Bill Gates Advocates Tax On Financial Transactions 694
First time accepted submitter wanzeo writes "With the current G-20 summit dominated by global financial uncertainty, previously unsuccessful tax strategies are getting new attention. In a short interview with the BBC, Bill Gates explains his support for a potential tax on financial transactions. The concept is sometimes called the Tobin tax after its originator, Nobel Laureate economist James Tobin, who first put forth the idea in 1972. Gates points to the success of Britain's Security Settlement Tax, and suggests that large economies like Germany, France, and the U.S. have expressed interest in his plan."
A first (Score:5, Insightful)
This might be one of those rare times when I actually agree with Bill Gates. A tax on financial transactions should reduce or stop some of the most exploitive behavior in the financial world. "High frequency" trading would become much less profitable, as would the even less ethical exploit of attempting to generate out of date quotes by overloading a trading system system.
Re:A first (Score:5, Insightful)
While I'm on the fence about the tax, I am definitely with you on making high frequency trading as difficult and least profitable as possible.
HFT is what crashes markets at a moment's notice. It can destroy companies in a matter of minutes. And it also an affront to the entire concept of a market where well informed buyers make well informed decisions about the value of a product.
Markets for Markets (Score:5, Insightful)
While I'm on the fence about the tax, I am definitely with you on making high frequency trading as difficult and least profitable as possible.
Most people know this and the only people who like high-frequency trading are those who profit from it directly. The markets work for these traders and these traders work for the markets.
Normal people and the companies listed on the markets are hurt by this arrangement. They would gladly take their business to another market that had more sane trading rules.
Which gets to the actual problem - regulations on securities markets. We have a classic example of regulatory capture here, so starting a competing market is effectively impossible. NASDAQ couldn't happen today.
Like anything else there needs to be a market in markets (sup, dawg), and this has been prevented from happening, so we wind up in this surrealistic position with markets that hurt most of its participants to enrich the very few (a net transfer of wealth). The 1% isn't just on Wall Street - their accomplices in Washington are essential to the mechanism.
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Eliminating corporate tax would attract a lot of money that's currently going to lower tax jurisdictions. It would be a job creation tactic more effective than any currently being proposed on either side of the aisle in Congress. And since corporate taxes account for less than 10% of the federal budget, with the jobs it would create it would likely be revenue neutral, since more would come in from payroll and personal income taxes. Sure, tax accountants would have to retool to do something that actually
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No, it means using corporate tax free income hidden by shady accounting practices to pay your rent, and your meals and your clothes and your vacation and your jet and your yacht and your hookers. Rather than of having to withdraw that income for personal use and pay the appropriate personal income taxes.
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And because the jobs they had attracted fled as soon as the country were in any kind of trouble, making the situation much worse. The problem with tax-tourists is that they are always only visiting.
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"High frequency" trading would become much less profitable.
Any tax at all on high frequency trading would make it unprofitable. If we don't slay that monster (HFT) soon, it will build itself a economic-political fortress that will be very hard to tear down.
Re:A first (Score:4, Insightful)
Crazy. A website devoted to nerds where so many people rail against automation and computerization. WTF slashdot.
Technology can be used for good, or not good. Unless you're one of the 0.1% who benefit directly from profits of high frequency trading, or maybe the 0.2% who benefit from the millisecond liquidity afforded by the high frequency traders, I'd call it not good for "the rest of us."
If securities trading liquidity was dragged back to where it took (gasp) a whole day to buy or sell, I don't think the majority of the world would suffer, just those guys that make money in trading. Use automation and computerization to execute those daily trades efficiently, but don't make our financial markets a god damned casino.
Re:A first (Score:4, Insightful)
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Of course, he comes out in favor of this tax now, when he's already in the process of giving away his billions.
Re:A first (Score:4, Insightful)
He earned his billions by actually producing a product rather than shuffling money around in HFT. I didn't like some of Microsoft's business practices when he was running the show, but it's not even in the same league as Gold Mansacks.
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pro tip: Hind site is a lying bitch.
No ONE, had an even decent PC operating system until the 31st century.
No one know how PCs would be used.
