Lion of the Blogosphere

I’m really tired of this dumb argument

A commenter writes:

Won’t rich people find a way around estate taxes pretty easily? In fact, do we collect that much from estate taxes at their current rate, or are they just avoided?

If the tax is so easily avoidable, why are Koch Brothers and Republicans so adamant about lowering it or abolishing it?

To the extent that there are loopholes, and yes there are loopholes, it’s because Republicans refuse to close them, because they think that tax loopholes are fast ones that they pulled on the Democrats.

So once again, rich people not paying taxes goes back to Republicans who do whatever they can to lower tax rates or allow loopholes to kick into the tax code because they shamelessly agree with the Koch Brothers program to make the rich even richer than they already are.

Written by Lion of the Blogosphere

July 3, 2017 at 9:34 am

Posted in Taxes

136 Responses

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  1. Why are you so hell bent on taxing the rich? Envy isn’t a good look. Letting the government have more money is a bad idea. The government has too much money.

    The problem is that the economy is riddled with rackets, not income tax rates. Probably about half of rich people are milking some government or fed reserve sustained racket of one sort or another. Like health care.

    Taxing income or capital gains is dumb in any case. There should be a land value tax and high consumption taxes. Be as rich as you want, but to spend any of it on luxury or own any land or prime location condos will cost you every year.

    bobbybobbob

    July 3, 2017 at 9:46 am

    • “Letting the government have more money is a bad idea.”

      Higher taxes on the rich means LOWER taxes on everyone else. It has very little to do with how much money the government spends. As we see, politicians are happy to spend money that government doesn’t even have, so government spending and taxation aren’t that closely related as conservatives think they are. Taxes just prevent the government spending from causing inflation. Inflation is really bad for the non-owning classes.

      • Well, they’re trying this experiment in Illinois, Connecticut, and California, with the result that high income people are fleeing those states in droves and making the budget situation even worse. This seems to be about envy and wishful thinking with you, rather than looking at history or the actual budget situations around the world.

        Only the USG can spend willy-nilly because the dollar is the global reserve currency but that’s not going to last the rest of our lifetimes. Probably not even the next ten years. Then America will be in the same boat as Puerto Rico and Greece and Connecticut. Taxing as a way to limit inflation doesn’t make any sense.

        bobbybobbob

        July 3, 2017 at 10:02 am

      • Raising taxes too much on the state level will do that because there is great interstate mobility. However, international mobility is extremely low. You’re generally not legally allowed to move to another country. And the United States will still tax you there anyway. People can avoid state taxes, but not federal taxes. Furthemore, the U.S. already has lower taxes on the rich than most other developed nation. There’s no where to go. Rich people would rather pay high taxes in a developed nation than low taxes in Somalia.

        For example, in Japan, the top marginal income tax rate is approximately 50%, and the maximum estate tax rate is also 50%.

      • Japan is on the verge of a fiscal meltdown. Their currency is going to collapse. I am short the yen. Japan pretty much illustrates how goofy your thinking is on this.

        bobbybobbob

        July 3, 2017 at 10:13 am

      • “Japan is on the verge of a fiscal meltdown. Their currency is going to collapse.”

        When reality doesn’t align with your ideology, you predict it will, Real Soon Now.

        jasonbayz

        July 3, 2017 at 1:55 pm

      • Please submit data that verifies that Japan is killing it with their economy.

        Lion o' the Turambar

        July 3, 2017 at 3:07 pm

      • > When reality doesn’t align with your ideology

        I don’t know what’s ideological about a geometrically growing central bank balance sheet that owns half the stock market, and an obviously unserviceable national debt. This seems closer to inexorable arithmetic than ideology.

        The point here is that lion fixates on his pet social status and class issues to the exclusion of the bigger picture. Income taxes are irrelevant in Japan and the USA and Europe because the governments are so far out of control and need to be starved into submission. There is no reason to tout some “soak the rich” line when it’s fiscally irrelevant.

        bobbybobbob

        July 3, 2017 at 3:40 pm

      • Higher taxes on the rich means LOWER taxes on everyone else.

        So why not higher taxes on you? You make about 3.5x the median household wage in the U.S. Why not, say, a 80% marginal tax rate on all income above the median wage? Afraid of loopholes?

        Dave Pinsen

        July 3, 2017 at 3:54 pm

      • fiscal meltdown? you cannot be serious!

        this misunderstanding just keeps popping up. japan has effectively monetized its debt with no ill effects.

        the fed has done the same to half the extent. it now owns 18.1% of the national debt. no inflation.

        the US is awash in capital. the rich can pay much more with no bad economic effects. if the 99% pay less this will have a good economic effect. the 99% spend. the 1% have run out of things to invest in a long time ago.

        i just heard that bald men are being murdered in somalia. witch doctors claim their heads contain gold. libertarian paradise.

        Beverly Hills Ninja

        July 3, 2017 at 4:39 pm

      • Japan is on the verge of a fiscal meltdown. Their currency is going to collapse. I am short the yen. Japan pretty much illustrates how goofy your thinking is on this.

        If the yen is going to collapse, why is the yield on 30-year Japanese government bonds 0.85%?: https://www.bloomberg.com/markets/rates-bonds/government-bonds/japan

        By way of comparison, the yield on U.S. 30-year Treasuries is 2.87%: https://www.bloomberg.com/markets/rates-bonds/government-bonds/us

        Dave Pinsen

        July 3, 2017 at 5:29 pm

      • can we retire this ridiculous Somolia-Libertarian trope? It just makes you look like a moron.

        Lion o' the Turambar

        July 3, 2017 at 5:31 pm

      • can we just retire proof that libertarians are out of touch with reality?

        Beverly Hills Ninja

        July 3, 2017 at 6:08 pm

      • On that 0.85% interest rate 10% of the government expenditures are already on interest. Japanese tax revenues have been declining. That 0.85% rate is what it is because the BoJ is monetizing the debt. This blows up when interest rates inevitably normalize, or even without that event the interest expenditures will spiral out of control in a matter of some years as the total debt continues to balloon. An unhappy ending is baked into the cake. Most likely, Japan finally gets a 3% inflation rate going and up towards 40% of the budget is going to interest, which is untenable. There will be some form of default, most likely helicopter money and a currency crash.

