> they're generally referring to structural obstacles,
I agree, and I'm not saying that 10% increase to social security fundamentally changes the underlying division. I think more drastic action is needed. But I wouldn't fight against a haircut on incomes over $100k that expanded the lower limits on medicaid (which many poor millennials take advantage of), even if income inequality still existed at the end.
Are rich, left-leaning professionals really under the illusion that the sort of policy change needed to fight structural inequality will lead to no change in their own relative purchasing power because there are even richer baddies out there to tax?
>> Literally no one in America, save for a very few on the fringe, is talking about “eliminating income inequality.”
I don't know about that; I've heard plenty of people talk about eliminating income inequality as an end goal (but I live in the SF Bay Area, so maybe a reflection of demographics out here?)
It's like saying no one but the fringe is going to vote for donald trump, and yet those poll numbers...
>> What people are talking about is a progressive income tax to reduce inequality.
Well, we have that. Taxes are historically low, so I'd be ok with raising them somewhat, but not too much.
>> So by taxing the wealthy and spending it on services, we can better ensure that the level playing field you allude to continues to exist.
This is really the crux of my argument: instead of increasing taxes first, we should hold the government more accountable over spending and look at programs and how they help or do not help the poor. Poverty is the metric that should be focused on, not inequality. If inequality is reduced as a side effect, all the better. But poverty is the problem. If government got more money from taxes, what makes you think they would use it to effectively reduce poverty?
> The idea that the wealthy's tax burden should increase as a result of [growing income inequality] is ridiculous, however.
The issue is that inequality is growing to a point that there is a potential for social, economic, and political destabilization. How do you propose the issue be addressed? Because it should be apparent that trickle-down economics isn't occuring, and I don't see how things can improve without some sort of wealth redistribution.
>Do I think we're fully at equality of opportunity yet? No.
I think this would be the issue most people have with the increasing income gap. As long as billionaires can pay a lower tax percentage than the lower/middle-class, I think frustration and desire for change is valid.
> money ends up being redistributed somewhat equally, spurring demand as the poor can suddenly afford a lot more good and services.
Does it? Maybe I'm just cynical but the idea of raising taxes on the wealthy sounds to me like just moving money from one set of rich white guys to another set of rich white guys. I vote one of them in to power at the local elementary school and the other every time I pull out my wallet. I'm not really convinced that either group as a whole spends their money more responsibly.
If we already had a social safety net reform in place, knew how much it was going to cost, and then pushed for higher taxes in order to directly fund the new safety net, that would be different. I think that's what PG meant recently when he said something along the lines of 'focus on poverty, not on income inequality'.
> You might want to pay closer attention to the complaints about inequality. What that focus is about is the degree of inequality.
I pay quite a bit of attention to it. I'm aware of what it is people are complaining about. Everything I said stands.
> Most people talking about it are not actually pursuing a world of absolute equality, but a world with reasonable levels of inequality, and with regulations that make a rapidly increasing spread less likely. I.e. we want floor and ceiling not too far apart, and not rapidly separating. Which means UBI alone, or minimum wage, or any number of floor-focused things are not the answer. Neither is a wealth tax, or any number of ceiling focused things the answer, by themselves.
Why? What's good about that? What, exactly, is the benefit we get from pursuing a flat wealth distribution? People often promote this idea, making the implicit assumption that reducing inequality is somehow a good in and of itself.
The point of these things should be to improve the material living standards of as many people as possible. If reducing inequality is a necessary side effect of doing that, then fine. But I see no reason to pursue that as an actual ultimate goal.
> Increasing and broadening the base of the estate tax would be a good move.
> Increasing the highest bracket of the income tax would be a good move.
How many times do we have to go over this? This would just make more companies and very wealthy individuals move their operations overseas or evade taxes. Income inequality is often a natural part of a large, growing economy like the United States.
Furthermore, I don't even view income inequality as a problem. Poverty is a problem. People having more money than other people isn't. We should focus on eliminating poverty, not eliminating rich people.
> Inequality is when the poor get 2x richer, but the rich get 3x richer, in real terms (not nominal). Do you have any reason to believe this is a problem?
But that isn't what's happening. The bottom quartile's incomes have shrunk when adjusted for inflation and they have stagnated since the 80s.
>I think the idea is that you raise taxes such that the middle class sees no difference, the rich pay more in taxes, and the poor receive more money.
But will that actually work out mathematically and economically? High income earners in big cities are already paying nearly 50% marginal income tax rates.
These people only work that hard to keep the golden handcuffs. If you take that away, they aren't going to continue.
> it is basically impossible to extract a significant amount of additional wealth from the 0.1%.
I'm not sure I buy this. If the IRS can measure income, they can also measure wealth. Sure rich folks will try to hide wealth, but they've also tried to hide income and the IRS when well funded is decently competent at finding it.
> The other fundamental problem with giving a big additional slice of the national wealth to the poor is that they will spend it on consumer services
That's no what anyone is advocating. They are advocating basic healthcare and education, not exactly consumer services.
> At which point you no longer have a middle class to extract from.
Even super leftist democrats are not advocating taxing the middle class. They are focusing on the super rich. The somewhat nice thing about this type of taxation is that even though it'll effect the absolute money you have, it won't affect your wealth rank. Sure, maybe Bezos' or Gates' net worth will go down, but they will still be the richest in the US. Your low-millionaire friends may be slightly less rich, but they will still be just as rich rank-wise as they were before.