No way in 1995 would anyone be able to predict that high level need of security needed in OS. The strong need for video and sound?
No one known where the fuck anything was going. ALL home OS's where garbage.
And stocks don't always have tangible value. I'm not sure why you think that.
Computer where changing SO fast, that OS would become obsolete just because new and somet
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Anywhoo, high frequency trading, just put all orders int
Re:A first (Score:5, Insightful)
Yup, because the whole stock market was a volatile mess before HFT came along, and now that we have this miracle mechanism, nothing EVAR goes wrong.
EVAR.
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Wow, fallacy alert. Thats totally not what parent said; he simply said that trading being less profitable would not help things.
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This is quite simply not true. Please look at evidence before you make sweeping statements like that. The data goes back quite far before the time of HFT.
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Re:A first (Score:4, Insightful)
Re:A first (Score:5, Insightful)
Yes, and with high frequency trading - and trading in general - being less profitable you can expect less liquidity, larger spreads between the bid and ask price, and much greater volatility in the markets. Well done.
Or, to put it another way, more incentive to hold on to shares as long term investment and maybe start giving a fuck about whether the enterprises they represent are actually creating sustainable wealth, and think about the wider consequences of the trades you make, rather than treating them as casino chips. But, hey, if it ain't broke don't fix it. Oh, wait, it is broke...
Plus, in case you haven't been reading the news for the last 3 years, the financial sector owes us some money.
Re:A first (Score:4, Insightful)
I don't live on credit, Don't have a mortgage, my wages now buy less than they did ... and there is little prospect of them going up any time soon ... Can I have my buying power back please
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liquidity provided by HFT is phony (they shuffle same stocks back and forth) but the minute shit hits the fan it disappears - just look what happened during the flash crash.
Also there needs to be some amount of friction in the system that acts as a dampener, otherwise it is prone to destructive resonance-like processes.
Re:A first (Score:5, Insightful)
Americans try to solve all the world's problems with a tax. It makes no sense.
No, they are just trying to solve one problem with tax - the fact that they are bankrupt. They are bankrupt, however, because they try to solve all the world's problems by spending money.
This would be much better for establishing stability in the markets.
High frequency trading results in very stable markets. To wit, I present the case that the market is at the same place it was since 1998. If jogging in place for 13 years isn't "stability" I don't know what is.
Re:A first (Score:5, Insightful)
I know, it is like the market has not seen 2 big bubbles pop, or record high unemployment or the largest budget gap in the history of the US.
I mean if the DOW's current price has not changed much in 13 years we can thank the benefits of "High frequency trading" for this stability!
Re:A first (Score:4, Interesting)
Then you get lots of shady agencies whose whole task it is to be the "owner" of said stock for two weeks, while the "rights to get the stock after two weeks" is changing owner at high frequencies - you have just invented a new kind of derivate, the option to buy stock after a two weeks period.
No love for financial institutions. (Score:5, Insightful)
... but the government needs to overhaul the system of taxation to a simple system without loopholes, and stop trying to figure out a way to tax everything we do. Once upon a time we didn't even need income taxes; times change, but having the government intrude on every aspect of our lives so that they can tax every little thing is not the way to go.
You have to ask what is the purpose of taxes to begin with; why do we need them and what's the most effective way to accomplish that, not keep coming up with new schemes that likely can have negative impacts on the economy. Every time the government creates a new tax, the cost of compliance adds to the amount that the government collects; more accountants need to be paid, more paperwork needs to be filled out.... the cost of compliance for the current system (not the taxes paid, but the resources spent figuring out what to pay). The tax foundation projects compliance costs to be in the hundreds of billions (Total Federal Income Tax Compliance Costs, 1990-2015 [taxfoundation.org]).
There's got to be a better way - overhaul the tax system, don't keep adding to the mess it already is.
If we don't stop this nonsense, we're going to be taxed for every action we take and the fourth amendment will be a joke. You'll have a federal tax on food (eat beef? Well, beef causes global warming, so you'll have to pay), a commute to work tax; have coffee break tax; drive anywhere tax (this will be beyond what we already pay in gasoline taxes). Every time money changes hands? Is that what you really want? Lend me $20 and pay a tax? How about both of us? Lender tax and borrower tax, and then a pay-you-back (loan repayment) tax. How about a tax on getting money from your ATM? Or transferring money from one account to another? Or every time you pay a bill? It's simply ridiculous to continue along this path.
