Left policies don’t work. The idea Left economics must separate from Woke isn’t unreasonable. The problem is once you implement left policies the economy craters. EVERY SINGLE TIME. At what point will you well meaning and earnest lefties wake up to the fact that Venezuela and Cuba, Soviet Russia, the Eastern bloc, and China pre capitalism were disasters. EVERY SINGLE TIME.
Let me give you an example. The left’s latest take on total economic destruction- taxing unrealized capital gains. I am guessing the bulk of people here think it is an awesome idea. Amirite?
So, a guy has an idea. He raises money, and takes a company public. The company is in startup phase. It isn’t making ANY money yet. But the market likes it. It has sizzle. It gets an evaluation quickly of $2B. The original founder has shares worth, on the surface, $500M. Oopsy! Elizabeth Warren’s plan means he has to pay $125M in taxes that year. Plus, all the other original investors have to pay their share too. How much? $500M in taxes will be collected. But the company has no cash. All its cash is going to development of the product. What happens? The founder and all the original investors owe $500M in taxes. They have to sell their shares! Every share is dumped simultaneously. Market value is demolished overnight.
Now multiply that by every small cap company in the US. The stock market tanks. Probably drops to about 20%. Amazon, Tesla, Berkshire Hathaway, all crater. Every pension fund is bankrupted overnight.
So, you are young and ambitious. You have an idea. If you start it in the US and if it takes off you are bankrupted and lose control of your idea. Within five years.
WHO IN THEIR RIGHT MIND WOULD DO THIS? No one!! You take your idea and do it in Canada or Mexico or Europe.
The left constantly tries to extract more money from those who do, to give to those who don’t do. It always backfires.
I've heard your argument from many individuals over the years. The comparisons you chose are not the correct examples. I'm thinking Denmark, Sweden, maybe France. Certainly not tyrannies like Russia or China. They call themselves "left." But they're mass murderers. Taxing unrealized cap gains is a non-starter and was never seriously considered by anyone. We should talk to each other. Not past each other or over each other. And without the expectation of changing anyone's mind. Simply an honest exchange of ideas.
Swedes would deny they are Socialist. They have a large social safety net, which is being retracted. But they are more economically free than Canada. Socialism is when the government directly owns the levers of production. What most people want is Fascism. When private huge corporations control or at least work in concert with government. And small business is entirely under the thumb if government. Arguably we are closer to the latter here.
China is the prime example of “actually existing fascism.”
i.e. corporatism. A nationalist socialist ethnostate with labor discipline and suppressed wages and a totalitarian political ideology descended from Marxism-Leninism but with much more room for a NEP of “reform and opening” to enrich the nomenklatura and attract diaspora capital to exclusive opportunities in partnership with the authoritarian party-state.
The actually existing socialist states of Eastern Europe were filled with intelligent and well meaning ( before cynicism set in) intellectuals and functionaries who tried their level best to make central planning work. The fatal contradictions of non market systems and the resulting failure to satisfy the basic needs of the population are well documented and theoretically explained by the Hungarian economist Janos Kornai in his lifetime. He left an intellectual memoir “By Force of Thought.” The Chinese economic policy establishment studied his writings with great seriousness and success.
The Northern European “social democracies” have large social safety nets -- which we probably could not afford to match -- but they also have thriving market economies. In some ways, more free than ours. And none of them tax unrealized capital gains. Why is it that advocates of Bernie-style socialism never actually bother to study the details of the societies they allegedly want us to emulate?
You're talking about Social Democracies, not Democratic Socialism. Big difference. All the Northern European Nordic or semi-Nordic economies follow a model which was friendly to business and capital, but pay for larger social safety nets through higher taxes on income and VAT taxes. Denmark has more billionaires per population than any other country in the world. Sweden got rid of inheritance tax and a Tobin tax they had back in the early nineties- their economy boomed at a result, largely due to more inward investment, and less offshoring.
One of the interesting aspects of this policy is that it gradually reduces the tendency to offshore- Sweden gains more in corporation tax and cap gains than it loses from inheritance tax. The Estate Tax generates less than 1 percent of federal revenue. America gets 1.1% of its revenue from corporation tax, Sweden gets 2.7%- and this is before one considers far higher returns on cap gains. Effectively, by attempting to tax wealth, one loses more in taxes on income from the wealthy, as people take steps to minimise tax burdens on their children's inheritances.
Another aspect of how the Nordics run smart policies to achieve many of the aims of socialism without enacting socialism one iota, relates to income tax rebates. Sweden gives a 30% tax rebate on the interest payments on loans like mortgages or debts incurred from living expenses whilst studying- encouraging learning and private home ownership. They've worked out neighbourhoods with a better rates of home ownership are significantly better from the point of view of public expenditure, allowing them to invest resources elsewhere, more productively. Without this push in the tax system, it is highly unlikely Sweden, with its higher income taxes, would achieve similar rates of home ownership as America- and many resources would be soaked up by the much higher public expenditure involved in public housing.
The lesson from the Northern European is simple- if you abandon the ideological basis of Leftism, 'Tax the Rich' to pay for things people want, then you can actually squeeze more money out of the rich and wealthy. People don't offshore as much if you don't threaten their capital or wealth, and they are more likely to invest in their own country.
Currently, more millionaires are fleeing my country, the UK, than any other country in the world. Why? Because inheritance was one of the tax rises not specifically ruled out by Labour...
I should also add that in many ways, the Nordics retain much of their progressive street cred- they have far stronger worker protections and generous paternity leave for fathers.
There is no reason to allow the transfer of large fortunes to the next generation untaxed. That's a form of entailment in effect, if not in name. Americans rejected nobility in our founding.
It makes sense for the estate to pay all income taxes, including on unrealized capital gains for the deceased individual before transferring it to the heirs. There's lots of ways to do this. Heirs who wished to keep a family business intact could take out loan to pay the tax liability. In effect they would be buying an asset from the estate at a bargain price. What's the problem with that?
Most inheritance taxes are raised from home ownership and family homes- not large businesses. The truly rich will always be able to afford the accountants and lawyers to legally avoid taxes, rather than evade them.
Obama tried going after expat wealth. It damaged America's national interest globally, because of a not unfounded perception that America's intelligence agencies would use the data collected from IRS reporting requirements to help American corporate interests gain an edge over their global competitors.
