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Posts Tagged ‘Wealth Tax’

Elizabeth Warren Has a Bad Plan for Everything – LewRockwell

Posted by M. C. on January 1, 2020

Rest assured someone has to pay for all this “Free Stuff”.

Even the Leftist UK party figured this out when they trounced Corbyn.

Independents and moderates will be highly unlikely to support Marxist nutcases.

Count the times you read “tax”.

As George Will is fond of saying-Corporations are tax collectors, not tax payers. Taxes like most government mandates (minimum wage) are costs of business that get passed on.

https://www.lewrockwell.com/2020/01/mike-mish-shedlock/elizabeth-warren-has-a-bad-plan-for-everything/

By

Mish’s Global Economic Trend Analysis

Elizabeth Warren wants to steer the US to the Left, radical Left.

If you are looking for ideas, Elizabeth Warren has a ton of them. All of them are bad. Please consider Elizabeth Warren’s Plan.

  1. Wealth tax: Tax net worth over $50 million at 2% a year, and 6% above $1 billion. To prevent the rich from yachting off, add a 40% “exit tax” on assets over $50 million upon renouncing U.S. citizenship. Estimated revenue: $3.75 trillion over a decade from 75,000 households. Most economists, including many Democrats, call that number a fantasy. Courts might also find the tax unconstitutional.
  2. Medicare for All tax: Mandate government coverage for everyone, including for illegal immigrants, with no copays or deductibles. Phase out the private plans of 170 million Americans. She says this would cost $20.5 trillion over a decade, which most economists say is $10 trillion short of reality. Keep the growth of health spending below 4% a year with tools like “population-based budgets” and “automatic rate reductions.” Pay doctors at “Medicare rates” and hospitals at 110% of that. Charge companies with at least 50 workers an “Employer Medicare Contribution,” equal to 98% of their recent outlays on health care, while adjusting for inflation and changes in staff size. These varying fees “would be gradually shifted to converge at the average health care cost-per-employee nationally.”
  3. Global corporate tax: Raise the top business rate to 35%. Apply this as a world-wide minimum on overseas earnings by U.S. companies. Businesses would “pay the difference between the minimum tax and the rate in the countries where they book their profits.” Apply a similar minimum tax to foreign companies, prorated by the share of their sales made in the U.S. Estimated revenue: $1.65 trillion over a decade.
  4. Corporate surtax: Tax profit over $100 million at a new 7% rate, without exemptions. This would go atop the regular corporate rate. Estimated revenue: $1 trillion over a decade from 1,200 public companies.
  5. Slower expensing: “Our current tax system lets companies deduct the cost of certain investments they make in assets faster than those assets actually lose value.” Closing this “loophole,” she says, would raise $1.25 trillion over a decade.
  6. Higher capital gains taxes: Tax the investment gains of the wealthiest 1% as ordinary income, meaning rates near 40% instead of today’s 23.8%. Apply the tax annually on gains via a “mark to market” system, even if the asset hasn’t been sold. Estimated revenue: $2 trillion over a decade.
  7. Finance taxes: Tax the sale of bonds, stocks and so forth at 0.1%. Estimated revenue: $800 billion over a decade. Charge big banks a systemic risk fee, raising $100 billion more.
  8. Individual tax increases: There’s no detailed proposal, but Ms. Warren’s clean-energy plan is “paid for by reversing Trump’s tax cuts for the wealthiest individuals and giant corporations.” She’s budgeted $1 trillion.
  9. Social Security: Increase benefits by $2,400 a year across the board. Raise them further “for lower-income families, women, people with disabilities, public-sector workers, and people of color” by changing “outdated” rules that Ms. Warren says disadvantage them.
  10. Lobbying tax: Tax “excessive lobbying” over $500,000 a year at rates up to 75%. Ms. Warren says this would have raised $10 billion over the past decade, although it probably runs headlong into the First Amendment’s right to petition the government. Use the revenue for “a surge of resources to Congress and federal agencies.”
  11. Green New Deal: Spend $3 trillion, including $1.5 trillion on industrial mobilization, $400 billion on research, and $100 billion on a Marshall Plan. By 2030 hit 100% carbon-neutral power and 100% zero-emission new cars. Retrofit “4% of houses and buildings every year.” For “environmental justice,” put a third of the funds into “the most vulnerable communities.”
