New Billionaires since the Pandemic

[1979Shocker]

Wall Street minted 56 new billionaires since the pandemic began — but many families are left behind (nbcnews.com)

[C0|dB|00ded]

Wall Street minted 56 new billionaires since the pandemic began — but many families are left behind (nbcnews.com)

This isn't going to go over too well with the new administration. Fasten seatbelts.

[wufan]

This isn't going to go over too well with the new administration. Fasten seatbelts.

He’s going to be pissed that his family wasn’t one of the first 50!

[C0|dB|00ded]

I'm not gonna lie, the wealth gap has become a problem. There's going to be a major societal backlash (it has already started). But even if the government enacted a one-time wealth tax and stole 50% of those billionaire's 4 trillion, it would run the government for 1.5 years. And the discouraging effect it would have on the rest of the job creators would likely nullify any temporary "gain". We need to help the middle-class be a real middle-class again. I would think mandating that all public companies have some sort of 401k stock matching plan (w/ some of their wages being involuntarily invested) would be a nice start. Workers need to own more of the company they work for. They need to share in the wealth created by the stock market. In the 70's and 80's people depended on their wage increases, but since the 90's, you better have invested the hell out of your money because your wages have been practically stagnant when adjusted for inflation. These are the costs of a global economy. Cheap labor and new trading partners increases GDP, but the wealth created isn't equal. Some of the wage increases we've lost since the 90's went to the Ping, Pong, Dongs of the world.

Another problem is key personnel salaries. They have skyrocketed. I know it's the market that sets the pay for executives, but it is the large stockholders/board of trustees that control the major hiring decisions. If the workers had more voting rights, we may not see the massive gaps in worker-executive salaries. I know it sounds Marxist, but we can't continue to have this income disparity and remain a healthy society.

Thoughts?

[WuDrWu]

But even if the government enacted a one-time wealth tax and stole 50% of those billionaire's 2 trillion, it would run the government for 1.5 years.

Umm, what?

[C0|dB|00ded]

Umm, what?

Sorry, I meant to say half of their 4 trillion.

[wufan]

I'm not gonna lie, the wealth gap has become a problem. There's going to be a major societal backlash (it has already started). But even if the government enacted a one-time wealth tax and stole 50% of those billionaire's 4 trillion, it would run the government for 1.5 years. And the discouraging effect it would have on the rest of the job creators would likely nullify any temporary "gain". We need to help the middle-class be a real middle-class again. I would think mandating that all public companies have some sort of 401k stock matching plan (w/ some of their wages being involuntarily invested) would be a nice start. Workers need to own more of the company they work for. They need to share in the wealth created by the stock market. In the 70's and 80's people depended on their wage increases, but since the 90's, you better have invested the hell out of your money because your wages have been practically stagnant when adjusted for inflation. These are the costs of a global economy. Cheap labor and new trading partners increases GDP, but the wealth created isn't equal. Some of the wage increases we've lost since the 90's went to the Ping, Pong, Dongs of the world.

Another problem is key personnel salaries. They have skyrocketed. I know it's the market that sets the pay for executives, but it is the large stockholders/board of trustees that control the major hiring decisions. If the workers had more voting rights, we may not see the massive gaps in worker-executive salaries. I know it sounds Marxist, but we can't continue to have this income disparity and remain a healthy society.

Thoughts?

Yes, the wealth gap is a problem. The greater the wealth gap, the greater the property crimes in the area. But, that’s the only problem. Every other problem is imagined. The wealthy pay most of the taxes and create most of the jobs. Wealth is rarely passed down more than one generation, and the benefits of having the ultra-wealthy around generally far outweigh the negatives.

There is art, culture, money to take care of the poor, educational opportunities, jobs, and EVERYONE’s standard of living is increased on average even if it is increased at a greater rate for those with more money.

There needs to be basic laws to make sure the wealthy and ultra-wealthy aren’t cheating the system, but the solution is NEVER to limit ones potential by taking it away.

[Ted Lasso's Neighbor]

I think one has to take these types of articles with a grain of salt, mainly because:

1 - the wealth mentioned is mainly just on paper and based on the number of shares the person has times the stock price. You can't tax paper wealth, so the billions of dollars some of these people have isn't taxable. If their stock crashes, they can just as easily lose millions or billions of dollars on paper as well. I saw an article today where it said short sellers had lost 38 billion - that's with a b - by shorting Tesla in 2020. But that too is mainly based on the price of the stock and stock being shorted vs actual losses, so it works both ways.