I'm not saying that there aren't elements of the tax code which were deliberately designed as loopholes, but one has to look at revenue raised rather than theoretical revenue from tax policies which only make sense in terms of a political appeal to the voter's sense of natural justice.
The fact remains that most inheritance taxes result in losses of overall tax revenue, rather than rises. Of course, there are always exceptions. Switzerland is the only country to have a functional wealth tax which is a net positive (somewhat interestingly, there wealth class moves out of cantons when the tax is raised above 0.7%, but won't move to cantons offering lower wealth taxes). South Korea is quite successful at taxing family shares- although currently they are in the process of reducing inheritance tax, due to a decline in readily available VC capital (from families retaining large capital reserves, and engaging in low risk asset accumulation, to pay IT, rather than riskier avenue of potential future national growth).
A large part of the problem is a complete lack of institutional literacy in terms of the American tax code (the bureaucracy actually tends to be better in this regard than the appointee class). One would want to keep the net loss carry forward, but not the carried interest loophole...
In the US estates worth less than $13.6 million (in 2024) are not taxed at all. So this issue only applies to a tiny number of estates, worth a very large amount of money in aggregate. My point is the provision of a new basis for inherited assets reduces effective taxes on capital gains even lower. Capital gains taxes are already too low and play a role in financial bubbles.
Wow. That's not what I expected! In most non-American tax systems I've looked at, it's family homes and people who have got lucky with property who mainly get hit- in effect, we were talking about completely different things.
In any event, Sweden's economy and tax revenue recovered drastically in the early nineties, after they abolished inheritance tax. It wasn't the only reform- they had a modest Tobin tax previously as well.
I agree with you on the capital gains, but would argue that it's specific types of investment and trading which need to be addressed, rather than a general rate rise. In particular, asset speculation can crowd out more productive investments.
Funnily enough, I've been looking at modern monetary theory in this area. Steve Keen has me convinced that inflationary cycles are about more than M1 money supply- something I thought I would never concede. First, I think it's about the reasons why government needs to borrow- the wealth of nations seems to be about the ratio of productive adults relative to dependents, so a growth in public sector workers can be a very bad thing in certain circumstances. In addition, most money printing eventually gets suctioned up by capital, which tends to get invested in asset speculation once productive economic investments dry up.
Plus, MMT causes problems at the layer of herding psychology. Once people start moaning about government debt servicing levels, it's never too long before markets start shifting their funds away from company shares and other productive investments and towards real estate, gold, etc.
I do see the problem to which you are alluding though- I'm just not sure a straightforward CGT rise is the way to deal with it. Hayek would argue that central banks cause a good deal of the problem, with long periods of low interest rates. Without the low interest rates both government and the private sector wouldn't be so tempted to engage in the financial alchemy of runaway debt and debt asset creation to the extent that such massive capital surpluses were created in the first place.
Maybe somebody should be working on a formula which requires banks and other financial institutions to hold larger fractional reserves in periods where low interest rates are sustained?
Woke. Woke. Woke. Whatever dude. Looking back on history, Reagan was wrong and the hippies were right. Dubya was wrong also. I think if you want to feel useful, go to Iraq and look for WMD’s.
Reagan was right. Reagan did an amazing job. The hippies, and I was one, were wrong. I know a woman married to a very high ranking Iraqi, a cousin of Saddam and from Tikrit. He was in Saddam’s inner circle. She told me all about the WMD and where they were. But Bush is a globalist, in the same club as all of them. I am useful. I don’t need to try to feel so. And WOKE is wrong wrong wrong.
And how is that some 20 year old from Youngstown, OH’s problem?? I supported the no-fly zone that contained Saddam but we have no obligation to improve the lives of Iraqis.
Didn’t worsen it the spending got us through it otherwise we would be having this argument in a back ally fighting for a can of spam…….. capitalism literally was in the verge of collapse and it took government handing out tax payer money to save it otherwise it would have closed shop and start from zero again. There are some excellent books about the crisis if you bothered to read
When you admit the socialism is what saved capitalism in 1929 and 2008, also if these extreme right wing policies worked so well what Happened to Kansas in 2012 ? The thing about republicans today their is a tad bit of truth in what they say that is then used to go over the top and justify absolute nonsense of economic policy
Taxing unrealized gains makes the most sense for estate settlements. For example let's say a mogul with $1billion in unrealized gains in their company's stock dies. Right now that $1 billion is transferred to the heirs with a new basis set at the price at the date of death. Thus, the heirs receive $1 billion in additional income in that year and don't have to pay any tax on it. The estate does pay an inheritance tax that is much less than what the income tax would be.
What could be done is for the estate to pay the X% capital gains tax on that $1 billion of unrealized gains if it has liquid assets that cover this. If not, the estate would gradually sell X% of the stock to pay the X% capital gains tax. The heirs would inherit 1-X% of what their parents had built, which is a pretty good deal since they didn't create it.
The system we have now amounts to a form of entailment, which the Founders considered and rejected. They were right to do so, we should go back to a system more in line with what they envisioned, using tax policy to avoid creation of dynastic wealth.
Also, the stock would not crater. Tesla shareholders have twice voted to give Elon Musk a $50+ billion bonus, which is more than what would be required to pay capital gains taxes on his Tesla shares. Obviously, they are unconcerned about the impact this might have on the stock price. Every year around a trillion dollars is extracted from the stock market and it keeps going up.
In Canada upon someone’s death all their assets are ‘deemed to have been sold’ to the Estate. Excluding a personal residence and after tax cash in a bank account. If someone had a $B in assets that cost them $10M then $990 million is taxed at capital gains rates. That is the way it is done in Canada. Absolute nightmare for estates. The new adjusted tax basis becomes the $1B that had been taxed on the death of the original owner.
How is this a nightmare? If it is a small estate, just sell the assets and pay the income tax. If it is a big estate, then its more complicated, but there is more money to pay people do the work. I fail to see where there is a problem.
After all, inheritance is income provided to people in exchange for nothing, like welfare. Heirs are not “owed” anything.
I do think it makes sense to allow a flat deduction from the estate and only apply the taxes on assets above this amount. Does Canada not do this?
Why if I have worked hard for 55 or 60 years and I wish to give the fruits of my labour to my children and grandchildren I can’t? Who are you or anyone else to tell me my assets should be taken from my family?