  12. An end to fossil fuels: Ban fracking. Halt new drilling leases on federal land. “Prohibit future fossil fuel exports.” Kill the Keystone XL and Dakota Access pipelines. “Subject each new infrastructure project to a climate test.” Give “workers transitioning into new industries” a “guaranteed wage and benefit parity” and “promised pensions and early retirement benefits.”
  13. K-12 education: Add $450 billion to Title I, $200 billion for students with disabilities, $100 billion for “excellence grants,” and $50 billion for school upgrades. “End federal funding for the expansion of charter schools.”
  14. A “right” to child care: Build a federal network of local providers, subject to national standards. Give free care to the “millions of children” whose households are under 200% of poverty, or $51,500 for a family of four. For everyone else, cap child-care spending at 7% of income. Estimated cost: $700 billion.
  15. Free college: “Give every American the opportunity to attend a two-year or four-year public college without paying a dime in tuition or fees.” Add $100 billion to Pell Grants and $50 billion for historically black colleges, tribal schools and more. Estimated cost: $610 billion.
  16. Student-debt forgiveness: Write off $50,000 for households with incomes under $100,000. This would phase out as income rises toward $250,000. Estimated cost: $640 billion.
  17. Housing: Spend $500 billion “to build, preserve, and rehab” millions of affordable-housing units. Condition such funding “on repealing state laws that prohibit local rent control.” Paid for by lowering the death-tax exemption to $7 million from $22 million per couple. At the same time, “raise the tax rates above that threshold.”
  18. Unions: Overturn “so-called ‘right to work’ laws” in 27 states. Guarantee public employees an ability to “bargain collectively in every state.” Amend labor law to aid “sectoral bargaining.” Give the National Labor Relations Board “much stronger” powers, such as “to impose compensatory and punitive damages.”
  19. Corporate governance: Make companies with revenue over $1 billion obtain a new federal charter—separate from the current state charter system—that requires them to “consider the interests of all corporate stakeholders.” Give workers 40% of board seats, and put CEOs under “a new criminal negligence standard.”
  20. Industrial policy: Manage the dollar’s value “more actively” to “promote exports and domestic manufacturing.” Create a Department of Economic Development, and have it write a National Jobs Strategy. Expand the Export-Import Bank. Impose a “border carbon adjustment” fee—that is, new tariffs—on imports from countries that don’t align with U.S. climate policies.
  21. Antitrust: Break up AmazonFacebook and Google. “Unwind” their mergers with Whole Foods, Instagram, DoubleClick and more. Regulate as a “platform utility” any online marketplace with global revenue of $25 billion. Reverse agriculture consolidation, “including the recent Bayer-Monsanto merger,” and create a “supply management program” to “guarantee farmers a price at their cost of production.”
  22. Banking: Pass “a 21st Century Glass-Steagall Act that breaks up the big banks.” Let the U.S. Postal Service “partner with local community banks” to provide “basic banking services like checking and savings accounts.”
  23. Gun control: Create a “federal licensing system for the purchase of any type of firearm or ammunition.” Raise taxes to 30% on guns and 50% on ammo. Ban sales of “assault weapons,” and make current owners “register them under the National Firearms Act.” Pass a law to let shooting victims “hold the manufacturer of the weapon that harmed them strictly liable.”
  24. Centralized elections: Use federal money to “replace every voting machine in the country.” For federal elections, mandate early voting and same-day registration. If state elections follow the same rules, they can be “fully funded by the federal government,” with “a bonus for achieving high voter turnout.” Estimated cost: $20 billion, paid by “closing loopholes” in the death tax.
  25. Miscellaneous: Spend $100 billion “to end the opioid crisis,” $85 billion “to massively expand broadband access,” $25 billion on “health professional shortage areas,” and $7 billion “to close the gap in startup capital for entrepreneurs of color.” Double the foreign service and the Peace Corps.

