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California is chasing wealth that has feet

292 points · 866 comments · idbnstra

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bigyabai · 1790282214 · focus · HN ↗
I ctrl+f search for "gentrification" and nothing pops up. I close the Substack blog and proceed with my day.
1. idbnstra · 1790286470 · focus · HN ↗
  why is that?
  1. bigyabai · 1790295300 · focus · HN ↗
    Because TFA ignored the problem.
    idbnstra · 1790302817 · focus · HN ↗
    “I think people shouldn’t be displaced from their neighborhoods because of lack of affordability”
    I didn’t mention gentrification in the above sentence. Does that mean I’m ignoring the problem?
    bigyabai · 1790315101 · focus · HN ↗
    If you're participating in a conversation between adults in the 21st century, yeah. We've got a word for it, even if it's like garlic to the private equity vampires on this website.
guywithahat · 1790284416 · focus · HN ↗
I think the point of the article is correct; the issue with CA is everyone wants to live there, including rich people. If we try and tax them then they'll leave just long enough to not pay state income tax, if we tax property values then the state actually gets the tax and doesn't miss out on job creation or future revenue.
Red states have implemented low income tax with heavy property taxes (think Texas) with great results. and although I'm sure California would just manage to mess it up it's a great idea.
1. asdff · 1790286168 · focus · HN ↗
  I would not frame Texas as having great results. If anything places should get as little like Texas as they possibly can. I mean they send you to jail for an abortion or a gram of weed. It's living under Shari-yall law.
  1. jostmey · 1790286541 · focus · HN ↗
    The tax system in Texas is a better system. Sure, Texas has lots of problems. That doesn't mean there is nothing to learn from Texas.
    I live in Texas. I don't like the restrictive laws. Texas could learn a lot for California, just not in the areas of taxation
    asdff · 1790286772 · focus · HN ↗
    The lack of a progressive income tax structure gives texas few levers to ameliorate budget issues without cutting services or raising property taxes. It doesn't help the current governor seems to be pushing city budgets to the brink by also cutting off the property tax lever.
    <a href="https://www.texastribune.org/2026/08/17/texas-city-budgets-cuts-tax-hikes/" rel="nofollow">https://www.texastribune.org/2026/08/17/texas-city-budgets-c...
    blm126 · 1790287331 · focus · HN ↗
    Out of curiosity, why couldn't property taxes be progressive? What stops Texas from having different tax rates based on the value of the property?
    It even seems like it avoids a lot the pit falls the uber-wealthy use to avoid most progressive income taxes. Its easy to disguise income as something else. Property, though, is right out in the open. The state can easily audit and value property and send the bill. No matter how fancy the accounting, that bill will eventually reach the person "consuming" that property.
    omgwtfbyobbq · 1790287637 · focus · HN ↗
    Nothing I'm aware of stops that.
    In practice, at least from what I've read, in TX, the largest/wealthiest companies get the biggest/best tax breaks (eg Tesla), and end up paying proportionally less, so it's somewhat regressive.
    Danox · 1790317018 · focus · HN ↗
    In Texas, like Florida, you get a bill for all improvements within your neighborhood or development as they come. Just because the tax may appear low on the front end, that doesn’t mean you don’t pay for the same relative lifestyle as everybody else in the United States of America.
    Even though all the states have their differences they all live relatively the same, in short, if you are an average person, you pay pretty much the same as any place else. It’s only the wealthy who get to hopscotch and dance over the top of all the bodies of the (working class) below.
    mcmcmc · 1790287160 · focus · HN ↗
    [delayed]
    jostmey · 1790299415 · focus · HN ↗
    Not better for me. But I believe it fairer. Yes, I have no income tax. Yes, I pay a lot in property tax. But it is a better capture of wealth. I shouldn't have my property tax locked to a low value from decades ago while squatting on a large asset
    Danox · 1790316616 · focus · HN ↗
    There’s nothing California can learn from Texas, but if you want to live like Texas or Oklahoma, you can just move to Bakersfield, California hint: that part of California sucks.
  2. jojogeo · 1790287569 · focus · HN ↗
    > Shari-yall
    Made me laugh while drinking; messy, but worth it for the smiles I'll have every time I remember it! Outstanding job, internet stranger.
    Terr_ · 1790288207 · focus · HN ↗
    Related slang options: "Y'all-Qaeda", "Yeehawdis", "Talibangelical".
    dabluecaboose · 1790304972 · focus · HN ↗
    You guys should really go back to reddit
  3. rightnutwingjob · 1790287910 · focus · HN ↗
    It’s pretty easy not to murder babies.
    Sohcahtoa82 · 1790288729 · focus · HN ↗
    Appropriate username.
    rightnutwingjob · 1790298473 · focus · HN ↗
    Solid counter argument.
cucumber3732842 · 1790285394 · focus · HN ↗
>. The land value tax can’t be dodged by leaving nor can it be passed on to renters
ROFL what? I'd bet the author a lot of money that costs WILL roll downhill, the source matters not.
1. skybrian · 1790285985 · focus · HN ↗
  I think the idea is that if the market demand is such that it allows them to raise rents, they'd already have done it, whether or not expenses justify it.
  1. cucumber3732842 · 1790286565 · focus · HN ↗
    If they can't raise rents to cover expenses plus "enough profit to make this PITA worth it" then things (slowly over time) grind to a halt.
    epistasis · 1790288803 · focus · HN ↗
    It won't grind to a halt. The owner will sell, because they can't make the business work.
    At what price will they sell? At whatever price a buyer who thinks will make it work. And by "work" there are many definitions, from continuing operation at current rents, to building more units on the land so that it generates enough income to pay the tax.
    Land value taxes shift tax burden away from productive use of land and on to unproductive uses of land. The people who pay more are land speculators and those with empty lots, and the people who pay less are those productively using the land, which is 99% of homeowners and businesses.
    skybrian · 1790289632 · focus · HN ↗
    [delayed]
    kelnos · 1790297922 · focus · HN ↗
    [delayed]
  2. bhelkey · 1790292226 · focus · HN ↗
    Did tariffs raise prices? Or did prices stay the same because "if the market demand is such that it allows them to raise [prices], they'd already have done it"?
    skybrian · 1790298761 · focus · HN ↗
    [delayed]
2. [deleted] · 1790286594 · focus · HN ↗
  [deleted]
3. idbnstra · 1790286621 · focus · HN ↗
  I'm curious what costs you think will roll downhill and why
4. omgwtfbyobbq · 1790286660 · focus · HN ↗
  Yeah, that's unlikely. There are certain classes of renters it can't be passed on to during their rental term, but I'm guessing it can and likely would in general.
  People can also sell their land/homes and move. It's less liquid than other assets, but less doesn't mean people won't sell/leave.
  1. sokoloff · 1790287551 · focus · HN ↗
    [delayed]
    omgwtfbyobbq · 1790287909 · focus · HN ↗
    I'm California some percentage of certain developments need to be rental controlled, so those are exempt from increases for those lower income folks, but I'm sure the difference would be spread out among everyone who isn't rent controlled.
    epistasis · 1790288184 · focus · HN ↗
    One of the benefits of a land value tax is that it has zero dead weight loss: because there's a fixed supply of land, the tax won't cause less of it to be around, and you don't lose out on the beneficial transactions that property tax can prevent.
    sokoloff · 1790289358 · focus · HN ↗
    There are several key benefits. My primary concern is that there are generally no market comparables for undeveloped land in developed areas. I can appeal my property tax assessment by using comparables for nearby developed property. There is no equivalent market-based process for land values alone.
    epistasis · 1790292665 · focus · HN ↗
    This is a reasonable and common concern, and one I shared until I looked into it in fine detail. Turns out it's far easier to estimate the value of land that things sit on than the entire property value, and most of the country actually operates on continually updated estimates of total property value rather than just land.
    There's several anchoring sales nearby, you can regress out from all sales, etc. etc. And it's smoothly varying for nearby parcels, with very little change!
    A much better explanation than what I can write can be found in the "Estimating" section here <a href="https://landeconomics.org/reports/california-billionaire-wealth-tax#estimating" rel="nofollow">https://landeconomics.org/reports/california-billionaire-wea...
    sokoloff · 1790292985 · focus · HN ↗
    [delayed]
    epistasis · 1790301251 · focus · HN ↗
    It's actually much harder to target a particular owner, because it's based only on land area, and the value of land in a general area! Property taxes are much much more susceptible to targeting as individual properties are much more variable and there's far more judgement about individual buildings and the potential value of a building.
    sokoloff · 1790325955 · focus · HN ↗
    Great! I’ll take all the oceanfront/riverfront land in an area and all the land immediately adjacent to major metro stops, please.
    This highly local variation in land value does not seem to be adequately addressed n the California link above either (other than “The estimation runs at the level of each property category within each California county or census tract, using parcel-level data”, which does not seem fine-grained enough to cover waterfront property).
    Surely the land value overlooking La Jolla or Malibu is worth far more than the lots just one block back. And those lots are likely to have more expensive improvements on them in any taxation system, but at least in a property taxation system there is a direct market reference to come back to rather than just an assessor’s judgment.
    How much is the dirt at 28824 Cliffside Dr, Malibu worth? $5M? $25M? $50M? $75M? What does the census-tract level estimate come up with? How does that compare to 28867 Cliffside with an ever-so slightly larger lot, both in Census tract 8004.12?
5. skew-aberration · 1790289001 · focus · HN ↗
  Economists for generations have agreed a land value tax is the least prone to this problem. You might want to take it up with Adam Smith.
cuzezzzbbfofai · 1790286605 · focus · HN ↗
I hope we agree that we need more taxes, it doesn't matter if they are taxes on billionaires, taxes on property, taxes on sales, taxes on crypto, or taxes on the poor. Without taxes we can't have a civilized society.
1. vondur · 1790286835 · focus · HN ↗
  No thanks, I pay too much in taxes as it is. California has a spending problem, not a revenue problem.
  1. jimt1234 · 1790287112 · focus · HN ↗
    Spending problem? What spending problem?
    <a href="https://www.smartcitiesdive.com/news/california-high-speed-rail-oig-spending/831110/" rel="nofollow">https://www.smartcitiesdive.com/news/california-high-speed-r...
2. pbh101 · 1790286857 · focus · HN ↗
  Taxes aren’t 0 right now, nor particularly close for anyone being taxed. Your statement supports taxes as a concept at all, but what’s the specific argument that they must be more than they are today?
3. nickff · 1790286863 · focus · HN ↗
  The number of different taxes is constantly increasing, obfuscating the total tax burden, and making democratic accountability almost impossible. Additionally, tax collections are already at a historical high, while government deficits world-wide are also at record levels, with services on the decline, and no realistic prospect of balancing budgets. This is true for most western countries.
  Given the current situation, I do not agree that "we need more taxes", but would welcome your clarifying exactly what you mean.
4. aeternum · 1790287150 · focus · HN ↗
  For a long time I agreed with you, but seeing how the tax money is spent I cannot agree any longer. In most cases government is no longer even spending the money itself, instead it is giving the money to NGOs.
  I would much rather see people keep more of their dollars and use them to 'vote' for the products and services that benefit them most, via their purchases.
  1. FridayoLeary · 1790287423 · focus · HN ↗
    Congragulations you have just rediscovered conservatism.
    kennyadam · 1790288317 · focus · HN ↗
    …and how to never have any large infrastructure projects like highways or just services that run at a loss while being essential like the EPA
    aeternum · 1790290185 · focus · HN ↗
    It would be interesting to run the counter-factual on the EPA. Lawsuits around pollution were already increasing significantly prior to the EPA even company vs. company.
    Would the resources have been better spent on a more efficient legal system, then leverage that?
    Terr_ · 1790288391 · focus · HN ↗
    [delayed]
  2. ks2048 · 1790289453 · focus · HN ↗
    How much of California's budget is "giving the money to NGOs"?
  3. chasd00 · 1790289656 · focus · HN ↗
    I’ve long thought if you doubled tax revenue or halved it the public services rendered would be the same. Tax revenue is not the problem.
5. heathrow83829 · 1790287155 · focus · HN ↗
  this is the sadest assertion i've ever seen. if sucking the life out of people is the only way people can remain civilized then we are truely lost.
  1. jonah · 1790287595 · focus · HN ↗
    How else are we going to support public infrastructure and society?
    AdrianB1 · 1790289213 · focus · HN ↗
    More efficiency in spending? We have newer tools and equipment, technology, automation etc. Do more with less, that is called productivity.
    grebc · 1790290338 · focus · HN ↗
    You don’t understand the natural order of things: productivity for you(the worker constantly told to do more), not for me(governments of all sizes, middle & execs, dumb owners).
    kelnos · 1790298077 · focus · HN ↗
    [delayed]
6. omgwtfbyobbq · 1790287351 · focus · HN ↗
  I think we should start with changing taxes on corporations/companies, specifically being able to indefinitely write off expenses against income regardless of size/etc...
  Most companies take profit eventually, but if it's possible for a company to decide to never take profit and grow/acquire perpetually without paying any taxes on gross income, that's a problem.
  That'd be like individuals being able to deduct living expenses and having uncapped pre-tax 401k contributions.
7. opinion-is-bad · 1790287849 · focus · HN ↗
  The ratio of the economy that gets collected as taxes has only gone up over time. Do you have an idea for how much should be collected as some ideal ratio? At what point do the effects of taxation become counterproductive?
  1. sunshowers · 1790288770 · focus · HN ↗
    Well, the general economist consensus is that the revenue-maximizing peak of the Laffer curve is around 65-70% [1]. Revenue maximization isn't necessarily the right primary goal, though.
    [1] <a href="https://en.wikipedia.org/wiki/Laffer_curve#Income_tax_rate_at_which_revenue_is_maximized" rel="nofollow">https://en.wikipedia.org/wiki/Laffer_curve#Income_tax_rate_a...
  2. sunshowers · 1790288836 · focus · HN ↗
    Well, the general economic consensus is that for income taxes, the revenue-maximizing peak of the Laffer curve is around 65-70% [1]. Revenue maximization isn't necessarily the right primary goal, though.
    [1] <a href="https://en.wikipedia.org/wiki/Laffer_curve#Income_tax_rate_at_which_revenue_is_maximized" rel="nofollow">https://en.wikipedia.org/wiki/Laffer_curve#Income_tax_rate_a...
  3. stouset · 1790290636 · focus · HN ↗
    Same back at you. Clearly you think they’re too high. So what is the correct ratio?
    The straightforward answer is there is no correct ratio. The best tax regime is the one that allows for sufficient funding of necessary and desired services while also balancing wealth creation with wealth inequality. That number isn’t fixed and it’s clear that it shouldn’t be evenly borne by the population as a whole.
    opinion-is-bad · 1790295852 · focus · HN ↗
    I made no such claim. I simply asked someone who said that we can all agree taxes must go up to what level they were referring to and how they chose the number. If there is no fixed ratio such as you say, then their claim is clearly false.
    stouset · 1790307902 · focus · HN ↗
    Sorry, but this is bullshit.
8. fhn · 1790289708 · focus · HN ↗
  haha. did you say taxes on the poor? I'd like to see you implement that.
9. kelnos · 1790298005 · focus · HN ↗
  [delayed]
Ancalagon · 1790286740 · focus · HN ↗
[flagged]
1. everybodyknows · 1790287113 · focus · HN ↗
  [delayed]
2. palmotea · 1790287313 · focus · HN ↗
  > News at 9.
  The idiom is "film at 11."
3. 999900000999 · 1790287624 · focus · HN ↗
  And it will never be repealed.
  Old voters like the house they brought 20 years ago for 100k being worth 1.5 million today. They also like not paying taxes on that 1.4m in wealth accumulation.
  1. Ancalagon · 1790287682 · focus · HN ↗
    I mean, I do too. Mine just happens to have been bought before the last inflationary cycle.
  2. pc86 · 1790287700 · focus · HN ↗
    I think not wanting to pay some yearly tax on that $1.4 million because the government pretends that the same as having $1.4M cash in the bank, or making $1.4M in a year, is fine.
    Not wanting to pay the property taxes associated with a $1.5M home is the problem.
    tikhonj · 1790287983 · focus · HN ↗
    Which is why we also have things like a deferred property tax program! The way to "solve" the problems Prop 13 addresses would be to expand programs like that, but homeowners—disproportionately active middle- and upper-middle-class voters—want to have their cake and eat it too.
    999900000999 · 1790296331 · focus · HN ↗
    It wildly distorts the entire real estate market. Cool your home is worth 1.5 million. Your kids will never ever afford a home.
    Without prop 13 that house would probably only be worth 600k. What difference does it make if it functions as a home.
    Too late to fix it now.
  3. gehsty · 1790287934 · focus · HN ↗
    Is it not that the gains are unrealized? If they sold the house they would pay capital gains tax?
    Guvante · 1790288059 · focus · HN ↗
    Property taxes are unrelated to income tax
    fhn · 1790289542 · focus · HN ↗
    I'm not a finance person but I think capital gains kicks in if you sell early. Otherwise, just regular taxes?
    Ancalagon · 1790290186 · focus · HN ↗
    opposite, income taxes take place first. after a waiting period, its just capital gains. capital gains taxes are typically lower than income taxes so this encourage long term holding
    binlog · 1790296466 · focus · HN ↗
    They aren't going to sell it, they'll pass it to their children and the cost basis will reset. Their children will then sell it and pay zero tax.
    gehsty · 1790326412 · focus · HN ↗
    Then it would be taxed under inheritance tax (at the full value of the property - not just the gains)
  4. fhn · 1790289460 · focus · HN ↗
    what reasonable persons wants to pay taxes? Just because you like to pay extra doesn't me we should.
4. guyzero · 1790288891 · focus · HN ↗
  But let's be clear: Prop 13 is bad and is holding down property taxes on both commercial and residential land.
5. roughly · 1790288927 · focus · HN ↗
  Whats wild is the commercial side didn’t get closed. I understand the argument for individuals or households (I don’t love it - I’m on the wrong side of it, but at least it’s somewhat defensible), but if you’re running a business and your income isn’t keeping up with inflation, that’s called failing.
6. yonran · 1790290329 · focus · HN ↗
  If the SEIU healthcare workers union is going to amend the state constitution, they should chip away at Proposition 13 instead of amending the constitution to make a bad tax that encourages capital flight.
7. mullingitover · 1790293242 · focus · HN ↗
  It drives me crazy that California voters will wave through every single regressive sales tax hike that is placed in front of them, yet they will crawl through broken glass to vote against a property tax hike on corporations.
8. tomhow · 1790302144 · focus · HN ↗
  Please don't post snarky dismissals like this on HN. The guidelines make it clear we're trying for something better here. <a href="https://news.ycombinator.com/newsguidelines.html">https://news.ycombinator.com/newsguidelines.html
  1. Ancalagon · 1790368071 · focus · HN ↗
    Mate have you seen how much slop makes it to the front page?
    tomhow · 1790400628 · focus · HN ↗
    Acting like a jerk is not the best way to deal with bad content. Our software autokills generated comments and dowmweight slop posts multiple times daily. We can only do that when we know about it. Maybe the way to deal with junk content is not to create more kunk content? You can just email us.
binlog · 1790286946 · focus · HN ↗
Wealth taxes are a symptom of a broken tax system. If you let someone get to hundreds of billions in net worth and then realize they haven’t been appropriately paying back into the system, it’s already too late. Like the article says they can simply say “no” in a variety of ways, from fighting in court to simply leaving.