Folks generally get less upset about taxes if it keeps their existing rank and standing in society
>Wealth inequality has been increasing for 40 years despite worker productivity rising. Nearly every metric shows the rungs to wealth being pulled away, and I'm the non logical one here?
Yes, inequality increasing because the richest aggregate in the US says absolutely nothing about how the quality of life has changed for regular people. It's a red herring.
If a rich person moves into my tiny town, I don't suddenly become worse off, despite inequality increasing drastically.
> "I think it’s unfair to say they support policies that favor the already wealthy."
it's not unfair to call a spade a spade. opposing tax cuts can be done for a myriad of supportive or unsupportive reasons, so that doesn't provide a useful counter-argument.
and "minimum wage increases" sounds great on the surface. but the underlying purpose of a minimum wage is to paper over gross systemic equities that have only grown over time and keep us from even discussing policies for creating more fair and dynamic markets that would naturally distribute wealth more widely and efficiently, and neatly obviate such a distortion-producing bandaid of a policy.
but the central point is that no significant party and nearly no politician is addressing systemic issues that has promoted winner-take-all dynamics in our politicoeconomy for at least the last 50 years. even obamacare was so browbeaten and laden with special interest provisions, our healthcare costs have only soared, all to append zeroes onto bank accounts that abosolutely don't need, and more pointedly don't deserve, them.
> that raising taxes won't by itself bring an effective program to fight income inequality into existence.
Raising taxes on rich people changes the post-tax distribution to have less inequality, so it does literally bring into place a program to "fight income inequality." Given the fact that most government revenue goes towards social security, medicare, medicaid, you already know what it will be spent on and there already are effective programs.
> There are plenty of other countries with old people.
And literally all of them have a wealth distribution that looks like that last one. Say you lived in a place where everyone saved $10k a year and worked for 50 years. Then the bottom 10% would have an average of $25k saved, and the top 10% would have $475k saved. If you add a modest 3% rate of return on investment, that brings the top 10% to ~$1 million. Visually this looks closest to the last wealth distribution. Wow much inequality! Time to eat the rich!
> "It's going to happen anyway, so lets not fight it"
This is such a disingenuous interpretation of my comment. Telling you not to volunteer to be a footsoldier of a class crusade isn't saying that we should do nothing. If you have a good argument for why should increase the capital gains tax rate, and why the fears of it disincentivizing investment are overblown, I'm all for it.
> Oh, but we do have an anger problem these days. People are not angry because they carefully examined their situation and decided it's caused by deep wealth inequality.
It isn't about my personal situation. Wealth inequality doesn't affect the people on HN in any real, substantial way if they work for a tech company because we (mostly) are in the 6 figure household income bracket where you can live a good life in America without being bothered by things.
I'm still angry about it because I see its effects in larger political campaign spends and a constant push for lower taxes on the rich rather than the poor.
> A growing body of research suggests that investments in children in low-income families not only reduce poverty and hardship in the near term, but can have long-lasting positive effects on their health, education, and earnings as adults. Cutting programs that support low-income families to fund tax cuts for the rich could therefore also have negative long-run economic impacts.
> People starving, having no health care, low life expectancy, that sort of thing, are problems. Their neighbor having more money in the bank is not really a problem.
Most people, when they critique wealth inequality, aren't critiquing their neighbors because most people in the same zip code are going to be at similar levels. When people critique wealth inequality, they're talking about the Koch brothers, or other parties who leverage capital to gain unfair advantage and political powers and then work against the first half of your statement.
> Whether it should be possible to be arbitrarily rich is another question.
I, too, am in favor of a 100% wealth tax upon death. No more freeloading failsons.
I'm still not convinced that it's possible to successfully tax the rich enough to ensure that the poor isn't poor. The redistribution (and taxation) always comes up as "the solution" to inequality. I think that's overestimating how rich the rich are, and underestimating the number of poor people.
It's easier to make the rich poorer, and close the wealth cap that way, compared to making the poor richer. Sadly that's not going to help anyone.
How so? It’s basic math. The middle and upper middle class is still responsible for the vast majority of income.
> you arent really taxing the ultrawealthy. You could raise tremendous revenue
See, you’re getting confused because it’s not “tremendous” in the scheme of tax revenue. The only thing that would accomplish is helping with income inequality (i.e. it’s punitive towards the rich). This is fine if that’s your goal but it’s not going to pay for anything like basic income, universal healthcare, or major infrastructure. It won’t even balance the existing budget.
> The reason that isn't done isn't that you can't raise enough revenue that way,
Yes it is, full stop. A 100% tax rate on the top .1% would bring in about 500 billion annually (~$3 mil * 150 mil filers * 0.001) . That’s not even enough to cover the “cheap” infrastructure bill being proposed.
> they earn vastly disproportionately ought to be untouchable.
Careful with that. You’re also talking about how much of the middle classes retirement is structured there. Long term capital gains are used by everyone.
I agree, and I'm not saying that 10% increase to social security fundamentally changes the underlying division. I think more drastic action is needed. But I wouldn't fight against a haircut on incomes over $100k that expanded the lower limits on medicaid (which many poor millennials take advantage of), even if income inequality still existed at the end.
Are rich, left-leaning professionals really under the illusion that the sort of policy change needed to fight structural inequality will lead to no change in their own relative purchasing power because there are even richer baddies out there to tax?
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