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Exactly. I despise the way so few governments care about admin and the hidden cost that is. Simplicity like you say is the key. Even if it makes things a tiny bit less fair overall, it more than makes up for it in paperwork (or the lack thereof). Another case of UWS (unnecessary work syndrome).
Do you know of a website which promotes a much simplified and universal tax scheme?
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I do, but if I post it the topic will go off on a tangent of misinformed people bashing the suggestion, despite years and millions of dollars of non-partisan research behind it.
The problem is there's no such thing as a "perfect" system of taxation; there's no system everyone will agree is "fair," and very often people jump on my suggestion because, as a revenue neutral system, it doesn't do anything to solve the spending cris
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Sounds like VAT ... we have that in the EU (at various rates), and income tax, and lots of others ...
Income Tax is based on what you earn, (not what you have left)
VAT/FairTax is based on what you spend ... and VAT at least is deliberately exempt on "essentials" that you must buy to live, which seems to me to be fairer ...
Re:No love for financial institutions. (Score:5, Insightful)
'Rich' people spend less (as a portion of income), but have more money to spend in total. Poor people spend more (as a portion of income), but have less money to spend in total. Do you not see a problem here...?
We already have lots of poor people who can barely afford essentials and sales tax is the most direct tax they see. Income tax is the reverse in that it is meant to tax the amount of money you have rather than the amount you spend. High sales taxes encourage those who can afford to to save. High income taxes encourage you to make the most of what you have in total, and save or not as you wish.
Re:No love for financial institutions. (Score:5, Insightful)
Re:No love for financial institutions. (Score:4, Insightful)
Absolutely. I don't understand what's so hard about saying "regardless of its source, all of your income just counts as income, minus some deductions, and you pay a percentage in tax based on these brackets".
Because you're not a politician who's being lobbied to give everyone tax breaks and loopholes so that only the powerless middle-class proles have to actually pay anything.
Re:No love for financial institutions. (Score:5, Insightful)
I think you missing the point of transaction tax. In this particular case, the goal is not so much to create new source of revenue, but to make most dangerous (for the world economy as a whole point of view) trading practices unaffordable. High Frequency Trading makes tons of money out of thin air. No one gets any better except select few trading houses which have enough muscle to participate in this. The transaction tax may have many consequences, but at the very least it will make stock market little bit less rigged.
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One is ostensibly a body created by and for The People, and the other is a generally unaccountable organization dedicated to getting the most profit at any expense?
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One is ostensibly a body created by and for The People, and the other is a generally unaccountable organization dedicated to getting the most profit at any expense?
No, they are both the second.
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Running a state is not cheap, and any government that will come clean and come up with ONE tax of 95%+ will get overthrown immediately, even if that's the truth, that amount is really required. People want to be lied, they want to pay 300+ different taxes so it sounds they are not paying that much.
E.G. Denmark will tax you 180% on a car saying that its f
Re:No love for financial institutions. (Score:4, Insightful)
... but the government needs to overhaul the system of taxation to a simple system without loopholes, and stop trying to figure out a way to tax everything we do. Once upon a time we didn't even need income taxes; times change, but having the government intrude on every aspect of our lives so that they can tax every little thing is not the way to go.
Unfortunately, the government isn't the only problem here. Here in Norway we have an oil fund yet at the same time lots of toll roads and toll circles around cities. We're taking up debt so loaning and saving at the same time, while adding a bunch of overhead to boot and really the result is often unjust all the same. We'd do a lot better just adding to the petrol tax and saying that yes we're maintaining a road network, some of you get a new road and others don't but it even outs over time. Instead we have to try millimeter-measuring out costs with tolls. But you'd also get a shitstorm of people feeling this is unfair. People are very much there that "I don't want to pay for that road, let those that use it do" and then you have to keep track of who's using it and who's not. Now it's just electronic pass keys and photo identification, no anonymous cash payments. Somewhere there's a record of every car passing every toll point, which supposedly gets deleted but it certainly is collected.