Sure you can. But they need to pay taxes on their windfall same as if they won it at Vegas. What am objecting to us heirs getting tax free income while the rest of us have to pay taxes on every penny we earn.
Heirs aren’t owed anything? Families are important. However, what if I want to give them a nice life? What if one of my kids is handicapped? Am I allowed to hand something over to him? My life, my family.
The progressive movement lost its way the day those 2 black girls shouted down Bernie at his rally and babbled woke nonsense while Bernie politely nodded agreement. It later came out that they were paid agitators.
The infectious disease outbreaks are almost exclusively linked to new immigrant populations.
The progressive mayors and DAs have been voted out due to their disastrous policies.
Generally, the progressive movement died when it dropped economic populism for woke craziness. You can’t call people bigots because when they say men can’t get pregnant and not expect pushback.
You sound like somebody left the front door open to the insane asylum….. my point is very clear and often when I run into people spouting nonsense those two questions shut them up, they move directions to well money doesn’t mean anything and I don’t measure happiness by my paycheck, I nowhere asked how happy we are because that is irrelevant i asked if we are better off a society with access to more productivity and that answer is yes as a whole collective group we are some have more much much more but so do those who have less, that why we are not fighting angry mobs of peasants. What other measure would you use to scale a society ? How happy you feel, that can be manipulated.
Inflation is the name of the game 2% is good anything higher is bad, inflation is how the pie grows without it and the pie starts to get smaller and prices lower because theirs less money in circulation, too much and prices grow to high to match wages even a moron understands this
You are simply a libtard, friend. Inflation is not natural or good. It is theft. What you worked for today will not be worth anything tomorrow. So you better keep working.
Reciting blurbs out of an Econ 101 textbook is not the comprehensive argument you think it is.
We’re living in the progressive age economically and socially and the world is better for it, our economies are the r most productive and we have a quality of life that would be considered magical 50 years ago, now there are serious problems but I’ll ask you two questions that will prove you wrong #1 are you making more money today then you did 10 years ago #2 is your access to life changing goods more accessible today then 10 years ago a
Majority of us would answer yes to those questions so how can you say progressive agenda has failed ? What proof is there of this failure ?
This reads like you are 19 and just discovered Steven Pinker from 5 years ago. Inflation means everything we have is worth less including the “more money” that we make as serfs.
I have more access to life-destroying technology than I did 10 years ago. My life is not made better by any technology improvements in the last 10 years. Everyone was happier ten years ago, check the stats.
Neither of these things have anything to do with my initial comment. We aren’t living in the progressive era we are living in the death throes of the liberal era. Since World War II the west has been in the process of burning all of the sociocultural capital it spent the previous 400 years accumulating in a race to the bottom driven by weaponized empathy.
What did it for me is when progressives defended Daniel Ortega as he committed a blood bath in Nicaragua and accused those being murdered of being CIA operatives.
After the election the Democratic Party (my party) must rethink many of its policies as it ponders its future.
To be entrusted with power again Democrats must start listening to the concerns of the working class for a change. As a lifelong moderate Democrat I share their disdain for many of the insane positions advocated by my party. We are no longer the patriotic, sensible party of FDR and JFK.
Democrat politicians defy biology by believing that men can actually become women and belong in women’s sports, rest rooms, locker rooms and prisons and that children should be mutilated in pursuit of the impossible.
They believe borders should be open to millions of illegals which undermines workers’ wages and the affordability of housing when we can’t house our own citizens.
They discriminate against whites, Asians and men in a futile effort to counter past discrimination against others and undermine our economy by abandoning merit selection of students and employees.
Democratic mayors allow homelessness to destroy our beautiful cities because they won't say no to destructive behavior. No, you can’t camp in our city. No, you can’t shit in our streets. No, you can’t shoot up and leave your used needles everywhere. Many of our prosecutors will not take action against shoplifting unless a $1000 of goods are stolen leading to gangs destroying retail stores. They release criminals without bail to commit more crimes.
The average voter knows this is happening and outright reject our party. Enough.
That is not the Bernie Sanders/Warren/AOC left, which is all about specific policies revolving around economic justice, supporting workers' rights, universal healthcare, a sustainable environment & climate action, reducing the destabilizing disparity in wealth & power between the rich & the rest of us, having the rich pay their fair share of taxes, affordable housing, etc. They are not focused on the issues or complaints you cited. That is another faction, that has been associated with the left, but I'm not really sure they are, since they seem to be focused on PC issues, rather than the economic & environmental issues that Bernie & most progressives care about, & which are highly popular with the American people in general. Political correctness tends to distract from the concrete issues that concern true progressives, which have been unfairly & incorrectly associated with those more abstract issues you mention.
Jaime: I tend to agree with you but I am not sure those politicians you mentioned are, in fact, very popular with the actual working class voters who swung our latest election to the Trump Republicans. They are tainted by the policies I mentioned.
It's because they've been the object of corporatist & right-wing attacks & propaganda that have falsely attributed unpopular ideas to them, when the actual policies they espouse are very popular with the American people.
Unfortunately, they all get lumped in together because nobody on the Left had the courage to stand up and say, "I do not agree with this Woke nonsense." And if the did, not loudly and often. They needed to. They needed to say they disagreed with the Biden Woke agenda and wanted to focus on working class economics. But nobody would say it. And suddenly, there is no way to define "woman" and we need to state our pronouns and kids can choose their gender and people get cancelled for FB posts...and none of the leaders of the Left denounced it strongly.
Indeed and now working class politics is electorally unviable for the foreseeable future because it’s so closely associated with woke politics by a crucial part of the electorate.
Bernie’s personality cult is nearly as obnoxious—and nearly as authoritarian—as Trump’s. (I actually lost friends to the Tara Reade debacle, for which they predictably fell, hook line and sinker.) It’s tough to watch them disappear down one unpopular, Democrat-damaging, democracy-damaging policy rabbit hole after another (masks forever, defund the police, Hamas is good ackchyually), and then wonder why their credibility is absolutely shot to bits. Must be the DNC! 🙄
Unlike a lot of pundits, I’m not terribly worried about this vocal-but-small contingent loudly withholding its votes from Biden. They were never exactly his fans in the first place, and there is no reasoning with the “burn it all down” mindset (reasonable people rarely have that mindset in the first place, as there’s NEVER a guarantee that something better will rise from the ashes). I believe that the persistently-high number of GOP primary voters who cast ballots against Trump are, for the most part, a much more gettable lot.