1. palmotea · 1790287152 · focus · HN ↗
  If you let someone get to hundreds of billions in net worth and then realize they haven’t been appropriately paying back into the system, it’s already too late. Like the article says they can simply say “no” in a variety of ways, from fighting in court to simply leaving.
  It's only too late if you're timid and wimpy.
  1. pc86 · 1790287632 · focus · HN ↗
    And care about the rule of law. You cannot pass retroactive laws, you cannot pass laws that target individual people. If you pass a general law (which could very well have reasonable objections), people have to have a chance to leave.
    "I'm passing this law that is effective the exact millisecond I sign it, tough shit if you don't like it" is tyranny and despotism. But based on your comment I think you know that.
    palmotea · 1790287989 · focus · HN ↗
    > And care about the rule of law. You cannot pass retroactive laws, you cannot pass laws that target individual people. If you pass a general law...
    A wealth tax is not a retroactive law, nor something that targets an individual person. It's a "general law" in your parlance. Think about it.
    > If you pass a general law (which could very well have reasonable objections), people have to have a chance to leave.
    I don't think so. By what legal authority is that required?
    > "I'm passing this law that is effective the exact millisecond I sign it, tough shit if you don't like it" is tyranny and despotism. But based on your comment I think you know that.
    No, it's not, and don't be ridiculous. When they passed laws against date-rape, would you have judged it "tyranny and despotism" unless the law was delayed to give the date-rapers time to finish up the date-rapes they'd planned?
    There's no justice in giving the wealthy the maximum opportunity to pick and choose the laws that apply to them.
    silver_silver · 1790290218 · focus · HN ↗
    The richest people in the world sure are lucky to have good people like you out here fighting to protect their rights
    pc86 · 1790301167 · focus · HN ↗
    What hyperbolic nonsense, just because something doesn't affect me doesn't mean it can't be bad policy. Wealth taxes are a fool's errand and serve only to damage and slow the economy.
    8note · 1790308855 · focus · HN ↗
    a lack of wealth tax is slowing the economy today.
    ultrawealthy people just cant spend as much or give useful market signals the way the masses can
    its hyperbolic to say laws that are active when passed are despotism
    dasil003 · 1790294478 · focus · HN ↗
    ah yes, all the tech billionaires of this era, had they been given the heads up that there success would have led to a level of concentration of wealth and power previously unknown to humanity, and that the populace would likely call for some changes to tax law to address the largely unforeseeable structural economic effects of this level of change they brought, would certainly have opted out, leaving the US, and moving to another less tyrannical part of the world, where, by the unique magnitude of their genius, they would have brought all their great works to the glory of other nations and not to America with its overly entitled peasants and social media sharecroppers; clearly the rule of law in Europe and China would have allowed them to fully manifest their unparalleled vision of technological greatness without any concern of a rug-pull by authorities challenging their well-deserved hegemony
    lkjdsklf · 1790310831 · focus · HN ↗
    > people have to have a chance to leave.
    They did give people that chance.. That's kind of what the entire article is about. They literally did leave.
  2. cobbzilla · 1790287747 · focus · HN ↗
    the FTB is anything but timid and wimpy
    if the voters and legislature have the “bravery” to pass the wealth tax law, it will be aggressively enforced by the FTB
    the second-order effects, whatever they may be, would be clearly visible within a couple years.
  3. xadhominemx · 1790287764 · focus · HN ↗
    Or if people can easily move. Or if you want the next generation of startups to operate in your state.
2. rayiner · 1790287376 · focus · HN ↗
  This fundamentally misunderstands how this paper wealth actually works.
3. philipallstar · 1790287724 · focus · HN ↗
  > If you let someone get to hundreds of billions in net worth and then realize they haven’t been appropriately paying back into the system
  This is to once again mistake net worth for money. Net worth is not real. It is not a good measure of the money someone may be able to realise. They do not have hundreds of billions. There is nothing to tax until they sell some shares.
  1. ceejayoz · 1790287953 · focus · HN ↗
    > Net worth is not real.
    Good way to find out it this is the case: take it away. Not real, right? Why would they mind?
    AdrianB1 · 1790288570 · focus · HN ↗
    There is no way to take anything like that. Net worth is quite similar with me saying you are worth 1 billion dollars, but you have zero money in the bank. What do you take, super-rich billionaire person?
    Avicebron · 1790288765 · focus · HN ↗
    You take control of the shares and distribute the proceeds and make it impossible to leverage them for loans, credit etc.
    Is it Zuck's networth or salary that makes it possible for him to own his ranch in Hawaii?
    wongarsu · 1790289216 · focus · HN ↗
    The net worth is simply the sum of assets minus the sum of liabilities. Take away the assets and you take away the net worth. I can't think of an asset category that you can't transfer if you are willing to sacrifice its value (which presumably doesn't matter, because it's not real anyways)
    delecti · 1790290259 · focus · HN ↗
    Why not? Net worth is the estimated sell value of a list of assets. It is entirely possible to take those assets, or charge a tax based on that estimated sell value. Why would it even be a little difficult, let alone impossible?
    And certainly ceejayoz was being a bit glib by suggesting we take all of it, but it would not be remotely insurmountable to tax billionaire wealth.
    AdrianB1 · 1790426502 · focus · HN ↗
    Net worth is the estimated value, not sell value. For example, Tesla shares owned by Elon don't have the same value if Elon is leaving, they are less worthy.
    ceejayoz · 1790438950 · focus · HN ↗
    > For example, Tesla shares owned by Elon don't have the same value if Elon is leaving, they are less worthy.
    This is, ironically, more of a guess/estimate than determining Musk's net worth is. We don't actually know that!
    8note · 1790307394 · focus · HN ↗
    which thing of mine are you saying is worth a billion dollars? the lawnmower? take that then?
    whats the complication? if its not worth anything whos gonna worry, especially if the government then compensates you in dollars
    AdrianB1 · 1790426393 · focus · HN ↗
    Your 1 billion dollar dog that will die 2 days after someone takes it from you. Tax that, please.
    xienze · 1790288857 · focus · HN ↗
    Because that would involve seizing assets? The parent meant it's not "real" in the simple-minded sense that people think it is: the average person imagines Elon Musk and other billionaires have a checking account that keeps increasing by tens of thousands of dollars per second because that's the only frame of reference they have. The reality is the wealth is mostly tied up in assets that ain't exactly liquid. Yes yes, they apparently have access to this supposed infinite money glitch where banks will endlessly loan them money without requiring interest payments (which would require liquidating assets for payment and therefore triggering a taxable event, the very thing people think never happens for billionaires). But the fact of the matter is the wealth isn't money in a bank, and therefore not "real" in the sense the parent was referring to. But it is at the same time something they would miss if it was just "taken away", much the same way you'd miss the numbers in your 401k if voters decided you had a few too many millions saved up for retirement.
    ceejayoz · 1790289962 · focus · HN ↗
    > Because that would involve seizing assets?
    Oh, are those real now?
    philipallstar · 1790338517 · focus · HN ↗
    Assets are real, but not the valuation of them. This sort of basic error, which seems to only appear on the "tax net worth" side, is good evidence that this is not a reasoned position, and thus you will not be reasoned out of it.
    ceejayoz · 1790349998 · focus · HN ↗
    > Assets are real, but not the valuation of them.
    Valuing assets is a routine, widespread thing.
    You can't just handwave away the fact that the real world exists.
    philipallstar · 1790366528 · focus · HN ↗
    Not when it comes to share prices. Share prices change all the time. Why would they if we could value them perfectly? Just think about it a little.
    ceejayoz · 1790367036 · focus · HN ↗
    What asset's value doesn't change?
    A painting can be valued. A vintage car can be valued. A movie script can be valued. Each is an asset; each may see its value change dramatically over time. But you can still estimate its worth.
    8note · 1790307614 · focus · HN ↗
    the government seizes dollars in the form of taxes, which are still assets, no?
    these other assets like musk's stocks are still quite divisible, and theyre as liquid as the government wants them to be. just because musk hasnt written the liquidity into his government sponsored contracts doesnt mean the government cant say yes, 10% of your private spaceX stock is liquid and belongs to donald trump now
    its real and thus it is taxable
    philipallstar · 1790340248 · focus · HN ↗
    No, dollars are not assets.
    philipallstar · 1790338419 · focus · HN ↗
    > Good way to find out it this is the case: take it away. Not real, right? Why would they mind?
    Take what away? I'm saying if I own 51% of Tesla, you cannot tell what amount of money that amounts to until I sell it.
    ceejayoz · 1790350785 · focus · HN ↗
    <a href="https://www.google.com/search?q=%24TSLA" rel="nofollow">https://www.google.com/search?q=%24TSLA
    C'mon, man.
    throwawayfifo · 1790434416 · focus · HN ↗
    >We know Musk's net worth
    No we don't.
    >It's public knowledge!
    No it's not. We estimate his net worth based on public filings. We know next to nothing about his nonpublic holdings.
    ceejayoz · 1790438834 · focus · HN ↗
    It has its own Wikipedia article.
    <a href="https://en.wikipedia.org/wiki/Wealth_of_Elon_Musk" rel="nofollow">https://en.wikipedia.org/wiki/Wealth_of_Elon_Musk
    That the estimates vary a bit on the edges doesn't mean they've no value. It was public knowledge when his net worth confirmably hit a trillion dollars in share holdings.
    throwawayfifo · 1790440581 · focus · HN ↗
    [dead]
    throwawayfifo · 1790440705 · focus · HN ↗
    From your own linked source: "with an estimated net worth of US$942 billion."
    "with an estimated"
    You made my point for me, thank you.
    >That the estimates vary a bit on the edges
    We don't know that. It could vary widely, intra-day even.
    >doesn't mean they've no value.
    I did not make this claim.
    >It was public knowledge when his net worth confirmably hit a trillion dollars in share holdings.
    It was "public knowledge" when his estimated net worth hit a trillion.
    ceejayoz · 1790445012 · focus · HN ↗
    > You made my point for me, thank you.
    If your point is "we can't tax people because estimates aren't perfect", sure. But it's a silly point. We already tax people off estimates - if you own a house, your property taxes are assessed in exactly this fashion - an estimate of its value.
    > It was "public knowledge" when his estimated net worth hit a trillion.
    No. It was public knowledge when his known numbers of shares in his publicly traded companies reached a known price point.
    throwawayfifo · 1790450066 · focus · HN ↗
    >If your point
    Don't try to deflect or move the goalposts. My point is you stated "we know Musk's net worth" when we don't. This is a false claim.
    >No
    Yes.
    >It was public knowledge when his known numbers of shares in his publicly traded companies reached a known price point.
    A valuation of his publically known stakes at a specific point in time, not his net worth.
  2. pj_mukh · 1790287962 · focus · HN ↗
    I dont know why it's so complicated to just say "Money is Money when it's Liquid, tax it then". Any loans on wealth should be taxed..nationwide.
    But even in California's case this doesn't feel like anything anybody would object to. Given how much California Billionaires extract on their wealth, I bet, they could do a middle class tax cut too to offset it a little bit too.
    I am little baffled as to why the politicos haven't latched on to this whole-heartedly. You can still proudly say you're taxing Billionaire wealth. Because you are! Just more sensibly.
    8note · 1790307162 · focus · HN ↗
    You will find that the centi-billionaires will find a different way to turn their illiquid wealth into personal power and value in a way that avoids that tax.
  3. no_multitudes · 1790288224 · focus · HN ↗
    Simply let them pay the tax with shares. Problem solved!
    edoceo · 1790288510 · focus · HN ↗
    Well one thing is, they'd sell shares to pay the taxes. Then dilute their own ownership of the thing (Tesla, Amazon) and it would serve as another form of wealth distribution.
    altruios · 1790290619 · focus · HN ↗
    Charitably speaking: I suspect the commenter above you was indicating that the government should have a stock portfolio you can transfer stocks to to pay taxes in a non-taxable event type scenerio.
    edoceo · 1790291293 · focus · HN ↗
    If you're taxing wealth (and not income) then switching stocks into cash doesn't change the wealth. Then use the cash to pay the taxes which reduces the wealth.
    Leherenn · 1790315981 · focus · HN ↗
    I believe the argument was that for some people, switching stocks into cash actually do change the wealth, because they own such a large % they are meaningfully moving the market by selling (the "paper money" argument).
    And the answer to that was "if you're so afraid that selling will tank the value of the stock, then we [the government] will happily take your taxes as stocks directly, and we take on the risk that selling it will reduce its value".
    philipallstar · 1790366586 · focus · HN ↗
    > And the answer to that was "if you're so afraid that selling will tank the value of the stock, then we [the government] will happily take your taxes as stocks directly, and we take on the risk that selling it will reduce its value".
    Yes indeed. It's basically saying "don't bother starting everything because the government will gradually just own it all anyway".
    drdec · 1790374429 · focus · HN ↗
    I look forward to buying the dip every April 15th
    8note · 1790307655 · focus · HN ↗
    which is also part of the idea of wealth taxes? to diffuse wealth?
    edoceo · 1790312484 · focus · HN ↗
    Yes.
  4. slg · 1790288251 · focus · HN ↗
    It's strange that people always make this argument for wealth taxes, but you rarely hear it about property taxes. If "net worth is not real" neither is equity in real estate.
    colordrops · 1790288482 · focus · HN ↗
    It's like saying cash isn't real until you spend it. Which is true in one sense but not what they mean.
    fhdkweig · 1790288566 · focus · HN ↗
    The only reason it works with real estate is because they can put a lien on the house and block the sale of it. They don't have any useful mechanism to stop the sale of a share of stock, but since the government is involved in the transfer (due to the registering of the new house deed) of a house, they can stop that one.
    minraws · 1790288765 · focus · HN ↗
    Why can't govt block the sale of stocks? It's not like you would be selling non digitalized assets, govts often freeze and reverse stock sales/trades when they find it to be illegal already.
    It's harder for private companies sure, but who will stand in the way of govts if they said we will sanction your if you buy X or Y company?
    This entire argument doesn't really hold IMHO
    zbentley · 1790288838 · focus · HN ↗
    > They don't have any useful mechanism to stop the sale of a share of stock
    The SEC exists. As do many other mechanisms by which the government regulates direct and brokered securities trades and sales. You can make the case that some of those controls are poorly/ineffectively implemented, but you can’t claim that it’s not something the government routinely regulates, intervenes in, and sometimes prohibits outright.
    fhdkweig · 1790290959 · focus · HN ↗
    Society has deemed it "ok" for a real estate transaction to take days or weeks to process and mountains of paperwork, probably because it is done so rarely in an average person's life. But stock trades are expected to be done quickly in minutes or even milliseconds with high frequency trading. It just isn't feasible to inject government paperwork in the middle of a transaction. Wall Street would revolt if they even tried.
    ceejayoz · 1790291365 · focus · HN ↗
    Nah. Look up the SEC’s reporting requirements, specifically form 4.
    <a href="https://www.sec.gov/files/forms-3-4-5.pdf" rel="nofollow">https://www.sec.gov/files/forms-3-4-5.pdf
    8note · 1790306393 · focus · HN ↗
    its perfectly feasible.
    high frequency traders dont have a right to a business model.
    if they want faster trades, they can take full liability for what they own
    BurningFrog · 1790289521 · focus · HN ↗
    The main reason real estate taxes work so well is that tax evasion is very difficult.
    Because the building is standing right where it is, in the open, lit by the sun every day. If you don't pay your tax, the government can just take it.
    This compensates for the several philosophical and moral problems with it, and I've seen several economists declare it the best form of taxation there is.
    porkshoe · 1790290162 · focus · HN ↗
    Exactly... that's why sales tax and VAT don't exist anywhere -- because there's no way to stop the purchase of goods or services.
    dwedge · 1790290652 · focus · HN ↗
    This type of low-hanging sarcastic rebuttal doesn't belong here
    porkshoe · 1790305960 · focus · HN ↗
    This type of pedantic tone-policing doesn't belong here.
    porkshoe · 1790349462 · focus · HN ↗
    My comment provided a clear and succinct rebuttal to a flawed argument.
    Your comment added literally no value, except to be a whiny prescriptivist and to establish that you think you're the center of the universe.
    I have no respect for people who hold themselves to lower standards than they hold others. Your father failed at his most important job. He raised a pathetic fucking asshole.
    x3n0ph3n3 · 1790288677 · focus · HN ↗
    If I sell my house, there's a reasonable expected range of money I can expect for it.
    If a majority stock holder in a company sells all of their stock, the price first the first share sold is likely going to be completely different than the last share sold.
    slg · 1790290388 · focus · HN ↗
    "It's difficult to accurately value" isn't an argument against taxing net worth. It's like the old (likely apocryphal) Winston Churchill joke, "We already established what type of woman you are, now we are just haggling over price". Just take whatever the proposal is, cut in half, quarter, or whatever fraction you want and you no longer have an argument against it.
    Personally my favorite idea for this stuff that I have heard thrown around is to allow people to self value everything. However, that self valuation then becomes a price tag. Let a billionaire's accountants put their own evaluation on their equity in a business. But that becomes a binding offer and some other billionaire could come along and buy them out at that valuation. That creates pricing pressure in both directions, the person is prevented from underpricing their assets due to the threat of another buyer coming in and a person is prevented from overpricing because it increases their taxes. And suddenly all the problems regarding how the government appraises these things disappears.
    jandrewrogers · 1790292671 · focus · HN ↗
    Forcing people to write a call option on their property without an offsetting risk premium only sounds like a good idea if you neither understand the implications nor the math. Asset values would collapse because risk would go to the moon.
    And that ignores that it trivially enables large-scale exploitation and looting by construction.
    slg · 1790294607 · focus · HN ↗
    >without an offsetting risk premium
    Once again, this is simply haggling over price. Name the premium you think is justified and add that into the law.
    jandrewrogers · 1790312305 · focus · HN ↗
    The market determines the risk, not the asset owner. The owner has no special knowledge of what the risk actually is separate from the market pricing it. You explicitly want them to accurately price it outside of a market, which is effectively impossible, ignoring that the price is highly fluid and dynamic.
    If the owner is required to invent a fake risk premium then it virtually guarantees that the risk will be mis-priced. Forced rampant mis-pricing is an exploitable arbitrage opportunity of epic proportions. Every quant worth a damn will make a fortune looting this. No serious policy can ignore this defect. It has the additional political downside that no one can ever own anything anymore in a meaningful way, which won’t be popular.
    No one takes this idea seriously because anyone with a modicum of finance math background can see that the math doesn’t math. Political ideology doesn’t even figure into it.
    slg · 1790351576 · focus · HN ↗
    I'm getting the impression you didn't get my "haggling over price" reference. This conversation is in the context of a wealth tax which typically only applies to a very select group of incredibly wealthy people. However, your complaints are all about the scale of the economic problems this would create. That means we can continue to add restrictions to this proposal until eventually all the issues you raised disappear.
