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Vulcan wrote:

Spoiler:

I'm going to quibble with this one, because gold is actually quite HEAVY. It's close to four times the weight of iron per unit volume.

bouncingboredom wrote:

Presuming someone was mad enough to introduce such a bizarre and counter productive piece of legislation, one of two things will happen. Either you'll see the mass failure of large firms, putting huge numbers of people out of work during every recession, or you'll see pension funds going bankrupt and pensioners being left to fend for themselves. As much as people might bitch and moan about it, the reality is that having a flexible labour force and market is critical to a properly functioning economy. If you want to make a recession worse by causing companies to go bust unneccessarily, putting large numbers of people completely out of work, then by all means pursue a course like this.

OR, you'll see recessions become very minor because people will retain more consumer confidence and can continue to participate in the economy normally instead of having 10% of the population totally removed from the economy and another 70% or so too terrified to RISK participating in the economy.

Strong economies are money IN USE, not money stockpiled in banks or Wall Street. Thus, boosting PAYROLL does more to stimulate the economy than any amount of dividends. In the end, the American economy is 100% based on consumers consuming, not on rich people's largesse to the poor. When the consumers stop consuming, that's when things get BAD.

@Vulcan

One of the problem by making layouts difficult is that company reacts by hiring fewer people or being much more picky and not necessarily in a good way. Empoyment discimination becomes a higher risk in such a system. The French system suffers from this up to a certain point. Its workforce isn't mobile enough and its very difficult for young people to find a job because companies will wait and sift through a lot of candidates before they hire someone because they fully expect to have to keep that person in their spot. When you are young, you are viewed as a risk because you don't have much work experience. Having a good social network becomes essential to get a job. Having studied in a prestigious school becomes very important. Immigrants and women struggle to find employment twice more. There are a lot of complexities to an economic system. A good social net is essential and so is a hearty level of progressive taxation. Governmental control over some key sectors of economical activities can also be very useful, but a good economy needs a certain flexibility and risks to be performant.

Let's say everyone gets a £100.00 tax break.

Me? I'm likely to spend that money. Possibly on models, maybe on nights out etc. Either way, that money re-renters the economy (usually the local economy, spesh on food and beer, as I am spoiled in my area!).

Someone might get their hair done, or have a Spa Day. Again, that money re-enters the economy and begins to circulate. This helps generate new taxes.

Sure, some might squirrel it away for a rainy day. And when that rainy day comes? It re-enters the economy.

To someone with lots of money already? Well, if they just whack it in their savings, that's the end of it. It's not gonna get spent. It's not gonna generate new tax income. It's ded munneh.

That's the annoying thing, isn't it? Marginal utility is a basic economic concept and yet trickle-down economics is somehow still a thing.

It's why the outcry when a 'poor' family has a nice TV or similar irks me.

See, when you've not got a lot, and you get a windfall? You don't spend it on a holiday. You don't save in an ISA or what have you. You spend it on things which make life that little bit more pleasant.

A nice new TV, bigger than the old one, and more energy efficient. A console and couple of games for the kids. Maybe a new sofa, so you're more comfortable overall.

And if they did scrimp and save for it, or bought it on credit? So what? What's it to you? They've the same right to state benefits as everyone else - and those are not intended for purely subsistence living.

Yes, it was annoying in my last job. See, I worked 40 hours a week on a full time basis. By the time I'd paid for my monthly essentials, I had maybe £200 left for me. Peeps on benefits could get more. But that is not a flaw with the benefits system. That's a flaw of employers paying as little as they possibly can.

Don't you see? Poor people buying replacments for their broken old household items with newer energy efficient models is damaging for the economy! Think about all the pounds they'll save on energy bills? That is money being stolen straight from the claws of hard working shareholders!!

Jokes aside, don't investors use dividends to invest further? Those investments fund the growth of new business, return a fraction of the investment back to the investor, as well as growing the value of their new investment. The growth of a new business means more productivity and more wages.

Sury invested money still takes part in the economy and doesn't just disappear?

Dividends can also make your shareholders less likely to sell, thus helping to keep your shareprice relatively stable.