        The same thing will probably happen here in the US, but we are farther out. There is no way the current rate of BoJ monetization continues for many years longer with this blowing up.

        bobbybobbob

        July 3, 2017 at 6:13 pm

      • Lyon, I urge you to study Modern Monetary Theory. Where do you think money comes from? I mean this with the utmost respect. Does it come from trees? Does it come from the earth? Farms? Where do the numbers in your bank account come from? Your employer? Where did he get them? His customers. Where did his customers get them? Their jobs. As you can see, there is a problem with this line of thinking.

        Money is not a scarce commodity. Commodities are scarce. Political power – i.e. the ability of a sovereign (i.e. politicians) to organize people around a common end is limited. But, numbers are unlimited. It is what we do with those numbers that makes a difference.

        Sovereignty has always been tied directly with the power to create money, regulate its value, adjudicate debts only in that currency, and to demand it in taxes.

        Until modern times, taxes were almost entirely about either a demonstration of fealty or about social control (i.e tariffs). With the advent of modern banking, the state increasingly delegated the right to create money to banks. It is not a coincidence that The Federal Reserve Act and the 16th Amendment legalizing the income tax passed within months of each other.

        As libertarians fondly point out, creating money can lead to inflation. What they always forget to mention is that is the function of taxes in modern times. In the past, it was purely to just get people to use the sovereign’s currency. Today, it is about controlling inflation. It is best to think of inflation being a problem ONLY when the ruling sovereignty cease to be sovereign. Hyperinflation always precedes a state’s collapse, especially during wars. Why is this? The money ceased having any political power.

        That is the reason for the state tax. The money hoarded by the wealthy doesn’t really do anything. But it gives its holders political power. This, we do not want.

        There is nothing more important today that getting everyone on the Right to understand that libertarian economics is bunk. There is an unlimited amount of money.

        Helmut

        July 3, 2017 at 6:50 pm

      • bobby,

        “monetize” means the BOJ carries 34% of JGBs on its balance sheet, and will never sell them. all the interest paid by the government to the BOJ is remitted, sent back to the government. this debt doesn’t really exist. people have been betting on a “normalization” of rates in japan for 25 years. it’s called “the widow maker trade”. central banks control interest rates. they keep them low as long as there’s no inflation. japan for the last 25 years, the EU and US for the last 10 have been trying to get inflation up. they can’t. if you don’t know why you haven’t been reading lion’s blog very long.

        Beverly Hills Ninja

        July 4, 2017 at 12:23 am

      • Japan’s strategy only works as long as the economy doesn’t recover. When Japan’s economy does finally recover, interest rates will go up and the Yen will crash.

        Latin America, Israel and Zimbabwe have all tried at various times to do what Japan is currently doing and the result was always hyperinflation. Japan is currently experiencing massive debt deflation so they are getting away with their monetization for now, but that won’t last forever.

        Otis the Sweaty

        July 4, 2017 at 11:48 am

      • Somalia has been struggling since Siad Barre’s socialist dictatorship collapsed in 1991. Ironically, the people are actually better off now than they were under socialism.

        “Life expectancy is higher; infant mortality has improved 24 percent; maternal mortality has fallen over 30 percent; infants with low birth weight has fallen more than 15 percentage points; access to health facilities has increased more than 25 percentage points; access to sanitation has risen eight percentage points; extreme poverty has plummeted nearly 20 percentage points…and the prevalence of TVs, radios, and telephones has jumped between 3 and 25 times.”

        destructure

        July 4, 2017 at 3:21 pm

      • >>Taxes just prevent the government spending from causing inflation. Inflation is really bad for the non-owning classes.

        This is true. Deficit spending is inexorably inflationary. The indicators of such may not be apparent immediately in the consumer price index – and that’s because capitalist economies always run at surplus to capacity, but it will someday be reflected in the CPI, big time – but it comes out in asset inflation, and proles need to buy assets too, the most important of which is a house. Economists try and bullshit us that there has been very little inflation over the past 30 years. That is untrue, the extra money sloshing around has gone largely to value transference industries, equities and into housing prices. Proles are poorer because of deficit spending.

        Daniel

        July 4, 2017 at 5:06 pm

      • When Japan’s economy does finally recover, interest rates will go up and the Yen will crash.

        i hope that’s a joke.

        you’re hilarious.

        Beverly Hills Ninja

        July 4, 2017 at 5:12 pm

      • Japan’s strategy only works as long as the economy doesn’t recover. When Japan’s economy does finally recover, interest rates will go up and the Yen will crash.

        Japan is doing great. Current unemployment rate there is 3.1%, life expectancy is the highest in the world, their infrastructure is the best in the world, and Tokyo has more Michelin-starred restaurants than any other city in the world. GDP growth is low, but the population is shrinking, so GDP per capita will be fine.

        Zimbabwe doesn’t even belong in this conversation.

        Dave Pinsen

        July 4, 2017 at 6:34 pm

      • “So far so good!” said the man as he sailed past the 50th story window.

        bobbybobbob

        July 4, 2017 at 7:55 pm

  2. Another example of GOP stupidity: Betsy Devos rolling back the regulations that prevent for-profit schools from qualifying for federal financial aid if their students don’t obtain “gainful employment.”

    Working class kids need to be protected from predatory schools that put them in lifelong debt with bogus degree programs.

    If anything Betsy Devos should expand the “gainful employment” standard to nonprofit schools!

    Jimi

    July 3, 2017 at 11:30 am

    • I agree 100%.

    • If you don’t crack four digits on your SAT, you shouldn’t be eligible for student loans.

      ScarletNumber

      July 3, 2017 at 12:45 pm

      • That would be a meaningful reform that would never ever happen.

        Mike Street Station

        July 4, 2017 at 12:55 pm

      • The College Board would just add another section to the SAT. Math – English – Writing – Feeling.