    For example, imagine we only apply this to people with a net worth over $500B. That's literally only Elon Musk. He has plenty of money to hire his own team of quants to price his assets. We can even be generous with this law and make the purchase price double the valuation. Hell, we can even restrict it to only apply to stock of publicly traded companies so the wealth valuations are highly informed by market pricing. We can just keep adding rules like this until you're out of economic reasons for why a wealth tax and/or this form of valuation can't work. At that point the debate is lost and "we're just haggling over price" because once we apply it to Musk, how can you argue against applying it to Bezos...
    kerenskiy · 1790299670 · focus · HN ↗
    I don't get it. What if the person doesn't want to sell at all? Self-value at +inf and pay 1% of that?
    slg · 1790302566 · focus · HN ↗
    Society has already decided that we can compel people to sell their private property for fair compensation via eminent domain. Plus getting the assets in the hands of people who value them more certainly creates utility and presumably increases the tax base via further development.
    This type of forced sale happens all the time with public companies. For example, only like 60% of Twitter shareholders approved the sale to Musk, but the other 40% were forced to go along with it regardless of their preference. If Musk can do that to other people, why should some hypothetically richer person not be able to do it to Musk?
    And to repeat myself for a third time, we don't need to haggle over price. If we only want this to apply to billionaires, assets worth $50 millions, or whatever, that's fine. If one of the people impacted truly doesn't want to sell, let them set the price as high as make them feels safe. I'm not going to lose any sleep over taxing the emotional desires of billionaires.
    philipallstar · 1790325105 · focus · HN ↗
    > For example, only like 60% of Twitter shareholders approved the sale to Musk, but the other 40% were forced to go along with it regardless of their preference
    They signed up to that, though. Tagalonpg/dragalong rights are priced into the share price. That's not the same thing.
    slg · 1790351770 · focus · HN ↗
    I always enjoy when someone takes a quote out of context to refute something I said when the context it was said in completely answers them. Like why didn't you include the sentence before that bit you quoted? Is it because me saying "this type of sale" shows that I was saying they are similar rather than identical? Or why didn't you include my first paragraph? Is it because eminent domain is also priced into everything a billionaire owns?
    ndriscoll · 1790289504 · focus · HN ↗
    People absolutely make that argument about property taxes. That's where deferrals or abatements for e.g. elderly or low-income homeowners, or caps on property tax increases come from. Someone may own a home that property taxes price them out of, forcing them to leave their community because they can't actually conjure money from a higher priced home.
    I think a lot of tax authorities also don't really aggressively reassess that regularly without a sale, so it also kind of ends up baked in that if you didn't pay that much for the property, it's only theoretically worth that much.
    lelandfe · 1790289931 · focus · HN ↗
    Predatory property taxes were a part of how so many black American farmers lost their land: <a href="https://archive.is/exkhR" rel="nofollow">https://archive.is/exkhR
    cucumber3732842 · 1790296819 · focus · HN ↗
    Their fault for not developing it to it's highest and best use so they could afford to pay the taxes /s
    slg · 1790290455 · focus · HN ↗
    This is all conceding the argument already. Many of us would happily accept these sorts of limitations on a wealth tax if it means there is a wealth tax.
    philipallstar · 1790290113 · focus · HN ↗
    > It's strange that people always make this argument for wealth taxes, but you rarely hear it about property taxes.
    I don't like property taxes either, and at minimum would rather they were called something else, and preferably replaced with per-service charges where possible.
    But either way they exist to pay for things, and not to just degrade the value of your property simply because you worked to own it.
    jandrewrogers · 1790291719 · focus · HN ↗
    Property taxes are use taxes, not wealth taxes. Apples and oranges.
    N_Lens · 1790297305 · focus · HN ↗
    I feel like there's think tanks thinking up talking points that sound reasonable to convince internet communities against taxing the wealthy.
    the_sleaze_ · 1790307793 · focus · HN ↗
    It's interesting to see the level of discourse change across time as these same points are brought up again and again.
    It seems there are many many more people heavily invested in preventing land tax all of a sudden and are very informed whereas when that guy made a land tax visualizer a few months ago... crickets.
    <a href="https://news.ycombinator.com/item?id=45425770">https://news.ycombinator.com/item?id=45425770
    > but I struggle to even conceptualize what land value means
    One of the first comments. Now there are dozens of people who are suddenly well versed in "georgeism"?
    N_Lens · 1790323877 · focus · HN ↗
    Narrative control and algorithm driven propaganda is evident - Most people scrolling any kind of algorithmic feed would be shocked at the intimate detail the algorithm knows their mind, proclivities, aversions.
    Another evident thing is that people will start retreating from internet as this gets worse (With LLMs accelerating the trend).
    philipallstar · 1790322079 · focus · HN ↗
    It's the opposite. You've been drip-fed "billionaires cause all the problems" for a few years, and now, as you say, you feel all sorts of things about them, which can rationalise all sorts of bad ideas.
    N_Lens · 1790323671 · focus · HN ↗
    Wealth inequality is worse than any other time in human history. What the wealthy and powerful are funding is division, fascism, the far-right and immigrant hate, so that they don't have to pay more taxes. It's the same divide and rule playbook since forever.
    I disagree with you on what is being drip-fed. It's factual that deranged levels of wealth inequality are causing problems, even the billionaire wannabes on HN are starting to see that.
    philipallstar · 1790336414 · focus · HN ↗
    > Wealth inequality is worse than any other time in human history
    This is circular. Wealth inequality:
    1. Isn't real. It's a paper value that would not survive contact with reality.
    2. Doesn't matter. What matters is the absolute level of poverty and whether that's getting better. Someone in poverty in the UK today will still get healthcare, eyecare and dental care beyond the dreams of Henry VIII.
    3. Is genuinely a stupid measure. You could "fix" it by burning everyone's possessions until everyone has the same: nothing. Zero inequality, and yet somehow doesn't sound great.
    > What the wealthy and powerful are funding is division, fascism, the far-right and immigrant hate, so that they don't have to pay more taxes. It's the same divide and rule playbook since forever.
    This is just your media consumption showing.
    N_Lens · 1790339390 · focus · HN ↗
    Absolutely real when Musk can tilt elections in America and fund far right parties in other countries. Your whole “paper wealth” argument holds no weight.
    philipallstar · 1790363053 · focus · HN ↗
    He didn't have to tilt anything in America. The Democrats ran the worst platform in living memory for the 2024 election, and the sooner they stop blaming billionaires for everything and start looking at themselves to improve the sooner they will get back the popular vote.
    N_Lens · 1790386181 · focus · HN ↗
    Whether he had to or not makes no difference. He did, that’s what matters
    philipallstar · 1790422615 · focus · HN ↗
    So did many other people. Any popular podcast will do that. Any media organisation has editorial bias, either in story presentation or even in selection. I don't see why Elon Musk would be singled out there, other than he's an ex-Democrat, and thus like all the ex-Democrats is a target of constant negative mentioning in a lot of one side's media.
    polski-g · 1790350196 · focus · HN ↗
    > Wealth inequality is worse than any other time in human history
    And humans are wealthier than any time in history. They have access to robot slaves that can wash dishes and clothes for them. They can access fruits grown over 1000 miles away for 69c. They have potions that can cure cancer. They have the database of all human intelligence in their pocket, accessible from anywhere on the globe. They have individualized transportation that can travel over 2 miles a minute. They have super intelligent thinking machines for cents.
    Life has never been better for mankind.
    N_Lens · 1790384428 · focus · HN ↗
    A big proportion of Americans are struggling to make ends meet on a fulltime wage. Your argument might have had a smidge of credibility 15 years ago.
    N_Lens · 1790385745 · focus · HN ↗
    A big proportion of Americans are struggling to make ends meet on a fulltime wage. No amount of luxuries make up for a lack of necessities. Your argument might have had a smidge of credibility 15 years ago.
    philipallstar · 1790422767 · focus · HN ↗
    That's just the consequence of various other policies that a lot of them probably voted for (or didn't vote against hard enough). If you transform a country a certain way, promising more and more from the government for some people, then everyone else has to pay more. If you pay for it with ZIRP, then you're going to need to pay it back.
    The last thing you should do at that point is vote for more policies that will destroy economic activity in the name of "fairness". That's how you got here.
  5. mulmen · 1790288454 · focus · HN ↗
    [delayed]
  6. minraws · 1790288632 · focus · HN ↗
    Absolutely ridiculous statement, it's not an accurate measure but it's definitely a good measure of money.
    If you have 100B to your name even if it's post IPO stock in a possibly ponzi company that's your current wealth and you can easily convert a staggering portion of it into material realized wealth depending on several factors.
    If I use cash to buy 1B dollars in Microsoft shares today, am I not worth a Billion dollars...?
    The value may not be exactly convertible agreed so let's just force everyone to book all gains every year, and force sell a net percent of your share.
    Not 100B$ of share, but 2% of 100 Million units of stock that you own. Why does this not work?
    If I take 2% of your shares why can't it work the same way? I can then pick and sell it over the next year or two however I see fit, in case of govt they can slowly sell back this share to not affect the prices too much.
    I am baffled by the fact that we have a tractible quantity and people call it hard to use to measure money.
    Paintings, Jewels, etc. are what's truly the hard part of the wealth equation not the stocks, which is over 99% of what a wealthy billionaire owns.
    I am not even considering pro or against taxes on billions people make but it's ridiculous to say stocks aren't money? Then what is money really... Currency is also traded, it's value can also go up or down....
    8note · 1790307310 · focus · HN ↗
    even still, the government can propose a value, and if the owner thinks its worth less than that, the government can immediately confiscate the asset and pay that price as compensation.
    if the owner thinks its worth more than what the government proposes, they can pay tax on the higher amount.
    its still not that hard
    philipallstar · 1790341305 · focus · HN ↗
    > even still, the government can propose a value, and if the owner thinks its worth less than that, the government can immediately confiscate the asset and pay that price as compensation.
    This is utter madness. What will happen is businesses will move en masse to places with economic systems not overrun by those driven clinically insane by years of listening to their favourite pundit blame billionaires for everything.
    solatic · 1790321579 · focus · HN ↗
    > If I use cash to buy 1B dollars in Microsoft shares today, am I not worth a Billion dollars...?
    Who says that the price you paid per share was the actual market value of the shares? For example, let's say that you inherited 10 million options to purchase Microsoft stock at $1/share, and in so exercising the options (by writing a check for, say, $10 million to Microsoft), you then end up with 10 million shares, which on paper, with the current stock price close to $500/share, would be worth close to $5 billion. But could you actually get that much money from selling 10 million shares? Definitely not overnight - so many shares getting dumped on the market at once would materially affect the stock price. The $5 billion number is a hypothetical that depends on other people backing up the hypothetical numbers with their own money (i.e. buying at the hypothetical price) - it is not the same as "I have $5 billion in a bank account and could use that to go buy a yacht and buy political ads etc. with it"
    minraws · 1790328371 · focus · HN ↗
    But you don't need to be taxed in actual dollar value you can be taxed in percentage of your share ownership. It might not work with real estate but with stock this is trivial
    solatic · 1790358260 · focus · HN ↗
    > with stock this is trivial
    On the contrary - it's trivial for controlling shareholders to direct the company to issue more stock to them and thus dilute the shares that were taxed. What do you propose, that companies can no longer issue stock after some of the stock has been taxed?
    And what about non-divisible assets like real estate? There's nothing that prevents the government from forcing real estate to be held by LLCs instead of individuals, then shares in the LLC could slowly be taxed by the government. So what happens in 20 years when the government owns 50.1% of all the LLC shares that comprise the ownership of the $100 million Hollywood mansion? You're going to let a bureaucrat kick out the A-lister who lives there and put it up for auction? Attempt to sell it to someone who knows full well the same would happen to him?
    It's very, very hard to design a wealth tax that doesn't end up being an assault on private ownership in all forms.
    philipallstar · 1790338757 · focus · HN ↗
    > If I use cash to buy 1B dollars in Microsoft shares today, am I not worth a Billion dollars...?
    No. It will be higher.
    You will buy shares at a ramping price, starting with the lowest available (say, $500) and going up and up and up (to, say, $1200) until you've spent all your money, and have only shares.
    Let's call the number of shares X. You net worth will be the final share price multiplied by X - i.e. $1200 . x. That is going to be far higher than the amount of money you spent.
    That's why net worth is stupid to reason about.
  7. donmcronald · 1790288749 · focus · HN ↗
    I’d be willing to take some of the “not real” money.
  8. MisterKent · 1790288787 · focus · HN ↗
    I hate this argument.
    Would you rather have 1M dollars in cash or 10B in stock that you can't sell?
    m_arnold · 1790289163 · focus · HN ↗
    Depends -- can I use the 10B as collateral?
    philipallstar · 1790339772 · focus · HN ↗
    You can do it today. Start a company, issue ten billion and one shares to yourself and convince someone to buy one of them for a dollar.
  9. 14u2c · 1790289039 · focus · HN ↗
    You are ignoring the most common approach, borrow against the asset. In that case the sufficient assets turn into essentially unlimited untaxed cashflow. Especially with how the market has been lately, the gains erase any burden of the loan. Sounds like a broken tax system to me.
    pj_mukh · 1790289259 · focus · HN ↗
    So why isn't the suggestion to tax the loan instead of the asset?
    14u2c · 1790289852 · focus · HN ↗
    That may be a perfectly viable solution. Seems like an easier path to me, at least. But the point is that these assets are a lot more fungible than you imply.
    > It is not a good measure of the money someone may be able to realise.
    And as such, when you get in to the higher ranges, net worth is quite a good indicator.
    sokoloff · 1790332701 · focus · HN ↗
    [delayed]
    ndriscoll · 1790290791 · focus · HN ↗
    What evidence do you have that people borrow against assets as some tax avoidance strategy? What are the details of this brilliant, often repeated plan? In particular, where do you get interest rates that are low enough to make it worth it to avoid capital gains even with an asset that's grown 100x over its cost basis (and are you accounting for reinvestment of income like dividends that can't indefinitely defer taxes, creating regular tax lots with higher basis that you could sell first)? e.g. are they getting better interest than SOFR somewhere?
    14u2c · 1790298623 · focus · HN ↗
    The framing was slightly glib, and you're correct that current rates impacts the equation, but there has been real damage caused by how extremely attractive this strategy has been over the past decade. We sitting on an unprecedented peace time deficit due to a failure to properly tax an economy that has been massively prosperous during this same period. This strategy is small part of it, but it is a real part.
    ndriscoll · 1790305841 · focus · HN ↗
    It wasn't extremely attractive if you actually think it through. e.g. if rates are lower and you're willing to carry investments with leverage (that's the idea, right? Your investments will grow faster than interest?), why aren't you already leveraged up to your risk tolerance? I don't think there's actually a world where this plan works. It seems like this is a reddit meme for people who have never actually considered a securities loan.
    throwawayfifo · 1790295613 · focus · HN ↗
    >into essentially unlimited untaxed cashflow
    Loans must be paid back, and are cash flow neutral over the maturity. That's why loans are not counted as income.
    14u2c · 1790297084 · focus · HN ↗
    In theory, maybe, but in practice that is not what happened over the past decade(s). Instead our retirement funds are paying it back.
    When the market grows it makes the collateral worth more, which lets the borrower keep refinancing the debt instead of selling assets and realizing taxable gains. As long as the assets appreciate faster than the debt grows, the borrowing can effectively roll forward for decades. Eventually the estate pays the debt out of the assets themselves, but this is not necessarily out of taxable income earned during the person's lifetime. The US markets has seen exceptional genuine growth, but the trillions of 401(k), IRA, etc money flowing in to them over the last 40 years is no small consideration.
    And even so, you could say it all settles out in the end, but that ignores the fact that there have constant constant efforts (and successes) in eroding away the e̶s̶t̶a̶t̶e̶ ̶t̶a̶x̶ "death tax" during this same period.
    WalterBright · 1790367894 · focus · HN ↗
    Eventually, the loan gets paid back, one way or another. There's no escape from it.
    txhwind · 1790307535 · focus · HN ↗
    However, the bank is happy to extend the loan infinitely for people with enough assets. It's questionable that whether such loans are cash flow neutral.
    throwawayfifo · 1790525818 · focus · HN ↗
    >However, the bank is happy to extend the loan infinitely for people with enough assets.
    Long maturity products still have to be repaid. There are no "infinite" maturity loan products for retail customers.
    >It's questionable that whether such loans are cash flow neutral.
    There's zero question: loans are cash flow negative (for customers) with interest. Banks are not going to offer products that are not cash flow positive for the bank.
    WalterBright · 1790367816 · focus · HN ↗
    Don't overlook the fact that the borrower pays interest on the loan.
    > Especially with how the market has been lately, the gains erase any burden of the loan.
    And when the market goes down, you get a margin call and get wiped out.
  10. binlog · 1790289080 · focus · HN ↗
    Try this - go to a bank and say “I’d like to borrow money using my 401k/Roth IRA as collateral. If I fall behind in payments you can liquidate the entire thing, including penalties, and make yourself whole.”
    You’d think they’d jump over each other to lend money against such a stable, secure asset right?
    Except they’ll say “sorry, this isn’t allowed. IRS treats borrowing against an untaxed retirement account as an early withdrawal, even if the asset itself stays untouched.”
    Turns out the government fully understands the concepts of stocks, gains, unrealized net worth and more, and has laws on the books to make sure you are being taxed appropriately for them.
    Meanwhile billionaires have convinced you – through their machinery of media, influencers, politicians and more – that this exact same reasoning absolutely cannot be applied to their own wealth. Because it’s “paper money”. It doesn’t exist. There’s nothing to tax. Just cannot be done, or it’ll bend the laws of spacetime.
    pmalynin · 1790289359 · focus · HN ↗
    Incredibly terrible example because you are allowed to borrow money against a 401k, up to $50000 with no penalties as long as you pay yourself back at whatever schedule you have determined for yourself
    binlog · 1790292318 · focus · HN ↗
    Is Larry page borrowing “up to $50000”?
    pmalynin · 1790294361 · focus · HN ↗
    No but he’s also not borrowing against his 401k? You and I can also go and borrow against stocks held in regular accounts? <a href="https://us.etrade.com/bank/line-of-credit" rel="nofollow">https://us.etrade.com/bank/line-of-credit
    twoodfin · 1790294441 · focus · HN ↗
    Does Larry Page’s brokerage account pay no taxes on dividends like a 401(k)?
    AaronAPU · 1790295596 · focus · HN ↗
    Not true if you’re unemployed or self employed. Which reveals the distinction, you’re actually borrowing from your employer’s program not your 401k.
    ndriscoll · 1790290238 · focus · HN ↗
    Your 401k/Roth IRA (subtracting early withdrawal penalty) literally do count when considering qualifying income for a conventional mortgage. This is not a taxable event. It's just standard procedure for loans.
    burpingtree · 1790302473 · focus · HN ↗
    You misunderstood. The discussion was not about income qualifications for a loan but about collateral.
    nullc · 1790306122 · focus · HN ↗
    > Meanwhile billionaires have convinced you – through their machinery of media, influencers, politicians and more – that this exact same reasoning absolutely cannot be applied to their own wealth.
