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Shareholders want a certain amount of profit on their invested capital, say 10%. The exact percentage depends on type of company and the industry it's operating in. Tax is an expense, one that comes after all other expenses are paid, but an expense nevertheless. If I have $100 in profit, and I have to pay 30% tax, I'm left with $70.

If a company today is returning 10% to its shareholders per annum (and is paying, say 30% tax), then reducing the tax rate to 15% frees up additional cash to reinvest in the business that wouldn't have been available / would've otherwise gone to taxes. Or that money could flow back to shareholders, who could then reinvest it in other businesses.




Oh well thats easy fix: require companies to be employee owned if they want the legal protection limited liability incorporation.

Now the workers are the share holders and reinvesting in other businesses is called consuming.

God I'm good at this.


So I'd actually have to share my profits? I'm being incentivized to create value for others already. Damn, you're good at this.


(Democratically) seize the means of production!


If I'm a shareholder I don't want 10%, I want as much profit as possible. This is why economics is based around the assumption that stakeholders are profit maximizing.


Bargain:

- Abolish corporate taxes

- Increase minimum wage (including an automatic inflation adjustment)

- Increase estate taxes and private corporate transfer taxes (intergenerational)

- Heavily tax (90%) all corporate spending in politics, using revenues to fund educational news sources

Everybody gets something that they want.


The last three are already being attacked on separate fronts, a compromise would be hard to make. My state just eliminated its estate tax and Republicans have been clamoring to attack it at the federal level as well.


It's weird how much the Republican side of politics is against the estate tax, given the high level of 'founding fathers desire!' rhetoric coming from that side. The estate tax was put in place for a philosophical reason, not a revenue-raising one, so it is part of the mosaic of the 'ff desires'...


Estate taxes are evil. It's money that has already been taxed at least once as income or capital gains.


Estate taxes are one of the least evil taxes; they are inherently more fair, because they reduce unearned income.


If the idea of having part of your hard-earned wealth confiscated rather than passed on to your children doesn't boil your blood, you're made of different stuff than I am.


I am made of different stuff than you are.

From experience, passing substantial unconditional wealth to my children (above and beyond education) seems far more likely to turn them into assholes than decent citizens.


I'm always amazed at the distaste that the idea of generational wealth receives here. For me, it is the foundation stone of my well-being. My great-grandparents scrimped and saved in the depression, and passed on a small nest-egg to my grandparents. They scrimped and saved and passed on a slightly larger nest egg on to my parents. My parents lived and raised me in many years of poverty, saving what they could, and then inherited the wealth of generations. I expect that I will inherit that nucleus of the family's fortune in due time, and will do my utmost to husband it and grow it in trust for my descendants.

Whatever I achieve in this life is not my own, it is the culmination of the efforts of all the generations that put me in position to do what I do, and a legacy to leave to all the future generations of my family.


At micro-economic level this makes sense, at macro-economic level it reduces economic mobility. In countries with no artificial taxes on generational wealth the richest families of 2016 are likely to be largely the same as richest families of 1916 and richest families of 1816.

As their wealth is typically preserved via real estate and land ownership, there's a politicial motive to decrease the cost of that, so economies also suffer from high barriers to entry and need to inflate taxes on something else to pay for the government services.

Repealing estate tax would work when combined with higher property tax rates or land value tax, but is rarely politically doable, as well-connected political families and large landowners tend to be the same families.


I value the spirit of passing something on, but I despise the inequality that emerges from repeated iteration.

The value lies in long term thinking, sustainability. A farmer can either maintain the soil, carefully rotating crops so that it will be able to feed future generations as good or better than his predecessors, or he can go for the agricultural equivalent of strip mining and move on to the next plot when the previous one is depleted.

But when you replace the soil with fungible assets, all that long term thinking benefit goes out the window. Sticking to the farming example, repeated slash and burn farming will only encourage more of the same, as long as there is something left to burn. Larger operators will grow faster than smaller ones, and after a few generations, when there is nothing left to burn, the descendants of those who burnt the most will employ the losers to tend the desert.


>taxed at least once as income or capital gains

for some one who is now dead and thus very very unlikely to give a shit.


The same can be said of any tax on individuals (sales tax, rates, etc), given that income tax has already been paid.


The same can be said of any tax, period, corporation tax included. Money that some person or corporate entity has paid tax on gets taxed again at or after the point it changes hands; estate tax is no different in that respect,


Only if it's not more profitable to invent financial instruments.

So, 'too late' basically. That world is long gone now.




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