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I've looked into stuff like FairTax and other flat taxes and I hear about how it's unfair. I really think this is more FUD than common sense.
It's hard to get more fair than a completely flat tax. Millionaires or billionaires could not completely avoid it because they have to spend money and you wouldn't be able to use a shell company to make personal purchases.
Lastly, the FairTax (and similar plans I've read about) often have exceptions below a certain income level. I've often heard this cited as unfair aga
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FairTax does not have exceptions; although I loathe the name, that's why they call it "fair," because it applies exactly the same to everybody.
Everybody would get the "prebate," (based on number in the household - which would be the ONLY information you'd have to give the government). Even the rich would get the prebate (even if it's mostly meaningless to them).
That makes things taxable at the same rate, regardless of what they are... milk would be the same as pizza, because instead of tweaking what gets t
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It may be equitable, but that is not the same thing as fair
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How about a tax on getting money from your ATM?
You're already paying it, it's a high tax, and not a penny of it goes to the government.
Or every time you pay a bill?
Have you ever looked at your utility bills? Already taxed to the hilt.
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High frequency trading (HFT) amounts to a tax that large financial firms levy by effectively inserting themselves in the transactions of third parties. If you agree that it is detrimental to the country, then how do you get rid of it? You can make a law against it, but enforcement costs money. You can tax it, which creates additional paperwork, but also generates revenue.
Thus, you have three options:
1) allow HFT to continue unfettered
2) spend money enforcing a law to prevent/curb HFT
3) make money by le
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Taxes are regressive. All taxes are regressive, all the time. The rich can avoid them, the poor cannot. That is why we should view Taxes not only as revenue generation for necessary government activities, but also as a means to retard the activities that shouldn't be illegal, but society doesn't want, like Prostitution, Drugs etc.
Drug war is a great example of failed policy to stem the tied of drug use, and has made Mexico a VERY VERY dangerous place with all the narco gangs, who are nothing more than moder
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Will never pass (Score:4, Interesting)
My feelings is that banks are heaviest lobby what are in this world - they own money we need to keep to run this charade called Capitalism. They will hold governments hostage til they will relent on this.
I really hope that someone will proove me wrong, but this doesn't give any hope:
" The Chancellor George Osborne has delayed his return to London from Brussels this lunchtime after a row over proposals for a financial transaction tax at a meeting of European Finance Ministers.
According to sources Mr Osborne asked what was the point in even having a conversation about the financial transaction tax given that it was going to be rejected and then asked if it was âoethe best way to spend our timeâ.
I understand that the Chancellor said no bank would end up paying the tax and the final payer would be pensioners."
http://www.bbc.co.uk/news/uk-politics-15640299 [bbc.co.uk]
As said Will Emerson in Margin Call (played briliantly by Paul Bettany): "One thing I can say for sure: they never loose their money".
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As said Will Emerson in Margin Call (played briliantly by Paul Bettany): "One thing I can say for sure: they never loose their money".
This is true. But sometimes they lose it.
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I don't think that's a typo, the banks should indeed loose more money. It's damned near impossible to get a mortgage or small business loan these days, money's way too tight. The banks loosing money could jump start the economy.
Misleading post! (Score:2, Informative)
The "Tobin tax" specifically targets currency trading, not "financial transactions" in general. In fact, the title/body of the original article are so misleading, it should probably be yanked as troll bait. All the gory details can be had here: http://en.wikipedia.org/wiki/Tobin_tax [wikipedia.org]
Re:Misleading post! (Score:5, Interesting)
The original Tobin Tax was targeting currency trading, but other economists since have proposed it for securities trading as well.
It tends to hit mostly the high-frequency traders and the big hedge funds who are constantly shuffling huge sums of money around. It has very little effect on somebody who makes a few trades a year as part of a smaller individual investment portfolio.
