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Anonymous A started this discussion 4 days ago#126,368
It's not zero sum, the taxes are not equal to the welfare distributed.
There is beaurocratic overhead, and worse yet there are dead weight losses: transactions that could benefit people but will never happen because the taxes turna profitable exchange into a costly exchange after additional taxes are added.
Anonymous C joined in and replied with this 4 days ago, 27 minutes later, 35 minutes after the original post[^][v]#1,367,681
Spending money doesn't make it stop existing. In a way this "bureaucratic overhead" is just another way that wealth would be redistributed. Regardless, redistributing wealth if done properly wouldn't hurt anyone in any meaningful capacity. A billionaire could lose 90% of their wealth and still have more money than they know what to do with. The poorest peoples' lives would be absolutely changed for the better with a few thousand dollars. It is absolutely a net benefit for society.
Want some fun numbers? American billionaires are worth a combined $5 trillion. Take 90% of this (because again, they will still have more money than they ever need) and you get $4.5 trillion. There are 340.1 million US citizens. Split that money up and that's $13k for every person. Do you know how many peoples' lives an extra $13k would totally transform? Meanwhile the wealthiest people are still extraordinarily wealthy and still never have to worry about money. How is this not a net positive?
Anonymous D joined in and replied with this 4 days ago, 18 minutes later, 54 minutes after the original post[^][v]#1,367,682
Tbh I think sometimes collectivism is better than individualism. Even if it was a net negative, the needs of the many still outweigh the needs of the few.
Anonymous E double-posted this 4 days ago, 8 minutes later, 1 hour after the original post[^][v]#1,367,686
@1,367,681 (C) > Take 90% of this (because again, they will still have more money than they ever need) and you get $4.5 trillion. There are 340.1 million US citizens. Split that money up and that's $13k for every person. Do you know how many peoples' lives an extra $13k would totally transform? Meanwhile the wealthiest people are still extraordinarily wealthy and still never have to worry about money. How is this not a net positive?
You'll just end up with billionaires again within a week's time. How often are you proposing we should reset the economy?
Anonymous D replied with this 4 days ago, 5 minutes later, 1 hour after the original post[^][v]#1,367,689
@1,367,686 (E)
Who tf became a billionaire in one week? Obviously socialism requires perpetual wealth redistribution. That’s why it’s called an economic system.
Anonymous D double-posted this 4 days ago, 1 minute later, 1 hour after the original post[^][v]#1,367,690
And wealth redistribution already does happen to some extent in the United States, taxes fund social security. That’s wealth redistribution, which makes the US economy a mixed economy with aspects of both capitalism and socialism.
Adding costs to a transaction (taxes) can turn a profitable transaction into a non profitable transaction. Meaning transactions that would be mutually beneficial, creating wealth, never happen. That does destroy wealth.
Anonymous D replied with this 4 days ago, 4 minutes later, 1 hour after the original post[^][v]#1,367,693
@previous (A)
Any transactions that would provide a smaller percentage of benefit than sales tax are investments that wouldn’t make you that much wealthier anyway.
Anonymous D double-posted this 4 days ago, 2 minutes later, 1 hour after the original post[^][v]#1,367,694
From a quick google search in the US sales taxes range from 2.9% to 7.25%. So that would only be true for transactions where you’re making single digit percentage profits.
Anonymous D triple-posted this 4 days ago, 1 minute later, 1 hour after the original post[^][v]#1,367,695
But if you’re selling a product in a free market, you do have an incentive to mark up the prices as much as you can get away with. Which is why monopoly is preferable to competition, since once you have a monopoly, you can set prices arbitrarily and make whatever profit you feel like making.
What if they were already generating $10 in taxes per transaction, and $4 in profit to the two parties between them?
You increase taxes $5, making the transaction a net loss so it never happens, and now the two parties lose $4 and the government loses $10 by raising taxes. A $14 loss overall.
Then consider that a tax doesn't affect one individual, but hundreds of millions, and these transactions could have been happening multiple times a day per person.
Now a small tax has a deadweight loss of billions per day, and "increasing" taxes has reduced government revenues.
No one ever takes that into consideration, but treats the whole thing as a zero sum game.
Anonymous D replied with this 4 days ago, 8 minutes later, 2 hours after the original post[^][v]#1,367,697
@previous (A)
So if a product is worth $X and after it is sold, $10 goes to sales tax and $4 is profit, that means the product has to be sold for at least $(X + 14). So if taxes are increased by $5, that means that in order to still make $4 of profit, if we’re assuming taxes are fixed rates instead of percentages for some reason, then you would have to sell the same product for $(X + 19) to make the same profit. Although, if sales taxes are increased universally and this applies to everyone, so will everyone else selling the same product, so your buyers won’t have any choice but to accept the new price or not buy.
Anonymous D double-posted this 4 days ago, 1 minute later, 2 hours after the original post[^][v]#1,367,698
Although, if you make all products more expensive, then that would incentivize people to work harder to earn more money so that they can still afford things, which might nudge people towards more efficient ways of making money.
Anonymous A (OP) replied with this 4 days ago, 11 minutes later, 2 hours after the original post[^][v]#1,367,700
@1,367,697 (D)
The premise of the example would be they (buyer and seller) would go from making a positive value from the transaction to a negative, meaning they would just not engage in the transaction.
@previous (D)
Again, the premise being that the seller would spend more than they make, and the buyer would have to work more than the product is worth.
There is a line where this is hit for almost everything in the economy. The exception is inelastic goods like rent/food.
Anonymous D double-posted this 4 days ago, 1 minute later, 2 hours after the original post[^][v]#1,367,702
For example, if there’s some transaction that really needs to happen, say, I have $10, you have a product that costs $100, but I could use your product to make $1,000, then in that scenario, it would be logical for me to borrow from someone else even if I have to pay interest on that loan.
Anonymous D replied with this 4 days ago, 4 minutes later, 2 hours after the original post[^][v]#1,367,706
@previous (A)
Obviously it is more risky, but there are some situations where that would be worth it. For example, if someone wanted to buy a company, but their wealth is mostly in shares of a company they already own, then instead of selling those shares of their company now, they could take out a loan, buy the company with the money from that loan, and pay back the loan partially using the profits of the company they bought. Or it could also blow up in their face and they could go into debt. But some people are willing to do things like that.
Anonymous E replied with this 4 days ago, 1 hour later, 12 hours after the original post[^][v]#1,367,745
@1,367,689 (D)
Name one time that all Billionaires were stripped of 95% of their wealth to be redistributed amongst the poors that didn't end up with Billionaires existing again within a week. You can't!