Warren’s Marxist Manifesto Read the rest of this entry »

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Understanding Elizabeth Warren’s “Radical” Wealth Tax | Mises Wire

Posted by M. C. on December 3, 2019

However, suppose the individual invests the wealth in fairly safe bonds that yield a return of 3%. At the end of the period, the individual will have the original $1,000 plus the $30 in gross interest income, for a new level of wealth of $1,030. If that wealth is then taxed at 3%, the individual owes the IRS ($1,030 x 3%) =  $31 (with rounding). Yikes! The income generated by that wealth was only $30 during the period, and so if the individual had the same liability from a income tax (applied to interest), then the “equivalent” tax rate would be 103%! 

Wealth is not all cash. It is buildings, machinery, stock (manufactured products)…things that get others employed. You are more likely to find a job with a “rich” person than one taxed to financial death.

https://mises.org/wire/understanding-elizabeth-warrens-radical-wealth-tax?utm_source=Mises+Institute+Subscriptions&utm_campaign=938d32f1ce-EMAIL_CAMPAIGN_9_21_2018_9_59_COPY_01&utm_medium=email&utm_term=0_8b52b2e1c0-938d32f1ce-228343965

Democratic presidential candidate Elizabeth Warren has had a long-standing call for a 2% wealth tax on any individuals with a net worth exceeding $50 million, and a 3% tax on wealth exceeding $1 billion. Yet when pressed on how to pay for her “Medicare for All” plan, Warren upped the ante to a 6% wealth tax for those fortunes exceeding $1 billion. (As I noted at the time of the announcement: If Warren doubles her wealth tax during the campaign, imagine how fast it will rise if she’s actually elected.)

Naturally, many conservative and libertarian analysts recoiled from such an economically destructive proposal. One of the ways critics used to illustrate the severity of Warren’s idea was to translate a wealth tax into an “equivalent” income tax on dividends, interest, and capital gains. But other economists pointed out problems with that line of attack, because after all, wealth and income are different things, and so taxes on them affect behavior differently. Wealth taxes are inefficient, no doubt about it, but not because “it’s the same thing as a huge income tax.” In the present piece I’ll try to referee the disputes and present the reader with an intuitive understanding of the issues involved.

How Wealth Taxes Can Correspond to Very High Income Taxes

In order to show that Warren’s seemingly modest 6% wealth tax was in fact quite radical, Richard Rubin at the Wall Street Journal warned that “Warren has unveiled sweeping tax proposals that would push federal tax rates on some billionaires and multimillionaires above 100%.” Likewise, Columbia University economist Wojciech Kopczuk—while commenting on the more academic proposal coming from economists Gabriel Zucman and Emmanual Saez—argued that, “If you consider a safe rate of return of, say, 3%, a 3% wealth tax is a 103% tax on the corresponding capital income and a 6% tax rate is a 206% tax.”

Before proceeding, let’s illustrate Kopczuk’s argument with a numerical example. (Note that in the rest of this article, in my examples I’m going to use small amounts of wealth, such as $1,000, to keep the math simple. Warren’s actual proposals of course only apply to wealth exceeding $50 million and $1 billion—at least so far!)

Now then, suppose someone starts with $1,000 in wealth. If he consumes it, then he faces no wealth tax nor income tax. (Kopczuk adopts the convention that any wealth taxes are assessed on wealth at the end of the period, while income taxes are based on income generated during the period.)

However, suppose the individual invests the wealth in fairly safe bonds that yield a return of 3%. At the end of the period, the individual will have the original $1,000 plus the $30 in gross interest income, for a new level of wealth of $1,030. If that wealth is then taxed at 3%, the individual owes the IRS ($1,030 x 3%) =  $31 (with rounding). Yikes! The income generated by that wealth was only $30 during the period, and so if the individual had the same liability from a income tax (applied to interest), then the “equivalent” tax rate would be 103%!

In General, a Wealth Tax Is Not Equivalent to an Income Tax

Although such calculations may be useful to wake up the average American to just how economically destructive even a “low” wealth tax may be, strictly speaking it is incorrect to argue that a wealth tax of x% is “equivalent to” or “the same thing as” a tax on capital income of y%. Over at EconLog, economists Scott Sumner and David R. Henderson both laid out some of the problems.