2 - IPO's always generate a lot of money for the company owners and investors, but once again it's just on paper because there are lockup periods where those types mentioned in the article have to wait a certain period of time before they can start selling their initial shares. Also, bad companies don't go public because no one wants to buy stock in a bad company, so IPO's are typically a sign of a good company and the people who run it are in a way being rewarded for all of their hard work in getting the company to where it is. Airbnb even allowed hosts to buy up to 275 shares of the stock before the IPO (https://www.npr.org/2020/12/12/94587...15-000-mistake) and those who took advantage of it made money as well.

3 - the Institute for Policy Studies mentioned in the article is described as the following on their wikipedia page - "The Institute for Policy Studies is the largest and most influential of the far left think tanks in Washington DC. Since its founding in 1963 it has steadily followed a pro-Marxist line on foreign policy, defense and the economy and has spawned a large number of spin-offs, other think tanks and public affairs organizations following the same radical agenda." Given it's wikipedia, who knows if that's all true, but some places monitor their wikipedia page closely and make sure any negative stuff is removed.


The article fails to mention that one of the main reasons most of the big companies survived the pandemic is because of large monetary reserves. Apple has billions of dollars in reserves and was never going to be hurt by the pandemic. The same is true for other companies. The main problem when it comes to wealth and taxes isn't people and paper wealth, but the fact that companies like Apple and others avoid paying taxes on billions of dollars from doing business by moving the money offshore. Politicians always say they'll change things, but seldom do and it's easier for them to get the sympathy of voters by saying people like Bezos, Musk, etc., and their paper wealth should be taxed vs going after the companies and their cash instead, mainly because most people don't understand company finances or how stocks work.

[wufan]

The problem with the off shore finances and tax evasion is that if you force tax it, they move their jobs to these locations too, then you get nothing.

[Ted Lasso's Neighbor]

The problem with the off shore finances and tax evasion is that if you force tax it, they move their jobs to these locations too, then you get nothing.

Is that what actually happens though or is that what companies say they'll do as a bluff to keep it from happening? I ask because I've heard companies say that in response to politicians and then the politicians back down, so I'd be interested to read about some actual examples of that happening.

[SB Shock]

w/ some of their wages being involuntarily invested) would be a nice start.

Isn't that called the Social Security Tax?

So so far you are advocating "Stealing" and increasing the Social Security Tax.

[revenge_of_shocka_khan]

I'm not gonna lie, the wealth gap has become a problem. There's going to be a major societal backlash (it has already started). But even if the government enacted a one-time wealth tax and stole 50% of those billionaire's 4 trillion, it would run the government for 1.5 years. And the discouraging effect it would have on the rest of the job creators would likely nullify any temporary "gain". We need to help the middle-class be a real middle-class again. I would think mandating that all public companies have some sort of 401k stock matching plan (w/ some of their wages being involuntarily invested) would be a nice start. Workers need to own more of the company they work for. They need to share in the wealth created by the stock market. In the 70's and 80's people depended on their wage increases, but since the 90's, you better have invested the hell out of your money because your wages have been practically stagnant when adjusted for inflation. These are the costs of a global economy. Cheap labor and new trading partners increases GDP, but the wealth created isn't equal. Some of the wage increases we've lost since the 90's went to the Ping, Pong, Dongs of the world.

Another problem is key personnel salaries. They have skyrocketed. I know it's the market that sets the pay for executives, but it is the large stockholders/board of trustees that control the major hiring decisions. If the workers had more voting rights, we may not see the massive gaps in worker-executive salaries. I know it sounds Marxist, but we can't continue to have this income disparity and remain a healthy society.

Thoughts?

• Increase taxes at the top end.
• Remove the hedge fund breaks. These folks are basically in the business of making synthetic money. They don't produce or create anything, so why shouldn't they have to pay the same amount in taxes as any other business owner?
• Change the constitution to require cyclically-balanced budgets.
• Put a tax on excess corporate bonuses
• Put in limits (or outright prevent) companies from buying back their stock on the open market.

I think I brought up the notion of cyclically balanced budgets a few years ago and got laughed out of the room. Since then, we elected a Republican as president who enacted a huge tax cut when it was not needed. I think this is a shell game the Republicans are playing. When a Democrat is president, scream and cry that we need to be fiscally responsible and the deficit ought to drop. Then when their guy is in charge, pass budget-busting tax cuts to benefit their contributors. If someone who is an officer at a state (or perhaps even Sedgewick County level) of the Republican party who can explain this logic to me, I'm all ears, but it not only happened under the guy who currently lives in the White House, but also the last Republican president we had. It's time for all parties in Washington to be a little more truthful and honest with their constituencies. To the Dems, I would say that it is not the government's job to provide free stuff. Actually, I would say that it is not the Republican's job to make sure their major contributors get a favorable tax bill (which, let's face it, is actually free stuff, too).