        Panther of the Blogocube

        July 4, 2017 at 1:33 pm

    • Many expensive fluff degrees from upper tier universities/colleges are bogus as well, don’t you think? What does a BA degree in Comparative Literature get you after graduation? A few more years with grad school perhaps!

      JS

      July 3, 2017 at 2:19 pm

      • Depends on how entrepreneurial you are. History is replete with successful men and women who had “liberal arts” degrees. If you are smart and ambitious, any degree from a good school will stand you in good stead. If you got a comparative literature degree to smell the roses then you’re in trouble.

      • The only issue — a combination of post scarcity economics, stagnant wages and far fewer status inducing positions make many people less inclined to become ambitious. There is no reward system that is relevant, because the rewards are not meaningful and they have run their course.

        The Anglo Prole Sphere’s Protestant Work Ethic is no longer meaningful and is outdated. Continental Europeans, especially Southern Europeans realized that striving was a much ado about nothing.

        Despite the aggressive and industrious nature of the Anglo fools, they still lag in quality of life when comparing to the other citizens of the industrialized world. So they have been a failure all along.

        JS

        July 6, 2017 at 9:24 pm

    • The for-profit non-profit distinction is bullshit though. Why should these rules apply to one and not the other?

      Steve@steve.com

      July 3, 2017 at 10:07 pm

    • Met a dude out here in Vegas. Went to ITT to learn electronics. Spent 2 years, $20,000+ and didn’t learn a thing. Couldn’t get a job. But I credit his drive though. He noticed that lots of people drive scooters around Vegas. He bought 2 junked scooters, hauled them into his apartment (to his wife’s chagrin) took them apart in his living room, learned how they work, put them back together, got them running and now runs a business fixing scooters. Minimum fee is $100 per house call. Probably makes $400 /day cash. I may follow his lead.

      Daniel

      July 4, 2017 at 5:10 pm

  3. Tax professionals actually do say that the amount collected from the estate tax is insignificant, from a deficit reduction perspective. Would the issue go away if we just mandated that rick kids aren’t allowed in to HYPS?

    Marty

    July 3, 2017 at 11:52 am

  4. Look, the entire history of the “Tax the Rich” movement since FDR has yielded only two results:

    1) Massive tax increases on the middle and working classes.

    2) Massive increases in the concentration of wealth.

    That’s it.

    “Tax the Rich” is just rhetoric. What it is designed to do is create a government mechanism that will allow the rich to use the state against its competitors. That is the result of this policy. Many Republicans do see this and act against it, even though others do not.

    Again, Nancy Pelosi did not run for Congress for the purpose of raising taxes on herself.

    map

    July 3, 2017 at 11:53 am

    • Standard libertarian talking points that don’t make any sense if you think deeply about it.

      Concentration of wealth happened because of a winner-take all economy, and massive expansion of the labor force from women and immigrants.

      Tax increases on the non-wealthy happened because of tax increases on the non-wealthy.

      • It’s not a talking point, it’s what actually happened, repeatedly over decades. You tend to try to think about things like a libertarian, where you break apart systems and policies and the effects. This is a waste of time when we can look back on history and review what obviously happened in practice. Every single burdensome individual tax was sold to the public as a way to soak the rich but that’s never what happens. The upper middle class always bears the brunt. Those allegedly high top bracket income taxes from the 50s and 60s never actually happened because the rich had dozens of ways to shield income.

        You need to do less thinking and theorizing and more looking at history. “Well, just don’t make those mistakes!” is a childish complaint of the sort that libertarians and communists make. “We just haven’t tried *real* libertarianism/marxism yet, so we don’t know!” No, exactly the same thing will happen again. It always does.

        bobbybobbob

        July 3, 2017 at 1:19 pm

      • bobbybobbob, if you actually look at history, you’ll see that tax increases since FDR occurred because people wanted the things that required increased taxes to pay for. The New Deal was very popular.

        “You need to do less thinking and theorizing and more looking at history. “Well, just don’t make those mistakes!” is a childish complaint of the sort that libertarians and communists make.”

        What’s more childish is assuming that just because X preceded Y that X caused Y, that somehow the government couldn’t have taxed the middle class unless it taxed the rich first.

        jasonbayz

        July 3, 2017 at 3:57 pm

      • You’d have to be a complete moron to think that since 1) preceded 2) it therefore caused it. Map is a moron.

        Magnavox

        July 3, 2017 at 4:03 pm

      • It’s true that modern income tax, going back to Wilson, was initially aimed only at the rich, then expanded to the middle class. But taxes in general have gone up due to the growth of the welfare state and the military over the 20th Century.

        Dave Pinsen

        July 3, 2017 at 5:35 pm

      • jasonbayz,

        You miss the point. The point is not whether taxes went up or whether they were popular. The point is that those taxes did nothing to soak the rich.

        Magnavox and Lion,

        Did you guys forget that the Democratic Party controlled the House from FDR until Newt Gingrich, with alternating stints in the Executive branch for the majority of that time? Did you forget that the Democrats were the blue-collar, populist party pushing all of this rhetoric about “taxing the rich?” And what actually happened in the entire time period that Democrats were in office? They were taken over by the rich. None of these rich people were soaked. None of their power was reduced. If anything, the rich became richer and more powerful than ever.

        I agree with Lion that value transference, useless inheritances for useless people, and lottery billionairism is the norm, but I don’t think getting rid of the estate tax will do anything. The rich will simply shift their money into charitable trusts and other non-profit entities, while people with family farms and small businesses are forced to liquidate to pay their estate taxes.

        This is how the concentration of inter-generational wealth happens at the top, while the competitive yeomanry is wiped out. It is why we keep discussing income taxes instead of wealth taxes.

        Remember, the real business base of the Republican Party is either a small business or a large business that still retains its original owners. It’s these “rich people” that most rank and file Republicans back.

        map

        July 3, 2017 at 8:39 pm

      • “The point is that those taxes did nothing to soak the rich.”