Hurts middle class most (Score:2)
This is a tax that will be paid almost entirely by the middle class. The wealthy have ways to avoid it, and low income folks will mostly not see any impact. But for the vast majority of the middle class, either working for an employer that practically requires pay to be made direct deposit, with loans that are direct draft, with lots of reliance on banking transactions, most of which are entirely unavoidable, will find their accounts draining even faster. Isn't the gouging by the banks of their small cus
Higher taxes only affect some wealthy... (Score:5, Interesting)
Here's my economic theory of taxing the wealthy. You won't find it in any textbook. It may be right, or it may be crazy...
There are two types of wealthy people: the ones that actually create economic value (the Buffets, Jobs, and Gates of the world), and the ones who don't.
The latter became rich, not because of what they accomplished, but because they knew the right people. Went to the right schools. Had executive hair. Had charisma, but no actual ability hiding behind it.
If you're actually a source of economic value, taxes don't affect you as much as you'd think. Government takes, gives to the poor, makes them a bit richer, and they end up buying more of your product. There may not be a 1:1 correlation, but $1 in new taxes probably ends up being far less than $1 out of their pocket when all is said and done. It may even make you more money.
If, on the other hand, you're rich purely because of luck, then a higher tax rate affects you a lot more, because you can't count on the wealth you lose being recirculated to you. It will end up going to an actual value creator and not you.
That's why the Buffets and Gates of the world don't sweat higher taxes too much, and why you hear so much wailing and gnashing of teeth from Wall Street types over the very idea.
My 2 cents, anyway.
Re:Higher taxes only affect some wealthy... (Score:5, Informative)
If you're looking for the economic term for your two different kinds of rich people, you're looking for "rent seekers" (which are opposed to less well defined people as "entrepreneur" or "capitalist" or "wealth creator"). I'd look it up on Wikipedia, and you can develop it a bit more.
As for why it's relevant to the debate, typically rent seekers are sitting on some sort of privilege (in law or in the market).
I would however comment that both Warren and Bill are beyond the point where they're sensitive to financial incentives.
When did Wall Street prove it was useful? (Score:5, Insightful)
We get so excited about the debate of "should we tax or shouldn't we" -- we forget the debate about; "Why do we have a 'Wall Street' to begin with?"
Turning over a stock in anything less than three years, and definitely less than 1 year is NOT an investment in a company -- it's an attempt to "play the market." One or two day traders might win at this -- but the professionals, who have machines that can trade in nanoseconds and shave time with the competition by using shorter network lengths to WS computers for trades are going to win. Market manipulation is also too lucrative to worry about the SEC and such -- much better to buy the regulators (as we've seen).
>> However, when we consider the Trillions more that our Government had to bail out Wall Street more than just the public "TARP funds" -- and that banks like Bank of America might be posting bigger losses in the range of $75 Trillion with the FDIC backing them. So a few pennies a trade will require a few hundred years just to PAY BACK expenses they've incurred -- much less "cover" future risks.
Another way to say this is; who is MORE crazy? The person who wants to tax the Mafia or the person who thinks you cannot trust the mafia in the first place? There is no way a group that can get the FDIC to cover $75 Trillion in "bad bets" after the fact, and AFTER a bail out for the same "mistake" (I call it fraud), is a group that CANNOT get around any tax. The Day Trader will see a tax, but if there is enough of a fee to stop the market manipulators -- be sure that they will get compensated where you are not looking.
Wall Street's EXCUSE to suck up 40% of all profits is that they help provide funds to let companies grow -- having seen the rampant leveraged buyouts, the VC funds used to sell away parts of companies, and the shuttering of tens of thousands of businesses to provide "fodder" for Hedge Funds -- it's a bit like allowing a Mercenary to continue to operate in a country after wiping out a town, because you've seen him walk a little old lady across the street once.
I once made my living with Financial Services companies -- but it felt a bit like carrying ammunition for a mercenary. Biting the hand that feeds you should be a mark of integrity, and I'd like to make a living building something or making the world a better place. ALL Financial services are a ruse, because they are predicated on "investing wisely" -- which is always a pitch of "getting back more than you put in." For every wise investment to do better than just the average of stocks, SOMEONE has to lose. By the time a company has stocks on Wall Street, it's either on someone's menu or it has all the money it needs -- and some VC firm reaped that benefit before you did.