Your ideas are conflated and total BS. As a Center Left person I was more pissed off about Hillary and the DNC screwing Sanders in 2016 when he alone could have beaten Trump because other than Trump - he was the only populist speaking to the majority of fed up citizens barely making ends meet in a post neo-liberal Reagan/Clinton/Republican corporate world. As for 2020 we who are smart knew you can't put lightening in a bottle twice-especially with an honest high integrity Democratic Socialist like Sanders and a fickle electorate. The greedy sick rich 1% will never allow such a person to become the president at least until we the people take our country back as in we are the 99%! I was part of Occupy Wall Street and you obviously know nothing about what the variety of humans from all age groups and backgrounds were fighting for. Saying COVID was a dream come true for leftists is one of the dumbest things I have ever read and I am older and very well read for many decades. Anyone who is older has seen this TV show before - the US is a big yin/yang pendulum that swings back and forth between the right and left forces. Most of us fall somewhere in the middle. But I fear the far right far more than the far left. This cycle is on repeat - watch how the billionaire republican cult of Trump drive our nation into the ditch as Republicans always do eventually - and then the Democrats and we the tax payers will have to dig us out as they always have and resuscitate the nation as in 50+ million jobs created since since 1989 vs only a measly million by the so called pro business Republicans! What a joke! But this time it feels different - the desperation of struggling ignorant voters lead to a stupid Trump vote or none at all - that may be the final death blow to Democracy. I pray not but it was already dying on the branch since the hegemony Citizens United SCOTUS decision. Democrats need to regroup and get back to basic life issues that affect most versus only a few - like stopping Global Warming, better wages for the majority of middle class and universal health care would be a good start - all the issues Sanders has consistently fought for his entire 50 years in public service and that the majority of American people want from both parties. Dems blew it but there are a few progressive stars on the horizon - like Gov Newsom from Cali and AOC from NYC who could be the first woman president. Again - only if Democracy is still around in 4 years. Time will tell if all the hundreds of thousands deaths and sacrifice of the men and women who died or were injured in wars for freedom, Democracy and the Constitution for over 250 years were in vain.
This whole article seemed to betray a confusion about who counts as left, progressive and mainstream. It also shows that the author doesn’t have a grasp on where the factions overlap and where they don’t.
I said they overlap, not that there’s a true “left”. But the Bernie left and woke left aren’t one in the same, which is the basis of the author’s argument
I walked away from the so-called "progressives in 2010 when they failed to support the Democratic majority in a fit of either stupidity (because they didn't know the significance in midterms) or pique because the ACA wasn't M4All. They portrayed Obama as a sell out while they sold him out. OWS was a raging failure because they refused to accept the necessity of lesdership. And yes, it opened the gate for the useless Bernie Sanders because they still didn't know what leadership looks like.
M4A makes more sense at the state level anyway. In states like Vermont and Massachusetts they currently have all of the money necessary to fund a M4A program being spent on health care in their states. So no new taxes are necessary and both state have an agency that runs a major health care system.
Hey, i liked your piece! I think it popped up in my feed because my colleague David Perlmutter liked it.
It’s nice to see calmly explained analysis where your political preferences, whatever they may be (centrist, maybe? But i find that term a little reductive), don’t keep you from being reasonable and perceptive.
The tuition of Bernie’s supporters behind the scenes at the Iowa caucuses was truly dreadful. They taught the locals how to silence everyone else’s supporters with cursing, yelling in unison, and every sort of dirty trick imaginable. In other words, his senior people acted like the same kind of Marxist street punk he was himself back in the 1960s. They convinced me that his entourage would, if he were elected, act like a leftist paramilitary to carry out Bernie’s “revolution”. He should not have even been allowed into the Democratic presidential election process. He is a Marxist and should be treated with the same disgust as AOC, Ro Khanna and all the other Marxists in Congress.
"Racist"Stop and Frisk policy = The Most Effective, Constitutional, Crime Prevention, Gun Control, and Support for the 14th Amendment's Equal Protection of the Law policy. The Progs must hate the vulnerable and innocent poor who live in gang-infested ghettos in every major city in the U.S.
And I bet they love stop and frisk, too. Oh, wait, no, they didn't/don't. Maybe they want effective law enforcement that doesn't depend on stop and frisk? Is that even possible to you? Try to reply without crazy-looking random capitalization, please.
What is fully left of center government? That's a pretty vague descriptor. What Joe Biden has done is as fully left of as anything since LBJ. He won once. He must win again.
People don’t vote for something which tells them what to do instead of telling them what they get. Trump couldn’t figure out Covid, and Biden promised an end.
Dem’s couldn’t figure out trans, told people to put up with it, Trump promised an end. Dems couldn’t figure out severe inflation effects, told people to put up with it, Trump promised prosperity.
Left policies don’t work. The idea Left economics must separate from Woke isn’t unreasonable. The problem is once you implement left policies the economy craters. EVERY SINGLE TIME. At what point will you well meaning and earnest lefties wake up to the fact that Venezuela and Cuba, Soviet Russia, the Eastern bloc, and China pre capitalism were disasters. EVERY SINGLE TIME.
Let me give you an example. The left’s latest take on total economic destruction- taxing unrealized capital gains. I am guessing the bulk of people here think it is an awesome idea. Amirite?
So, a guy has an idea. He raises money, and takes a company public. The company is in startup phase. It isn’t making ANY money yet. But the market likes it. It has sizzle. It gets an evaluation quickly of $2B. The original founder has shares worth, on the surface, $500M. Oopsy! Elizabeth Warren’s plan means he has to pay $125M in taxes that year. Plus, all the other original investors have to pay their share too. How much? $500M in taxes will be collected. But the company has no cash. All its cash is going to development of the product. What happens? The founder and all the original investors owe $500M in taxes. They have to sell their shares! Every share is dumped simultaneously. Market value is demolished overnight.
Now multiply that by every small cap company in the US. The stock market tanks. Probably drops to about 20%. Amazon, Tesla, Berkshire Hathaway, all crater. Every pension fund is bankrupted overnight.