        What’s your evidence for this? If it’s “the rich still exist,” sure, but eliminating the rich was never the goal outside of communists and libertarian strawmen. But the government obviously did extract significant taxes from the group of rich people.

        You may bring up other ways in which government power has been used to enrich the rich at the expense of the poor, such as through regulation or housing restrictions, but that has little to do with the government’s power to tax. With lower taxes, the rich would just have more money to lobby the government for more favorable treatment.

        “while people with family farms and small businesses are forced to liquidate to pay their estate taxes.”

        But back in reality, the estate tax already applies only to those estates in excess of 6 million. No remotely small business is going to be liquidated by that.

        jasonbayz

        July 4, 2017 at 12:22 am

      • Right, if a business has ASSETS of more than $5.45 million (or $10.9 million of owned by a married couple which is more likely), it’s not “small” by any normal definition, it’s a top 0.1% business.

        A ridiculously tiny percent of family-owned businesses wind up being affected by the estate tax, it’s just a conservative talking point that’s not based on any reality.

        If anything, the problem is that the tax kicks in at too high of a wealth level. People who are very wealthy (decamillionaires) can pay no estate tax at all. That’s wrong.

      • jasonbayz,

        “What’s your evidence for this? If it’s “the rich still exist,” sure, but eliminating the rich was never the goal outside of communists and libertarian strawmen. But the government obviously did extract significant taxes from the group of rich people.”

        The purpose of taxing the rich is not to raise revenue. The purpose is to reduce the concentration of wealth so that the government does not become a private enterprise of a few select families and their coteries. The estate tax has failed to do exactly that. Worse, since you are targeting a small group of powerful people with essentially expropriation of their wealth, you give this group an enormous incentive to capture the state and turn it to serving its interest at an even more accelerated pace, which is exactly what happened. And then those people will turn around enrich themselves and attack the society around them with the same rules that you created.

        We are at the point where rich people can borrow from the government at 0% interest, invest in some enterprise, and then sell back to the government, while borrowing more money to paper over any short-term losses. That is pure gravy at any tax rate. And you wonder why they are exceedingly liberal?

        We will end up paying estate taxes on modest wealth just like we pay income taxes on modest income. Income taxes were also sold to us as “taxes on the rich.”

        map

        July 4, 2017 at 1:27 pm

      • Lion,

        “A ridiculously tiny percent of family-owned businesses wind up being affected by the estate tax, it’s just a conservative talking point that’s not based on any reality.”

        It probably is not ridiculously tiny. The cutoff of $5-10 million is a canard that probably does not exist in practice.

        map

        July 4, 2017 at 1:33 pm

      • A ridiculously tiny percent of family-owned businesses wind up being affected by the estate tax, it’s just a conservative talking point that’s not based on any reality.

        Trump’s estate is one of those estates.

        Right or wrong the tax hikes are not happening.

        The Undiscovered Jew

        July 4, 2017 at 3:01 pm

      • But back in reality, the estate tax already applies only to those estates in excess of 6 million. No remotely small business is going to be liquidated by that.

        Back in reality the Congress is Republican controlled while the billionaire Republican President plus his family stand to lose in the event taxes go up – campaign ploys about taxing the rich notwithstanding.

        It’s neither passing Congress nor worth worrying about.

        The Undiscovered Jew

        July 4, 2017 at 3:13 pm

      • It’s also taxed marginally after the 5.45/10.9 million cut off and marginal taxation is a concept that these anti tax crusaders never seem to be able to understand so I guess that’s par to of their problem.

        Magnavox

        July 5, 2017 at 2:10 am

  5. “I’m really tired of this dumb argument”

    What is the really dumb argument? You reference at least three different hypothesis in your post.

    Clearly people do respond to incentives. Especially in the tax code. If tax something you give people an incentive to distort their normal behavior to avoid the tax. Maybe the cost of the distortion is big enough that people wont be bothered, but clearly a lot of times they do.

    This is Economics 101. Do you not accept the Global Economic Consensus on people responding to incentives?

    In an given situation you can find people acting irrationally, but overall if you offer to “pay” people millions to use a loophole, they will.

    “Koch Brothers and Republicans so adamant” about about the issue because they find the distortions that the tax encourages are a drag on the economy.

    Lion o' the Turambar

    July 3, 2017 at 11:58 am

    • The main goal of people is to increase their status and not to avoid paying taxes. This libertarian nonsense that rich people will stop working if you raise their tax from 30% to 40% is just nonsense. And it’s also libertarian nonsense that rich people are what drives value creation.

      • Certain wealthy individuals believe they should be taxed more.

        JS

        July 3, 2017 at 2:31 pm

      • This is you projecting your unusually high status neuroticism. Most people are working for money, and respond rationally and predictably to incentives regarding money.

        bobbybobbob

        July 3, 2017 at 3:33 pm

    • My response to that point is, so what?

      Sure, people will try to find ways around the estate tax. People will also try to find ways around laws like those prohibiting the use of crack and meth, as well as those prohibiting theft, rape, and murder. “The war on drugs is a failure” they say, because some people ignore the law, which is a stupid argument there and it’s a stupid argument against taxation.

      What, specifically, is so bad about the “distortions?”

      jasonbayz

      July 3, 2017 at 4:02 pm

      • Well to take one distortion, the US government incentivizes corporations to hire large tax departments and and to focus their decisions to some extent on being tax advantageous verses profit-maximizing. See how much Warren Buffet’ annual reports have focused on his companies tax efficiencies. Clearly this is top of mind at the highest levels.

        This wastes a lot of corporate resources and results in over $2T USD being parked overseas where the US government gets $0 of tax on it.

        Another distortion that Lion acknowledges above is “great interstate mobility” where State politicians give people incentive to leave their state.

        Lion o' the Turambar

        July 3, 2017 at 6:21 pm

      • jasonbayz,

        You are missing the point again. They are not just trying to get around the law. They are actively re-writing the laws to go after their class enemies. How? Because you’ve established that power for them to begin with. It’s similar to not only having laws against murder, but establishing an enforcement mechanism whose job is it to frame people for murder.