Depends where it's being invested. The very rich scoff at taxes, because it's all squirreled away offshore, or sunk into dodgy schemes to keep the taxman away - and indeed, lower their tax bill elsewhere.

Me? Give me that £100, and Mr Taxman is automatically getting £20 back in tax. And even if I tip it down my neck in the form of lovely, lovely beer? That £20 is joined by the Beer Duty, and any tax the Pub owes on wages and profits etc.

nareik wrote:
Sury invested money still takes part in the economy and doesn't just disappear?

Yes. Even money in savings accounts gives banks cash that they can lend out to companies to help them grow.

I'm hardly an economist, but it isn't hard to recognize that there are some real misunderstandings here about how this stuff works.

 gorgon wrote:

nareik wrote:
Sury invested money still takes part in the economy and doesn't just disappear?

Yes. Even money in savings accounts gives banks cash that they can lend out to companies to help them grow.

I'm hardly an economist, but it isn't hard to recognize that there are some real misunderstandings here about how this stuff works.

Except rich people don't have their money just sitting in a savings account (unless said account is in Bermuda or Switzerland). When they "save" money, it means they are doing something like buying a property to sit empty and gain value or squirrel away offshore.

And the people they're buying those properties off of? They're doing the same thing. They're all avoiding taxes.

Ultra high net worth people still invest in equities markets. I worked at an investment manager and would see names of professional athletes and such with accounts. They might not be using the same investment vehicles as you and I, but they have plenty of money participating in the economy. It isn't all tied up in secret tropical island bases and such like some of you seem to believe.

Trickle down is inherently ridiculous; if the wealthy were going to share the money they gained they would be sharing the money they already have. Trickle down is a just means to give a handout to the wealthy in exchange for their support, but that's veering into politics.

To be fair, there have been a number of the ultra-wealthy calling for higher taxes to address social inequality

https://www.theguardian.com/business/2019/jun/24/disney-soros-wealth-tax-call-for-higher-taxes-us

 NinthMusketeer wrote:
Trickle down is inherently ridiculous; if the wealthy were going to share the money they gained they would be sharing the money they already have. Trickle down is a just means to give a handout to the wealthy in exchange for their support, but that's veering into politics.

I don't know if you're responding to me, but my post has nothing to do with 'trickle down' as I understand it. I'm just stating the fact that the wealthy absolutely have sizable sums participating in world economies.

epronovost wrote:
@Vulcan

One of the problem by making layouts difficult is that company reacts by hiring fewer people or being much more picky and not necessarily in a good way. Empoyment discimination becomes a higher risk in such a system. The French system suffers from this up to a certain point. Its workforce isn't mobile enough and its very difficult for young people to find a job because companies will wait and sift through a lot of candidates before they hire someone because they fully expect to have to keep that person in their spot. When you are young, you are viewed as a risk because you don't have much work experience. Having a good social network becomes essential to get a job. Having studied in a prestigious school becomes very important. Immigrants and women struggle to find employment twice more. There are a lot of complexities to an economic system. A good social net is essential and so is a hearty level of progressive taxation. Governmental control over some key sectors of economical activities can also be very useful, but a good economy needs a certain flexibility and risks to be performant.

If you think having a good social network isn't essential to getting a good job in America you're fooling yourself. How do you think so many idiots get into upper management? They're relatives of friends of the executive board. That's how fools who couldn't run the overnight shift at a Wendy's wind up direction operations for hundreds of them.

I can honestly say I don't fathom how anyone gets a job without social connections anymore.

Almost everyone I knew growing up got a job through social connections, doesn't has one, or works minimum wage. There's like two exceptions to this. I tried for years to get a job on merit alone, and the only lesson I learned is that merit doesn't matter in America nearly as much as Americans fool themselves into thinking.

 LordofHats wrote:
I can honestly say I don't fathom how anyone gets a job without social connections anymore.

Almost everyone I knew growing up got a job through social connections, doesn't has one, or works minimum wage. There's like two exceptions to this. I tried for years to get a job on merit alone, and the only lesson I learned is that merit doesn't matter in America nearly as much as Americans fool themselves into thinking.

Networking is certainly very important. However, my last three positions (all permanent, full time) were either posted jobs that I applied for, or were jobs that a recruiter approached me about. There were other interviews during that time that also fit those categories.