Agreed. Although it will never happen. (Score:3)
Putting the tax burden on those who insist on playing with depositor money, privatizing profits and socializing losses is a start towards fairness. Not much of a start, granted, but a start. Unfortunately, money = unaccountable political power. Until congress and the class from which most of congress comes (i.e. the wealthy) are barred from office, this will never happen.
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That is why I play the Air Banjo.
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That is why I play the Air Banjo.
if toy play the air banjo you deserve a prize in air currency (also known as BitCoins)
Bank of Sweden prize in memory of Nobel (Score:3)
Re:There is no Nobel Prize for economics (Score:5, Informative)
There are no Nobel prizes for...economics.
While, strictly speaking, that's true, it's close enough to the truth as to make little or no difference. There is a periodic prize that's awarded at the same time the Nobel prizes are awarded. This particular prize is given for achievements in economics, and the decision as to whom to award the gift to is made by the same people who award the Nobel prizes. It's called The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. Your statement is little more than an exercise in pedantics.
~Loyal
Stocks, bonds, derivatives, or foreign currency (Score:4, Informative)
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Did you read the next page of the article [bbc.co.uk] with the guy dressed up like Link from The Legend of Zelda? Proposals include a tax on large trades in stocks, bonds, derivatives, or foreign currency.
Like rupees.
And not lamp oil, rope, or bombs (Score:3)
Re:Stocks, bonds, derivatives, or foreign currency (Score:5, Insightful)
It should not be limited to large trades.
Right now the high-frequency traders are basically stealing. They jump in front of other peoples' trades by milliseconds, holding no trade position at the end of the day. It has nothing to do with the purpose of a stock exchange. It does not create capital, value or liquidity. It's a hack, pure and simple, and it's costing the rest of us a ton of money by increasing volatility where there would otherwise not be volatility. They are the griefers of the financial sector.
All you'd have to do is make this a very small tax for it to have a very positive effect, both on the bottom line and on the health and stability of the marketplace.
Plus, since we're talking about a very small amount, it would not hurt all of the retirees who were suckered into 401ks and Roth IRAs instead of proper pensions.
Re:Stocks, bonds, derivatives, or foreign currency (Score:4, Informative)
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But they don't have to be. What you describe is a poor implemented pension fund. Proper pension funds are not in the control of management. However to do that the workers need a strong voice.
Proper pensions are better the 401Ks.
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Re:Stocks, bonds, derivatives, or foreign currency (Score:4, Informative)
I far prefer having a 401k than a pension plan. It gives me more job mobility - most pensions back-load the benefits, so that those who move from job to job have less at retirement - and puts me less at the mercy of corrupt management or corrupt union bosses (depending on who manages the pension fund). It also allows companies to easily predict compensation costs associated with retirement, which as an employee prevents me from facing an underfunded pension plan that ends up paying pennies on the dollar.
The only downside for me is that I face the market risk, rather than the pension fund. But I have more flexibility to do that than I do in a pension fund - check out how many pension funds have become insolvent - so I'm ok with that.
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I'm sure that we'll hear soon enough that the dead hand of government wishes to prevent granny from retiring on her 401k; but that this isn't a sales tax proposal(except to the extent that it might
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My problem is not simply a tax on exchange of currency, although as someone who travels internationally, do I really have to pay an extra tax to exchange currency? That would suck. It's already too expensive to travel.
No, my problem is that all the government seems to want to do is find new ways to tax people.... they want to tax everything, and the reasons people suggest for doing it are not conducive to economic freedoms and liberty - often they just want to effect social change, which is the wrong reas
Re:Instead of Financial transactions? (Score:5, Insightful)
No, my problem is that all the government seems to want to do is find new ways to tax people..
"The" government? I pay taxes to more than one government. There's Federal tax, state tax, and local tax. As to the Feds, Federal taxes are lower than they've been in 60 years. TFA is a red herring; rather than taxing financial transactions, why not simply tax Capital Gains as income (as well as get rid of loopholes like the mortgage deduction and the charity deduction)? Why should someone who "earns" $75k gambling on the stock market pay half the tax of someone earning $75k working as a roofer? The stock answer to that is "the stock market investor has huge risks!" Really? He's only risking money, the roofer risks his very LIFE.