        You’re taking a parasite and giving them the tools to gain more control over you.

        map

        July 3, 2017 at 8:48 pm

      • “Well to take one distortion, the US government incentivizes corporations to hire large tax departments and and to focus their decisions to some extent on being tax advantageous verses profit-maximizing.”

        As Lion has repeatedly pointed out, this is due to tax loopholes which Republicans aren’t acting to close.

        “This wastes a lot of corporate resources and results in over $2T USD being parked overseas where the US government gets $0 of tax on it.”

        That’s mostly because they are waiting for more favorable treatment by a future conservative congress. Once more, tax cutters are the cause of that distortion.

        jasonbayz

        July 4, 2017 at 12:26 am

      • You said give an example of a distortion and I did. Its behavior that wouldn’t occur except for the tax law creating an incentive for it.

        Now your quibble is that your taxes are good ones and therefor wont have a distortion? Come on.

        If Buffet and Munger and spending a good chunk of their time figuring out how to get around existing taxes, they will do the same things minimizing taxes you propose. Causing more economic distortions.

        Lion o' the Turambar

        July 4, 2017 at 10:15 am

      • It’s the job of Congress to close loopholes that the rich use to avoid paying their fair share.

      • “fair share” doesnt exist because the rich pay infinitely more than the 46% of people who pay nothing.

        The assumption that idea that Congress ought to close the loophole is along the line of saying someone ought to do something about the weather. Talked about but has never, ever happened.

        In general the Koch’s favor a uniform tax code which prevents law makes from picking winners and punishing losers. That takes the distortions out of business planning and would be a good thing.

        Lion o' the Turambar

        July 4, 2017 at 4:17 pm

      • “The assumption that idea that Congress ought to close the loophole is along the line of saying someone ought to do something about the weather.”

        No, the weather can’t be changed. Congress WILL change if it’s what the voters demand. And in fact, During the past decades, Democrats have tried to close loopholes and they were blocked by Republicans.

    • Do you not accept the Global Economic Consensus…

      sounds like…

      97% of scientists agree on climate change…

      Beverly Hills Ninja

      July 3, 2017 at 4:56 pm

    • people *are* implicitly motivated by status whether you like it or not. what does a person with 5 billion dollars care about making another 5 billion dollars? he has all the money he needs at 5 billion. its about the self-actualisation of growing, being better, bigger and stronger than his competitiors. it’s not about an explicit class-neuroticism (that highly self-aware guys like lion obviously possess), its an implicit drive to be number one. saying human beings don’t possess that trait and just want “more money” (for god knows why) is ridiculous.

      james n.s.w

      July 3, 2017 at 11:52 pm

    • jasonbayz,

      “As Lion has repeatedly pointed out, this is due to tax loopholes which Republicans aren’t acting to close.”

      So why didn’t the Democrats get rid of the loopholes when they controlled the government for 60 years? Maybe it had something to do with FDR being a plutocrat?

      map

      July 4, 2017 at 1:29 pm

      • Let’s forget about the politics of the 1940s. In the current decade, Democrats HAVE tried to shut loopholes and Republicans blocked it.

  6. I would rather see a movement that tried to get rid of non-profit organizations.

    map

    July 3, 2017 at 12:00 pm

    • And disallow tax-exempt status for churches.

      E. Rekshun

      July 3, 2017 at 12:37 pm

      • Taxes collected by the IRS and the State Revenue departments pay for nothing that is to the well being of the nation.

        JS

        July 3, 2017 at 2:30 pm

      • PREACH IT!

        For all the conservative whining about Planned Parenthood, they’d be on sturdier ground if they were willing to stop tax breaks and money going to the organizations on their own side. This works for no other reason than you get bodies like Catholic Charities taking vast amounts of government money and often bringing in immigrants to undermine the social conservative agenda.

        And it would stop the ridiculous sight of churches and charities begging the government to get tax exempt status, then whining about getting disproportionately examined by the IRS. Same logic as for Welfare Moms: if you don’t want Daddy Gubmint in your business, feel free to not go cap in hand to him.

        Jesse

        July 3, 2017 at 2:48 pm

  7. I don’t understand this notion of taxing people because of their political views. Taxation should be fair and low across the board. Taxes are too high on everyone already. So I dunno, this is crazy.

    Yakov

    July 3, 2017 at 12:02 pm

    • Why wouldn’t you support raising taxes on dirtbags who use their money to push destructive agendas?

      destructure

      July 3, 2017 at 1:27 pm

      • People shouldn’t be penalized for their political views. This is one of the foundations of freedom. This is very simple.

        Having said that, a revolution maybe necessary where opponents are more then just penalized, but that is an extreme temporary situation, not the way a free county should be governed on a permanent basis.

        Yakov

        July 3, 2017 at 3:30 pm

      • My position is even more simple — I don’t care.

        destructure

        July 3, 2017 at 10:42 pm

    • My thinking is simple. Tax what you don’t want; subsidize what you want. The government perverts this simple concept when it taxes tobacco, alcohol, and ordinary income while it subsidizes unwed mothers, the lazy, corporations or rich with capital gains, and itself. Pay off as much of the government debt as you can with cash and what do you have left but more debt.

      cesqy

      July 3, 2017 at 1:50 pm

  8. If the tax is so easily avoidable, why are Koch Brothers and Republicans so adamant about lowering it or abolishing it?

    Because their primary constituents are upper middle class people who are well off but not rich enough to easily avoid such taxes like the mega rich are.

    The Democrats like such taxes because their constituents are the poor and the coastal mega rich, and both of them dislike the middle and upper middle classes. The coastal mega rich like the taxes because they can easily avoid them, while the upper middle class can’t and the latter’s fortunes are reduced, thus providing less competition for the mega rich.

    Tom

    July 3, 2017 at 2:11 pm

    • you have no clue. it’s only the top 1% of estates that are taxed.