For our purposes, let me focus on Henderson’s commentary, where he showed the problem with Kopczuk’s analysis. Note, however, that in his actual example, Henderson ran the numbers for a 2% wealth tax. I’m going to change the calculations to make his same point, but using a 3% wealth tax, because I think that’s easier for the reader and also to be consistent with my commentary above:

The way to see what the marginal tax rate on capital income is[,] is to think on the margin: change the income from capital and see how much extra tax is paid.

So, for example, start with $1,000 at the start of the year that earns what Kopczuk calls the riskless rate of return, 3%. With a wealth tax, $1,030 at year’s end is taxed at [3%], leaving the owner with [97%] of $1,030, which is [$999.10].

Now raise the rate of return to 4%. With a wealth tax, $1,040 is taxed at [3%], leaving the owner with [97%] of $1,040, which is [$1,008.80].

How much more did the owner of capital net from the investment at 4% rather than at 3%? [$1,008.80] minus [$999.10], which is [$9.70]. In other words, for an extra income from capital of $10, the owner kept [$9.70]. The wealth tax amounted to a [3%] tax on the income from capital. [David R. Henderson, bold added, with bracketed numbers reflecting Murphy’s tweaking of the size of the wealth tax.]

As Henderson’s example shows, in general you can’t take a given wealth tax and then translate it into the “equivalent” income tax. In his example, if an investor has the choice between Investment A that is relatively safe and carries a return of 3%, and Investment B that is riskier but promises the higher expected return of 4%, then the wealth tax of 3% provides different incentives than a tax on capital income of 103%.

Specifically, under a 3% wealth tax, the investor who takes on the extra risk by switching to Investment B—trying to boost his gross rate of return from 3% to 4%, and hence his gross income on the investment from $30 to $40—will be able to keep 97% of that extra $10 in expected return on the investment.

In utter contrast, if the investor faces not a wealth tax, but instead a tax on capital income of 103%, then even if the riskier investment pays off as expected, the investor ends up worse off! Specifically, if he goes with Investment A our investor ends up with $1,030 gross on which he must pay ($30 x 103%) = $30.90 in income tax, leaving him with $999.10 after the dust settles. But if he goes with the riskier Investment B and even if it pays off as he’d hoped, the investor ends up with $1,040 gross on which he must pay ($40 x 103%) = $41.20 in income tax, leaving him with $998.80 when the dust settles.

In summary, David R. Henderson has come up with a specific example to show why it’s wrong to argue that a wealth tax of 3% is “equivalent to” a capital income tax of 103%. If we assume an investor has the option of putting his wealth into a riskier investment with a higher rate of return, then the 3% wealth tax only distorts the decision by 3% (loosely speaking). If the risker investment pays out, then the investor’s upside is only clipped by the modest 3% tax on the extra wealth he now holds. In contrast, under a 103% income tax, then it would be insane for the individual to even consider the riskier asset. Perversely, the more it pays out, the worse off the investor ends up, because the government assesses a tax that is proportional to, but bigger than, any gains.

At this point, we see that wealth and income taxes can have very different effects on investor behavior. Generally speaking, if we are considering long-term deployments of financial capital, and comparing it to a no-tax baseline, a modest wealth tax will lead investors to seek riskier assets earning higher (expected) rates of return, while a very high capital income tax will lead investors to tread water, putting their wealth into safe assets that earn very low rates of return. Both types of taxes distort financial decisions, but they do so in different ways. They aren’t “equivalent” in general.

Still Not the Full Story

My apologies dear reader, but we’re not done yet: Henderson’s analysis isn’t the full story, either. Strictly speaking, what he showed is that under a wealth tax of 3%, an investor who consumes all of his wealth at the end of the period only faces a marginal income tax rate of 3%. Yet in practice, most investors probably aren’t planning on consuming everything in one fell swoop, and so Henderson has led readers to understate the economic impact of a wealth tax.

Recall the example: An investor who switches his $1,000 in capital from an asset yielding 3% to one that yields 4% will see his gross income jump from $30 to $40. Henderson reasoned that under a wealth tax of 3%, the investor got to retain $9.70 of the extra $10 in gross income, and concluded that the marginal income tax rate was therefore only 3%.  (A reminder to avoid confusion: In order to keep the analysis comparable to the quotation from Kopczuk, I amended Henderson’s numbers to deal with a 3% wealth tax rather than a 2% version.)