"Merit" may be less important in some fields, but it's very important in others. I'm a creative professional, and the quality of my portfolio has a lot to do with whether I'm hired or not. If they don't like my work, they aren't going to hire me no matter who I know. For an IT position or something, I can see how there may be fewer differentiators between candidates and more importance on having an 'in'.

 Vulcan wrote:

Strong economies are money IN USE, not money stockpiled in banks or Wall Street. Thus, boosting PAYROLL does more to stimulate the economy than any amount of dividends. In the end, the American economy is 100% based on consumers consuming, not on rich people's largesse to the poor. When the consumers stop consuming, that's when things get BAD.

This is where tax policy in government comes in to play. . . One of many factors in the 1950s and into the 60s (when many western countries were well caught up to the US in production) was a tax rate/system that corporations had to pay. . . In those days, the company paid less taxes in two ways: first, they built new facilities and expanded production/operations, second they made their workers pay more taxes in the form of higher wages. Over time, trickle-downers realized that if they wanted their idiotic policies in play, they could make a tax deductible "donation" (bribe) to a politician's campaign, and start implementing lower and lower tax rates. History shows us again and again that when you lower tax rates, you exacerbate the problems of the rich getting richer while the poor get poorer. . . Yes, you *could* counter argue that the standard of living continues to rise. More and more houses have what used to be considered high end appliances (microwaves, freezer/refrigerator combos, TV, etc), however I think its important to view many of those products prices relative to inflation as the prices of those goods have, relatively, gone down to a much higher degree. This is even more apparent when you look at wage stagnation accounting for inflation/buying-power.

 gorgon wrote:

 NinthMusketeer wrote:
Trickle down is inherently ridiculous; if the wealthy were going to share the money they gained they would be sharing the money they already have. Trickle down is a just means to give a handout to the wealthy in exchange for their support, but that's veering into politics.

I don't know if you're responding to me, but my post has nothing to do with 'trickle down' as I understand it. I'm just stating the fact that the wealthy absolutely have sizable sums participating in world economies.

I wasn't, but should have made that more clear, whoops!


Automatically Appended Next Post:

 LordofHats wrote:
I can honestly say I don't fathom how anyone gets a job without social connections anymore.

Almost everyone I knew growing up got a job through social connections, doesn't has one, or works minimum wage. There's like two exceptions to this. I tried for years to get a job on merit alone, and the only lesson I learned is that merit doesn't matter in America nearly as much as Americans fool themselves into thinking.

Think of it this way; getting a job is an attack that needs a 6 to hit. Being well qualified nets you a +1 bonus to the roll. But if someone else hits with their attack first they get it and you don't get to try; people with social networking are +3 and ASF.

Crispy78 wrote:
To be fair, there have been a number of the ultra-wealthy calling for higher taxes to address social inequality

https://www.theguardian.com/business/2019/jun/24/disney-soros-wealth-tax-call-for-higher-taxes-us

If they feel they aren’t paying enough taxes, they can send a check to the Treasury whenever they like to assuage their guilt. Leave the rest of us out of it.

 totalfailure wrote:

If they feel they aren’t paying enough taxes, they can send a check to the Treasury whenever they like to assuage their guilt. Leave the rest of us out of it.

No. They cannot. . . Please stop with this idiotic and false line of reasoning.

 totalfailure wrote:

Crispy78 wrote:
To be fair, there have been a number of the ultra-wealthy calling for higher taxes to address social inequality

https://www.theguardian.com/business/2019/jun/24/disney-soros-wealth-tax-call-for-higher-taxes-us

If they feel they aren’t paying enough taxes, they can send a check to the Treasury whenever they like to assuage their guilt. Leave the rest of us out of it.

Proposals (if you'd read the article) are things like a 2% wealth tax on assets of $50m or more, and a further 1% on assets over 1bn. If this is going to affect you, please feel free to buy me a couple of armies with your spare change.

Crispy78 wrote:


Proposals (if you'd read the article) are things like a 2% wealth tax on assets of $50m or more, and a further 1% on assets over 1bn. If this is going to affect you, please feel free to buy me a couple of armies with your spare change.

