Leading French presidential candidate's 75 percent tax

[BigBallinStalin]

Ooooh now we're getting somewhere.

But deadweight losses are offset if the government investments are also efficient.

If the government is moderately efficient the effective deadweight loss isn't what a hardline capitalist will tell you because the investment landscape looks very very different. That 0.75 cents in every dollar doesnt dissapear from the economy. A rational investor will know this an understand the impacts on risk.

Note: I dont support a 75% tax rate on millionaires. I do however support a progressive tax rate in the order of 30-50% on top earners depending on policy (only applying to marginal income of course).

"But deadweight losses are offset if the government investments are also as efficient" as economic decision-making of individuals within the market. If that was true, then the Soviet Union's economic policies should have been a smashing success.

Of course, it depends on the goods in question, so now we get into the grand 'ol debate government v. non-government provision of goods. We can also talk about how decision-makers within the government and in bureaucracies face different incentives than decision-makers in the market. (I'd argue that this difference explains the inherent inefficiency of the government provision of many goods. Of course, this inefficiency decreases relative to non-rivalrous and non-excludable nature of the good)...

so now what, Lootifer? Where do you want to begin?

[Timminz]

Deadweight loss is a perfectly valid argument against taxation, but I don't like the description provided here. Particularly the part about realizing gains net-of-taxes, but realizing losses in-full. Investment losses do indeed have a tax effect, and so losses are only realized at the same rate as gains (assuming all figures are within the same bracket).

[betiko]

Ooooh now we're getting somewhere.

But deadweight losses are offset if the government investments are also efficient.

If the government is moderately efficient the effective deadweight loss isn't what a hardline capitalist will tell you because the investment landscape looks very very different. That 0.75 cents in every dollar doesnt dissapear from the economy. A rational investor will know this an understand the impacts on risk.

Note: I dont support a 75% tax rate on millionaires. I do however support a progressive tax rate in the order of 30-50% on top earners depending on policy (only applying to marginal income of course).

did you guys read what I wrote? 75% tax on +1M€ earners doesn't mean 75cents on the euro, it's less. if you earn a billion a year or something yes, it's almost 75cents on the euro.
And since the subject is about french economy and that you guys have deviated quite the subject, I also wanted to add that total income taxes in france are equivalent to the reimbursment of interests on the national debt. Add on top of that that the government spends +33% more than it gets income, and you wonder where we are heading to. Tax all from the rich? yeah, best populist proposition ever! I'm sure you would end up with less income because they would all fly away from france and pay taxes elsewhere.
Then you see that a situation that seems tragic from are point of view is actually way worse than most countries now a days.
Let's get ready to be ruled by the fed and the big banks. After all, they designated the new leader in italy a few month ago, goodbye elections and "democracy" (anyway how stupid can italians be to be electing time after time berlusconi?)

[Timminz]

And to think, France used to be used as a tax haven.

[Lootifer]

Ooooh now we're getting somewhere.

But deadweight losses are offset if the government investments are also efficient.

If the government is moderately efficient the effective deadweight loss isn't what a hardline capitalist will tell you because the investment landscape looks very very different. That 0.75 cents in every dollar doesnt dissapear from the economy. A rational investor will know this an understand the impacts on risk.

Note: I dont support a 75% tax rate on millionaires. I do however support a progressive tax rate in the order of 30-50% on top earners depending on policy (only applying to marginal income of course).

did you guys read what I wrote?

Bolded bit indicates I did

Um BBS should we even bother? I mean I might learn something new, but I dont really have the time or inclination tbh... I prefer the instant gratification of funny gifs.

[BigBallinStalin]

Deadweight loss is a perfectly valid argument against taxation, but I don't like the description provided here. Particularly the part about realizing gains net-of-taxes, but realizing losses in-full. Investment losses do indeed have a tax effect, and so losses are only realized at the same rate as gains (assuming all figures are within the same bracket).

(underlined) What's that mean? I don't know much about accounting terms, if that's what they are.

(bolded) Yeah, haha, I don't know what you're implying. Are you talking about investments made by government and/or non-governmental actors? Or wat?

[BigBallinStalin]

Ooooh now we're getting somewhere.

But deadweight losses are offset if the government investments are also efficient.

If the government is moderately efficient the effective deadweight loss isn't what a hardline capitalist will tell you because the investment landscape looks very very different. That 0.75 cents in every dollar doesnt dissapear from the economy. A rational investor will know this an understand the impacts on risk.

