someone who's actually poor on paper. Most super rich people actually don't seem to have much wealth officially declared, all of their wealth is sort of like "pseudo" in that it's all tied up in assets, and sometimes assets that aren't directly owned by them but their companies etc. and they have a lot of shortcuts for tax breaks on the stuff that can be taxed. With the current system in place then it's impossible to actually tax the rich.
> It's incredibly difficult to tax someone who's actually poor on paper
You think this because the super rich want you to think this. Actually, it's not hard and there are some good ideas floating around (e.g. more inheritance tax, don't let them get loans without taxes againt their illiquid wealth). Does it require a change of laws? Yes, but that's the whole point of democracy.
> don't let them get loans without taxes againt their illiquid wealth
You don't want to fix this. It would kill repurchasing agreements as a collateral damage, making access to credit more difficult and expensive for everyone. Not to mention HELOCs. You might say, "ok, exempt HELOCs", but that's just an arbitrary goalpost.
The economy is organic, you can just use a wrench and have a go at a couple of cogs and expect there to be no knock-on effect.
> The economy is organic, you can just use a wrench and have a go at a couple of cogs and expect there to be no knock-on effect.
What do you even mean by "organic"? Of course governments can, do and should intervene in the economy. And yes, there should be a range of experts evaluating policies before they are encated. I never stated the opposite.
It isn't difficult at all. This is an oft repeated excuse. The rich use their wealth as collateral to purchase things, like homes, companies, investments, etc. and transfer wealth to inheritors with basically no tax. So stop worrying about trying to figure out how to tax unrealized wealth and start taxing the things that unrealized wealth helps secure and purchases. This is one way to force realization of that wealth and thus tax it as well and get it back into circulation.
Right now, the rich are extremely incentivized to remain "poor on paper", so we should remove those incentives.
All the money they’ve made has been taxed. When they sell assets they pay taxes. Yes there are sone areas to address but wealthy people pay the majority of taxes.
Gifts eliminate estate tax up to $12m. You can exceed even that limit by purchasing a property and placing it in a QPRT.
Life insurance trusts also have no limit.
Finally, even if it were true that it's merely deferring taxes, that means you can essentially time the market to pay less in tax when the rules are more favourable, and you can realize more gains in the interim.
Except there are abuses of Roth IRAs and other cases where tax can be completely avoided. I think it was only recent that some limitations of Roth IRAs were put in place for heirs, but such investment vehicles do exist that do not get hit by the normal estate taxation processes.
Some rich person says “teehee, I actually have no money! It’s all in (some country)!” and the US gov says “oops! Guess you really are poor!”
They take a letter of the law instead of a spirit of the law approach with taxes. If they start seizing mansions because clearly they have no money and the only way they could afford it is through ill-gotten means, people will start paying. Police already take cash from the wallets of random people because they assume it’s illegal—meanwhile the IRS knows full well where your money comes from but they pretend to believe the tricks of the mega rich.
Plus the IRS literally have access to banks around the world. You’re required to give them proof of foreign bank accounts or face imprisonment and other countries comply with IRS requests. They can literally seize wealth and know it’s yours. They choose not to.
Of course you can track down de facto ownership and streams of income regardless of de jure separation. This is a question of political will, not economical (im)possibilities.
Whenever you try making rich people responsible, they move abroad. In Norway, the super rich are becoming Swiss citizens after a recent change in taxation. Unless Switzerland takes social responsibility, they're getting away with it. But if Switzerland does the right thing, the rich will find another safe haven.
However, this is a short term issue. The long term changes require a historical change in culture and policy. Otherwise we're still very much catering to the will of old money and power structures that resembles autocracy.
(I'm just an armchair socialist and no expert by any measure, ymmv.)
What's wrong with saying good riddance to the super rich moving abroad? I'm tired of these threats of the rich and corporations saying they'll just go elsewhere. I say go for it and call their bluff.
They still need to interact with developed countries economic systems, so still punish them there.
If the billionaires are net negative and worse than the value they provide, ie billionaires are harmful to society, it seems the easiest way to reduce inequality is just to have them leave.
That's win/win for everyone, they keep their money, you get a society without billionires.