The stock market gambler should be paying twice the tax the roofer pays. The roofer is creating wealth, the gambler simply shuffles it around and leeches off of it. TAX WALL STREET.
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You must be one of them commies I've been warned about...
Re:Instead of Financial transactions? (Score:4, Informative)
If that's the stock answer you get, then I suppose you are asking the wrong person. The right reason why capital gains are taxed lower is because they've already received an additional tax before being distributed. Capital gains, are subject to a corporate income tax before they are distributed, so they are taxed both before and after distribution. Salary, on the other hand, is NOT subject to corporate taxation (contrary to what Joe the Plumber would have you think), so the only taxation it receives is the income tax after it's paid out. The lower value of capital gains tax is supposed to even this out.
Now, capital gains can come in a few different forms. It can come in the form of a dividend, which clearly works as described above. On the other hand, it can also come in the form of an increase in the stock value, and that's not so clearly tied to the corporate assets. In theory it should be somewhat reflective of the corporate assets, and those assets have likewise been reduced by the amount of the corporate tax, so to that degree, the above holds true. However, stock value also has a large component that ISN'T tied directly to corporate assets, but rather just to the whims of the market, and I think it's fair to say that portion of it is only subject to the capital gains rate.
Note, I'm not saying I believe the capital gains rate is too high, too low, or just right. I'm merely explaining the logic behind it being lower.
Re:Instead of Financial transactions? (Score:4, Informative)
capital gains should, if anything, be taxed as unearned income
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What do you mean?
I buy a share of stock for $10 (with my post-tax income), and sell it for $15. I made capital gains of $5.
Where was that $5 subject to "corporate income tax"???
Re:Instead of Financial transactions? (Score:4, Interesting)
why not simply tax Capital Gains as income
I advocate this as well, though you would need to eliminate corporate income tax. Dividends should also be taxed as regular income. This would have the additional benefit of severely reducing overseas corporate tax havens, in fact possibly even making the US a haven. It would wipe out the entire corporate "creative accounting" industry, which IMHO is a good thing. I'm sure there will still be ways to dodge taxes, but nothing like the mess we have now.
I have no problem with keeping things like the mortgage deduction below a certain income limit, and phase it out for higher earners. Ease the shock to the housing market by grandfathering current loans. Most deductions should not be available for higher earners, except for charitable contributions.
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The value of stocks became somewhat disconnected from any "real" value long ago. I'm opposed to differentiating tax levels by how you made the money. All income should be taxed the same.
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When I heard of this way back when, this kind of tax was supposed to replace most other taxes. That part seems to have been lost somewhere along the way though.
So, if I go and buy a hotdog from a street vendor with cash, and he keeps the cash, and uses it to buy gas later, there is no tax on the money?
On the other hand, if I pay with debit card, and his vending service pays him through a check, and then he pays for his gas using a debit card, then it is taxed 3 times?
If this is the case, I see a quick resurgence in cash, followed by a host of new payment types that get around the letter of the law.
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Nice try, but the FP summary includes far MORE detail than TFA - Proving, amusingly enough, that you haven't R'd TFA.
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Nearly all of Bill Gate's money will be going to charity once he dies. His kids are only getting something like 10mil a piece, which is is nothing compared to the lot.
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Until this minute, I never knew that someone could be as unintelligent as you. If you're trolling, try harder.
He seems pissed, not unintelligent. Can't say I blame him.
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Yes, because so many rich people, like the Koch brothers
I fail to see how what the Koch brothers do or don't do in any way relates to Bill Gates? Is there some sort of quantum entanglement that I'm not aware of between all of these people? Please enlighten me. Or are you just trying to excuse Bill Gates by saying someone else is worse? With that line of reasoning, everybody can play along and be guilt-free. Hey, that guy might have killed 12 people but at least he's not Pol Pot, herp derp. That's dangerous thinking.
