Quote:
Originally Posted by BoLevi
People think tax cuts are on the rich. That's not an accurate and useful way to look at it. Tax cuts are on capital. If you think about it that way, it will you to understand why your whole trickle down economics "theory" is an illusion.
People get rich when capital is free flowing and allocated efficiently to those that create value. But that that's a consequence of releasing capital from the constraints of taxation, not the mechanism.
When people have a simplistic view of this, they view the participants as the key component in the flow of capital. In fact, the participants/individuals that you view as being at the top of the hierarchy are only a minor component of the capital flow, even if they appear to be wildly wealthy. For instance, if you own say a profitable donut shop, you accumulate only a small portion of the capital that flows through that shop. The rest of the capital is just using the donut shop as a conduit between suppliers, employees and customers. This is relevant because even if the people who own the business get "rich", they are still a tiny eddy in the much large and much more important flow of capital - which is the flow that helps the little guy.
You do yourself no favors by viewing the economy as some sort of two dimensional pyramid with stacks of cash at each level and the idea is to figure out how to grab the other guy's stacks.
|
That’s a lot of word salad that doesn’t address anything I said. Taxation just doesn’t happen at the individual level. Capital accumulation allows people and companies to access even more capital to continue concentrating wealth. The easiest example that I think should be cut is the ability to access loans against equity in order to avoid taxation events. The middle class is paying 40% in taxes and the wealthy are getting low interest rate loans. Flight is finally here but keep on fighting for that Atlas Shrugged world you so desire.