So, you are young and ambitious. You have an idea. If you start it in the US and if it takes off you are bankrupted and lose control of your idea. Within five years.
WHO IN THEIR RIGHT MIND WOULD DO THIS? No one!! You take your idea and do it in Canada or Mexico or Europe.
The left constantly tries to extract more money from those who do, to give to those who don’t do. It always backfires.
I've heard your argument from many individuals over the years. The comparisons you chose are not the correct examples. I'm thinking Denmark, Sweden, maybe France. Certainly not tyrannies like Russia or China. They call themselves "left." But they're mass murderers. Taxing unrealized cap gains is a non-starter and was never seriously considered by anyone. We should talk to each other. Not past each other or over each other. And without the expectation of changing anyone's mind. Simply an honest exchange of ideas.
Swedes would deny they are Socialist. They have a large social safety net, which is being retracted. But they are more economically free than Canada. Socialism is when the government directly owns the levers of production. What most people want is Fascism. When private huge corporations control or at least work in concert with government. And small business is entirely under the thumb if government. Arguably we are closer to the latter here.
China is the prime example of “actually existing fascism.”
i.e. corporatism. A nationalist socialist ethnostate with labor discipline and suppressed wages and a totalitarian political ideology descended from Marxism-Leninism but with much more room for a NEP of “reform and opening” to enrich the nomenklatura and attract diaspora capital to exclusive opportunities in partnership with the authoritarian party-state.
The actually existing socialist states of Eastern Europe were filled with intelligent and well meaning ( before cynicism set in) intellectuals and functionaries who tried their level best to make central planning work. The fatal contradictions of non market systems and the resulting failure to satisfy the basic needs of the population are well documented and theoretically explained by the Hungarian economist Janos Kornai in his lifetime. He left an intellectual memoir “By Force of Thought.” The Chinese economic policy establishment studied his writings with great seriousness and success.
The Northern European “social democracies” have large social safety nets -- which we probably could not afford to match -- but they also have thriving market economies. In some ways, more free than ours. And none of them tax unrealized capital gains. Why is it that advocates of Bernie-style socialism never actually bother to study the details of the societies they allegedly want us to emulate?
You're talking about Social Democracies, not Democratic Socialism. Big difference. All the Northern European Nordic or semi-Nordic economies follow a model which was friendly to business and capital, but pay for larger social safety nets through higher taxes on income and VAT taxes. Denmark has more billionaires per population than any other country in the world. Sweden got rid of inheritance tax and a Tobin tax they had back in the early nineties- their economy boomed at a result, largely due to more inward investment, and less offshoring.
One of the interesting aspects of this policy is that it gradually reduces the tendency to offshore- Sweden gains more in corporation tax and cap gains than it loses from inheritance tax. The Estate Tax generates less than 1 percent of federal revenue. America gets 1.1% of its revenue from corporation tax, Sweden gets 2.7%- and this is before one considers far higher returns on cap gains. Effectively, by attempting to tax wealth, one loses more in taxes on income from the wealthy, as people take steps to minimise tax burdens on their children's inheritances.
Another aspect of how the Nordics run smart policies to achieve many of the aims of socialism without enacting socialism one iota, relates to income tax rebates. Sweden gives a 30% tax rebate on the interest payments on loans like mortgages or debts incurred from living expenses whilst studying- encouraging learning and private home ownership. They've worked out neighbourhoods with a better rates of home ownership are significantly better from the point of view of public expenditure, allowing them to invest resources elsewhere, more productively. Without this push in the tax system, it is highly unlikely Sweden, with its higher income taxes, would achieve similar rates of home ownership as America- and many resources would be soaked up by the much higher public expenditure involved in public housing.
The lesson from the Northern European is simple- if you abandon the ideological basis of Leftism, 'Tax the Rich' to pay for things people want, then you can actually squeeze more money out of the rich and wealthy. People don't offshore as much if you don't threaten their capital or wealth, and they are more likely to invest in their own country.
Currently, more millionaires are fleeing my country, the UK, than any other country in the world. Why? Because inheritance was one of the tax rises not specifically ruled out by Labour...
I should also add that in many ways, the Nordics retain much of their progressive street cred- they have far stronger worker protections and generous paternity leave for fathers.
There is no reason to allow the transfer of large fortunes to the next generation untaxed. That's a form of entailment in effect, if not in name. Americans rejected nobility in our founding.
It makes sense for the estate to pay all income taxes, including on unrealized capital gains for the deceased individual before transferring it to the heirs. There's lots of ways to do this. Heirs who wished to keep a family business intact could take out loan to pay the tax liability. In effect they would be buying an asset from the estate at a bargain price. What's the problem with that?
Most inheritance taxes are raised from home ownership and family homes- not large businesses. The truly rich will always be able to afford the accountants and lawyers to legally avoid taxes, rather than evade them.
Obama tried going after expat wealth. It damaged America's national interest globally, because of a not unfounded perception that America's intelligence agencies would use the data collected from IRS reporting requirements to help American corporate interests gain an edge over their global competitors.
I'm not saying that there aren't elements of the tax code which were deliberately designed as loopholes, but one has to look at revenue raised rather than theoretical revenue from tax policies which only make sense in terms of a political appeal to the voter's sense of natural justice.
The fact remains that most inheritance taxes result in losses of overall tax revenue, rather than rises. Of course, there are always exceptions. Switzerland is the only country to have a functional wealth tax which is a net positive (somewhat interestingly, there wealth class moves out of cantons when the tax is raised above 0.7%, but won't move to cantons offering lower wealth taxes). South Korea is quite successful at taxing family shares- although currently they are in the process of reducing inheritance tax, due to a decline in readily available VC capital (from families retaining large capital reserves, and engaging in low risk asset accumulation, to pay IT, rather than riskier avenue of potential future national growth).
A large part of the problem is a complete lack of institutional literacy in terms of the American tax code (the bureaucracy actually tends to be better in this regard than the appointee class). One would want to keep the net loss carry forward, but not the carried interest loophole...
In the US estates worth less than $13.6 million (in 2024) are not taxed at all. So this issue only applies to a tiny number of estates, worth a very large amount of money in aggregate. My point is the provision of a new basis for inherited assets reduces effective taxes on capital gains even lower. Capital gains taxes are already too low and play a role in financial bubbles.