Neither of the things you list in this comment are as "extreme" as what the US had during the high-water point of its middle class. During the 1950s, the highest income earners were paying around 70% of income in the top bracket. IMO, the progressive tax bracket system needs to come back, but we also need to redefine "income" to alleviate the issues of situations where like Howard Schulz did at one point at Starbucks, had a "salary" of $1 per year, but if you looked more closely, he was making around 16-20 million a year because his real salary was being paid in investment options that weren't taxed because they aren't considered income.

Quite. Tax as mentioned is on assets not income though - big difference

Tax reform is desperately needed, but I also feel like a number of problems can be addressed without changing tax levels at all.

The use of real estate as tax shelters/deductions has had drastic ramifications across society, most of them not so great. The ability to pay less in taxes by giving to political campaigns is just sleazy. Lots of industries receive billions in government subsidies that frankly are not deserved. And... most of the other things I could rant about probably cross too clearly over the politics ban so *zip*

Point is, if no one wants us to raise taxes on a demographic that by majority actually wants us to raise their taxes, there are alternatives in simply adjusting how much can be written off and for what they could have a lot of benefits on the whole. Maybe. Hard to say someone go hire a committee to actually bother looking into it. We don't do that gak enough around here.

I also feel like there's gotta be a way to get a better grasp on wage disparities. I have no idea what, but there's gotta be something.

If you were to tax on asset the wealthy would just have their company pay them in 'loans' with very loose repayment plans, so (on paper) they would have negative wealth, despite having access to obscene sums of money.

nareik wrote:
If you were to tax on asset the wealthy would just have their company pay them in 'loans' with very loose repayment plans, so (on paper) they would have negative wealth, despite having access to obscene sums of money.

Honestly, I'm not sure that's any different from right now in practice. Being wealthy and making liberal use of the company's assets seems to go hand in hand. You can tax "perks" as easily as you can tax anything else... our you know just toss the somewhat self-serving and unethical practice of using company property as personal property. Either the business is privately owned or it isn't. Pick one or the other and stop letting people have it both ways. Which is a whole other series of problems, because corporate stuff is complex and I doubt anyone here is going to be able to encapsulate everything that could/should/might be done to get a better social balance than we currently have.

 Mad Doc Grotsnik wrote:


To someone with lots of money already? Well, if they just whack it in their savings, that's the end of it. It's not gonna get spent. It's not gonna generate new tax income. It's ded munneh.

Not true. Money in savings accounts is what banks use to finance the loans they give out. It is very much still being used in the economy. Not to the extent of money that is directly spent, but it is definitely a vital part of the economy.

The only way to truly remove money from circulation is to withdraw it in cash and have it stuffed in a mattress or something.


Automatically Appended Next Post:

 Ensis Ferrae wrote:

 totalfailure wrote:

If they feel they aren’t paying enough taxes, they can send a check to the Treasury whenever they like to assuage their guilt. Leave the rest of us out of it.

No. They cannot. . . Please stop with this idiotic and false line of reasoning.

Actually yes. You can simply send the government a donation to this address.

Gifts to the United States
U.S. Department of the Treasury
Funds Management Branch
P.O. Box 1328
Parkersburg, WV 26106-1328

https://fiscal.treasury.gov/public/gifts-to-government.html

The money is considered an unconditional gift to the federal government and is added to the general fund. Anybody who does feel that they aren't paying their fair share may send however much they want this way.

And sending a check to the treasury doesn't work. It's not something that can be budgeted for so it doesn't really solve any problems. It's a really bad answer and thus meaningless. It doesn't actually do anything.

Also this is interesting.
https://www.businessinsider.com/unemployment-vs-involuntary-part-time-work-underemployment-2019-1?fbclid=IwAR2EcizIsTspjDx3L9C5AwoIJUcUFzmI2B9FuA9e_S-eF-SUL1Q0VgiRFgg

Also, workforce participation hasn't budged that much, i.e. there's arguably 0 appreciable change in the actual number of people employed. The only change was in the number of people trying to find work.

The employment rate has always been a garbage statistic for the overall health of the economy (most stats taken in vacuum are). The employment rate just makes a really nice sound bite, so TV news tends to give it undue attention.