    Quite the opposite: Socialist politicans and their media lapdogs have dishonestly convinced you that wealthy people are escaping taxes en-masse by taking out loans and that this can only be stopped by eye watering wealth taxes. They frequently use a motte and bailey confusing unrealized gains (which certainly exist in huge amounts but are also significantly fiction) with tax escape via loans collateralized by securities.
    But it's not true: were there meaningful tax escape that way it could be addressed by establishing rules with conditions where taking a loan against securities can be treated as realizing gains (and adjusting cost basis accordingly). Doing so would be minimally disruptive and distorting and have relatively little legal complication (at least compared to wealth taxes!).
    But the reality is that the claimed tax escape isn't happening (at least not at any significant scale) particularly in the current interest rate environment, so a reasonable policy change to address it would be a no-op.
    ... and to grow and maintain their political standing they specifically need to push a NON-SOLUTION because they can't campaign on something that was simply done and solved, and to retain your (highly monetizable) attention they need to rile you up against an Enemy, and certainly never address the state's addiction to wasteful spending and buying votes with tax dollars as one half of the revenue vs expenses equation.
    8note · 1790307086 · focus · HN ↗
    wealth taxes solve the problem that the ultra-wealthy will find a way to make their income untaxable, and focusing on these loans is a red herring. its how theyre doing it now, but not how theyll do it an hour after you add this tax. That the ultra-wealthy propose this as the solution means theyve already planned the next work around.
    they dislike wealth taxes, which are an old roman concept predating socialism, because the wealth tax covers all the work arounds they can think of.
    it is a proper solution to the overall problem which is extreme wealth concentration.
    the obvious alternative is nationalization of all assets worth more than 100M.
    DOGE has pretty conclusively proved that the government has been incredibly efficient with spending and doesnt have an addiction to wasteful spending. instead the problem is wasteful monopolization and wealth concentration. society writ large has an addiction to giving a small cadre too much power and control, and they arent the government
    philipallstar · 1790337173 · focus · HN ↗
    Elon Musk paid $11bn in tax in 2021[0]. How much tax are you paying that you're looking at that and thinking the wealthy barely pay any tax?
    [0] <a href="https://factually.co/fact-checks/business/did-elon-pay-11b-in-2021-taxes-843789" rel="nofollow">https://factually.co/fact-checks/business/did-elon-pay-11b-i...
    zzrrt · 1790377595 · focus · HN ↗
    I can't tell if you're accusing the state of waste and bribes no matter who is at the helm. You did specifically call out socialists, but the anti-socialists aren't improving that situation either.
    > buying votes with tax dollars
    This was more convincing of an attack on "Socialist politicians" before Sept. 9, when Trump did it more openly than they ever have. I guess you could believe his claims it won't come from tax dollars. But if the government has $1 trillion lying around for this and chooses not to unconditionally lower taxes for everybody, is it any different?
    The head of the anti-socialist/anti-wasteful-spending party is spending billions on a more impressive Air Force One, golf days, family vacations, vanity renovations, DHS ads starring a POTUS wannabe, DOGE effectively paying people not to work, not to mention the wars.
    nullc · 1790380521 · focus · HN ↗
    Everyone is guilty of it, just generally in their own form-- partisan nonsense is largely a distraction to get people mad at the other team and not notice their allies also picking your pocket. Though sure there are some particular ways different parties divide us and pilfer, bad in their own way.
  11. jasonlotito · 1790289690 · focus · HN ↗
    Nah, just make them pay taxes when it's valued as collateral and it's over a certain amount. Anyone saying you can't do that is lying to you.
  12. jedmeyers · 1790289906 · focus · HN ↗
    Another thing with taxing unrealized gains is that no one in the government is willing to return any money if the unrealized losses happened.
  13. danny_codes · 1790290094 · focus · HN ↗
    That’s just a decision we made about what is taxable.
    Purely an accounting artifact. We can pass a wealth tax tomorrow and it’ll suddenly be taxable.
    Net worth is real money, and is usually a very accurate measure of what people can realize. There are a few outliers who own so much that they’d move the market if they sold it all. Selling 2% to cover taxes? Not going to move the market very much.
    sokoloff · 1790331959 · focus · HN ↗
    Article I, Section 9, Clause 4 of the U.S. Constitution would like a word (assuming you’re contemplating a federal wealth tax; states could do it, at the risk expressed in the headline of the article we’re discussing).
    danny_codes · 1790348198 · focus · HN ↗
    That’s a law my dude. We can change it at any time. We did already for the income tax (amendment 16).
    sokoloff · 1790349797 · focus · HN ↗
    [delayed]
    danny_codes · 1790357182 · focus · HN ↗
    OK I think you might be reading this a bit too literally. The dangers of online discourse.
    The point is that we can do it if we want to.
    sokoloff · 1790359630 · focus · HN ↗
    [delayed]
  14. folkrav · 1790290212 · focus · HN ↗
    The actual mistake is pretending like they can't leverage those shares to access fiat, for example securities-backed loans. The proceeds aren't taxable income, the bank gets its interest, and the latter is typically substantially cheaper than realizing the shares and paying capital gains tax. Meanwhile, they keep the assets, which on average continue appreciating.
    BugsJustFindMe · 1790293592 · focus · HN ↗
    The obvious correct solution is to tax securities-backed loans the same as selling the securities.
    dmix · 1790299857 · focus · HN ↗
    Security backed loans for what though? Personal spending? Building a factory to great jobs?
    BugsJustFindMe · 1790300094 · focus · HN ↗
    Capital gains for what though? Personal spending? Building a factory to great jobs?
    Income for what though? Personal spending? Building a factory to great jobs?
    Property for what though? Personal spending? Building a factory to great jobs?
    Inheritance for what though? Personal spending? Building a factory to great jobs?
    8note · 1790306596 · focus · HN ↗
    no more obvious than taxing against the whole value of the asset rather than just the loan.
    BugsJustFindMe · 1790317408 · focus · HN ↗
    I'm confused. You think it's better to tax the money you didn't get rather than the money you did get?
    polski-g · 1790350239 · focus · HN ↗
    Interest income is already taxed. You want to tax both sides? Why?
    charcircuit · 1790313653 · focus · HN ↗
    >security backed loans
    Which currently require interest payments of ~6-8% APR. Meaning that you need to be able to invest that money that is being borrowed back into the economy to hopefully get a return more than that. And if your investment fails you will have to realize a different investment. The interest being paid doesn't get hoarded either and is used to make other investments, pay employees, build products, etc.
    The idea that a bunch of people are just hoarding their money and not reinvesting it back into the system is flawed. Taxes actually have the opposite effect to contributing to the system. Taxes are like if someone was to come and start hoarding money under their mattress for himself and not contribute back to society.
    BugsJustFindMe · 1790317733 · focus · HN ↗
    It's only a loan on paper, not in reality. In practice the shares now belong to the other party and you've avoided capital gains tax by not "selling" the shares and income tax by only being "loaned" the money.
    charcircuit · 1790329009 · focus · HN ↗
    It's funny that their case study ignores how much wealth you lose from the interest on the loans. If you pay $140k of interest you can avoid $62k of taxes.
    I don't know what point you were trying to get across with your link, so I gave my general thoughts on the article.
    BugsJustFindMe · 1790348957 · focus · HN ↗
    If you look again you might notice that the difference in outcome between option 1 (sell shares) and option 2 (buy-borrow-die) is $600k after taxes. Note that the interest is substantially less than that.
    folkrav · 1790332504 · focus · HN ↗
    The idea is so flawed that wealth keeps concentrating in fewer and fewer hands. Poor billionaire sods.
    WalterBright · 1790366924 · focus · HN ↗
    Maybe we should tax your mortgage, too!
  15. blargey · 1790290705 · focus · HN ↗
    Yeah, it's all illiquid illusory non-wealth when they have to pay taxes, but when they want to buy a newspaper or social network they suddenly have 40 billion in hand.
    Forced liquidation hurts more than the sticker price, but with billionaire taxes, that's a feature, not a bug. They make the most sense as a check on concentrated power rather than a revenue driver.
    philipallstar · 1790338014 · focus · HN ↗
    > Yeah, it's all illiquid illusory non-wealth when they have to pay taxes, but when they want to buy a newspaper or social network they suddenly have 40 billion in hand.
    Yes, businesses are allowed to buy and sell things without being taxed on the sales. If you want to change that rule, you are going to change a giant number of things purely to get at the billionaires you've spent the last few years being trained to hate.
    > Forced liquidation hurts more than the sticker price, but with billionaire taxes, that's a feature, not a bug. They make the most sense as a check on concentrated power rather than a revenue driver.
    It's missing the planetwide jungle for the trees if you think giving politicians the ability to reach into ownership percentages of businesses and deciding how much they want to charge you for owning a business is a check on power.
  16. pydry · 1790291320 · focus · HN ↗
    >Net worth is not real.
    You wont mind if we tax it then will you?
    You do, of course.
    marginalia_nu · 1790292810 · focus · HN ↗
    If you have $2bn worth of the same listed stock and go sell half of those, now you have a net worth of $1400m because your gargantuan order drained the order depth, tanked the stock value and triggered a panicked selloff at the stock market which further drove down that stock's price.
    You can't take net worth away because it's just an estimate of what someone is worth. It may eventually be possible to turned into dollars and cents without losing too much in the process, but almost universally it can't immediately be exchanged in such a fashion.
    Even more so when we're talking shares in a company that is not yet public, e.g. a founder's shares. At that point the valuation is complete speculation, based on what the company may be worth in some hypothetical future IPO. There's no actual price discovery since there's no public trading of such shares.
    pydry · 1790293300 · focus · HN ↗
    you confused liquidity and wealth.
    illiquid wealth != unreal wealth.
    as I said, if it were unreal you wouldn't mind losing it.
    if it is illiquid, you clearly do.
    economic illiteracy is not the best foundation for arguing against taxing the wealthy. by pretending the wealth "doesnt really exist" and "isnt there" to tax it highlights the underlying greed motivating the argument.
    if you dont agree, perhaps elucidate on what legitimate reason you had for confusing unreal with illiquid?
    marginalia_nu · 1790293567 · focus · HN ↗
    How do you propose to pay taxes with assets that can't be liquidated and may not be possible to validate?
    Even if you somehow pay taxes in assets that can't be liquidated, now the government has the same problem instead. What is the government gonna do, pay its employees in unlisted stocks and famous paintings?
    pydry · 1790317074 · focus · HN ↗
    there is no lack of reality. you confused liquidity and wealth. a third time.
    there are plenty of ways to handle the problem of taxing illiquid wealth but I dont think there is much value in discussing it with somebody pretending that means it is "not real".
    it would be like discussing the science behind vaccines with somebody who persisted in calling them "poisons".
    jandrewrogers · 1790293048 · focus · HN ↗
    Net worth is usually not fully realizable unless it is in the form of cash. The larger the net worth, the smaller the realizable fraction usually is. In some cases, including some highly visible billionaires, the realizable fraction is likely tiny.
    8note · 1790307847 · focus · HN ↗
    id say it usually is.
    most people have very little illiquid wealth, and its generally in the form of a house.
    billionaires are a tiny propertion of people, and their situation is as atypical as it comes. theres no reason to make super special accomodations for them, when theyre responsible for making their own dumb situation where they have too many assets to make them liquid on a hurry
    jandrewrogers · 1790314318 · focus · HN ↗
    There is a lot of literature on this. In the US, 2/3 of wealth is non-liquid so any attempt to price it is fiction. Of the 1/3 that is liquid, most is not realizable. Tax policy is effectively restricted to the liquid, realizable fraction, which is such a small percentage of the total that even modest-sounding percentages are a large percentage of what is practically taxable. Governments know this.
    An overlooked issue in popular discourse is that notional asset values are tightly coupled to who owns them — it isn’t transferable. Concepts like “dead equity” have been in the finance literature for a very long time. Elon Musk’s equity only has the value it does because he owns it. He couldn’t convert it into cash even if he wanted to.
    pydry · 1790327616 · focus · HN ↗
    >Tax policy is effectively restricted to the liquid, realizable fraction
    no it isnt. illiquid doesnt mean unpriceable and illiquid doesnt mean can't be liquidated.
    it being "complex to collect" is a criticism of many taxes which are already being paid. sales tax and VAT are horrendously complicated (more so than a wealth tax) to collect but we still do it.
    >An overlooked issue in popular discourse is that notional asset values are tightly coupled to who owns them — it isn’t transferable. Concepts like “dead equity” have been in the finance literature for a very long time. Elon Musk’s equity only has the value it does because he owns it
    even if it were true, it's not a good reason not to tax him.
    in fact, it might even help bring some sanity to the capital markets if he were forced to price his assets for tax purposes.
    philipallstar · 1790341179 · focus · HN ↗
    > Why is liquidating their shareholdings suddenly a problem only when they need to pay taxes?
    It's not. The problem is in the calculation of "net worth".
    pydry · 1790349836 · focus · HN ↗
    >The problem is in the calculation of "net worth".
    Let them value their own assets. If they value their ming vase at $10k then the government reserves the right to buy it for...$10k. They might get away with avoiding paying taxes. Or the government might get a bargain. The incentive, though, is to remain scrupulously honest.
  17. darth_avocado · 1790293665 · focus · HN ↗
    > Net worth is not real.
    Well then why are people able to borrow against it and then also deduct taxes on the interest on that borrowed amount?
    Also I pay property taxes. Somehow the worth of the property goes up every year and gets gets taxed accordingly. Then why can’t wealth get the same treatment?
    philipallstar · 1790336769 · focus · HN ↗
    > Well then why are people able to borrow against it and then also deduct taxes on the interest on that borrowed amount?
    > Also I pay property taxes. Somehow the worth of the property goes up every year and gets gets taxed accordingly. Then why can’t wealth get the same treatment?
    Well, three things.
    Firstly, as an aside, it's incredible that you would want this. That is a bad system. You should get taxed according to the services you consume, along with a flat rate for common services, rather than punished with taxes for daring to spend money on improving your house.
    Secondly, "wealth" is far less tangible than property prices. Property prices are very well understood. A share price can fluctuate wildly, and saying "well your net worth for today is the number of shares you have times the last share sale price" is just a terrible measure.
    Thirdly, what will those shares be worth to sell when they are taxed? Investing is a gamble. Housing is different: we need housing to live, and we want a nice house. No one wants shares. They want a return, and for it they'll stump up a giant amount of money, that will fund many jobs for years, and generate lots of taxes, and who will want to do that when their share will be eroded year on year? There's no benefit to shares except the return. Decreasing the return will have a direct impact on innovation and jobs.
  18. UltraSane · 1790295077 · focus · HN ↗
    > There is nothing to tax until they sell some shares.
    This is a very strange claim when we have property taxes. Shares are property so they can be taxed just like houses and land.
  19. dhosek · 1790303909 · focus · HN ↗
    They play a clever little game where they borrow against those shares to live on. Since there’s no realized gain, there’s no income (and the interest is deductible against any incidental gains that might happen along the line). Then when they die, the sale of shares to pay off the loan is a non-taxable event and the estate value is reduced so the heirs won’t pay as much (or any) estate tax.
    philipallstar · 1790337514 · focus · HN ↗
    > They play a clever little game where they borrow against those shares to live on
    Yes, everyone in the US can play the same clever little game by taking out a loan against a property and deducting the interest against their income.
    > and the estate value is reduced so the heirs won’t pay as much (or any) estate tax
    This is just madness. The estate value is reduced so their heirs won't get as much. You still pay inheritance tax on what you get. Anyone can avoid inheritance tax by just not passing anything on.
  20. 8note · 1790306289 · focus · HN ↗
    that net worth is still power, which is even more valuable than money.
    if you are claiming the high net worth, almost certainly you have raised significant actual money on things you own. a wealth tax means that if you dont actually think your business is worth a billion, you cant raise money as if it was.
    thays a net good thing.
    if peter theil is lying about being rich and he only has a couple hundred thousand bucks to his name, the publiv overall deserves to know, and it should cost him quite a lot to raise or borrow money.
    these people are commiting fraud and should be forced into texas prisons without AC because theyre lying to banks about the value of their assets, and the bankers too beed to go to those same prisons because theyre defrauding their depositors.
    this is only a good thing for routing how whos lying about their worth
  21. ajross · 1790306723 · focus · HN ↗
    > There is nothing to tax until they sell some shares.
    That's tautological. I mean, it's true under current federal tax law. It's obviously not true under new California law, which is what the article is about.
    Clearly the government can tax non-cash assets, and they do all the time. People act like "wealth taxes" are some moral horror or logical impossibility, while tossing their mortgage statement into a big file and pretending to ignore the property tax line on the escrow account.
    Are there practical problems like "wealth has feet"? Sure. Taxation is hard and all systems can be gamed. But let's not pretend that there's a greater principle at work here.
    hunterpayne · 1790312552 · focus · HN ↗
    Just wait until you find out what $20b in necessarily liquidations does to Meta's stock price and your S&P500 ETF.
    ajross · 1790339559 · focus · HN ↗
    Did you have to liquidate your house to pay the property tax on it?
  22. rsynnott · 1790334856 · focus · HN ↗
    There is absolutely no reason that unrealised gains cannot be taxed (and some tax systems do indeed tax them in various ways).
    WalterBright · 1790368199 · focus · HN ↗
    Except that would trigger a massive reduction in investment, which would be very damaging to the economy.
    rsynnott · 1790428553 · focus · HN ↗
    Why? What are they going to do with the money instead? If you charge, say, 5% on unrealised gains, possibly discountable against CGT on sale, say, then do you think rich people are really going to go "well, now I'm only getting 9.5% return instead of 10% return, so I'm going to sell all my shares and build a Scrooge McDuck style swimming pool full of money, instead"?
    There are cases where taxes can hurt investment, but you're really talking about quite high rates. For instance, the US peak rate of income tax used to be 94%. That almost certainly _did_ hurt investment.
    WalterBright · 1790453886 · focus · HN ↗
    Such taxes will make marginal businesses go out of businesses, and turn otherwise modestly profitable businesses into marginal ones.
    rsynnott · 1790541744 · focus · HN ↗
    ... Wait, how would a tax on unrealised capital gains make marginal businesses go out of business? Like, what scenario are you thinking about here?
  23. triceratops · 1790358410 · focus · HN ↗
    > There is nothing to tax until they sell some shares.
    Why can't they pay tax in shares?* If net worth isn't real it shouldn't really matter...right?
    *Please no pedantry about how the IRS doesn't currently accept shares as payment for taxes. If laws can be written to add wealth taxes on stocks and bonds, they can easily have a clause to allow payment in kind. Address the question I'm actually asking.
4. jdm2212 · 1790287761 · focus · HN ↗
  Larry Page owns about 5% of Alphabet, which is worth $4T, so he has $200B give or take. Which part of that do you think reflects a "broken tax system"? Companies should get kneecapped if their market cap gets too high? Founders shouldn't be allowed to keep even a single digit percent of the company?