Yet to repeat, this is only true if the investor consumes that $9.70. If instead the investor holds it another period, then it will trigger a second tax liability under the wealth tax, this time of ($9.70 x 3%) = 29 cents. And then if the investor carries the balance forward yet again, at the end of the third year he must pay another ($9.41 x 3%) = 28 cents in wealth tax. In contrast, under an income tax regime, if the investor just sits on his after-tax wealth after he earns it the first year, rather than deploying it to earn new income, then he owes no more additional tax on it.

In short, if our hypothetical investor had long-term plans for his wealth, then Henderson underestimated the burden of the wealth tax. In the limit, if the investor earned a one-shot return of $10 and then put it somewhere earning no return, it would asymptotically approach $0 over the years, as the government kept nibbling 3% annually at it. (For example, after 20 years of getting hit with the wealth tax, the original $10 in extra interest income earned that first year would have been whittled down to about $5.44.)

Let’s do one last example to illustrate the subtleties involved. Suppose our investor earned that extra $10 during this year (by moving his $1,000 into an asset that yielded 4% rather than 3%), and then wants to put the $10 under his mattress, where he intends to keep it for 50 years. How then would this extra $10 he earned this year, affect his long-term tax liability? Well, at the end of the first year he owes 30 cents. At the end of the second year he owes 29 cents on the remainder, and at the end of (say) the 25th year he owes 14 cents. However, when computing the burden from today’s perspective, those future tax payments need to be discounted. Since Kopczuk and Henderson both assumed a “safe” return of 3%, we can use that for a discount rate. (For example, the 14-cent wealth tax liability due in 25 years only has a present discounted value to our individual of 7 cents.)

Using this approach, the total wealth tax (in present-dollar terms) that the incremental $10 in wealth will cause our investor, over a 50-year time horizon, is some $4.89. In that sense, then, when our investor is considering whether to rearrange his portfolio in order to earn an extra $10, he faces a “marginal income tax rate” of about 49%.

Another way of showing the issue is to assume our investor wants to set aside a portion of his initial $10 in extra wealth, in order to cover all of the future wealth tax payments over the 50-year horizon. If he puts his earmarked “sinking tax fund” wealth into the relatively safe asset yielding 3%, then the investor must allocate $6.01 of his initial $10, just to cover the future wealth tax payments. Using this approach, the investor could understandably conclude that of his $10 in gross earnings—since he could only put $3.99 under the mattress “free and clear” for use in 50 years—he effectively paid the equivalent of a 60.1% marginal income tax rate.

Conclusion

Putting aside the moral problems with taxation—it’s theft, as a popular libertarian slogan reminds us—Elizabeth Warren’s proposed wealth taxes will have devastating consequences on capital formation, and will encourage investors to hold riskier assets than they otherwise would have. In order to illustrate the magnitudes involved, some analysts translated Warren’s proposals into “equivalent” income tax rates.

However, wealth and income are different concepts, and in general taxes on wealth and income will have different effects. For those investors with a short planning horizon, a modest wealth tax has a relatively modest impact on the decision to save for the future. However, for those with longer time horizons, even a seemingly modest wealth tax has an economic impact akin to a large income tax.

 

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As Democrats Push a “Wealth Tax,” Here’s Why Other Countries Got Rid Of It | Mises Institute

Posted by M. C. on June 27, 2019

https://mises.org/power-market/democrats-push-wealth-tax-heres-why-other-countries-got-rid-it

Daniel J. Mitchell

…Another guilt-ridden rich guy wrote for the New York Times that he wants the government to have more of his money.

My parents watched me build two Fortune 500 companies and become one of the wealthiest people in the country. …It’s time to start talking seriously about a wealth tax. …Don’t get me wrong: I am not advocating an end to the capitalist system that’s yielded some of the greatest gains in prosperity and innovation in human history. I simply believe it’s time for those of us with great wealth to commit to reducing income inequality, starting with the demand to be taxed at a higher rate than everyone else. …let’s end this tired argument that we must delay fixing structural inequities until our government is running as efficiently as the most profitable companies. …we can’t waste any more time tinkering around the edges. …A wealth tax can start to address the economic inequality eroding the soul of our country’s strength. I can afford to pay more, and I know others can too.