      Beverly Hills Ninja

      July 3, 2017 at 4:59 pm

      • It’s the estates that are around $5 million and up. That’s not the mega rich, who have much more and evade the estate tax.

        Tom

        July 3, 2017 at 6:23 pm

      • No, it’s not.

        map

        July 3, 2017 at 8:59 pm

  9. Notice that the dumb argument never works both ways. You keep seeing trucons arguing that the govt shouldn’t raise taxes because the rich will just avoid them. They never argue that maybe the rich should sit down and pay their taxes because the govt will, at some point, come after them again.

    Jesse

    July 3, 2017 at 2:43 pm

    • The rich will not avoid them. The rich have been avoiding them since 1915. It is not a statement about what might happen. It’s an observation about what has happened.

      map

      July 3, 2017 at 9:01 pm

    • in order to fund tax cuts on everyone else. this is populism. and it would be great for the economy. there’s no shortage of capital. there’s a shortage of customers.

      Beverly Hills Ninja

      July 3, 2017 at 5:01 pm

    • You can probably trust Bannon to craft a policy that implements these taxes in a way Lion supports.

      map

      July 3, 2017 at 9:02 pm

      • If Bannon has spent as many years as he has in the media and doesn’t have a bunch of reforms to help that shit show then he is useless. So as far I can tell he’s useless.

        Magnavox

        July 5, 2017 at 2:12 am

    • Yes, I was happy to see Steve Bannon reads this blog!

      GondwanaMan

      July 4, 2017 at 10:11 am

  10. If the tax is so easily avoidable, why are Koch Brothers and Republicans so adamant about lowering it or abolishing it?

    Could be for moral/ideological reasons, the same way rich liberals vote for higher welfare spending that they won’t benefit from.

    Dave Pinsen

    July 3, 2017 at 3:52 pm

    • charles koch was interviewed for 2h on Freakonomics, the radio show. very un-impressive. what fran liebowitz said is true. whoever thinks the richest are the smartest has either never met a smart person or never met a rich person.

      Beverly Hills Ninja

      July 3, 2017 at 5:03 pm

      • Charles Koch has three degrees from MIT; a BS in general engineering and two master’s in chemical engineering and nuclear engineering. He’s also taken his dad’s company from 21M to 100B. So I suspect he’s pretty smart.

        I’m critical of the Koch bro’s because I disagree with them on immigration and protectionism. Otherwise, I don’t have that much disagreement with them. The irony is that I suspect you’d actually agree with CK on a lot of things, too. As he said about Bernie “We may not agree on the solutions but at least he’s identified the problem.”

        destructure

        July 4, 2017 at 11:48 am

      • The Koch brothers are engineers my training. They view themselves as value-creators and builders. That’s probably why they have a strong libertarian streak.

        map

        July 4, 2017 at 1:36 pm

      • Ah, that’s an insightful comment.

      • Beverly Hills Ninja doesn’t know what he’s talking about.

        GondwanaMan

        July 4, 2017 at 3:33 pm

      • he’s not a professional talking head. maybe it was the interviewer’s fault. and he is in his 80s. but he was spouting the usual john birch society platitudes. i do agree with him on many things, but the libertarian notion of freedom is only a small part of what freedom is. and it’s clear that today a calvin coolidge government would be a disaster. the GOP should be the party of efficient govt, not the party of no govt.

        Beverly Hills Ninja

        July 4, 2017 at 3:36 pm

      • i get it. koch donates almost exclusively to the GOP not because he’s a republican but because he thinks the GOP is more amenable. in that case he should also favor proportional representation. there should be a koch party.

        blah blah blah. legislators should identify the problems that need solving. my guess is there’s a lot of agreement across the aisle on what the problems are.

        then political differences can be reduced to opinions on what the most effective solutions are to the problems.

        government as problem solver rather than problem maker. so many republicans are motivated by hatred of government per se and hatred of the 99%. they’re “addlepated”.

        Beverly Hills Ninja

        July 4, 2017 at 4:15 pm

      • of course he’s smart. it’s just that his wealth and his IQ are obviously not 1 to 1…as far as i can tell.

        he seems to be one of those very high PIQ, not so high VIQ folks.

        george soros, his left wing transporter malfunction, sounds smarter.

        Beverly Hills Ninja

        July 4, 2017 at 5:05 pm

  11. I don’t have a problem in principal with inheritance taxes, but I’d make them lower and flatter. Say, 0% on the first $10k and 5% on everything above that.

    Dave Pinsen

    July 3, 2017 at 3:58 pm

    • it’s already 0% on the first $5.5m.

      Beverly Hills Ninja

      July 3, 2017 at 5:04 pm

      • My point is that it shouldn’t be 0% on the first $5.5mm.

        Dave Pinsen

        July 3, 2017 at 10:57 pm

    • The estate tax isn’t an inheritance tax, it’s a tax on the estate itself. So if some guy dies leaving behind an estate of $4m divided evenly between 2 heirs, they each get $2m, tax free. But if some other guy dies leaving behind an estate of $6m divided evenly between 3 heirs, they each get less than $2m after taxes, because that additional $1m above the first $5m is taxed.

      Hermes

      July 3, 2017 at 11:43 pm

      • The end result of the tax is that those who inherit from the deceased get less money.

      • it should be an income tax, inheritance being a form of income.

        Beverly Hills Ninja

        July 4, 2017 at 3:26 pm

  12. Politicians of both parties view the tax code primarily as a way to (a) reward their donors, (b) punish people and corporations their donors dislike, (c) subsidize behaviors they wish to encourage. Raising the revenue necessary to run the government is pretty far down the priorities list, because if it were the main priority you’d see something like a flat income tax, tariffs, and maybe a VAT, with few or no loopholes.

    Sgt. Joe Friday

    July 3, 2017 at 4:22 pm

  13. Another annoying, fraudulent argument is “the rich have already paid income tax on their accumulated wealth,” so it should not be taxed a second time upon death.

    First, acquired capital is not taxed unless and until it is sold, so, for example, the shares of Amazon owned by Jeff Bezos (now worth $82 billion) have not been taxed.