Wow. That's not what I expected! In most non-American tax systems I've looked at, it's family homes and people who have got lucky with property who mainly get hit- in effect, we were talking about completely different things.
In any event, Sweden's economy and tax revenue recovered drastically in the early nineties, after they abolished inheritance tax. It wasn't the only reform- they had a modest Tobin tax previously as well.
I agree with you on the capital gains, but would argue that it's specific types of investment and trading which need to be addressed, rather than a general rate rise. In particular, asset speculation can crowd out more productive investments.
Funnily enough, I've been looking at modern monetary theory in this area. Steve Keen has me convinced that inflationary cycles are about more than M1 money supply- something I thought I would never concede. First, I think it's about the reasons why government needs to borrow- the wealth of nations seems to be about the ratio of productive adults relative to dependents, so a growth in public sector workers can be a very bad thing in certain circumstances. In addition, most money printing eventually gets suctioned up by capital, which tends to get invested in asset speculation once productive economic investments dry up.
Plus, MMT causes problems at the layer of herding psychology. Once people start moaning about government debt servicing levels, it's never too long before markets start shifting their funds away from company shares and other productive investments and towards real estate, gold, etc.
I do see the problem to which you are alluding though- I'm just not sure a straightforward CGT rise is the way to deal with it. Hayek would argue that central banks cause a good deal of the problem, with long periods of low interest rates. Without the low interest rates both government and the private sector wouldn't be so tempted to engage in the financial alchemy of runaway debt and debt asset creation to the extent that such massive capital surpluses were created in the first place.
Maybe somebody should be working on a formula which requires banks and other financial institutions to hold larger fractional reserves in periods where low interest rates are sustained?
“Certainly not tyrannies like Russia or China. They call themselves "left." But they're mass murderers.”
Oh so they're NOT like Stalin, who called himself “left” but wasn't a mass murderer, got it.
We should tax unrealized cap gains of greater than X.
Woke. Woke. Woke. Whatever dude. Looking back on history, Reagan was wrong and the hippies were right. Dubya was wrong also. I think if you want to feel useful, go to Iraq and look for WMD’s.
Reagan was right. Reagan did an amazing job. The hippies, and I was one, were wrong. I know a woman married to a very high ranking Iraqi, a cousin of Saddam and from Tikrit. He was in Saddam’s inner circle. She told me all about the WMD and where they were. But Bush is a globalist, in the same club as all of them. I am useful. I don’t need to try to feel so. And WOKE is wrong wrong wrong.
My friend’s sister’s boyfriend’s cousin said Saddam had WMDs!! Bush/Cheney 2004!! They love Jesus!!!
This was the wife of a very high ranking Iraqi government official. She told me horror stories about Saddam’s Iraq. And the Gulf War.
And how is that some 20 year old from Youngstown, OH’s problem?? I supported the no-fly zone that contained Saddam but we have no obligation to improve the lives of Iraqis.
I wasn’t advocating for anything. No 20 year old from Iowa or Ohio should ruin his life over Halliburton getting a giant rebuild contract.
You are hopelessly wrong.
You’ll come around.
Noting sadder than an old hippie that turned MAGA.
You’ll be disappointed
You will be embarrassed it took you so long.
Didn’t worsen it the spending got us through it otherwise we would be having this argument in a back ally fighting for a can of spam…….. capitalism literally was in the verge of collapse and it took government handing out tax payer money to save it otherwise it would have closed shop and start from zero again. There are some excellent books about the crisis if you bothered to read
No. The media told you Capitalism
Was on the verge of collapse. Not even close. It was a mild recession which was made worse by everything Obama did.
I do read. You should learn to discern and not just eat propaganda.
When you admit the socialism is what saved capitalism in 1929 and 2008, also if these extreme right wing policies worked so well what Happened to Kansas in 2012 ? The thing about republicans today their is a tad bit of truth in what they say that is then used to go over the top and justify absolute nonsense of economic policy
No Ssicialism didn’t ‘save’ capitalism in 2008. It worsened the recession.
Taxing unrealized gains makes the most sense for estate settlements. For example let's say a mogul with $1billion in unrealized gains in their company's stock dies. Right now that $1 billion is transferred to the heirs with a new basis set at the price at the date of death. Thus, the heirs receive $1 billion in additional income in that year and don't have to pay any tax on it. The estate does pay an inheritance tax that is much less than what the income tax would be.
What could be done is for the estate to pay the X% capital gains tax on that $1 billion of unrealized gains if it has liquid assets that cover this. If not, the estate would gradually sell X% of the stock to pay the X% capital gains tax. The heirs would inherit 1-X% of what their parents had built, which is a pretty good deal since they didn't create it.
The system we have now amounts to a form of entailment, which the Founders considered and rejected. They were right to do so, we should go back to a system more in line with what they envisioned, using tax policy to avoid creation of dynastic wealth.
Also, the stock would not crater. Tesla shareholders have twice voted to give Elon Musk a $50+ billion bonus, which is more than what would be required to pay capital gains taxes on his Tesla shares. Obviously, they are unconcerned about the impact this might have on the stock price. Every year around a trillion dollars is extracted from the stock market and it keeps going up.
In Canada upon someone’s death all their assets are ‘deemed to have been sold’ to the Estate. Excluding a personal residence and after tax cash in a bank account. If someone had a $B in assets that cost them $10M then $990 million is taxed at capital gains rates. That is the way it is done in Canada. Absolute nightmare for estates. The new adjusted tax basis becomes the $1B that had been taxed on the death of the original owner.
How is this a nightmare? If it is a small estate, just sell the assets and pay the income tax. If it is a big estate, then its more complicated, but there is more money to pay people do the work. I fail to see where there is a problem.
After all, inheritance is income provided to people in exchange for nothing, like welfare. Heirs are not “owed” anything.
I do think it makes sense to allow a flat deduction from the estate and only apply the taxes on assets above this amount. Does Canada not do this?
Why if I have worked hard for 55 or 60 years and I wish to give the fruits of my labour to my children and grandchildren I can’t? Who are you or anyone else to tell me my assets should be taken from my family?
Sure you can. But they need to pay taxes on their windfall same as if they won it at Vegas. What am objecting to us heirs getting tax free income while the rest of us have to pay taxes on every penny we earn.