When reading this kind of nonsense, my initial instinct is to tell this kind of person to go ahead and write a big check to the IRS (or, better yet, send the money to me as a personal form of redistribution to the less fortunate). After all, if he really thinks he shouldn’t have so much wealth, he should put his money where his mouth is.

But rich leftists like Elizabeth Warren don’t do this, and I’m guessing the author of the NYT column won’t, either. At least if the actions of other rich leftists are any guide.

But I don’t want to focus on hypocrisy.

Today’s column is about the destructive economics of wealth taxation.

report from the Mercatus Center makes a very important point about how a wealth tax is really a tax on the creation of new wealth.

Wealth taxes have been historically plagued by “ultra-millionaire” mobility. …The Ultra-Millionaire Tax, therefore, contains “strong anti-evasion measures” like a 40 percent exit tax on any targeted household that attempts to emigrate, minimum audit rates, and increased funding for IRS enforcement. …Sen. Warren’s wealth tax would target the…households that met the threshold—around 75,000—would be required to value all of their assets, which would then be subject to a two or three percent tax every year. Sen. Warren’s team estimates that all of this would bring $2.75 trillion to the federal treasury over ten years… a wealth tax would almost certainly be anti-growth. …A wealth tax might not cause economic indicators to tumble immediately, but the American economy would eventually become less dynamic and competitive… If a household’s wealth grows at a normal rate—say, five percent—then the three percent annual tax on wealth would amount to a 60 percent tax on net wealth added.

Alan Viard of the American Enterprise Institute makes the same point in a columnfor the Hill.

Wealth taxes operate differently from income taxes because the same stock of money is taxed repeatedly year after year. …Under a 2 percent wealth tax, an investor pays taxes each year equal to 2 percent of his or her net worth, but in the end pays taxes each decade equal to a full 20 percent of his or her net worth. …Consider a taxpayer who holds a long term bond with a fixed interest rate of 3 percent each year. Because a 2 percent wealth tax captures 67 percent of the interest income of the bondholder makes each year, it is essentially identical to a 67 percent income tax. The proposed tax raises the same revenue and has the same economic effects, whether it is called a 2 percent wealth tax or a 67 percent income tax. …The 3 percent wealth tax that Warren has proposed for billionaires is still higher, equivalent to a 100 percent income tax rate in this example. The total tax burden is even greater because the wealth tax would be imposed on top of the 37 percent income tax rate. …Although the wealth tax would be less burdensome in years with high returns, it would be more burdensome in years with low or negative returns. …high rates make the tax a drain on the pool of American savings. That effect is troubling because savings finance the business investment that in turn drives future growth of the economy and living standards of workers.

Alan is absolutely correct (I made the same point back in 2012).

Taxing wealth is the same as taxing saving and investment (actually, it’s the same as triple- or quadruple-taxing saving and investment). And that’s bad for competitiveness, growth, and wages.

And the implicit marginal tax rate on saving and investment can be extremely punitive. Between 67 percent and 100 percent in Alan’s examples. And that’s in addition to regular income tax rates.

You don’t have to be a wild-eyed supply-side economist to recognize that this is crazy.

Which is one of the reasons why other nations have been repealing this class-warfare levy.

Here’s a chart from the Tax Foundation showing the number of developed nations with wealth taxes from1965-present.

Jun-25-19-Tax-Foundation-Chart.jpg

 

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Dreams or Nightmares?

Posted by M. C. on April 23, 2019

Harris: I’ll ‘Take Executive Action’ if Congress Doesn’t Pass Gun Legislation in First 100 Days

https://www.breitbart.com/clips/2019/04/22/harris-ill-take-executive-action-if-congress-doesnt-pass-gun-legislation-in-first-100-days/

Look for expanded definitions of “assault” and crimes worthy of prohibition.

The ultimate goal is total prohibition. It makes control easier.

Warren: My Wealth Tax Will Pay for Universal Child Care, Universal Pre-K, Free College Tuition

https://www.breitbart.com/clips/2019/04/22/warren-my-wealth-tax-will-pay-for-universal-child-care-universal-pre-k-free-college-tuition/

Is ‘free’ the inevitable set of rules and regs that will make the tax code look like a short story?

