Death Taxes

[lord of the mark]

Your estate size
depends on a helluva lot of things. How steady is your employment. How steady is your spouses employment. Forget getting rich off a good house investment, do you lose a couple of hundred thou in a BAD housing investment, as some around here are doing now? How many kids do you have? How expensive are they? Normal expensive, or do they have special needs that insurance doesnt cover and you cant convince the schools to help with? Do you have a messy divorce? That causes you to sell a house at an inopportune time? Or causes all your money to go to lawyers to fend off a grudge bearing spouse?

How much do you spend when you retire? How long do you live?


Its not that industry and thrift DONT matter, or even capitalist dealmaking, but its still a crapshoot.

[Arrian]

Oh, agreed.

Even leaving out the really disasterous stuff (divorce, losing your proverbial shirt in a bad real estate deal), merely having kids has a big impact. The little buggers are expensive.

In all likelyhood I won't hit the $2mil (though I don't concede it for sure), because:

a) I may not make enough money
b) My wife & I may have a kid.
c) If we do have a kid, I may very well go part time or even quit & do some sort of work from home. Part time would reduce my income & 401(k) contributions. Quitting and doing some sort of work-from-home thing would likely end my contributions altogether.

However. IF I remain a full time worker, and IF we don't have kids, and IF we suffer no calamity... it can be done.

-Arrian

[Kidlicious]

Originally posted by Arrian
True, over time things even out (though I'm not sure about 3-5%, but whatever). What I meant was that, for the purposes of determining whether I managed to get $2mil, where the market is in its cycle of boom/bust when I hit 59 1/2 will matter. Also, my own decisions will matter too. Say the market is riding high when I'm about 55 and I time things right and switch my money over into stable funds at just the right time. I do well. Say I don't - I don't do as well.

-Arrian

It's possible, and very unlikely.

[LordShiva]

Originally posted by Kidicious


No, you still have to contribute about 15k a year. What type of work do you do?

I save a lot more than that.

My job pays a little more than teh average 24 year-old's salary, but it's still "working." I don't own any means of production, nor do I make "deals."

[Kontiki]

Originally posted by LordShiva


I save a lot more than that.

My job pays a little more than teh average 24 year-old's salary, but it's still "working." I don't own any means of production, nor do I make "deals."

Yes you do. You probably have money invested in the market in some form or another. That makes you a dirty capitalist tightening the screws of oppression on anyone who doesn't feel like investing in the market.

[LordShiva]

[Agathon]

The justification for taxation is pretty simple. It's the justification for the distribution of taxation that is more complicated.

Taxation is justified because of market failure. Where there are substantial market failures in the provision of goods we need, we have to rely on public funding. There is no alternative, as letting everyone pay for it voluntarily is just putting it back into the hands of the market and results in the same market failure.

As for distribution of taxation, there seems to be a consensus (although I am not sure it is a good idea) that taxation should be distributed equally. It then depends on whether your conception is equality of welfare or equality of resources. The latter necessitates a flat tax (I don't mean a flat percentage, but a flat amount). The former necessitates a progressive tax, since $10 represents a steeper loss in welfare to a poor person than a rich person (the traditional flat percentage tax is really a progressive tax).

Almost nobody who allows for tax would argue for a flat sum tax, but would argue for a progressive or traditional flat percentage tax, thus implicitly accepting that the standard for the distribution of tax burdens is equality of welfare. And in that case, the progressives win, because the traditional flat percentage tax is not as accurate as the progressive tax as a measure of welfare burdens.

Dissenters from this model usually argue that higher taxes on the wealthy has a depressive effect on overall productivity, thus lessening the overall tax take. However, proof of this claim is sparse and it is largely politically motivated.

Surprisingly, we would probably be better off if there were much higher taxes, since most of our discretionary income is spent on competitive consumption, which is notoriously inefficient. A country that wants to improve the overall welfare of its citizens would do well to look at this.

[Kidlicious]

Originally posted by LordShiva


I save a lot more than that.

My job pays a little more than teh average 24 year-old's salary, but it's still "working." I don't own any means of production, nor do I make "deals."

The average 24 year olds salary is little more than that. You don't want to say what type of work you do?

[Kidlicious]

Originally posted by Kontiki


Yes you do. You probably have money invested in the market in some form or another. That makes you a dirty capitalist tightening the screws of oppression on anyone who doesn't feel like investing in the market.

I've got no problem with saving money and even earning interest or capital gains. What I oppose is large estates.

[LordShiva]

Originally posted by Kidicious


The average 24 year olds salary is little more than that. You don't want to say what type of work you do?

I'm a management consultant.

[Arrian]

Kid,

LS is a consultant. Exactly what he bull****s about consults on I don't know.

-Arrian

[Arrian]

Ah-hah! You help the managment oppressors keep the workers down!

Up against the wall!

-Arrian

[Kidlicious]

Originally posted by LordShiva


I'm a management consultant.

That's kind of iffy on the "work" there bud.

[Kontiki]

I thought you opposed ownership of the means of production without being an active participant in said production. Besides the total dollar amount, what's the practical difference between someone like you owning some stock for retirement savings and someone that owns a huge amount of stock and lives off of their transactions?

[LordShiva]

Originally posted by Kidicious


That's kind of iffy on the "work" there bud.

So you admit that one can make $2m over one's lifetime without working, without making deals, and without owning capital?