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0 pointscroon4y ago0 comments

> If anything I think we should encourage rich people to give their money away (even if only to their children) since wealth consumed by a broader number of people leads to more happiness than if it's all consumed by one person. It's better for a $10 million fortune to be spent by 10 consecutive generations than for it to all be spent by the original owner.

I don't understand how you reach this conclusion. If the original owner spends all of it it enters a whole lot of more peoples pockets than his kids.

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OscarCunningham4y ago

Increasing the velocity of money doesn't help the world on average. Otherwise the Fed would just set their inflation target higher. Even if you disagree, given that the Fed has a fixed inflation target you can't do anything about it by changing inheritance tax. If you force a bunch of rich people to spend more than they would have, the Fed will just take that money straight back out of the economy.

Sometimes I find all this money swirling around difficult to keep track of. It's easier to forget about money and look at what's happening to the goods and services. Ten families in $1 million houses get more happiness than one family in a $10 million house and nine homeless families. No matter how you shuffle the accounting around it has to add up to that same utility difference.

croonOP4y ago

> If you force a bunch of rich people to spend more than they would have, the Fed will just take that money straight back out of the economy.

So if they go on more vacations, buy a flashy car, have more parties, you are saying that the Fed "takes that money straight back" and that it doesn't go to travel agencies, car dealers, caterers, party planners, service workers etc?

> Ten families in $1 million houses get more happiness than one family in a $10 million house and nine homeless families. No matter how you shuffle the accounting around it has to add up to that same utility difference.

Sure, and I reject your hypothetical and say it's better if 100 people live in $80k (after some tax) houses/condos than 1 in a $10M house, if we're just making things up.

OscarCunningham4y ago

> So if they go on more vacations, buy a flashy car, have more parties, you are saying that the Fed "takes that money straight back" and that it doesn't go to travel agencies, car dealers, caterers, party planners, service workers etc?

They do get the money. But the world hasn't become any more productive; the number of goods and services being produced is still the same. So when they spend that money and consume goods and services, someone else must necessarily be consuming less.

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imtringued4y ago

Assuming those savings are invested, it wouldn't change anything. Right now there is an excess of uninvested savings in corporations that is not being invested and sure, distributing that money would help with the economy but betting on inheritance taxes to do the job is weird. It's too unreliable.

croonOP4y ago

Por que no los dos?

j / k navigate · click thread line to collapse

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OscarCunningham4y ago

croonOP4y ago

> If you force a bunch of rich people to spend more than they would have, the Fed will just take that money straight back out of the economy.

Sure, and I reject your hypothetical and say it's better if 100 people live in $80k (after some tax) houses/condos than 1 in a $10M house, if we're just making things up.

OscarCunningham4y ago

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imtringued4y ago

croonOP4y ago

Por que no los dos?

j / k navigate · click thread line to collapse