Corporate behavior is also a problem. CEO's (in publically-traded companies) engineer big stock buy-backs to keep the price of the stock artifically high and ensure they get those huge bonuses, especially when the said companies start underperforming and large institutional investors start to complain (and get traction). These same people stack the board of directors with friends and family to make sure they get a large payout when or if they lose their jobs.

Cyclically balanced budgets - COVID. Any questions? It seems like when we have economic calamity brought on by any one of a number of causes (speculative investment crashing markets and dragging the economy down (housing most recently, but you can go back in history and see that there was a lot of economic speculation going on immediately before many market crashes), pandemics, wars) we should have flexibility in the governmental tax/budget cycle so that the little guy doesn't get wiped out when the economy crashes.

I say all this, and I will probably still get laughed at if I were to say (again) that I am willing to pay a few thousand more in taxes each year SO LONG AS we balance the budget, reduce our national debt and don't enact tax cuts for the politician's sponsors. I would like to see my daughter and grandkids have the same opportunities that I had.

[WuDrWu]

I'm not completely sure you understand why people are laughing at you.

Many of your proposals are sound in theory. However, balancing the budget, given where we are spending money now, just isn't going to happen without painful changes to entitlement programs. It's not coming from raising your taxes and mine a "few thousand" a year, it's not coming from the Kennedy Center and it's NOT coming from Democratic leadership.

But almost no one wants to address the real problems, and that's mostly because they fear for their (government) jobs.

I'm telling you, right now, the ONLY hope we ever have of fixing our financial problems...the ONLY hope..the ONLY possible cure is simple.



Term limits. I promise you, get everyone out of Congress in 1 term, and we're fixing the problems within one generation. Done.



There are really only 2 groups of people that have thrived during these troubling pandemic times. The ultra wealthy (and they are likely thriving though every scenario anyway) and government employees. And not just Congress. Government employees at all levels all across the country have it so much better than everyone else it's not even funny. Why more people don't see the flaw behind this is unfathomable to me.

[C0|dB|00ded]

Yes, the wealth gap is a problem. The greater the wealth gap, the greater the property crimes in the area. But, that’s the only problem. Every other problem is imagined. The wealthy pay most of the taxes and create most of the jobs. Wealth is rarely passed down more than one generation, and the benefits of having the ultra-wealthy around generally far outweigh the negatives.

There is art, culture, money to take care of the poor, educational opportunities, jobs, and EVERYONE’s standard of living is increased on average even if it is increased at a greater rate for those with more money.

There needs to be basic laws to make sure the wealthy and ultra-wealthy aren’t cheating the system, but the solution is NEVER to limit ones potential by taking it away.

It's a bit more complicated than property crime. This "gap" affects everything about the "American familly". And the fact that the wealthy pay the largest percentage of the taxes is not the solution, it's illustrative of the problem. Also, the taxes they do pay is a vastly smaller percentage of their disposable income than the middle class.

There's a video available on Amazon Prime right now that touches on some interesting income disparity points.

Isn't that called the Social Security Tax?

So so far you are advocating "Stealing" and increasing the Social Security Tax.

Social Security is a safety net for the aged. It's supposed to keep up with inflation, but it does nothing to rebalance the wealth gap and it does nothing-nothing for working-age families. I'm talking about your average middle-class American owning parts of the economic expansion that the wealthy are automatically a part of because they own everything.

Advocating stealing? I did nothing of the sort; in fact, what I said conveyed exactly the opposite sentiment. If we snatched 2 trillion dollars, it would barely pay for the $2k stimulus they just attempted to pass. Our economy is much less closed than in the past so there needs to be other avenues for the unwealthy to "keep up". Traditional education, traditional J.O.B.S. aren't going to cut it in the new world economy. For America to maintain its economic leadership position, it is going to have to evolve. I do not know the solutions, I just know the end result - and that is that the middle-class needs to be dealt back into the "hand" - and it has to happen without taxing the **** out of the wealthy (because that wont work). Politicians are owned by the wealthy, and if they can't legislate their loopholes, they'll just move to a more favorable tax climate.

This is going to take much more than the traditional talking points (lower taxes vs. higher taxes + handouts). We need an economic revolution (that doesn't mean Socialism). It begins and ends with the middle-class owning more of "the means of production". That sounds like Socialism, but it's not what I'm saying. I'm vaguely talking about a wealth "adjustment". We have cost-of-living raises in order to keep up w/ inflation; I submit the need of a "wealth-of-living" raise without disincentivizing the ambitious and future job creators of America, and without engendering a reduction in labor participation from the very class this initiative would be designed to aid. All I can think of is company stock and a sort of dividend/profit sharing that is owned but not accessible. Something like this would certainly change the dynamics of the stock market. The consistent purchases would far exceed the support received by 401k's now. The market's positive drift would likely escalate and perhaps bubbles would be less disruptive.