Note: I dont support a 75% tax rate on millionaires. I do however support a progressive tax rate in the order of 30-50% on top earners depending on policy (only applying to marginal income of course).

did you guys read what I wrote?

Bolded bit indicates I did

Um BBS should we even bother? I mean I might learn something new, but I dont really have the time or inclination tbh... I prefer the instant gratification of funny gifs.

If you change your mind, I found this lit. survey paper to be the best on economics and political institutions. For questions regarding "state v. private" provision, they take it into a more sophisticated framework. In short, it's a trade-off between disorder (i.e. the social losses due to private expropriation) and dictatorship (i.e. social losses due to state expropriation).

show

Otherwise,

[Lootifer]

offtopic: reckon he won legit?

[BigBallinStalin]

In democratic, capitalist Russia, he got 60% of the vote, didn't he?!

[rockfist]

He is no more legitimate than the Communist Party wins in the 1950's through the 1980's.

The most shocking thing I find about it is that it actually generates headlines that "he may have cheated."

[Timminz]

Deadweight loss is a perfectly valid argument against taxation, but I don't like the description provided here. Particularly the part about realizing gains net-of-taxes, but realizing losses in-full. Investment losses do indeed have a tax effect, and so losses are only realized at the same rate as gains (assuming all figures are within the same bracket).

(underlined) What's that mean? I don't know much about accounting terms, if that's what they are.

(bolded) Yeah, haha, I don't know what you're implying. Are you talking about investments made by government and/or non-governmental actors? Or wat?

I was referring to your analogy of the investor only making 25 cents on the dollar for gains, but losing the whole dollar if the investment goes south.

Non-governmental investors. Like in your analogy.

[BigBallinStalin]

Deadweight loss is a perfectly valid argument against taxation, but I don't like the description provided here. Particularly the part about realizing gains net-of-taxes, but realizing losses in-full. Investment losses do indeed have a tax effect, and so losses are only realized at the same rate as gains (assuming all figures are within the same bracket).

(underlined) What's that mean? I don't know much about accounting terms, if that's what they are.

(bolded) Yeah, haha, I don't know what you're implying. Are you talking about investments made by government and/or non-governmental actors? Or wat?

I was referring to your analogy of the investor only making 25 cents on the dollar for gains, but losing the whole dollar if the investment goes south.

Non-governmental investors. Like in your analogy.

lol, this is gonna start looking weird.

That was a point about incentives.

What's your point?

[Timminz]

I realize now that I initially jumped in a handful of posts after-the-fact, and did not quote the part I was responding to, so let me back this up a bit.

Let's look at incentives, for example. Under a 75% tax for millionaires, think of it this way:

Mr. Capitalist Pig looks at an investment opportunity (which brings jobs, goods, and profits into the economy). He thinks "For every $1 I could earn, I am taxed $0.75; therefore, I only earn $0.25. And, for every loss, which I incur, I lose $1 for every $1 invested. So, do the risks of this seemingly profitable endeavor outweigh my expected profits?"

This is what I was taking issue with, bolded part specifically.

Regardless of whether it's a gain or a loss, marginal income is a net-of-taxes amount. Think of it this way: when Mr. Capitalist Pig losses $100 on a bad investment, in effect it cancels out the previous $100 he had earned (and already paid $75 tax on), so he gets $75 back, meaning he only lost $25 in the end.

There are plenty of decent arguments against taxation, but this isn't one of them.

[thegreekdog]

I realize now that I initially jumped in a handful of posts after-the-fact, and did not quote the part I was responding to, so let me back this up a bit.

Let's look at incentives, for example. Under a 75% tax for millionaires, think of it this way:

Mr. Capitalist Pig looks at an investment opportunity (which brings jobs, goods, and profits into the economy). He thinks "For every $1 I could earn, I am taxed $0.75; therefore, I only earn $0.25. And, for every loss, which I incur, I lose $1 for every $1 invested. So, do the risks of this seemingly profitable endeavor outweigh my expected profits?"

This is what I was taking issue with, bolded part specifically.

Regardless of whether it's a gain or a loss, marginal income is a net-of-taxes amount. Think of it this way: when Mr. Capitalist Pig losses $100 on a bad investment, in effect it cancels out the previous $100 he had earned (and already paid $75 tax on), so he gets $75 back, meaning he only lost $25 in the end.