  1. binlog · 1790288003 · focus · HN ↗
    The broken part is that there is third world-level poverty on the streets outside Google’s offices, working class people cannot afford to live in the Bay Area, and a fifth of California lives in poverty.
    JuniperMesos · 1790288149 · focus · HN ↗
    This has basically nothing to do with with market cap of Google or Larry Page's percentage ownership of it; and the state government taxing it more will not make this situation any better.
    linkregister · 1790288347 · focus · HN ↗
    This is almost completely traceable to Californians' failure to allow sufficiently dense housing to be built on their doorsteps. The only thing Larry did was bring prosperity to the region.
    (I'm in agreement with the thesis of the article)
    johnsmith1840 · 1790288448 · focus · HN ↗
    More taxes should solve that.
    Read somewhere that SF spends roughly 50k$-80k$ per homeless person per year.
    Taxing more doesn't solve a massively inefficient system at it's core. Just like US education, we spend more than any country on earth, why is it still bad?
    Answering that question with a "if only we had more money" is a really poor argument. The CA tax fundamentals are bad, pooring more cash onto the fire will not fix that.
    edoceo · 1790288618 · focus · HN ↗
    If money isn't solving the problem, you're just not using enough.
    jdm2212 · 1790289616 · focus · HN ↗
    You can't solve a shortage with demand subsidies. You need to expand supply. SF has too little housing relative to its population, and has perennially tried throwing money at the nonprofit industrial complex which has (obviously) perennially failed to solve the problem because it doesn't generate new housing units, it just bids up and reshuffles the existing ones (and steals a lot of money in the process).
    edoceo · 1790291193 · focus · HN ↗
    OK, use money to expand supply. Using more money can make more supply.
    robocat · 1790371936 · focus · HN ↗
    > SF has too little housing relative to its population
    The population that's already living in those houses?
    Note that "native-born Californians are ~37% of San Francisco County. That percentage has remained relatively flat over recent decades"
    natural population change was positive in San Francisco County, CA, with births exceeding deaths by 574
    <a href="https://usafacts.org/answers/is-the-population-growing-or-shrinking/county/san-francisco-county-ca/" rel="nofollow">https://usafacts.org/answers/is-the-population-growing-or-sh...
    johnsmith1840 · 1790292300 · focus · HN ↗
    Technically, cratering every fortune 500 does solve inequality so at it's purest their argument is right.
    I think it's more socialist/communist motivation to seize production I don't think they care about the rich as much as control.
    omgwtfbyobbq · 1790289295 · focus · HN ↗
    Sure. A lot of that money doesn't even make it to intended recipients because of corporate welfare.
    <a href="https://youtu.be/YKAD7l1a9hc" rel="nofollow">https://youtu.be/YKAD7l1a9hc
    In addition, there should probably be changes to laws/regulations to address companies that exploit the poorest.
    <a href="https://youtu.be/U9Rls-_7LdQ" rel="nofollow">https://youtu.be/U9Rls-_7LdQ
    And, many people who are poor have persistent mental/physical disabilities, so part of that spending is because many of these people have it the hardest.
    With that said, we could likely fix all of these things and significantly unequal wealth distribution would still result in a lot of poverty.
    peab · 1790289854 · focus · HN ↗
    I think it's hitting 96k per homeless person a year now. But yes, it's the tax system's fault.
    johnsmith1840 · 1790291918 · focus · HN ↗
    96k$?! Those are rookie numbers. I propose a mclaren for every homeless person. We will weath tax all stocks in the fortune 500 to pay for it, crash the stocks and solve inequality.
    epistasis · 1790289101 · focus · HN ↗
    I agree that that's the major problem; the poverty is inexcusable. But that's not caused by the $300B (or whatever) of equity. It's caused because the homeowners of the Bay Area decided that once they got a house, nobody else should, and that they should get to exclude others from the opportunities they had.
    This same thing was observed during the Gold Rush in California in the 1800s; extreme wealth also resulted in extreme poverty. And there's a great way to solve this: tax the land and redistribute it equally to everyone. Land can't be moved, it's something that belongs to all of us, and you can't make more of it.
    jdm2212 · 1790290717 · focus · HN ↗
    You sort of can make more land -- by building tall buildings. Unfortunately the Bay Area has mostly outlawed that, too. And we can't blame that just on homeowners. SF "tenant advocates" are just as violently allergic to developers building new structures as homeowners are. But the worst offenders are definitely Peninsula and South Bay homeowners.
    epistasis · 1790292431 · focus · HN ↗
    That distinction between tall buildings and shorter buildings on the same plot of land is exactly why the land should be taxed.
    Economic land is any capital that has a fixed amount, that you can't make more of. When the local governments in the Bay Area started capping the amount of buildable square feet, they greatly accelerated inequality by converting regular living space and working space into economic land, just like the real land it sits upon.
    This is why economic inequality skyrocketed so much. Rentierism resulted in so much being stolen from anybody who doesn't own the land, and blocks out so many people from even having access to the economic system.
    Tiktaalik · 1790301989 · focus · HN ↗
    Tenant advocates recognize that eviction is an existential threat to their way of life and so understandably they are fighting for their short term future. I disagree with their efforts in the long term, but I understand why they'd do what they're doing.
    In contrast when you have enormously wealthy people like Marc Andreessen fighting against higher density zoning there is no such excuse and it's pure greed. Nothing could actually be an existential disruption to the wealthy in the same way. There is no reason to listen to the rich like Andreessen at all.
    The equitable thing would be to focus on redeveloping wealthy homeowner areas and limit redevelopment in areas occupied by poor renters, but somehow that option never seems to be on the table. Only the reverse.
    epistasis · 1790305244 · focus · HN ↗
    I tend to keep quiet on the following critiques, because it can be counterproductive to larger goals to speak the truth sometimes, but something in this comment got to me and I need to share my truth. You're too kind on the "tenant" advocacy groups here. They are nearly 100% funded by wealth foundations that have exactly the same motivations as Marc Andreesen, and the people carrying out the wishes of the wealthy foundations are merely woke-washing really bad behavior.
    If anything, these "tenant" groups only advocate for the interests of a small subset of tenants, those who have their forever home, and do so at the expense of tenants in general. It's "pure greed" too, at the expense of others in their same general social, economic, and political class!
    I say this as someone who continues to advocate alongside tenant groups on policy for better protections, for rent registries, etc. And as someone who spent many years giving small donations to local tenant advocacy groups. At least Andreesen is transparent in his greed, and not hiding it. I regret all those years of donations to the groups that hurt people, but when it comes to the few good things they do I'll be there with them still.
    Tiktaalik · 1790306098 · focus · HN ↗
    Well I'm speaking from first hand experience knowing working people who live in such situations. Their existence is so precarious that a change in housing situation is indeed existential. So even if there are some disingenuous tenancy orgs out there, it doesn't change the reality that this is a real problem.
    > They are nearly 100% funded by wealth foundations that have exactly the same motivations as Marc Andreesen, and the people carrying out the wishes of the wealthy foundations are merely woke-washing really bad behavior.These "tenant" groups fight the types of change that would redevelop wealthy areas, precisely because of their funding sources, and they do it just as hard if not harder than stopping housing going up in other areas.
    Certainly not the case in my jurisdiction of Vancouver, where such political groups (eg. COPE) have explicitly advocated for apartment development in the wealthiest areas of the city. Maybe this is the case but a big [citation needed] here. If there are somewhere tenant advocacy orgs that aren't in favour of turning low density detached homes into apartments for workers that's certainly not one I recognize.
    > If anything, these "tenant" groups only advocate for the interests of a small subset of tenants, those who have their forever home, and do so at the expense of tenants in general. It's "pure greed" too, at the expense of others in their same general social, economic, and political class!
    Yes this is the point of my last comment. The solution is to increase the amount of people who have their forever home. The most equitable way to do that is to "destroy" the forever homes of the very rich for whom that is really no big disruptive deal, not to destroy the forever homes of the poor for whom it would be incredibly existentially disruptive. It is not "greedy" for people to keep their toehold on their long term home. To be clear the stakes here are not simply moving somewhere else but being priced out of the city entirely.
    peab · 1790289805 · focus · HN ↗
    that has ZERO to do with the tax system... You can't be serious? Have you looked at the data at all? have you seen how much money is spent "combatting" homelessness in San Francisco?
    oklahomasports · 1790290501 · focus · HN ↗
    just not his problem. not a single motherfucker on this website lives their life as if wealth disparities are a genuine problem anyways. you are motivated by resentment
    qurren · 1790310671 · focus · HN ↗
    None of that is Google's fault.
    Landlords could have collectively agreed to keep rents at $1K/month, but they decided to be greedy instead.
  2. jszymborski · 1790288091 · focus · HN ↗
    Yes. No one person should have assets worth as much as the GDP of Qatar.
    jdm2212 · 1790288693 · focus · HN ↗
    Sure, yeah, but which of the two numbers I was multiplying together is, in your mind, too big, and should be made smaller, and by what mechanism?
    pizzafeelsright · 1790291817 · focus · HN ↗
    What if they provided value of 10x of the GDP of Qatar?
    csallen · 1790293373 · focus · HN ↗
    Why does it matter how much the shares of his company are worth? They just represent ownership of a company. It's not like their existence is somehow holding back wealth from the market or from other people. And if he wants to sell the shares to make some cash, then he's going to have to pay taxes on that, which is good for everyone else. And he wouldn't do that unless he planned to spend or invest the cash receives, which is also good for everyone else. I fail to see the harm.
    I think one could argue that taxation should be higher, and harder to dodge, and I would agree with that.
    But once you start saying that some people shouldn't have more than others to some degree, that's a very slippery slope. Where do you draw the line? Why is it okay for middle class Americans to buy nicer clothes and move into bigger apartments when people are out there starving? If it's not okay for someone to have the net worth of Qatar, why would it be okay for someone to live in an apartment that's worth more than a poor township in South Africa?
    At some point we have to accept that inequality exists, and that although almost everyone could do something to minimize it, there's an ethical and practical line that needs to also respect individuality to a large degree, if we want people to feel incentivized to do things, to feel ownership, to maintain autonomy. And where to draw that line is tough to say exactly, but it probably shouldn't be a line, it should probably be smooth, or at least smooth-ish. So I feel like we're just coming back around to progressive taxation. Which we already have.
    tancop · 1790320291 · focus · HN ↗
    > They just represent ownership of a company.
    That, exactly, is the problem. It's not even about money and tax evasion but power. Why should one person have more say over the company they work for than 10,000 other employees? Or even worse they don't even work there anymore and just control it from outside?
    Even if they are a perfectly good and business smart person who never makes bad decisions or abuses their workers. They will eventually die or sell their share, and in either case it will end up with people who care less about the company's long term health than the founder did. Profit maximizers with no ethics and no feeling of responsibility.
    I think the concept of shareholders is the problem. Layoffs, cartels and price inflation happen when the people who make decisions get all the benefits but none of the downsides. If it was up to me I would ban stocks and replace them with time limited shares that give you a right to part of the profits for 1 or 5 or 10 years, but zero control over the company. Leave power to workers and returns to investors but never bind the two together.
    csallen · 1790635345 · focus · HN ↗
    > Why should one person have more say over the company they work for than 10,000 other employees?
    Why shouldn't they?
    That's how pretty much every organization works. Every military, every government, every sports team, every space mission, every classroom, etc., they all have some person or small group up people with more more decision-making power, or "more say," as you put it.
    I fail to see the problem with that. In fact, there's a very real benefit in that it's generally more effective. For example, today people are completely free to create organizations that work differently, and they rarely choose to, and when they do, they rarely out-compete the alternative. So the proof is in the pudding that there's something less effective about it.
    If I had to wager a guess: decision-making isn't something that scales well. Bodies might have dozens of organs, but they only really need one brain to control them all.
    > They will eventually die or sell their share, and in either case it will end up with people who care less about the company's long term health than the founder did. Profit maximizers with no ethics and no feeling of responsibility.
    1. There are plenty of counterexamples where the leader of a company ensures its long-term success after their tenure ends.
    2. Even if this were somehow a downside of owner-led companies, you always have to ask the question, "...compared to what?" It's not like the alternative doesn't have its own slew of downsides, as evidenced by the dearth of competitive co-ops that compete successfully with owner-led companies. In other words, organizations are always going to have issues and errors and flaws, no matter how you set up decision-making.
    ButlerianJihad · 1790635621 · focus · HN ↗
    People trying to apply the principles of democracy to corporations are misguided. And therefore, corporations function most efficiently, essentially, as autocracies with fascist features. It is not difficult to compare the corporate style with fascism in many elements: certainly more similarities there than a liberal democracy, or a socialist nation, where we've often said that politicians shouldn't be businessman, at least insofar as you cannot/shoudn't run a state like a business.
    After all, businessmen often use strategies like aiming to be acquired/purchased by a much larger company, merging with their competitors or partners, or anticipating bankruptcy by draining every viable resource and asset they can reach.
    At the same time, observers such as JB Crawford have also pointed out that very large corporations function like a religion. For example, telecommunications. <a href="https://computer.rip/2024-09-08-private-lines.html" rel="nofollow">https://computer.rip/2024-09-08-private-lines.html
    Of course I mean this metaphor internally, as if we were regarding each corporation as a sovereign microstate, which they aren't... hopefully...
    If the ideal CEO has psychopathic qualities, and the ideal capitalist corporation is comparable to a fascist organ, and the corporations are the primary unit of American culture, then where does that leave us?
    thesmtsolver2 · 1790307763 · focus · HN ↗
    Why?
  3. colordrops · 1790288674 · focus · HN ↗
    Yes perhaps there should be wealth caps. Did Larry Page really do 5% of all that labor that made google as big as it is? And should a single company get so big and have so much power? Yes, I get that they took risks and invested early, and we shouldn't take away that type of incentive, but perhaps it should have caps, or an S curve tax schedule.
    jdm2212 · 1790289301 · focus · HN ↗
    Google doesn't have much power. It can't arrest you or pass laws or vote. It just happens to produce a lot of profits for its shareholders (who are, overwhelmingly, average people with 401Ks) and a lot of profits means a big market cap.
    If we need revenue to fund useful government programs, great, let's tax Larry. But I don't understand what problem is solved by expropriation qua expropriation.
    colordrops · 1790306846 · focus · HN ↗
    Figured I wouldn't get much traction with that comment on a message board run by Silicon Valley hyper-capitalists lol
    8note · 1790308725 · focus · HN ↗
    that is to say theyre being kneecapped.
    it does have monopoly power and anticompetitive power all over the place though.
    google bans are quite intrusive, but google could pretty easily with their graph knowledge apply secondary or tertiary sanctions, at which point you would not be able to do much of anything, same as if the US government sanctioned you
  4. ForHackernews · 1790289110 · focus · HN ↗
    > Companies should get kneecapped if their market cap gets too high?
    Yes. They should be broken up because competition is good for consumers and society. If we had functional anti-trust enforcement Google would not have a near-monopoly on search ads where they own both the ad inventory and the marketplace where you have to buy those placements.
    jdm2212 · 1790289752 · focus · HN ↗
    Then you'd have two (or three, or four) companies that Larry owns 5% each of that are collectively worth $4T.
    ForHackernews · 1790334099 · focus · HN ↗
    That's fine, I don't care as long as they are legitimately competing and not colluding to the detriment of consumers/employees/citizens.
  5. 14u2c · 1790289255 · focus · HN ↗
    The part where he has access to essentially unlimited untaxed cashflow by borrowing against that asset. Especially with how the market has been lately, the gains erase any burden of the loan. Something has be done about this, at least. Otherwise broken sounds about right.
    jdm2212 · 1790289478 · focus · HN ↗
    Larry has sold tons of Alphabet stock and paid lots of capital gains taxes. This is easily available public information. The whole buy-borrow-die thing is sort of a stupid myth. Actual centibillionaires diversify because the risk of having a huge concentrated position is much greater than the liability of having to pay some capital gains taxes.
    csallen · 1790293038 · focus · HN ↗
    Well, why does something have to be done about this, exactly? Who is getting hurt here? It's not like his ownership percentage of Google is somehow keeping wealth out of the market.
    14u2c · 1790296592 · focus · HN ↗
    > Just like anyone else, he has to pay back what he borrows, he immediately owes an equal debt. And that requires actual income, which gets taxed.
    In theory, maybe, but in practice that is not what happened over the past decade(s). Instead our retirement funds are paying it back.
    When the market grows it makes the collateral worth more, which lets him keep refinancing the debt instead of selling assets and realizing taxable gains. As long as the assets appreciate faster than the debt grows, the borrowing can effectively roll forward for decades. Eventually the estate pays the debt out of the assets themselves, but this is not necessarily out of taxable income earned during his lifetime. The US markets has seen exceptional genuine growth, but the trillions of 401(k), IRA, etc money flowing in to them over the last 40 years is no small consideration.
    > Well, why does something have to be done about this, exactly?
    The something here is what's required to have a functional tax system. Without addressing this situation I do see an argument that we have one. How important that is to one is another question.
    8note · 1790308493 · focus · HN ↗
    the people getting hurt is anyone who would have bought something but was outbit by larry page's free money glitch.
    he doesnt necessarily have to pay it back either. he could just take out another loan against his same now higher valued assets to pay off the old loan
    xhkkffbf · 1790350509 · focus · HN ↗
    Higher valued assets? Can we just assume that assets will go up in value?
    csallen · 1790702283 · focus · HN ↗
    Okay, but now he just has even more debt to pay back, what's your point? At some point he does have to pay.
  6. 8note · 1790308355 · focus · HN ↗
    whats its mean to be kneecapped?
    like, if a company's market cap gets too big, the law should stop applying to them? they should be allowed to start their own militaries and enforce martial law a la east india company?
    how does a founder keep a single digit of their company after theyve been dead for a thousand years?
    These arent nearly as absolute as you are making them to be.
    a founder can keep their percent by paying their taxes with other money they have, or by decreasing the worth of their company. theyre a founder, they have control. Maybe founders wont be so keen to enshittify their products if theres a downside to continued growth forever. considering google dropped "dont be evil" in exchange for making larry page's 1% grow for the sake of growing, how's society at large benefiting from continuing to subsidize it?
    lkjdsklf · 1790310362 · focus · HN ↗
    There's also the fact that alphabet should have been broken up into about a dozen companies over a decade ago
    Larry would still be rich as heck, but probably... less rich..
  7. bagacrap · 1790309017 · focus · HN ↗
    If you taxed him half of that wealth he'd still have single digit percentage of the company.
    The broken tax system is that I get taxed about 50% on my marginal income dollar --- the system doesn't wait for me to spend it first --- but when his stock portfolio appreciates by a dollar, he's not taxed! Not until he sells in order to spend. Why are we taxing labor so much more than capital?
    And no, I don't think that inventing pagerank really entitles two people to $200B. Although in their case I don't think they've done as much harm with it as some other billionaires.
    jdm2212 · 1790323068 · focus · HN ↗
    When your job pays you a dollar, you get an actual dollar. Your job never claws that money back. Unrealized capital gains are not money, and they routinely get clawed back. Unrealized capital gains just means someone in New York traded GOOG/GOOGL at a higher price than they did yesterday.