There are many issues with this idea; first is that it would only work w/ public companies. You can't force large private companies to become public. And this "wealth-of-living" investment purchase would have to come out of the paychecks that are already too low. Folks new to the work force would see little benefit, but those w/ a few years under their belts would start to see their income augmented. And to keep from incentivizing stock manipulation, the "wealth-of-living" accounts would invest in indexes instead of individual companies. The entire paradigm of "dividend stocks" would have to change...... so yeah, complicated, revolutionary,.. but necessary. The gap needs to close. The secret sauce of America is it's strong middle-class.

[C0|dB|00ded]

• Increase taxes at the top end.
• Remove the hedge fund breaks. These folks are basically in the business of making synthetic money. They don't produce or create anything, so why shouldn't they have to pay the same amount in taxes as any other business owner?
• Change the constitution to require cyclically-balanced budgets.
• Put a tax on excess corporate bonuses
• Put in limits (or outright prevent) companies from buying back their stock on the open market.

I think I brought up the notion of cyclically balanced budgets a few years ago and got laughed out of the room. Since then, we elected a Republican as president who enacted a huge tax cut when it was not needed. I think this is a shell game the Republicans are playing. When a Democrat is president, scream and cry that we need to be fiscally responsible and the deficit ought to drop. Then when their guy is in charge, pass budget-busting tax cuts to benefit their contributors. If someone who is an officer at a state (or perhaps even Sedgewick County level) of the Republican party who can explain this logic to me, I'm all ears, but it not only happened under the guy who currently lives in the White House, but also the last Republican president we had. It's time for all parties in Washington to be a little more truthful and honest with their constituencies. To the Dems, I would say that it is not the government's job to provide free stuff. Actually, I would say that it is not the Republican's job to make sure their major contributors get a favorable tax bill (which, let's face it, is actually free stuff, too).

Corporate behavior is also a problem. CEO's (in publically-traded companies) engineer big stock buy-backs to keep the price of the stock artifically high and ensure they get those huge bonuses, especially when the said companies start underperforming and large institutional investors start to complain (and get traction). These same people stack the board of directors with friends and family to make sure they get a large payout when or if they lose their jobs.

Cyclically balanced budgets - COVID. Any questions? It seems like when we have economic calamity brought on by any one of a number of causes (speculative investment crashing markets and dragging the economy down (housing most recently, but you can go back in history and see that there was a lot of economic speculation going on immediately before many market crashes), pandemics, wars) we should have flexibility in the governmental tax/budget cycle so that the little guy doesn't get wiped out when the economy crashes.

I say all this, and I will probably still get laughed at if I were to say (again) that I am willing to pay a few thousand more in taxes each year SO LONG AS we balance the budget, reduce our national debt and don't enact tax cuts for the politician's sponsors. I would like to see my daughter and grandkids have the same opportunities that I had.

There's probably room to raise taxes on the high-end, but all that does is give more funds for general government budgets which are by and large, wasteful. And the wealth-gap issue is a 10's of trillions of dollars problem. You could tax the rich at 99% and it wouldn't be enough; plus, it would destroy America.

These folks are basically in the business of making synthetic money.

That really hurts. But seriously, "Wall Street" is the oil that greases the economic machine (For. The. Entire. World); without highly efficient capital markets we become Russia overnight... and Russia becomes Venezuela. The question is, does the reward match the risk? I say yes but I'm biased.

Stock buybacks are representative of the inefficiencies of government intervention, but not with the marketplace itself. Lowering corperate taxes raises corporate profit; the trustees have a fiduciary responsibility to direct profits back to the owners (shareholders) and/or raise the stock price. Executives offer stock option incentives to key personnel in order to align their goals with the goals of the ownership (stock holders). It does provide an avenue for manipulation though which goes back to my comment to wufan the other day about Capitalism failing when the virtue of the people wanes. Your average company CEO (within reason) can choose to offer a dividend, extend bonuses to his executives, hire more employees, raise wages, or buy stock back. He has within his power the ability to tilt the scales in favor of the average employee, the shareholder, or the executive. THIS is the best place for Capitalism to get that shot in the arm of virtue and altruism. With greed unchecked by those in power, the only alternative is government intervention or "the people" rising up. Both of those solutions are very messy.