    Second, an ordinary person pays sales tax with income that was already taxed; he pays real estate tax with income that was already taxed. Only apologists for the rich argue the rich should be exempt from paying tax on money that was already taxed, as if it’s a kind of double jeopardy, a fundamental human rights violation.

    Mark Caplan

    July 3, 2017 at 4:39 pm

    • You’re saying that some of their money was already taxed and some wasn’t, right? Then shouldn’t only the portion that wasn’t taxed be subject to the estate tax? It seems like a reasonable objection to me to say the same money shouldn’t be taxed twice.

      Sales tax doesn’t seem fair to me. In Hong Kong there’s no sales tax but the subways are way better and there is public healthcare that is at least functional on a basic level (although it kind of sucks). Half the population also seems to live in public housing (probably an exaggeration). A lot of this is probably possible because there are no blacks and no random immigration.

      Rogal Dorn

      July 3, 2017 at 9:12 pm

  14. I thought the big game among the rich these days was to set up perpetual trusts, never sell a thing and have future generations take out loans guaranteed against the trust but never called because the heirs make sure and keep expenditures below trust earnings so the banks feel comfortable just rolling the debt over and keeping it on their (the bank’s) books.

    Curle

    July 3, 2017 at 4:56 pm

    • Yep. The wealth tax is bogus. Unless you’re going give Chavez dictatorial power over your economy it aint happening.

      Andrew E.

      July 3, 2017 at 7:18 pm

  15. I don’t know whether trying to tax the rich more is a good idea or not. I tend to agree with those who argue that the added tax burden usually winds up falling on the upper middle class and not the rich. What I do know, though, is that the Republicans spend a lot of political capital on fighting for economic policies which benefit liberal rich people who overwhelmingly support the Democrats. That doesn’t seem like very good politics to me.

    verylongaccountname

    July 3, 2017 at 6:52 pm

    • The Rs these days are all careerists, meaning they are absolutely reliant on either keeping their jobs by keeping Wall St. happy or keeping Wall St happy so they have a safe place to land if the barbarians turn on them. Think Cantor.

      Curle

      July 4, 2017 at 2:21 pm

      • Great comment. Both the Rs and Ds are anti-prole. One plays nice with proles and then back stabs them. The other is all about empowering their more primitive neighbors at their expense.

        JS

        July 5, 2017 at 9:06 am

  16. Not gonna happen. What’s more important? Punishing rich libs or keeping their dwindling # of rich GOP donors happy?

    Brendan

    July 3, 2017 at 7:11 pm

  17. OT- Author argues that Christian prohibition on infanticide and abortion helped balance sex ratios in the ancient world (previously imbalanced in favor of women) resulting in high female adoption (of the religion) followed by men ‘going where the women were’.

    An interesting thesis that raises questions about the much vaunted (among modern historians) prevalence of homosexuality in Ancient Rome.

    https://roosevelt.ucsd.edu/_files/mmw/mmw12/RodneyStarkReconstructingRiseofChristianityWomen.pdf

    Curle

    July 3, 2017 at 9:46 pm

    • error- previously imbalanced in favor of men, more men than women. Was this the cause of the ‘commonplace homosexuality’ of the Roman era which modern historians seem so eager to teach as some sort of normalizing baseline for current times? Was there an earlier imbalance (too few females) that incentivized the ancient Hebrews to outlaw the practice in Leviticus? Might lesbianism result from a shortage of men?

      Curle

      July 3, 2017 at 11:21 pm

    • I think you mean balanced in favor of men.

      I’ve heard this before, too. Christian women were often rescued from exposure as babies.

      map

      July 4, 2017 at 1:03 am

  18. Steve Bannon is pushing for the tax rates for the rich to be increased.

    http://www.breitbart.com/economics/2017/07/03/bannontax/

    If they don’t vote for you, why serve them?

    chris

    July 3, 2017 at 10:51 pm

    • Bannon understands Trumpism better than a lot of commenters on this blog. And unfortunately, Trump is letting a bunch of old-guard Republican conservative types run the tax and healthcare issues.

    • The article says Bannon wants the top income tax rate to be raised, which would just hit the upper middle class even harder. The truly “rich” don’t derive most of their earnings from income; they derive it from capital gains.

      Serious leftists often talk about raising the capital gains rate, but that’s not what’s being discussed here.

      Hermes

      July 4, 2017 at 10:02 am

    • Steve Bannon is pushing for the tax rates for the rich to be increased.

      Bannon is a dumb prole.

      A tax hike on the rich means a tax hike on Trump. An inheritance tax hike means an inheritance tax hike on Trump’s children and grandchildren.

      Why did anyone think Trump was serious about raising taxes?

      Bannon understands Trumpism better than a lot of commenters on this blog.

      Trump isn’t going to raise taxes on his own family.

      The whole “raise taxes on the rich” rhetoric was just to win over working class proles in the Rust Belt.

      It worked even though Trump wasn’t serious.

      Trump is letting a bunch of old-guard Republican conservative types run the tax and healthcare issues.

      Apparently Bannon has been sidelined in the White House.

      The Undiscovered Jew

      July 4, 2017 at 10:13 am

      • “The whole “raise taxes on the rich” rhetoric was just to win over working class proles in the Rust Belt.”

        I thought Trump ran on lower taxes on the rich.

        Here is a quote from December on his tax plan:

        CNBC’s John Harwood calls Trump’s tax reform a “remarkable paradox,” as middle America may not benefit as much as coastal elites.

        I don’t recall him ever saying he would raise taxes on the rich. Maybe I am wrong and he did.

        But look at this article.

        http://www.washingtontimes.com/news/2016/may/15/stephen-moore-why-tax-rate-cuts-work/

        Stephen Moore from Heritage loved Trump’s tax plan and he always wants lower taxes on the rich.

        “Hillary Clinton took another sniper shot at Donald Trump’s tax reform plan last week by calling it “a tax cut for billionaires” like him”.

        ttgy

        July 4, 2017 at 2:55 pm

      • I thought Trump ran on lower taxes on the rich.