    And, sure, super-rich people can in theory use the appreciated stock as collateral for loans and not pay taxes, but in practice Larry and most other centi-billionaires actually sell loads of stock and pay a lot in capital gains taxes because having your status as super rich dude who owns a huge yacht be totally dependent on Google's stock price is a dumb risk to take on, and it's worth paying some taxes to eliminate that risk.
    bagacrap · 1790394276 · focus · HN ↗
    > When your job pays you a dollar, you get an actual dollar.
    No.. many cents of it are withheld, by law.
    Elon uses his vast wealth to influence, intimidate, and generally get away with lawlessness. He effectively took huge loans from banks to buy a giant bullhorn in Twitter. Those loans are collaterized by unrealized capital gains. And more generally, billionaires have the ear of politicians because of what they could do with their money. So you don't need to realize gains (gains which are taxed at a more or less flat rate!) to make use of your wealth.
    Though like I said, Larry is not really a bad guy in the world of billionaires. I would only support taxing him more than I would support levying additional taxes on w2 income assuming CA actually had a provable need for more money. (Right now I think they waste most of the budget.)
    anabab · 1790326915 · focus · HN ↗
    He has single digit percentage of the _company_ but double digits percentage of _voting stock_. My understanding is that he and Bring are holding together barely above 50% of the latter and understandingly do not want to lose the control.
5. cavemandaveman · 1790287817 · focus · HN ↗
  If the $100B+ was created through ownership of a company and is unrealized wealth, how would you have taxed it if not through a wealth tax? Nobody is getting to $100B by way of income.
  1. delichon · 1790289320 · focus · HN ↗
    Capital gains and patience.
  2. kccqzy · 1790359530 · focus · HN ↗
    [delayed]
6. chis · 1790287902 · focus · HN ↗
  Just a moronic comment lol
7. jasonlotito · 1790289735 · focus · HN ↗
  > it’s already too late.
  Absolutely not. 100% you can take it.
8. freediddy · 1790291977 · focus · HN ↗
  I would care more about the broken tax system if the politicians didn't waste our tax money. Stop the fraud and the corruption and the incompetence and then let's talk about increasing taxes.
  $24 B unaccounted for and lost that was supposed to be for homelessness. $12 B already spent on high speed rail and they want $120 B more. $50 B in EDD unemployment fraud during the pandemic.
  This is just in California in the last year or two.
  How much more fraud and corruption and incompetence is there that we just don't know about?
  There is no way I will agree to any increase in taxes just to see it wasted and going to corruption and political buddies on every side of the aisle.
  1. dennis_jeeves2 · 1790295960 · focus · HN ↗
    >Stop the fraud and the corruption and the incompetence and then let's talk about increasing taxes.
    Zero taxes is the only right answer. Any talk of taxation means that you have already given in to being exploited, because it's a slippery slope. Let's be realistic - corruption will never end. The only way to reduce it is to starve the beast.
  2. haizhung · 1790329658 · focus · HN ↗
    You could quite literally introduce a wealth tax and then set the (additionally) taxed money on fire; and it would improve living standards.
    The point is to lower the economic power of single individuals that compete against the entire rest of the nation.
9. mort96 · 1790294468 · focus · HN ↗
  We're in a situation where it's already "too late". We can't go back 100 years. How do you propose we fix it, assuming time machines won't get invented soon?
10. credit_guy · 1790296361 · focus · HN ↗
  > If you let someone get to hundreds of billions in net worth
  "Let someone"? I guess the right to pursue one's happiness is not all that self-evident after all. One should first ask permission, and, if we are in a good mood, we might "let them" pursue their happiness.
  1. lkjdsklf · 1790310651 · focus · HN ↗
    > One should first ask permission, and, if we are in a good mood, we might "let them" pursue their happiness.
    yes... this is called the law...
    Lots of peoples "pursuit of happiness" is hindered by the law because we've deemed it not good for society.
    nickpp · 1790326923 · focus · HN ↗
    Last time I checked building companies offer goods and services was considered good for society.
    I actually lived in a society where this was illegal and we were all starving and freezing.
11. analog31 · 1790304184 · focus · HN ↗
  They can move to Afghanistan. I'm not sure the wealth leaving the state, or the country, is such a bad thing.
  Meanwhile, when you're in an "already too late" situation, it's already too late. You still have to deal with it.
12. gorgoiler · 1790325498 · focus · HN ↗
  Additionally, the state gets to tax you on what they say you’re worth based on the markets. That’s a pretty weird way to assign dollar value to someone instead of, say, looking at how many dollars they have.
  While stock markets provide useful liquidity for investors entering and exiting positions, they are also rampant with finbro kids doing nothing more than jumped-up gambling. We don’t know which market trades fall into the serious wheels-of-capitalism bucket, and which are gambling, because we don’t have to know. The real world works in dollars so, to date, the state taxes people on the realized capital gain in dollars.
  If a bunch of kids are selling handfuls of leaves to each other for a nickel each is the state now valuing my unkempt forest at $99bn? The state is welcome to pull up a chair and watch me try to sell 5 kilotons of leaves to every kindergarten playground in the country. If I succeed then it will take its cut of the capital gain. If I fail, it will not.
  When the state starts looking inside the market black box and guesses, based on little Johnny and Becky’s recent playground trades, that I might be able to get at least $300 a tonne for my damp, rotting leaves, then the state is doing something at best weird and at worst unfair, and tates doing unfair things is really bad.
  Fix the system properly: if you inherit stock, you inherit the cost basis as well. Rinsing off capital gains liabilities through “buy/borrow/die” is the real villain here.
13. throwaway2037 · 1790328826 · focus · HN ↗
  Norway, Spain, and Switzerland have wealth (net worth) taxes. Why don't we see the same outrage from rich people living there? Also, most billionaires get rich with equity in a business that they built. How else can we tax that net worth?
  1. haizhung · 1790329508 · focus · HN ↗
    Not only that but they are actively moving into these countries, because, like everybody, they like a functioning government that provides infrastructure, housing and health care for their citizens. This makes for much more livable cities and a happy society.
  2. konradx · 1790338410 · focus · HN ↗
    Actually, in Norway there is some outrage. Many people with (a lot of) money move to Switzerland. There is also the issue that startups are being taxed on "paper money" — the value of the firm on paper based on expected future income — even though they have not yet started earning money.
    throwaway2037 · 1790415962 · focus · HN ↗
    From what I can find, the top wealth tax rate in Norway is about 1.1%. That seems pretty dumb to leave your home country to avoid paying 1.1% tax per year. For entrepreneurs that now have enormous equity (100s of millions of Euros), my sympathy is low. They can easy sell a tiny fraction of their equity to investors to pay the wealth tax.
jmyeet · 1790287494 · focus · HN ↗
Two things:
1. If wealth was only motivated by taxes and was going to leave, it would've left already. Fact is, billionaires don't want to live in Tennessee;
2. Nobody is doing the right thing to tackle any of this, including California.
The article mentions California has land and that's the key point. Unfortunately, California homeowners have been coopted into voting against their own interests to raise property values. If the house you bought in SF in 1975 for $80,000 is now worth $3M, you still only own 1 housing unit's worth of wealth. And that housing cost is an input into everything you need to buy because all the workers required for those things have to be paid high enough to pay those exorbitant rents.
Let me repeat that: high housing costs are an input into everything that you buy.
So what needs to happen? We need to stop treating housing as a speculative asset. It's simply stealing from the next generation. Worse, it's diverting investment capital from productive output because land has become the asset with the best tax treatment, highest returns and most government protections. So what does this look like?
1. Some form of land value tax. The higher the value goes, the higher the taxes go. You raise the rent and your land value taxes go up because it's more valuable;
2. Punitively tax land hoarding including second homes. We could give discounted rates to primary residences of state residents. Nobody else should get a discount. This would mean repealing Prop 13 and that's never going to happen. As an example of this, I'll bring up Prop 19. In CA you can inherit a preferential property tax rate. Prop 19 proposed to limit this to only one property could inherit this preferential rate and it barely passed (51% IIRC). Do we think that 49% of California voters have multiple properties that have property tax rates set 40+ years ago? Of course they don't. It's an example of how people vote against their own interests;
3. Part of what sold Prop 13 originally was the idea of pushing seniors out of their homes with property taxes. Well, that gave Disneyland a tax rate that was set in the 1960s. California should do what Texas does: you can defer your property taxes until you die if you're a senior but there's no capped property tax rates like incumbent SF residents have and no inherited preferential property tax rates;
4. Wind back the preferential collateralization of property for mortgage debt over time. Residential property lending now dominates bank lending and earnings. It's significantly harder to get finance for any form of productive output;
5. Wind back over time preferential tax treatment for home ownership.
Do I think any of this will happen? No.
Oh, one of the worst things to do is transaction taxes, often called stamp duty. This is where you pay a percentage of the value on purchase. This really hurts mobility. I guess it's fine if it's only on the luxury end of the market (CA's is at $5M+?) but it's not a good idea regardless.
The other part of this is to provide social housing like Vienna. The government should be a significant supplier of affordable quality housing.
1. Sohcahtoa82 · 1790288669 · focus · HN ↗
  > We need to stop treating housing as a speculative asset.
  Something I've been yelling from the rooftops.
  Housing can either be affordable, or it can be an investment that's bought, rented, and sold for the sole purpose of profit. It's not possible for it to be both.
  People expect their house to appreciate faster than inflation, but all that does is rob the next generation of home ownership.
  1. edoceo · 1790289060 · focus · HN ↗
    Many, many years ago multiple generations would live in one home that may have even been built by a generation that is long dead.
    Sohcahtoa82 · 1790321051 · focus · HN ↗
    And now, when mom and dad downsize after the kids move out, rather than selling the house or pass it to one of their children, they rent it out.
    Alternatively, they keep the house, but get either a reverse mortgage or a cash out refi to survive until they die, at which point their kids can't afford to buy it from the bank.
  2. JKCalhoun · 1790292684 · focus · HN ↗
    What are the proposals for accomplishing this?
    kelnos · 1790297736 · focus · HN ↗
    [delayed]
    Sohcahtoa82 · 1790321479 · focus · HN ↗
    Increase taxes on rental income on single-family homes and double the property tax on vacant homes to discourage hoarding.
    Encourage building upwards to increase housing supply. This can be done via tax breaks or subsidies. Especially encourage multi-use buildings to make cities walkable. Stores/restaurants at the street level with apartments above.
2. xienze · 1790289505 · focus · HN ↗
  > We need to stop treating housing as a speculative asset.
  This kind of assumes the only reason a house appreciates in value is because people are "treating it as an asset" rather than "the house I bought 30 years ago in the middle of nowhere is now smack dab in the middle of a very desirable area." At that point it's simple supply and demand, not some homeowner being greedy.
  > The higher the value goes, the higher the taxes go. You raise the rent and your land value taxes go up because it's more valuable
  This makes the fatal assumption that just because a house is worth dramatically more than what you paid for it many years ago that your income must have risen just as dramatically. "Oh well, too bad, sell your house and deal with it." Maybe people kind of like living where they've put down roots and don't want to be punished for something outside of their control? Any proposal that boils down to "pay more or fuck off" is not going to go over very well.
3. green_wheel · 1790290192 · focus · HN ↗
  [dead]
4. parineum · 1790309982 · focus · HN ↗
  > voting against their own interests
  What you mean is voting against what you think their interests should be.
  This phrase is incredibly condescending and undemocratic.
digitaltrees · 1790287655 · focus · HN ↗
If the tax is calculated based on residency at the time it was earned or granted rather than when it vested or was sold then it doesn’t matter if they leave.
MrZander · 1790287691 · focus · HN ↗
I agree the proposed wealth tax is a bad idea, but raising property taxes is probably not viable. They are incredibly unfavorable to voters. No one who owns a home wants to pay rent, that's why you buy in the first place.
Personally, this is why I am fine with higher income or sales taxes.
1. edoceo · 1790288926 · focus · HN ↗
  Sales Taxes are the worst ones. Burden on seller, burden on buyer, regressive. Income is more fair but easy to mask-out for the wealthy. Property is meh, Wealth tax is the best one. Assuming all were well designed.
  1. fhn · 1790289390 · focus · HN ↗
    why is it a burden when they are already collecting sales tax? They just change one number but nothing else changes.
    edoceo · 1790289806 · focus · HN ↗
    Some items taxable, some are not. Keep track. Some have different rates depending on who's buying, keep track. Buyers in different locations pay different rates, keep track. The rules change frequently, keep track. Collect money for the govt, keep track. Remit quarterly or face penalty.
    There complexity and overhead on sales taxes; more than on an income, retained earnings or wealth taxes.
    Also, sales taxes take more percent of wealth away from the lower wealth bracket than from the upper wealth bracket.
    charlieyu1 · 1790300159 · focus · HN ↗
    If you kill demand, you kill economy.
    And I’m very surprised nobody mentioned cooperative tax in this post. Taxing cooperative profits is the simplest and fairest solution.
  2. daedrdev · 1790293969 · focus · HN ↗
    Property is literally a wealth tax on an asset that can’t move away
  3. Danox · 1790314182 · focus · HN ↗
    Sales tax and the gasoline tax are use taxes. They are about as fair (democratic) as you’re gonna get because it’s based upon use most the other taxes whether they’re high or low, you can’t escape from particularly if you are the average person in the middle, and once again, if you benefit from capital gains, that is a huge life-changing benefit. which most people working people don’t have. Vote yes. on proposition 40 if you are in California the less than .001 and even the 1% will easily survive.
2. Gigachad · 1790292682 · focus · HN ↗
  > No one who owns a home wants to pay rent
  They just want continually delivered services from the city funded by taking out increasing amounts of debt or selling off new land in a ponzi scheme to fund existing obligations.
3. JKCalhoun · 1790292939 · focus · HN ↗
  "Personally, this is why I am fine with higher income or sales taxes."
  Indeed, the working poor need to pay more in taxes.
  1. N_Lens · 1790297453 · focus · HN ↗
    The numbers on wealth distribution are shocking, to say the least. I think wealth taxes without loopholes are a really good idea in the current circumstances, infact I believe it may not go far enough.
  2. jrockway · 1790298846 · focus · HN ↗
    [delayed]
    seizethecheese · 1790305588 · focus · HN ↗
    [delayed]
    bagacrap · 1790309336 · focus · HN ↗
    Even worse, step up basis! That capital gain may never be taxed
    Danox · 1790313622 · focus · HN ↗
    [dead]
    Danox · 1790312703 · focus · HN ↗
    Which is why the majority of people in California who work for a living shouldn’t be carrying any water for billionaires or hundred millionaires, you could even extend that down to someone who’s worth 10 million, until you get to that level, you don’t realize how many people over that level have it very easy.
    In comparison to the majority of the population, you know the other 99%. That’s right, you heard it right. 99% of the population does not have $10 million free and clear without debt. In other words, if you are still paying off your house you are not in that upper bracket.
    8note · 1790309353 · focus · HN ↗
    everyone working is the poor.
    the rich are an astounding amount of wealthy such that they dont show up and still make a good poor wage in the first couple hours/days of a year by their assets increasing in value
    you are poor, even if you are doing plenty well for yourself
4. kelnos · 1790296996 · focus · HN ↗
  > No one who owns a home wants to pay rent, that's why you buy in the first place.
  If this is actually a common attitude, people are... ridiculous. Real property is a limited resource, and allowing people to own property comes with strings attached. This is a pretty normal thing in very many places.
  But I do agree that raising property taxes in CA in particular is a politically toxic topic.
5. MikeNotThePope · 1790314023 · focus · HN ↗
  And higher taxes on capital gains & dividends.
Animats · 1790287893 · focus · HN ↗
It's the single taxers again, with a new argument.
1. draw_down · 1790288768 · focus · HN ↗
  [dead]
2. larsiusprime · 1790289046 · focus · HN ↗
  I'm not a single taxer.
  1. Animats · 1790305107 · focus · HN ↗
    The article is. It's an argument for the main tax being on real property.[1]
    [1] <a href="https://en.wikipedia.org/wiki/Single_tax" rel="nofollow">https://en.wikipedia.org/wiki/Single_tax
    larsiusprime · 1790314964 · focus · HN ↗
    I co-wrote the article. Neither Greg nor I are single taxers.
abeppu · 1790288289 · focus · HN ↗
> The land value tax can’t be dodged by leaving nor can it be passed on to renters.
In what sense can't it be passed to renters? Esp if all landlords in the market were faced with a new land tax that they had not previously planned for, why would it not be passed on?
1. larsiusprime · 1790288963 · focus · HN ↗
  Rent is a function of supply and demand, not a landlord's costs, otherwise we would expect changes in e.g. mortgage interest costs to be passed on to, but in practice we don't see this effect. We also don't see landlords who own their properties outright (and thus don't have mortgage interest costs) charging lower rents than landlords in the neighborhood with identical properties who have mortgages. When landlords' costs drop, do they drop the rent in response?
  Taxes can be passed on when the tax induces a change in supply. Conventional property taxes are partially passed through because the component of the tax that falls on the building. Tax buildings, get less buildings.
  Taxes on land do not affect the supply of the land, this implies they are not passed on and the research literature largely agrees with this.
  1. EgregiousCube · 1790289752 · focus · HN ↗
    Landlord costs impact supply.
    skybrian · 1790289875 · focus · HN ↗
    If mortgage expenses go down and property tax expenses go up, it's basically a wash.
    But for that to happen, land values need to go down. Landlords need to bid less.
    tomrod · 1790290023 · focus · HN ↗
    Of housing, but not of land.
    pydry · 1790290319 · focus · HN ↗
    LVT would push up the supply of rental properties by ensuring that property owners who don't rent out their properties or who don't make efficient use of land lose money.
    Thats an incentive to rent out the property or sell up to somebody who will.
    It would apply harsh market discipline on landlords - a demographic that has usually been rather coddled.
    retired · 1790294877 · focus · HN ↗
    A property loses ~30% of its value when rented out and maintenance cost and insurance cost goes up significantly. Plenty of landlords rather have their property be empty and just collect on the equity gains over the years without putting in any effort.
    xp84 · 1790296553 · focus · HN ↗
    > property owners who don't rent out their properties
    The existence of property tax (which on a single house in some areas of the state is upwards of $15,000 a year already) already makes it absolutely ruinous to just sit on an extra house you don't need and not rent it out.
    > or who don't make efficient use of land
    A little more convincing. Though I suspect most empty land in places where anyone would be willing to live in California, is empty because our insane zoning laws don't allow what would otherwise make sense there (I don't care that it's like what most areas have -- it's insane to have laws that would make it illegal to build a place like San Francisco, Brooklyn, or Boston).
    The funny thing about those zoning laws though is that they're held up by a rare case of bipartisanship:
    - The MAGA Boomer set who doesn't want any more development near them because "it'll bring traffic" or noise or crime
    - And most of the "progressives" who don't want any more development anywhere because "we hate greedy developers" and "Not enough of this proposed development is low-income housing for the government to dole out in lotteries to a few lucky families."
    lesuorac · 1790338211 · focus · HN ↗
    Idk, I’ve seen plenty of houses get torn down and replaced by a $2M house and just sit vacant years until they sell.