Heirs aren’t owed anything? Families are important. However, what if I want to give them a nice life? What if one of my kids is handicapped? Am I allowed to hand something over to him? My life, my family.
The progressive movement lost its way the day those 2 black girls shouted down Bernie at his rally and babbled woke nonsense while Bernie politely nodded agreement. It later came out that they were paid agitators.
The infectious disease outbreaks are almost exclusively linked to new immigrant populations.
The progressive mayors and DAs have been voted out due to their disastrous policies.
Generally, the progressive movement died when it dropped economic populism for woke craziness. You can’t call people bigots because when they say men can’t get pregnant and not expect pushback.
Please stop posting crap
Please don’t comment on the internet if you have nothing worthwhile to say.
You are a Libtard
You are a bot
And if they're not, I think it's safe to assume that someone who uses the word "libtard" isn't arguing in good faith.
"The infectious disease outbreaks are almost exclusively linked to new immigrant populations."
That is laughable nonsense, if you mean COVID.
I don’t mean Covid, I mean the diseases being referenced in the article we are commenting on.
Your a Libtard and even you don’t know what you are saying
You sound like somebody left the front door open to the insane asylum….. my point is very clear and often when I run into people spouting nonsense those two questions shut them up, they move directions to well money doesn’t mean anything and I don’t measure happiness by my paycheck, I nowhere asked how happy we are because that is irrelevant i asked if we are better off a society with access to more productivity and that answer is yes as a whole collective group we are some have more much much more but so do those who have less, that why we are not fighting angry mobs of peasants. What other measure would you use to scale a society ? How happy you feel, that can be manipulated.
Inflation is the name of the game 2% is good anything higher is bad, inflation is how the pie grows without it and the pie starts to get smaller and prices lower because theirs less money in circulation, too much and prices grow to high to match wages even a moron understands this
You are simply a libtard, friend. Inflation is not natural or good. It is theft. What you worked for today will not be worth anything tomorrow. So you better keep working.
Reciting blurbs out of an Econ 101 textbook is not the comprehensive argument you think it is.
We’re living in the progressive age economically and socially and the world is better for it, our economies are the r most productive and we have a quality of life that would be considered magical 50 years ago, now there are serious problems but I’ll ask you two questions that will prove you wrong #1 are you making more money today then you did 10 years ago #2 is your access to life changing goods more accessible today then 10 years ago a
Majority of us would answer yes to those questions so how can you say progressive agenda has failed ? What proof is there of this failure ?
This reads like you are 19 and just discovered Steven Pinker from 5 years ago. Inflation means everything we have is worth less including the “more money” that we make as serfs.
I have more access to life-destroying technology than I did 10 years ago. My life is not made better by any technology improvements in the last 10 years. Everyone was happier ten years ago, check the stats.
Neither of these things have anything to do with my initial comment. We aren’t living in the progressive era we are living in the death throes of the liberal era. Since World War II the west has been in the process of burning all of the sociocultural capital it spent the previous 400 years accumulating in a race to the bottom driven by weaponized empathy.
What were the names of those two black girls who were paid agitators?
https://www.nbcnews.com/politics/2016-election/black-lives-matter-activists-disrupt-bernie-sanders-speech-n406546
What did it for me is when progressives defended Daniel Ortega as he committed a blood bath in Nicaragua and accused those being murdered of being CIA operatives.
No one cares
After the election the Democratic Party (my party) must rethink many of its policies as it ponders its future.
To be entrusted with power again Democrats must start listening to the concerns of the working class for a change. As a lifelong moderate Democrat I share their disdain for many of the insane positions advocated by my party. We are no longer the patriotic, sensible party of FDR and JFK.
Democrat politicians defy biology by believing that men can actually become women and belong in women’s sports, rest rooms, locker rooms and prisons and that children should be mutilated in pursuit of the impossible.
They believe borders should be open to millions of illegals which undermines workers’ wages and the affordability of housing when we can’t house our own citizens.
They discriminate against whites, Asians and men in a futile effort to counter past discrimination against others and undermine our economy by abandoning merit selection of students and employees.
Democratic mayors allow homelessness to destroy our beautiful cities because they won't say no to destructive behavior. No, you can’t camp in our city. No, you can’t shit in our streets. No, you can’t shoot up and leave your used needles everywhere. Many of our prosecutors will not take action against shoplifting unless a $1000 of goods are stolen leading to gangs destroying retail stores. They release criminals without bail to commit more crimes.
The average voter knows this is happening and outright reject our party. Enough.
That is not the Bernie Sanders/Warren/AOC left, which is all about specific policies revolving around economic justice, supporting workers' rights, universal healthcare, a sustainable environment & climate action, reducing the destabilizing disparity in wealth & power between the rich & the rest of us, having the rich pay their fair share of taxes, affordable housing, etc. They are not focused on the issues or complaints you cited. That is another faction, that has been associated with the left, but I'm not really sure they are, since they seem to be focused on PC issues, rather than the economic & environmental issues that Bernie & most progressives care about, & which are highly popular with the American people in general. Political correctness tends to distract from the concrete issues that concern true progressives, which have been unfairly & incorrectly associated with those more abstract issues you mention.
Jaime: I tend to agree with you but I am not sure those politicians you mentioned are, in fact, very popular with the actual working class voters who swung our latest election to the Trump Republicans. They are tainted by the policies I mentioned.
It's because they've been the object of corporatist & right-wing attacks & propaganda that have falsely attributed unpopular ideas to them, when the actual policies they espouse are very popular with the American people.
Unfortunately, they all get lumped in together because nobody on the Left had the courage to stand up and say, "I do not agree with this Woke nonsense." And if the did, not loudly and often. They needed to. They needed to say they disagreed with the Biden Woke agenda and wanted to focus on working class economics. But nobody would say it. And suddenly, there is no way to define "woman" and we need to state our pronouns and kids can choose their gender and people get cancelled for FB posts...and none of the leaders of the Left denounced it strongly.
Indeed and now working class politics is electorally unviable for the foreseeable future because it’s so closely associated with woke politics by a crucial part of the electorate.