There are plenty of decent arguments against taxation, but this isn't one of them.

Sorry to jump in here, but fatcats will sell loser stocks to generate a capital loss he/she can use against capital gains. It's less an argument against taxation and more a tool used by investors to avoid paying tax. Do they lose the money anyway? Sure. But why sell it at a loss 5 years from now when you can sell it at a loss now and avoid paying tax on your capital gains?

[Haggis_McMutton]

Sorry to jump in here, but fatcats will sell loser stocks to generate a capital loss he/she can use against capital gains. It's less an argument against taxation and more a tool used by investors to avoid paying tax. Do they lose the money anyway? Sure. But why sell it at a loss 5 years from now when you can sell it at a loss now and avoid paying tax on your capital gains?

Huh, interesting.

How do they know they'd lose money on the stock 5 years down the line?

[thegreekdog]

Sorry to jump in here, but fatcats will sell loser stocks to generate a capital loss he/she can use against capital gains. It's less an argument against taxation and more a tool used by investors to avoid paying tax. Do they lose the money anyway? Sure. But why sell it at a loss 5 years from now when you can sell it at a loss now and avoid paying tax on your capital gains?

Huh, interesting.

How do they know they'd lose money on the stock 5 years down the line?

I suppose they don't; I was probably exagerrating.

In any event, I know plenty of investors who will sell stock at the end of a year to recognize a loss so they can offset capital gains. Hell, my father does it.

[Timminz]

I realize now that I initially jumped in a handful of posts after-the-fact, and did not quote the part I was responding to, so let me back this up a bit.

Let's look at incentives, for example. Under a 75% tax for millionaires, think of it this way:

Mr. Capitalist Pig looks at an investment opportunity (which brings jobs, goods, and profits into the economy). He thinks "For every $1 I could earn, I am taxed $0.75; therefore, I only earn $0.25. And, for every loss, which I incur, I lose $1 for every $1 invested. So, do the risks of this seemingly profitable endeavor outweigh my expected profits?"

This is what I was taking issue with, bolded part specifically.

Regardless of whether it's a gain or a loss, marginal income is a net-of-taxes amount. Think of it this way: when Mr. Capitalist Pig losses $100 on a bad investment, in effect it cancels out the previous $100 he had earned (and already paid $75 tax on), so he gets $75 back, meaning he only lost $25 in the end.

There are plenty of decent arguments against taxation, but this isn't one of them.

Sorry to jump in here, but fatcats will sell loser stocks to generate a capital loss he/she can use against capital gains. It's less an argument against taxation and more a tool used by investors to avoid paying tax. Do they lose the money anyway? Sure. But why sell it at a loss 5 years from now when you can sell it at a loss now and avoid paying tax on your capital gains?

I would not argue against anything you've just written.

Are you arguing something I've written?

[thegreekdog]

I realize now that I initially jumped in a handful of posts after-the-fact, and did not quote the part I was responding to, so let me back this up a bit.

Let's look at incentives, for example. Under a 75% tax for millionaires, think of it this way:

Mr. Capitalist Pig looks at an investment opportunity (which brings jobs, goods, and profits into the economy). He thinks "For every $1 I could earn, I am taxed $0.75; therefore, I only earn $0.25. And, for every loss, which I incur, I lose $1 for every $1 invested. So, do the risks of this seemingly profitable endeavor outweigh my expected profits?"

This is what I was taking issue with, bolded part specifically.

Regardless of whether it's a gain or a loss, marginal income is a net-of-taxes amount. Think of it this way: when Mr. Capitalist Pig losses $100 on a bad investment, in effect it cancels out the previous $100 he had earned (and already paid $75 tax on), so he gets $75 back, meaning he only lost $25 in the end.

There are plenty of decent arguments against taxation, but this isn't one of them.

Sorry to jump in here, but fatcats will sell loser stocks to generate a capital loss he/she can use against capital gains. It's less an argument against taxation and more a tool used by investors to avoid paying tax. Do they lose the money anyway? Sure. But why sell it at a loss 5 years from now when you can sell it at a loss now and avoid paying tax on your capital gains?

I would not argue against anything you've just written.

Are you arguing something I've written?

No. I just thought it was relevant to the discussion that fatcats are not overly burdened by capital losses. I suppose I'm agreeing with you and arguing with BBS (if I could be said to argue with anyone).

[Timminz]

That's what I thought. Just needed the clarification.