Look for expanded definitions of “wealth”. Taxes are trickle down. They are costs of business that get paid by consumers.

Why go for the next big breakthrough if the government “redistributes” profits and retards investments (i.e. jobs).

When everything is free, no one has to work and government takes what little you make don’t be surprised when there is no doctor or mechanic to attend to your needs.

In the Soviet Union when you waited in line for for six hours to get shoes , you at least received one left shoe. Right shoes next month, maybe.

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Free lunch.

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How to Turn America into a Shit-hole Country in 4 Easy Steps | The Daily Bell

Posted by M. C. on April 19, 2019

https://www.thedailybell.com/all-articles/news-analysis/how-to-turn-america-into-a-shit-hole-country-in-4-easy-steps/

By Joe Jarvis

Opening up the floodgates of immigration to people from shit-hole countries would not actually be a problem if America was a free country.

If people were free to keep what they earn instead of having it redistributed, free to defend themselves and their loved ones wherever they went, free to become entrepreneurs without impossible protectionist regulations, America would absorb and assimilate any number of immigrants and refugees.

That’s what happened when Ireland, Italy, and Scotland were shit-hole countries where my ancestors emigrated from. The Irish were poor as dirt, fleeing a famine. The Italians brought the murderous Mafia.

And according to Thomas Sowell in his book Black Rednecks, White Liberals, the Scottish immigrants started the southern redneck culture, ready to fight and kill at the tiniest insult to defend their “honor.”

But a lot has changed since then. You can’t leave your home without breaking a law, so American policing agencies would have to spend a lot of time, energy, and tax dollars beating the ‘Merica into new immigrants.

But why blame the immigrants instead of the system?

1. Tax the citizens’ wealth away (or just steal it outright)

Elizabeth Warren has proposed a wealth tax as part of her campaign platform for President 2020.

This would tax the entire net worth of individuals worth over $50 million, every single year.

This eventually guarantees that no one worth over $50 million lives in the United States. At which point the tax will creep down to the middle class as it always does (especially if inflation makes millionaires of all of us)… Read the rest of this entry »

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Is Income Inequality Fair? – LewRockwell

Posted by M. C. on March 13, 2019

https://www.lewrockwell.com/2019/03/walter-e-williams/is-income-inequality-fair/

By

Some Americans have much higher income and wealth than others. Former President Barack Obama explained, “I do think at a certain point you’ve made enough money.” An adviser to Rep. Alexandria Ocasio-Cortez who has a Twitter account called “Every Billionaire Is A Policy Failure” tweeted, “My goal for this year is to get a moderator to ask ‘Is it morally appropriate for anyone to be a billionaire?’” Democratic presidential hopeful Sen. Elizabeth Warren, in calling for a wealth tax, complained, “The rich and powerful are taking so much for themselves and leaving so little for everyone else.”

These people would have an argument if there were piles of money on the ground called income, with billionaires and millionaires surreptitiously getting to those piles first and taking their unfair shares. In that case, corrective public policy would require a redistribution of the income, wherein the ill-gotten gains of the few would be taken and returned to their rightful owners. The same could be said if there were a dealer of dollars who — because of his being a racist, sexist, multinationalist and maybe a Republican — didn’t deal the dollars fairly. If he dealt millions to some and mere crumbs to others, decent public policy would demand a re-dealing of the dollars, or what some call income redistribution.

You say, “Williams, that’s lunacy.” You’re right. Read the rest of this entry »

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The Problem with Elizabeth Warren’s Wealth Tax | Mises Wire

Posted by M. C. on February 12, 2019

But the reason for this is not that government isn’t doing enough so far. It is instead that the government is doing too much

https://mises.org/wire/problem-elizabeth-warrens-wealth-tax

A wealth tax is not a new idea, though it certainly has come out of fashion recently – in 1992 twelve OECD countries had one, now there are only four.

One of the central issues of a wealth tax is that it is difficult to actually implement and enforce. As Nicole Kaeding and Kyle Pomerleau from the Tax Foundation write, “the uber wealthy tend to have very hard-to-value assets,” such as ownership in real estate holdings, trusts, and most importantly, businesses.