    15k/2M is 75 basis points. Its definitely profitable to just sit on land especially if you turned it into a parking lot or some other barely improved thing.
    xp84 · 1790378295 · focus · HN ↗
    On a 2M house the current property tax burden in california is $20,000 a year. More if you have Mello-Roos taxes in that subdivision.
    Gormo · 1790436593 · focus · HN ↗
    > LVT would push up the supply of rental properties by ensuring that property owners who don't rent out their properties or who don't make efficient use of land lose money.
    That doesn't follow. If LVT reduces the net return on rentals, it will disincentivize construction and maintenance of housing in the first place. If it creates a net negative or zero return on property ownership, it may lead to abandoned/undeveloped property instead of housing development, or more property being used for other purposes than housing.
    It's also worth pointing out that the existing ad valorem tax system used for property taxes is functionally equivalent to LVT, and does have these influences on the housing market. LVT proposals are distinguished by their being rooted in (fundamentally flawed) Georgist theory, not by being unique as a form of taxation in practice.
  2. JumpCrisscross · 1790289852 · focus · HN ↗
    > otherwise we would expect changes in e.g. mortgage interest costs to be passed on
    These aren't a universal cost. When rates change, some landlords' costs go up. But some don't. That lets the latter set the marginal price.
    If everyone's costs go up the same amount, it's collusion without communication. In an inelastic market like San Francisco's, you'd expect prices to rise.
  3. Gormo · 1790291515 · focus · HN ↗
    > Taxes on land do not affect the supply of the land, this implies they are not passed on and the research literature largely agrees with this.
    Taxes may not affect the amount of land that physically exists, but they absolutely can and do affect the amount of land available for rent as opposed to other income-generating use cases.
    On top of that, a tax that applies equivalently to all of the land available to the rental market in a given area will simply push prices upwards across the board, which is likely to just be absorbed by renters given the usually low price elasticity of demand for housing.
    jeremyjh · 1790292075 · focus · HN ↗
    These are assertions, not arguments. Respond to points in the post you replied to.
    cltby · 1790292687 · focus · HN ↗
    These are assertions, not arguments. Respond to points in the post you replied to. Be sure you understand them first.
    Gormo · 1790595644 · focus · HN ↗
    > These are assertions, not arguments.
    In fact, they are indeed arguments derived from applying well-understood economic principles to the specific -- and purely speculative -- claims posited by the preceding comment.
    > Be sure you understand them first; your assertions do not hold in the case of LVT.
    Indeed I have, and indeed they do. Rather, your own response attempting to dismiss rather than engage with counter-arguments betrays a likely ideological rather than pragmatic interest in the concept of LVT.
    larsiusprime · 1790292962 · focus · HN ↗
    > On top of that, a tax that applies equivalently to all of the land available to the rental market in a given area will simply push prices upwards across the board
    Most research asserts that a land value tax decreases the selling price of land.
    EgregiousCube · 1790293381 · focus · HN ↗
    Presumably by exactly the value of the tax (over the lifetime of the purchase).
    iso1631 · 1790307617 · focus · HN ↗
    In a fully functioning spherical chicken market, once balancing in
    If I buy land for $100k today, I can assume I'm going to make say $6k a year from renting it to someone and $2k a year from it increasing in value, giving me a 8% roi
    If I instead had to pay just $4k a year in LVT, the price would reduce to $50k to keep that 8% roi. I'll still be making money for doing nothing.
    Now if that LVT was returned to the population at large, it's quite possible the population has more money to spend on land, so I could increase the rental price from $6k a year, but then the LVT would increase, because the idea is it reduces unimproved land value to zero -- nobody should make money from occupying land, they should make money through improving it.
    In reality though any LVT implemented would be full of loopholes which would introduce absurd incentives. Just like taxing income, and worse taxing earned income more than non-earned income.
    jlarocco · 1790293407 · focus · HN ↗
    But who's selling the land? If everybody has to pay the tax then all of the property owners can increase rental prices by the same amount.
    iso1631 · 1790307724 · focus · HN ↗
    All property owners can increase rental prices now anyway. They can only increase them to the maximum someone will pay for it. That's why average rental prices tends to track average income. If you have 5 homes and 6 people, each able to pay 2100, 2200... 2600, then the worst home will rent for 2200, and the one who can only afford 2100 will live in a box.
    nly · 1790318714 · focus · HN ↗
    There's a difference between can and must. A LOT of landlords don't maximally squeeze their tenants.
    In fact, I'd argue the majority of landlords are shit investors sat on fairly low yields
    jlarocco · 1790405247 · focus · HN ↗
    They can only increase rents as much as the next guy. If you're charging $2500 but next door is $2400, nobody will rent from you. But if everybody's charging $2500, then that's what people will have to pay.
    You're right that some people will get squeezed out, but in high demand markets there are enough people willing to pay that it doesn't matter. Property owners will eat the 5% increase for a while, like until the existing leases expire, but eventually they'll incorporate that 5% increase into the rent.
    iso1631 · 1790480240 · focus · HN ↗
    If you charge $2500 and next door charges $2400, the first person to arrive rents for $2400, the second person has no choice but to pay your $2500
    Gormo · 1790554134 · focus · HN ↗
    Now what happens if there are three houses for rent in the area, instead of two? Four houses? A thousand?
    aesthesia · 1790293715 · focus · HN ↗
    Why would a land value tax shift the allocation of land between uses? The amount of the tax doesn't depend on what the land's being used for. If renting is the highest-value use without the tax, it will still be the highest-value use with the tax.
    Gormo · 1790881228 · focus · HN ↗
    > Why would a land value tax shift the allocation of land between uses?
    For the same reason that inflation shifts the allocation of money between investment opportunities.
    When there's an increased baseline cost that has to be overcome by whatever use the underlying asset is put to, it shifts the incentives and the risk-reward calculations of people deciding what to do with their assets.
    Why would land be any different from cash in this regard?
    iso1631 · 1790307795 · focus · HN ↗
    Whether the landowner rents it to someone who will improve it to generate income, or they improve it themselves, doesn't matter.
  4. malfist · 1790291609 · focus · HN ↗
    Most mortgages are fixed interest. So it makes since that today's rate change doesn't impact a renter cost in the near future. Probably not until the next time the property is sold.
    nly · 1790318868 · focus · HN ↗
    In the US. The majority of the world doesn't have government subsidies on 30 year mortgages
  5. jen20 · 1790291626 · focus · HN ↗
    > we would expect changes in e.g. mortgage interest costs to be passed on to
    This absolutely happens in the UK where variable interest rates affect more people.
    > When landlords' costs drop, do they drop the rent in response?
    The price of everything is pretty much a ratchet. They never go down again absent some kind of competitive pressure.
  6. nly · 1790291978 · focus · HN ↗
    If I own £100K worth of land, and the government announces a 1% annual land tax, it's likely the value of my land will fall by about ~25-33% overnight.
    If you think that's morally unobjectionable, fine, but I'd love to know what happens when all the landowners who own rural land that doesn't have a profitable development path attached to it can't pay their tax bills. Have the state seize it all?
    Or do they just claim it's of negligible value and avoid the tax?
    lesam · 1790292225 · focus · HN ↗
    You would sell the development for as much as you can get, regardless of tax. The people buying from you aren't going to pay you more just because the government raised your taxes.
    nly · 1790293086 · focus · HN ↗
    A land tax would effect every single landlord though. Every single landlord would put up rent.
    The market will bare it because people have no choice. The choice is homelessness or paying the higher rent.
    It's principally the same when mortgage rates rise. Landlords with mortgages put up rent. Only it would be worse, since not all landlords have mortgages.
    lesam · 1790378832 · focus · HN ↗
    Do you have data for this? The data I've seen in the past is that landlords are not in aggregate able to pass on mortgage rate increases as rent increases, possibly because their tenants are already squeezed to the limit and there is simply no more money to be had. So when mortgage rates go up rents stay roughly constant and property values go down.
    lesam · 1790379136 · focus · HN ↗
    Note that I believe this comment was substantially edited after I replied.
    jayd16 · 1790294533 · focus · HN ↗
    > Or do they just claim it's of negligible value and avoid the tax?
    Property is already taxed based on its assessed value.
    invalidOrTaken · 1790295629 · focus · HN ↗
    > all the landowners who own rural land that doesn't have a profitable development path attached to it
    If it doesn't have a profitable development path attached, the price(and therefore "value") will go down, as will the tax burden.
    rtpg · 1790297492 · focus · HN ↗
    This is a solved problem, because of things like primary household exceptions!
    You can also of course make the land tax not be 1% but 0.1% or 0.2% or whatever number that is deemed "alright". Make it progressive taxation if you want.
    For rural land that really actually is worth nothing... well it's a tax on value right? You can easily just make it 0% under a certain amount per acre or whatever.
    You might think "OK well then the tax will get so many carve outs that it will not work". Maybe. But tax law doesn't actually have to fit on a postcard. It's alright for it to have _some_ complications.
    I am sympathetic to people going underwater on their mortgages for their primary households for example because then they can't even really move (so things like changing jobs becomes hard). And land is less fungible than other assets, so "just sell 1% of your land to pay off taxes" is... not that workable for many.
    I think that at one point land owners do have to be exposed to _some_ risks and costs. Society is worse off in a world where land owners only get upside!
    robocat · 1790304422 · focus · HN ↗
    [delayed]
  7. anon373839 · 1790292154 · focus · HN ↗
    > Rent is a function of supply and demand
    Is there really a market dynamic in rent pricing anymore? I thought that algorithmic collusion had eliminated the need for landlords to compete on price.
    georgemcbay · 1790305448 · focus · HN ↗
    > I thought that algorithmic collusion had eliminated the need for landlords to compete on price.
    Well, that and non-enforcement of antitrust which is a big part of many of our current economic problems.
    With massive corporate landlords like Greystar and Morgan Properties owning so much of the market they can do a lot of pricing damage even without colluding with other landlords (but of course they do that too).
    mrguyorama · 1790374365 · focus · HN ↗
    There's a somewhat non-conglomerate reason though too:
    The government, society, municipalities in the US do not build housing. They allow it to be built. Housing is built by developers, who are businesses that insist on making a profit.
    So lets say you are one of the only couple of companies that can build a new 100 unit apartment in an area with tight housing supply. Great, you love money, you will look to invest in a development to capture some of that market and make money.
    Do you build 100 cheap units for $X and make 5% profit over your planned ROI term, or do you build 100 absurdly upmarket units for $X + 10% dollars and make 10% profit over the same ROI term?
    You already know the answer. The normal response is that "All new build is good and will lower price" but no, the rich people buying McMansions and $3000 per month condos in states they haven't ever been to can just absorb far more supply than actual local workers. And, well, they are so fucking rich compared to the average person that they can simply not care about how many of these properties they own, so there isn't downward pressure on them to sell off some of those locations.
    The rich are just too rich and can easily outbid the rest of us forever for anything. They are so rich and their marginal value of a dollar is so low that they can happily buy up expensive housing basically for shits and giggles and sit on it and forget they even have it. They own ten properties they never visit. Because they can literally own a property just because they might some day want to visit.
    Developers have mostly decided to only serve that clientele because they are so goddamned profitable, because they will negotiate less, will happily pay for box checking features meant to increase the price (like really really bad smart home implementations that they never even experience because they never go to that home). The rich guy who hired my dad to be his general contractor doesn't care what my dad charges and doesn't look at the bill, so my dad abandoned his plan to build 10 houses and instead just lives a relaxing life off of that man's excess, because why the fuck would you do a hundred times the work for less money?
    That's one of the reason income inequality on it's own is so bad. Money doesn't work in a linear way, so having 2X the dollars as the next guy is more than 2X as "powerful". The uber rich can just own everything and you have no hope of outbidding or competing. You simply have no other choice than finding what little scraps they ignore.
    Capitalism optimizes for best profit per effort. In a society where a tiny percent own the majority of all resources, why would you ever fight for the scraps the little guys have?
    Profitable businesses in Portland are being forcibly evicted to be replaced with brand new hotels meant for Executives to visit once a year, all over the area, because providing any service to the uberwealthy is just that much more profitable than providing very necessary service to the average person. It doesn't matter how desperate normal people get, they can't afford to outbid the uberwealthy.
    Gormo · 1790436866 · focus · HN ↗
    > I thought that algorithmic collusion had eliminated the need for landlords to compete on price.
    What sustains 'algorithmic collusion' in a non-market-clearing situation when landlords ultimately just want to rent their property out?
    To put it another way, why would a property owner who has a vacant house leave it unrented in order to benefit other property owners at his own expense?
  8. echoangle · 1790292748 · focus · HN ↗
    > We also don't see landlords who own their properties outright (and thus don't have mortgage interest costs) charging lower rents than landlords in the neighborhood with identical properties who have mortgages.
    Why would they as long as they find a renter? The market always charges the marginal cost.
    iso1631 · 1790307930 · focus · HN ↗
    They will charge the maximum amount possible, no matter what their costs.
    bagacrap · 1790308328 · focus · HN ↗
    And the maximum amount possible is based on the cost of bringing more housing supply to the market aka the marginal cost.
    iso1631 · 1790309412 · focus · HN ↗
    Which comprises
    1) Cost of land per year (which won't change as you'd be paying $10k a year tax rather than $10k a year in interest on the loan taken to buy the land)
    2) Cost of building per year (which won't change)
    bagacrap · 1790396268 · focus · HN ↗
    I don't think that logic works because if I'm paying for a loan, I'm not just paying interest, I'm also paying against principal. So in the new, landtax world, I'm building less equity for the same rental cashflow. If I'm thinking of building a unit for rental, I look at all the costs over the next 10-30 years, and all the expected revenue, including eventually owning an asset with some perpetual value. If we have higher taxes in perpetuity then that final asset has lower value and I need to charge more rent to make the same profit in that timespan.
    Not to mention that many real estate investors don't use loans, and that the banks giving out loans understand the lack of equity being built and demand higher interest given the inherently lower collateral (greater risk).
    iso1631 · 1790576420 · focus · HN ↗
    You're assuming that the loan repayments of interest plus capital are the same as the land tax. That wouldn't be the case.
    Currently the purchase price of the property includes a good deal of future land rent, you just pay the current owner.
    If you spend $50k on some land and pay 5% a year you're paying $2500 a year in rent, but you're paying that to the existing owner.
    Under an LVT you'd be paying $2500 in rent, but the land itself would cost basically nothing.
    Whether it's a loan, or the opportunity cost from not putting the capital elsewhere, doesn't matter.
    Land speculators profit from land values increasing, and they do nothing other than gamble. They don't increase the value of their own land, that's what their neighbours do. LVT removes that speculation, and indeed risk. If the area goes downhill (say in Detroit), your taxes lower
    The downside of this is if you have taxes funding the government, you end up in a death spiral. That's what the UK has with council tax (which is very regressive, a 10m house in one area can pay less than a 100k flat in another, and even in the same area would only pay about 3 times the price), and I believe it's the case in the US.
    That's why I'd rather see a citizens dividend than just cutting taxes.
  9. seanmcdirmid · 1790293434 · focus · HN ↗
    Landlord costs affect supply in the long term, so you will see changes, just not necessarily immediately over a one year period, but definitely over a 5-10 year period.
    > We also don't see landlords who own their properties outright (and thus don't have mortgage interest costs) charging lower rents than landlords in the neighborhood with identical properties who have mortgages. When landlords' costs drop, do they drop the rent in response?
    If costs are uniform for each landlord (they have to pay for), it limits the amount of money they can invest in new capacity, and you will see the effects over a decade. If one landlord has cost advantage over another, then they will of course probably just take the extra money as extra profit.
    > Taxes on land do not affect the supply of the land, this implies they are not passed on and the research literature largely agrees with this.
    They provide friction with what can be done with the land, because the cost of owning the land has to be paid. If it is just a land tax, however, you can game it by building as much as possible on it so the landowners who can't build as much as you can subsidize your usage (long term, you either have to build as much as you can on your land, or sell the land to someone who can).
    Gareth321 · 1790326959 · focus · HN ↗
    > Landlord costs affect supply in the long term, so you will see changes, just not necessarily immediately over a one year period, but definitely over a 5-10 year period.
    This is true, but the degree depends on elasticity of supply, and that depends a lot on profitability of the sector.
    roenxi · 1790337994 · focus · HN ↗
    > Landlord costs affect supply in the long term, so you will see changes, just not necessarily immediately over a one year period, but definitely over a 5-10 year period.
    In fact - although that logic is usually correct - in the case of a land value tax it isn't useful because landlords do not supply land. Someone is still going to own the land and it is still going to be used for something. There is no incentive to leave it unused. There aren't any less resources in the overall system and resources haven't been diverted from a productive use to an unproductive use (quite the reverse, they're being redirected away from someone who was doing nothing to earn them). That is the theoretical advantage of taxing the land.
    If it were anything else (eg, taxing the houses on the land) then the argument would be useful because the tax was on transforming less valuable resources into more valuable and there would be less productive economic activity and losses leading to less supply of something that the economy was signalling a need for.
    There might be a reallocation from housing to some other purpose if an LVT is bought in, who knows. But it is a very context-dependent change and not possible to reason about as a general outcome. It might be that the economy produces exactly the same amount of housing before and after. Less resources overall will be allocated to landlords, obviously, but not in a fashion that penalises building houses.
    > If it is just a land tax, however, you can game it by building as much as possible...
    I've never heard an entirely satisfactory process for valuing the land either.
    DreadY2K · 1790357285 · focus · HN ↗
    > If it is just a land tax, however, you can game it by building as much as possible on it
    That's not gaming it, that's the tax working as intended. We need more housing, so if that gets people to build more of it, that's a win.
    MaysonL · 1790807823 · focus · HN ↗
    So the land tax does away with zoning?
    bjustin · 1790454740 · focus · HN ↗
    > If it is just a land tax, however, you can game it by building as much as possible on it so the landowners who can't build as much as you can subsidize your usage (long term, you either have to build as much as you can on your land, or sell the land to someone who can).
    I was on the fence but your advocacy in favor of the land value tax has convinced me. Well played.
  10. ajb · 1790293939 · focus · HN ↗
    A transaction can occur if the price is >= the seller's cost, and <= the value to the buyer. If it's at the minimum, the seller must pass on the tax or not trade, at the maximum (down to the max minus the tax) , the seller can't pass on (all of) the tax and still trade. We observe that landlords make profit, so we are not at the minimum. Are we at the maximum?
    I think there are cases where we are in between for significant periods of time. Consider a positive shock to wages. Can landlords put up prices overnight? I don't think so, unless the landlords all co-ordinate to do so, prices will be sticky as there are always some properties in the market, so it's difficult to be the first to increase rent. Unlike a purchase, a landlord who waits for a buyer at the right price is forgoing income during the void. So the market price can be a Schelling Point.
    A tax increase, however, happens at the same time to all landlords. All of them would prefer to pass it on, and they know that so they can assume all other landlords will try to pass it on. If the rent is currently below the maximum possible, they will succeed.