        In general, yes.

        But he also threw in some populist rhetoric about taxing hedge funds and other taxes that would impact the wealthy.

        I should have been more specific.

        The Undiscovered Jew

        July 4, 2017 at 6:29 pm

      • Trump made a few references to getting rid of the carried interest deduction and how hedge fund managers shouldn’t pay lower rates than everyone else.

        Magnavox

        July 5, 2017 at 2:16 am

      • At one point in the campaign Trump proposed lowering everyone’s taxes and dramatically raising the standard deduction so a sizeable proportion of wage earners would not owe any income tax. He would lower taxes on the rich to the point where the rich paid the same rate as the hedge fund “carry interest” bandits.

        Mark Caplan

        July 5, 2017 at 7:41 am

  19. This is the dumbest post by Lion that I recollect. Tax your political opponents! Imagine Founding Fathers trying to legislate punitive taxation of each other? Lion, what wrong with you, man? What’s wrong with you mates discussing this madness seriously? You wanna make this country into a banana Republic?

    Yakov

    July 4, 2017 at 8:54 am

    • It’s not wrong if the other people WANT to be taxed, which they do otherwise they wouldn’t have a track record of voting Republican. Giving voters what they WANT is what Democracy is about.

      • The bigger principle here is forcing people who vote for something to be FORCED to face the consequences of that decision.

        Rich people who vote Left should pay higher taxes. Rich people who vote open borders should be forced to take in refugees to their home or as neighbors and send their kids to public school.

        But that will never happen, and we know that the rich vote Left for virtue signaling and to increase and expand their control.

        fakeemail

        July 4, 2017 at 10:51 am

      • What we need is a hypocrite’s bill (or perhaps Pecksniff’s bill) to pass congress that forces people to suffer the consequences of their principles. Section 8 housing for wealthy democrat suburbs and 100% taxes above $1 000 000 for Hollywood producers and actors.

        chris

        July 4, 2017 at 12:07 pm

      • If this is how you put it’s OK. I’m slow, as you should know by now. My bad.

        Yakov

        July 4, 2017 at 1:22 pm

      • “What we need is a hypocrite’s bill (or perhaps Pecksniff’s bill) to pass congress that forces people to suffer the consequences of their principles. Section 8 housing for wealthy democrat suburbs and 100% taxes above $1 000 000 for Hollywood producers and actors.”

        If we could aim public housing and section 8 vouchers to the highest income zip codes in a community, you would see the interest in those programs vanish. The rich are happy to build public housing somewhere else. It needs to be brought home to them. Same thing with refugees. Instead of dumping them in poor and middle income communities, dump them in the high income zip code areas and let the people who want them the most pay for them.

        Mike Street Station

        July 4, 2017 at 5:11 pm

      • Giving voters what they WANT is what Democracy is about.

        Giving it to them good and hard…

        Magnavox

        July 5, 2017 at 2:16 am

    • Trump isn’t raising taxes on himself or his family.

      Bannon needs to give up thinking he can get Trump to hike taxes and stick with pushing Trump right on immigration and trade like Miller, Sessions, Ross, and Navarro are.

      Otherwise Bannon can get lost.

      The Undiscovered Jew

      July 4, 2017 at 10:17 am

      • The best tax reduction to push is to push down the middle rate.

        map

        July 4, 2017 at 1:53 pm

      • The best tax reduction to push is to push down the middle rate.

        I have a different opinion…

        The Undiscovered Jew

        July 4, 2017 at 6:29 pm

    • “This is the dumbest post by Lion that I recollect. Tax your political opponents! ”

      Principled conservatives never punch back. I believe that economies work best when taxes are low, generally speaking.

      But I also believe in punching back rather than going gently into the night.

      Mark Zuckerberg happened to be in the right place at the right time and now he has one of the most lucrative pseudo-monopolies in the world. And he wishes to use that monopolistic mega-fortune to wreck America.

      And he has plenty of company.

      Why should the prole factory workers in Ohio fight for the Internet billionaires and Goldman Sachs bankers who will never return the favor?

      Let populism bare its teeth a little bit. Stupid elites in America are the only elites in the world that can get away with such limousine leftism, while poor proles in Appalachia fight their battles.

      Meanwhile will those wealthy folks protected politically by the proles ever return the favor by defending borders or faith or family? Never!

      I am not advocating to go full Venezuela, but let our rotten elites feel the burn a little bit.

      Dan

      July 4, 2017 at 10:49 am

      • Zuckerberg is not an estate tax issue. The problem with Zuckerberg is that he operates a business that should be illegal.

        His business is taking your private information and selling it to third parties under the novel theory that data passing through his server is his property.

        map

        July 4, 2017 at 1:56 pm

      • Agreed with all of this; and further it has *always* been this way. Working/middle working for and FIGHTING WARS for rich Elites who *never* return the loyalty; quite the contrary actually. Soldier and employees are cannon fodder, PERIOD.

        Major Smedley Bulter figured it out way back when: http://warisaracket.com/

        And Zuck is a monstrous example of how un-elected private power is far more dangerous and permanent than any public power (even the Presidency). Some spergy computer nerd leftist makes a social networking site and becomes a veritable KING for life. It’s totally nuts.

        There should be checks and balances on private power as well otherwise it’s Autocrat Zuck for the next 70 years along with the other usual suspects.

        fakeemail

        July 4, 2017 at 1:59 pm

      • America is done, finished, and greed screwed her for good.

        Let’s celebrate, July 4th Repentance Day!

        JS

        July 4, 2017 at 3:37 pm

  20. Well, to be fair to me, my “comment” consisted of two questions. They were really meant as questions, not assertions. I’ll ask my million sister if she is set up to avoid estate taxes, and how.

    CamelCaseRob

    July 5, 2017 at 12:01 am

    • Millionaire.

      CamelCaseRob

      July 5, 2017 at 12:02 am

  21. julian

    July 6, 2017 at 2:07 am


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