Outright rejected you make a slim victory to be some sort of electoral blowout you exaggerate
Bernie’s personality cult is nearly as obnoxious—and nearly as authoritarian—as Trump’s. (I actually lost friends to the Tara Reade debacle, for which they predictably fell, hook line and sinker.) It’s tough to watch them disappear down one unpopular, Democrat-damaging, democracy-damaging policy rabbit hole after another (masks forever, defund the police, Hamas is good ackchyually), and then wonder why their credibility is absolutely shot to bits. Must be the DNC! 🙄
Unlike a lot of pundits, I’m not terribly worried about this vocal-but-small contingent loudly withholding its votes from Biden. They were never exactly his fans in the first place, and there is no reasoning with the “burn it all down” mindset (reasonable people rarely have that mindset in the first place, as there’s NEVER a guarantee that something better will rise from the ashes). I believe that the persistently-high number of GOP primary voters who cast ballots against Trump are, for the most part, a much more gettable lot.
Your ideas are conflated and total BS. As a Center Left person I was more pissed off about Hillary and the DNC screwing Sanders in 2016 when he alone could have beaten Trump because other than Trump - he was the only populist speaking to the majority of fed up citizens barely making ends meet in a post neo-liberal Reagan/Clinton/Republican corporate world. As for 2020 we who are smart knew you can't put lightening in a bottle twice-especially with an honest high integrity Democratic Socialist like Sanders and a fickle electorate. The greedy sick rich 1% will never allow such a person to become the president at least until we the people take our country back as in we are the 99%! I was part of Occupy Wall Street and you obviously know nothing about what the variety of humans from all age groups and backgrounds were fighting for. Saying COVID was a dream come true for leftists is one of the dumbest things I have ever read and I am older and very well read for many decades. Anyone who is older has seen this TV show before - the US is a big yin/yang pendulum that swings back and forth between the right and left forces. Most of us fall somewhere in the middle. But I fear the far right far more than the far left. This cycle is on repeat - watch how the billionaire republican cult of Trump drive our nation into the ditch as Republicans always do eventually - and then the Democrats and we the tax payers will have to dig us out as they always have and resuscitate the nation as in 50+ million jobs created since since 1989 vs only a measly million by the so called pro business Republicans! What a joke! But this time it feels different - the desperation of struggling ignorant voters lead to a stupid Trump vote or none at all - that may be the final death blow to Democracy. I pray not but it was already dying on the branch since the hegemony Citizens United SCOTUS decision. Democrats need to regroup and get back to basic life issues that affect most versus only a few - like stopping Global Warming, better wages for the majority of middle class and universal health care would be a good start - all the issues Sanders has consistently fought for his entire 50 years in public service and that the majority of American people want from both parties. Dems blew it but there are a few progressive stars on the horizon - like Gov Newsom from Cali and AOC from NYC who could be the first woman president. Again - only if Democracy is still around in 4 years. Time will tell if all the hundreds of thousands deaths and sacrifice of the men and women who died or were injured in wars for freedom, Democracy and the Constitution for over 250 years were in vain.
This whole article seemed to betray a confusion about who counts as left, progressive and mainstream. It also shows that the author doesn’t have a grasp on where the factions overlap and where they don’t.
Do we really need a 'one true Scotsman' argument?
I said they overlap, not that there’s a true “left”. But the Bernie left and woke left aren’t one in the same, which is the basis of the author’s argument
I walked away from the so-called "progressives in 2010 when they failed to support the Democratic majority in a fit of either stupidity (because they didn't know the significance in midterms) or pique because the ACA wasn't M4All. They portrayed Obama as a sell out while they sold him out. OWS was a raging failure because they refused to accept the necessity of lesdership. And yes, it opened the gate for the useless Bernie Sanders because they still didn't know what leadership looks like.
M4A makes more sense at the state level anyway. In states like Vermont and Massachusetts they currently have all of the money necessary to fund a M4A program being spent on health care in their states. So no new taxes are necessary and both state have an agency that runs a major health care system.
Hey, i liked your piece! I think it popped up in my feed because my colleague David Perlmutter liked it.
It’s nice to see calmly explained analysis where your political preferences, whatever they may be (centrist, maybe? But i find that term a little reductive), don’t keep you from being reasonable and perceptive.
At any rate— I’m looking forward to reading more.
The tuition of Bernie’s supporters behind the scenes at the Iowa caucuses was truly dreadful. They taught the locals how to silence everyone else’s supporters with cursing, yelling in unison, and every sort of dirty trick imaginable. In other words, his senior people acted like the same kind of Marxist street punk he was himself back in the 1960s. They convinced me that his entourage would, if he were elected, act like a leftist paramilitary to carry out Bernie’s “revolution”. He should not have even been allowed into the Democratic presidential election process. He is a Marxist and should be treated with the same disgust as AOC, Ro Khanna and all the other Marxists in Congress.
Instead, you got a MAGA cadre. Happy now?
“Mike Bloomberg, the architect of a racist Stop and Frisk policing policy”
Racist, lol!
"Racist"Stop and Frisk policy = The Most Effective, Constitutional, Crime Prevention, Gun Control, and Support for the 14th Amendment's Equal Protection of the Law policy. The Progs must hate the vulnerable and innocent poor who live in gang-infested ghettos in every major city in the U.S.
And I bet they love stop and frisk, too. Oh, wait, no, they didn't/don't. Maybe they want effective law enforcement that doesn't depend on stop and frisk? Is that even possible to you? Try to reply without crazy-looking random capitalization, please.
Interesting article, but any take on the left in 2020 that doesn’t tackle the BLM riots is missing a big piece of the puzzle.
I doubt Americans will ever accept fully left-of-center government. Most of the times when they had the opportunity to have it, it was spurned.
What is fully left of center government? That's a pretty vague descriptor. What Joe Biden has done is as fully left of as anything since LBJ. He won once. He must win again.
HE. DIDN'T
When are so-called progressives going to figure out that imposing conformity from the top down does not advance, well, anything?
People don’t vote for something which tells them what to do instead of telling them what they get. Trump couldn’t figure out Covid, and Biden promised an end.
Dem’s couldn’t figure out trans, told people to put up with it, Trump promised an end. Dems couldn’t figure out severe inflation effects, told people to put up with it, Trump promised prosperity.
Yeah and Biden got 12 million votes that neither Obama nor Kamala got. Trump got basically the same number of votes all 3 times. 🤔
When the Overton window moves due to radicalism and you find your self in the centre.
Spot on. Another great piece. Thank you.