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The point is so many people fall all over themselves to defend the repugnant crap the Koch brothers are doing with their fortune, meanwhile Bill Gates actually uses his money for good and people crawl out of the woodwork to make sure no one gives him any credit whatsoever.
Do you have any reason to believe the people allegedly doing all of this are the same people? Isn't it possible that whoever is praising the Koch brothers are not the same people decrying Bill Gates?
According to conservative ideology, Bill Gates was the poster boy for success
I don't understand, are you for or against conservatism? Do you have the official conservative guidebook that says unequivocally that Bill Gates is the "poster boy" for anything? Otherwise, you're using a whole lot of words just to prove that you don't really know what you are talking about.
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When they started strong arming windows onto OEM vendors, OS2 was a potential adversary.
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The wages paid to employees are not taxed a income. Thus, your company does not pay tax on your salary.
Sales tax is State and local, not Federal. Feel free to move to a State that does have sales tax. For example, Oregon, Montana or New Hampshire. Feel free to rent if you don't want to pay property tax.
Yes, we need to drastically reduce military and conflict spending. But you do have a degree of control over many of the taxes you pay.
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Actually, the military spending (Not just DOD) is actually ~60% of federal spending when you include everything related to defense including homeland security, CIA etc, military projects at NASA, veterans affairs etc plus the interest on the debts directly related to these projects.
Right now the DOD (only about half of all defense spending) is fully 50% of the world spending on military. The US is only 20% of the world GDP. therefore the CORRECT spending on the military is actually about 25% of what we ac
Re:Gotta love these rich people (Score:4, Interesting)
I don't know about Gates, but Buffet is well-known for bemoaning the fact that he pays less (as a percentage) in taxes than his secretary does. I have never heard of him advocating any changes that would increase the tax burden on the Middle-class relative to his own. Quite the opposite, actually.
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Claiming that he should just give his money away is a flippant ridiculous answer. It is similar to telling people who point out that the planet is overpopulated that if they think the planet is over populated, they should just kill themselves. It is neither a legitimate a
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Seriously I feel as though all these people saying "corporate taxes are already applied to capital gains!" have never actually done business taxes.
Get a life (Score:2)
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I am not an expert, and no I can not explain exactly how it will happen.
I believe you mean to say "I have no idea what I'm talking about but I am going to say it anyway". Yeah buddy I actually make money by trading stocks so I know how it works. You, and everyone else that argues against HFT, have no fucking clue how the market works. HFT cannot alter the price. Because if Goldman Sachs is on one side of the trade with HFT, then JP Morgan is on the other side doing just the opposite. Otherwise you would be seeing prices all over the map, all the time. HFT is not a price maker,
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So what exactly changed so much in the real world, that those 5 minutes were so important? Did all of the worlds corporations suddenly declare they were bankrupt?
Saying people were 'desperate to sell' just highlights one of the problems of the stock market - it's not about the performance of the corporations, just their second by second stock prices.
So why should the people support a stock market like that? Why not implement a 10% tax on any stock trades where you keep the stock for less then a few days?
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Mr. Gates who has already moved most of his assets into a loophole (sorry, "Foundation") to protect his progeny's inheritance from taxes, certainly shouldn't worry about the future.
I think the Gates Foundation would be in more than a little trouble if they started making large payments to Melinda or Bill's children. Both Bill Gates (and Warren Buffett as well) have made it quite clear that their philosophy is that they don't want their kids to inherit ridiculously huge gobs of money, just something in the low 7 figures.
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As people advocate taking the living shit out of everything to fix all our problems...
The article is about a modest tax on a specific activity to address a particular problem.
I recall France beheading everyone...
Which is why there are no more French people... oops, pointless hyperbole leads to absurd conclusions, yet again.
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You are far closer to the truth than you think. Cash transactions over 5000 Euros are now illegal in Italy [zerohedge.com]. Greece also wants to make cash illegal [dailyreckoning.com] for some transactions. Oh it's all being done in the name of preventing crime and money laundering, but it's fairly obvious that since electronic transactions are much easier to monitor, governments are salivating at the thought of forcing us all under their microscope.
First they make a law but only apply it to large transactions that people don't normally pay