Calculating the overall value of the wealth of a household would cost an immense amount of time and effort. Jeffrey Levine notes that wealthy households own “one of a kind works of art, ‘priceless’ jewelry, expensive cars … the list goes on and on. And now imagine the need to have all these assets valued each and every single year. It would be a total disaster show.” What effect such a measurement would have on a tax code which already comes in at 2.4 million words can already be presumed. The only ones profiting from such additional complications would be appraisers and lawyers, who will have the privilege to find out what the value of one’s wealth even is approximately… Read the rest of this entry »

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Rip-Off the Rich? – LewRockwell

Posted by M. C. on January 30, 2019

https://www.lewrockwell.com/2019/01/laurence-m-vance/tax-the-rich/

By 

According to the latest figures released by the Internal Revenue Service (IRS):

  • In 2016, the top 50 percent of all taxpayers paid 97 percent of all individual income taxes, while the bottom 50 percent paid the remaining 3 percent.
  • The top 1 percent paid a greater share of individual income taxes (37.3 percent) than the bottom 90 percent combined (30.5 percent).
  • The top 1 percent of taxpayers paid a 26.9 percent individual income tax rate, which is more than seven times higher than taxpayers in the bottom 50 percent (3.7 percent).

“The rich” are also punished through the phase-out of tax exemptions, deductions, and credits as their income rises.Yet, according to Democratic politicians like Senator Elizabeth Warren, Representative Alexandria Ocasio-Cortez, Senator Bernie Sanders, and former Senator Hillary Clinton, “the rich” are still not paying enough in taxes.

Senator Warren has proposed a “wealth tax” on the richest Americans: Read the rest of this entry »

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EconomicPolicyJournal.com: Elizabeth Warren Goes Tax Crazy

Posted by M. C. on January 30, 2019

This is a remarkably aggressive tax proposal because of the annual nature of the tax and would severely reduce the wealth of those taxed in just a decade. It would destroy over 2.75 trillion dollars in capital investment in just 10 years, according to Warren’s own numbers. And would put those funds into the bureaucratic government machine that wastes money as all central planning money does.

http://www.economicpolicyjournal.com/2019/01/elizabeth-warren-goes-tax-crazy.html

RW 

Sen. Elizabeth Warren, D-Mass., has just proposed an annual “wealth tax” on the richest Americans.

Note well: This is not a tax on income. It is a tax on the wealth rich Americans have. This is big.

The new tax proposal from Warren, who recently announced her bid to challenge President Donald Trump in 2020, would apply to Americans with more than $50 million in assets.

It would be a tax of 2% per year on the wealth of anyone who’s wealth falls between $50 million and $1 billion. For those with wealth over a $1 billion, the tax would be 3%.

This is a remarkably aggressive tax proposal because of the annual nature of the tax and would severely reduce the wealth of those taxed in just a decade. It would destroy over 2.75 trillion dollars in capital investment in just 10 years, according to Warren’s own numbers. And would put those funds into the bureaucratic government machine that wastes money as all central planning money does…

Be seeing you

Faux

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5 Ways a Wealth Tax Is At Least as Bad as an Income Tax | Mises Wire

Posted by M. C. on December 2, 2018

https://mises.org/wire/5-ways-wealth-tax-least-bad-income-tax

There has been an increasing push for wealth taxes as of late. Supporters for new and larger wealth taxes contend that as the population ages, there won’t be enough wage earners to fund the public purse. In other words, there will be less wage-based income to tax as time goes on. But there will still be plenty of pensioners to pay for. As The Guardian noted back in March, new revenue sources will be needed “as the number of people over 65 grows by almost a third, while the working age population is expected to only increase by about 2%.”

Thus, The Guardian concludes: “the time has come to make the case for greater wealth taxes, given our emerging economic realities, demographic shifts and growing levels of inequality.”

But taking a further look into the issue, and applying some common sense logic, it becomes clear a wealth tax brings with it a host of problems.  Many of these problems are reminiscent of the problems we already encounter with a wealth tax. But some are new:

One: The Audits

Read the rest of this entry »

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