    How long it takes prices to adjust I don't know. It is an empirical question, but I don't know what data would answer it. But it seems like it took decades for landlords to capture the two-income surplus after it became common for women to have a career.
  11. sroussey · 1790293973 · focus · HN ↗
    This is a prime example of short term thinking, often espoused by politicians.
  12. jayd16 · 1790294248 · focus · HN ↗
    Landlord costs drives supply at a given price point so your initial premise is flawed.
  13. xp84 · 1790295457 · focus · HN ↗
    I do acknowledge that rent is a function of supply and demand in the big picture, at least. I don't think the whole foundation of economics is wrong.
    Demand for apartments will be constant. Supply of apartments will be constant.
    But I think what's going on here is that we are way off the equilibrium point. The supply of good places to rent is far outpaced by demand for them, at most price points, and especially so where all the value is (on the coast). So, this means if you're a landlord and you know you'll owe another $1200 tax to Sacramento this year, you should be very confident that if you raise rent by $100 a month, even if an individual tenant would rather move than pay it, someone who can afford $100 more exists and will almost certainly fill that vacancy promptly. It may represent a slight step down in what their buying power would buy. Like, they may have rented a $3000 apartment before, and they'll now rent what used to be a $2900 apartment from you for $3000.
  14. parineum · 1790295976 · focus · HN ↗
    Profitability of renting effects supply. Reducing the profitability of renting reduces supply which, as you noted, increases price.
  15. anamax · 1790296710 · focus · HN ↗
    > Rent is a function of supply and demand, not a landlord's costs,
    Do you really believe that landlords will subsidize tenants for a long time?
    More to the point, if landlords are losing money, why would anyone build rental housing? Instead, why wouldn't they take housing off the market?
    lkjdsklf · 1790309792 · focus · HN ↗
    > Do you really believe that landlords will subsidize tenants for a long time?
    This literally happens all the time in California.
    You buy a house in CA. You move somewhere else. You hold on to the house because your property taxes are fixed and housing prices grow like crazy here. Maybe your kids will want it. Maybe you'll want to move back..
    You can't charge enough rent to cover the mortgage and taxes os you end up taking a loss monthly.
  16. WalterBright · 1790315685 · focus · HN ↗
    > Rent is a function of supply and demand, not a landlord's costs
    Of course it does. The landlord's costs factor into the supply made available by landlords.
    > When landlords' costs drop, do they drop the rent in response?
    Competition says they do.
    ajb · 1790324384 · focus · HN ↗
    [delayed]
    WalterBright · 1790368321 · focus · HN ↗
    > Market can be out of equilibrium for a long time; maybe indefinitely.
    Arbitrage forces say otherwise.
    ajb · 1790465393 · focus · HN ↗
    [delayed]
  17. jjav · 1790329333 · focus · HN ↗
    > Rent is a function of supply and demand, not a landlord's costs
    Only in one direction. If that rent, based on supply and demand, does not cover all of the owner's costs (+profit) then that rental property simply disappears off the market. No owner is going to rent out at a loss, so either the renter is paying for all expenses (+profit), or they get kicked out.
  18. LastTrain · 1790338408 · focus · HN ↗
    > Rent is a function of supply and demand, not a landlord's costs
    And one of the functions of supply is cost.
2. dwheeler · 1790288983 · focus · HN ↗
  That cost will, of course, be passed on to renters unless the rental prices cannot be raised at all.
  If they can't be raised, and the costs end up being ruinous to the landlords, they will find other solutions like mass arson. That isn't hyperbole; this was a serious problem in the 1970s: <a href="https://en.wikipedia.org/wiki/1970s_South_Bronx_building_fires" rel="nofollow">https://en.wikipedia.org/wiki/1970s_South_Bronx_building_fir...
  That was obviously not acceptable... but it was predictable.
  All legal proposals should be viewed like a chess move. Presume others will respond, and make sure you're ok with that response. In a sense that's also the point of the original article too, a law was passed without adequqtely thinking through what would happen.
  1. Guvante · 1790289304 · focus · HN ↗
    Feel free to quote in the article what supports your summary given the article doesn't actually talk about that
    In fact it mentions insurance fraud as the cause...
    Additionally it certainly wasn't increasing cost but reduced income which is a very different issue
    CodeWriter23 · 1790289691 · focus · HN ↗
    Yeah. Arson-induced insurance fraud. Hope this helps.
    Guvante · 1790378976 · focus · HN ↗
    But that doesn't align with your phrasing above
  2. iloveoof · 1790289340 · focus · HN ↗
    If landlords can already raise the price of rent, why haven’t they?
  3. QuadmasterXLII · 1790289523 · focus · HN ↗
    That’s one of the ideas of LVT actually: building apartments in land doesn’t increase tax burden, burning the apartments doesn’t lower it
    dwheeler · 1790290546 · focus · HN ↗
    I actually think there's a lot of positives in land value taxes. However, I was objecting to the phrase "The land value tax can’t be dodged by leaving nor can it be passed on to renters" because that is missing key issues.
    Land's assessed value is based on what you could do with it. If can be rented at a profit, that's something you can do with it, and its potential matters. If it can't, then that is no longer a potential value of it.
    That doesn't make lvt a bad idea, it's just that I think there's not enough acknowledgement of the trade-offs and limitations.
    aesthesia · 1790293973 · focus · HN ↗
    Burning down an apartment building doesn't change what could be done with the lot; an appropriate valuation method for LVT would not take this into account when setting the valuation.
    dwheeler · 1790296799 · focus · HN ↗
    > Burning down an apartment building doesn't change what could be done with the lot; an appropriate valuation method for LVT would not give a different valuation for the land depending on what is built on it.
    True, but an LVT is a cost. Changes in cost can change what is financially viable to do with a property, regardless of what is currently done with the lot, and thus can impact the land value.
    kjshsh123 · 1790310957 · focus · HN ↗
    Actually no, land value tax is not marginal cost so does not change the profit maximizing use of land.
    The idea of cost-plus pricing is folk economics.
    Tax incidence is very well understood in economics and has to do with relative supply and demand elasticity (supply of land is perfectly inelastic) and marginal costs which land value tax does not touch.
    It's accurate to say LVT changes the price of land. But it doesn't change the profit maximizing productive use of land.
    Other taxes that scale with production (sales tax, income tax, property tax) do change profit maximizing productive use.
    QuadmasterXLII · 1790341092 · focus · HN ↗
    And crucially, “rent it for 10 bucks” and “rent it for 20 bucks” are different uses such that the LVT can’t change which is optimal
  4. danny_codes · 1790289859 · focus · HN ↗
    Arson would be irrelevant for land taxes.
  5. kccqzy · 1790289996 · focus · HN ↗
    [delayed]
  6. thewanderer1983 · 1790290052 · focus · HN ↗
    > they will find other solutions like mass arson.
    Or the more likely option is they will no longer do investment properties as the return it too low vs the risk.
  7. pydry · 1790290702 · focus · HN ↗
    >If they can't be raised, and the costs end up being ruinous to the landlords, they will find other solutions like mass arson
    Landlords who have their entitlements ripped away from them would almost assuredly endorse the use of violence.
    Land redistribution (of which this is a form) from the propertied to the propertyless has historically resulted in brutal violence in order to protect the privilege of the propertied.
    elmer2 · 1790291541 · focus · HN ↗
    Why shouldn't people's property be protected?
    pydry · 1790365416 · focus · HN ↗
    you mean their entitlement to natural non-man made wealth?
3. Avicebron · 1790289113 · focus · HN ↗
  LVT is incoherent, it pretty much only benefits people who are cash rich and land poor. Which is why it gets so much oxygen from tech elites with lots of cash and an inability to buy a house somewhere like mill valley, or wherever.
  Essentially taken to the logical conclusion, there will be people competing for more cash to pay their increasing taxes on the same land, it doesn't fundamentally solve the problem. It's such a joke.
  1. azan_ · 1790289722 · focus · HN ↗
    The idea is that valuable land will be utilized better.
    Avicebron · 1790290018 · focus · HN ↗
    "utilized better" in that context just means that the owner of the land can support the taxes on it, it doesn't mean suddenly we are going to put skyscrapers in el cerrito.
    pydry · 1790291544 · focus · HN ↗
    It would most definitely lead to densification in SF and its surroundings.
    Detrytus · 1790311459 · focus · HN ↗
    No, you won't have a skyscrapers in some random village in the middle of nowhere. But maybe the land owner, seeing how high is the LVT tax is, decides to build an apartment building with 50 units, instead of 5 single family homes. And that's a win.
  2. danny_codes · 1790289955 · focus · HN ↗
    It completely solves the problem. I recommend you read “progress and poverty” to get a better understanding of it.
    You don’t seem to understand how it works or what it does.
    Avicebron · 1790290725 · focus · HN ↗
    I do understand how it works, are you saying that the zoning will magically be fixed when the taxes go up or the land becomes more exlusive? because I can tell you which one has precedent and which one is wishful thinking.
    danny_codes · 1790348634 · focus · HN ↗
    Yes, zoning does get magically fixed, because the incentives that led to zoning disappear. Under full LVT, owners have an incentive to maximize their land use. Otherwise, they will go bankrupt. So places with zoning more restrictive than land use demands will be underwater financially. Think SFH tract homes in Cupertino. These homeowners have fought viciously to retain SFH zoning. If LVT was imposed 95% of them would be faced with a tax bill they cannot pay. Their only option would be to surrender their land or rezone to allow development of sufficient scale to pay the tax.
    It’s not wishful thinking it’s just a fact. Zoning exists because landowners want it. As soon as they don’t want it, it’s gone.
4. maest · 1790289159 · focus · HN ↗
  Rents are already as high as renters can bear. If a tax is introduced, you'd expect landlord competition to drive down the landlord margins, not increase rents.
  1. arrowleaf · 1790289926 · focus · HN ↗
    And if margins are decreased, then... (what happens to new supply?)
    Alpha3031 · 1790290482 · focus · HN ↗
    [delayed]
    sapphicsnail · 1790294299 · focus · HN ↗
    They can make higher density buildings that generate more income and house more people on the same amount of land.
  2. 8note · 1790291316 · focus · HN ↗
    youd think that, but you can fit another 10 people into that studio apartment
  3. Gigachad · 1790292433 · focus · HN ↗
    I don't think this is why it won't get passed on. In theory the lowest income could leave the state and higher income renters would come in.
    But in reality a land value tax incentivizes higher density housing. A single house and an apartment complex pay the exact same amount of tax, while the apartment building can split it up over many occupants. Land value taxes are a very natural hands off way of encouraging the right use of land, empty lots and car parks become unaffordable in highly desirable areas while apartments become relatively very cheap.
    pessimizer · 1790295022 · focus · HN ↗
    > In theory the lowest income could leave the state and higher income renters would come in.
    Why would a land tax make the state more attractive to higher income renters than where they currently live?
    happyopossum · 1790298866 · focus · HN ↗
    [delayed]
  4. doctorpangloss · 1790309531 · focus · HN ↗
    listen to yourself
5. CodeWriter23 · 1790289599 · focus · HN ↗
  This is the problem with governments who think they can synthesize value. They think all businesses can too.
  If these communists succeed, they will use the very fact that a landlord cannot synthesize money to prove the landlord passed the cost to the tenant and seize the land.
6. wmf · 1790292712 · focus · HN ↗
  My understanding is that LVT would be lower than current property taxes, so it should be viewed as a tax cut for landlords not an increase.
7. bijowo1676 · 1790307062 · focus · HN ↗
  the rent is already priced to the maximum of purchasing power of the local renters ability.
  if landlords were able to raise rent, they would have done that already as its pure profit for them. The fact that they can't, means they will have to eat any marginal tax imposed on them
  1. superfrank · 1790307534 · focus · HN ↗
    The author makes the comment about the land value tax not being able to be passed on to renters in the context of comparing it to a property tax.
    If I’m understanding the argument you’re making here correctly, wouldn’t what you’re saying be equally true for a property tax?
    I’m not saying you’re wrong, but I don’t think the author would agree with your point since I don’t see how your argument could be true for a land tax, but not for a property tax.
    bijowo1676 · 1790316835 · focus · HN ↗
    costs are irrelevant here, imagine there was no tax hike, but just landlords decided to be greedy.
    if they hike rents, whoever is more inelastic will eat the rent increase to the degree of her inelasticity.
    the cost increase is shared between renters/landlords in the ratio of their elasticities. Whoever is more inelastic, will eat the cost.
    Inealstic renters will pay up increased rent (like techbros in SF are eating up all rent increases).
    Elastic renters will get up and move to Texas, if renter swill hike rent.
    Elastic landlords will lever down and decrease number of low margin properties like rent-controlled properties, or unprofitable properties.
    Inelastic landlords will eat the taxes and take a hit to profitability.
    superfrank · 1790356273 · focus · HN ↗
    Yeah. I understand the point you’re making, but what I’m saying is that I don’t think that aligns with the authors position.
    The author seems to say that costs can be passed on to the renters when the costs are a property tax, but they cannot be passed on when it’s a land tax. That seems like a really odd position to take and it doesn't align with your "costs are irrelevant" statement. I fully admit that I could be missing something, but I don’t understand how it can be true that only certain types of taxes can be passed on to renters.
    I fully understand the argument you’re making and I’m neither agreeing nor disagreeing with it. It sounds logical, but I frankly don’t know enough about this topic really process it. What I’m saying is that regardless of whether you’re right or wrong, I don’t think your argument is the same one the author is making unless I’m missing something in your argument about why that only applies to land taxes and not property taxes.
  2. chris_va · 1790309310 · focus · HN ↗
    Landlords are competing with each other, and renters can take their next best alternative. If everything gets strictly more expensive, the next best alternative is not necessarily any cheaper...
    bijowo1676 · 1790316301 · focus · HN ↗
    if everyone raises rents by a certain percentage trying to recoup taxes, this will be equivalent of Supply line shifting up by the amount of tax in Economics 101 terms.
    From economics we know that increase in cost is split between Landlords/Renters in accordance to their elasticities. Whoever is more elastic - will eat the tax.
    if renters are elastic, they will get up and move out of state to Texas. Alternatively, they will demand more wages, and wages usually kick up inflation.
    if landlords are elastic, they will have to eat the tax from their profits, some will shutdown or lever down (reduce number of properties)
  3. throw2726264 · 1790320956 · focus · HN ↗
    > The fact that they can't, means they will have to eat any marginal tax imposed on them
    My company rents a space in a commercial lot, and the contract states the property tax is split among the tenants. It's separate from the rent.
    Apparently this is common in commercial settings. I wouldn't be surprised to see this start happening for consumers.
    bijowo1676 · 1790325081 · focus · HN ↗
    some tenants who are on the margin of profitability will decide to close shop/relocate to Texas, which will free up rental space and drive down the prices
8. roshin · 1790309784 · focus · HN ↗
  Sounds like the debate from 2 years ago whether the importer or exporter pays for tarrifs
9. csomar · 1790309860 · focus · HN ↗
  The author probably has a very superficial understanding of economics. It's economics 101, like VAT, the cost will be passed to BOTH the renter and the landlord. The portion of each is dependent on market dynamics and hard to calculate.
  1. kjshsh123 · 1790311095 · focus · HN ↗
    >In the instance of perfect elasticity of the demand or perfect inelasticity of the supply, the price will remain the same and the entire tax burden is on producers. An example of perfect inelastic supply curve is unimproved land (the supply of improved land is elastic because more or less could be created by investment in improvements) or crude oil. Thus, the whole tax burden is on landowners and owners of the oil.
    <a href="https://en.wikipedia.org/wiki/Tax_incidence" rel="nofollow">https://en.wikipedia.org/wiki/Tax_incidence
    It's literally econ 101 that says landowners will bear the burden of a land value tax.
    Supply of land is perfectly inelastic and land value tax is not a marginal cost of production so does not change MR=MC.
    bijowo1676 · 1790316720 · focus · HN ↗
    renters dont rent land.
    renters rent apartments/houses, and these things are very elastic.
    the cost increase is shared between renters/landlords in the ratio of their elasticities. Whoever is more inelastic, will eat the cost.
    Inealstic renters will pay up increased rent (like techbros in SF are eating up all rent increases).
    Elastic renters will get up and move to Texas, if renter swill hike rent.
    Elastic landlords will lever down and decrease number of low margin properties like rent-controlled properties, or unprofitable properties.
    Inelastic landlords will eat the taxes and take a hit to profitability.
    kjshsh123 · 1790342415 · focus · HN ↗
    LVT doesn't change the profit maximizing rent of apartments, or the quantity supplied.
    You can feel free to solve the profit maximization problem of the apartment owner if you want.
    <a href="https://en.wikipedia.org/wiki/Profit_maximization" rel="nofollow">https://en.wikipedia.org/wiki/Profit_maximization
    bijowo1676 · 1790355238 · focus · HN ↗
    if there are apartments on the margin of profitability, the cash outlay of LVT will have impact in either landlords quitting the market or deferring/stopping maintenance and such
    kjshsh123 · 1790356995 · focus · HN ↗
    Nope. If it was most profitable to quit the market or stop maintenance before LVT, it would be most profitable after.
    A conversation with an LLM where you paste this exchange into the context is likely to clear up the reasons for your misconception.
sublinear · 1790288829 · focus · HN ↗
"I'm livin' to keep warm, you livin' to pay rent [...] Bitch I made my moves, with shackled feet"
- some Kendrick guy
1. chasd00 · 1790289199 · focus · HN ↗
  Narrator: Kendrick’s feet were never shackled.
demo4567 · 1790289190 · focus · HN ↗
[dead]
duhhhhh1212 · 1790289304 · focus · HN ↗
<a href="https://www.pangram.com/history/afa0fd9b-eeae-49d0-932a-24b80c82a441?ucc=t8c6BkzVOh8" rel="nofollow">https://www.pangram.com/history/afa0fd9b-eeae-49d0-932a-24b8...
This is mostly slop. Don’t waste your time.
xlayn · 1790289407 · focus · HN ↗
just make it federal, bump it to 20%, permanent, each year over shares they own... then they will still pay 20% less than the other 90% of USA
flenserboy · 1790289732 · focus · HN ↗
Coveting is a terrible basis for an economic system.
1. jadar · 1790290557 · focus · HN ↗
  Which economic system are you critiquing? I would tend to agree, since I think wealth taxes amount to a breaking of the 8th and 10th commandments. But I also think some would argue that the consumerism (envy) that often drives capitalism is a form of covetousness. I think the counter argument is that capitalism does not require consumerism, and that consumerism (envy) can appear in any economic system.
  1. 8note · 1790309917 · focus · HN ↗
    capitalism itself is covetousness and greed.
    not good believer in christ would ever participate, when jesus made it clear you are supposed to freely give away everything you own to the poorest among us
    logicchains · 1790310617 · focus · HN ↗
    It's covetous to expect someone else to give you a part of something they worked for and you contributed nothing to. One of the basic 10 commandments is not to covet your neighbour's property; envy is a sin.
2. JKCalhoun · 1790292615 · focus · HN ↗
  You prefer a regressive one?

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