What's wrong with taxing the rich to maintain current spending?

jandrewrogers an hour ago | parent | next [-]

Taxes on the rich are already at European levels in the US. There simply aren’t enough of them to cover current spending.

It is a similar issue with taxing nominal wealth. 2/3 of nominal wealth in the US is completely non-liquid. Taxing the liquid fraction is essentially leveraged as a result, causing a catastrophic collapse in the value of similar investments by ordinary people as a side effect. Impoverishing a large portion of the middle class to own the rich isn’t a recipe for political success.

	▲	superice an hour ago \| parent [-]
		We’ve got to stop pretending loads of wealth is non-liquid and therefore off limits. The rich borrow using it as a collateral, if they can do that for their own purposes, they can do that to pay their fair share of taxes too.

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denkmoon 2 hours ago | parent | prev | next [-]

That the rich don't want to be taxed, obviously. and manage to convince a voting plurality that they shouldn't.

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nradov 2 hours ago | parent | prev | next [-]

That question assumes that the current level of spending is optimal. Regardless of who pays the taxes, are we getting a good value for that spending? Or could it be drastically cut?

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missedthecue 2 hours ago | parent | prev | next [-]

Laffer Curve. Depends on the country but France for example already takes 44% of their GDP as tax, runs heavy deficits, and attempts to make up the difference by increasing taxes on the wealthy causes them to leave.

At some point they'll need to do austerity.

	▲	underlipton 2 hours ago \| parent [-]
		It's well-established that Americans are much earlier on the curve than wealthy people would like to believe. Mamdani Doctrine: ignore the part of your brain screaming rich people double consciousness and just do what's right for and fair for most people. At this point in history, that's taxing wealthy people - including paid-off-6k-sq-ft-house-with-2-people-in-it pensioners and $200k-a-year-living-paycheck-to-paycheck-in-a-coastal-metro yuppies. Yes, there'll have to be some tough decisions; austerity, indeed.

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IG_Semmelweiss 2 hours ago | parent | prev [-]

Confiscating the wealth of all U.S. billionaires (~$8 trillion) would fund federal operations for roughly 9 months...1-time only.

After that, the money is gone.

The underlying problem of high, persistent government spending remains. This isn’t primarily a “tax the rich” problem.

	▲	johnnyanmac 24 minutes ago \| parent \| next [-]
		The goal of taxing the rich isn't to save the enormous defecit. It's to make sure they can't buy elections and undermine democracy. It also does help to reign in some spending. Because a lot of spending is indirectly performed through subsidies. Oftentimes in the modern day for the rich who can already afford such initiatives.
	▲	underbluewaters an hour ago \| parent \| prev [-]
		Even if this were true, such a tax program would limit the outsized corrupting influence of this class. That's arguably an even greater benefit than just helping with the deficit.