Green New Deal

[juliusa]

At the end of the day we're increasingly being split into two classes of people. One class that gets more than they can possibly spend from income they didn't work for and another class that can't work enough to get what they need. This is only going to get worse until we take active steps to mitigate it.

So the GND is about income/wealth redistribution?

It's also mildly frustrating because my parents were 'foolish' enough to serve their country in the military so I inherited ~nothing. If they had been 'smarter' and contributed nothing to society by shuffling $$$ from one place to another and back again I could have had a sizable inheritance..... Sort of 'amazing' where our society places value

'Foolish' enough to live an honorable and meaningful life? Is it the goal of a parent's life to leave an inheritance for their children? Do children measure their parent's value based on the inheritance they leave?
My guess is for every child with no inheritance that loves and admires their parents for the people they are, there is a child with a nice trust fund and empty childhood that would trade trade it all for parents who love them more than they love money.

A more pragmatic way of looking at the GND is the fact that the extraction of and addiction to fools fuel is unfortunately a 'load bearing' wall of our society. You can't simply knock it down and expect things to be ok. There needs to be thoughtful reinforcement of effected sectors. 'The risk of fiscal collapse in coal reliant communities'

Which is why I think the simple solution is a revenue-neutral carbon tax. Depending on how you "rationalize" it, it creates a level playing field for energy (removes fossil fuel subsidies) or provides a financial incentive for non-carbon energy (wind, solar, hydro, nuclear). It adds no tax burden, no government investment (Solyndra), no government takeover of the energy sector. It is simply a wealth redistribution from above average carbon users (generally rich people with big houses, big cars, big toys) and gives it to below average carbon users.

Suddenly those solar panels on the roof have a bigger ROI. More fuel efficient car saves more money. Taking the bus/train instead of driving puts money in your pocket. High-speed rail projects that didn't make sense suddenly do.

No revolution. No big government. No rapid displacement of millions of workers. Simply accelerating what is already happening, and people are already adapting to. Coal jobs are going away.

What we need to do is talk about a Green Deal and a New New Deal. Using the former to justify the latter is doing nothing to save the planet from global warming. Let them each stand on their own. Combining them falls into the usual power-hungry politicians not wanting to let a good crisis go to waste. Most politicans could care less about global waming - they just see it as a convenient way to expand their power.

Coal is already going away in the US (but not in the world). We can accelerate its decline in the US with a revenue-neutral carbon tax. Still need a way to get the rest of the world to do something.

As an aside, can you identify the countries/regions in this chart that are and are not signatories to the Paris Climate Agreement?? Tariffs / trade war with China could do more to help global warming by slowing down China's economy and growth than anything else we do.

 

[nwdiver]

So the GND is about income redistribution?

'Foolish' enough to live an honorable and meaningful life?

The GND is about solving a systemic problem with a systemic solution. Sadly an honorable and meaningful life doesn't pay the bills... but an estate tax could certainly help with medical expenses and from your perspective maybe a few empty childhoods.

Here's a crazy idea. Why don't we establish a reasonable estate tax, end this absurd plutocracy, EVERYONE works for what they have and we use the proceeds to fund a clean energy future

 

[Merrill]

My parents had no money, in fact I had to help them on occasion. I served my country in the Army in Vietnam and was proud to do so. I had to commute to college and work to afford to go, my work ethic was such that after spending 3 years in the military and flying around getting shot at in Vietnam I was very motivated to finish college and have a career. I expected nothing from anyone and made no excuses for anything, if you want something you can have it if you are willing to work your butt off.

 

[nwdiver]

if you want something you can have it if you are willing to work your butt off.

My point is that we're entering an economic phase where that is increasingly difficult bordering on nearly impossible. The only way to get wealth will be to grow it from wealth.

The reason this is related to the GND is because it requires a fundamental restructuring of the energy sector. There are cities dependent on the 3GW coal plant nearby or the coal mine or the refinery. Without support they will evaporate destroying billions of dollars in value of the surrounding area. Not to mention the social cost. There's a reason deaths of despair are skyrocketing in the rust belt. Opioids were really just a spark after a deep economic drought that's only going to get worse for these areas.

 

[juliusa]

but an estate tax could certainly help with medical expenses and from your perspective maybe a few empty childhoods.

We have a federal estate tax of 40%. CT adds in another 12%.

50% seems like enough to me. You seem to be a believe in inheritance, so I'm guessing you don't want 100%.

The federal estate tax generates about $25B per year and we spend almost $4T on healthcare. I don't think raising the estate tax is going to do much in paying for healthcare. You also know that Warren Buffet and Bill Gates will pay little if anything in estate taxes since they will be giving away the vast majority of their fortunes.

My point is that we're entering an economic phase where that is increasingly difficult bordering on nearly impossible. The only way to get wealth will be to grow it from wealth.

Sounds like DiBlasio and his robots taking over and leaving no jobs for people. Better stop the machines while we still can - once they start thinking for themselves we will have no choice in the matter. They will be the army and control society. We will be their servants, if they even decide to keep us around.

In 1900 40% of the people in this country lived on farms and supplied food to the country. Now it is 1%. It did not cause the economy to collapse - on the contrary if freed people up to do more productive things. Yes there will be fewer coal miners in 20 years. Fewer taxi drivers in 20 years.

I am a little confused though. It seems to be the same people saying we have a crisis that jobs are going away and there will be nothing left for people to do, and we have a crisis and need more immigration because we have more jobs than people to fill them. Which is it??

 

[nwdiver]

You seem to be a believe in inheritance,

Not really. That was satire to highlight the absurdity of how the system works. And the estate tax is too easily dodged with trust funds. That's what needs to end. You really think Donald sent a check for 40% of what Fred was worth to the IRS?

 

[juliusa]

The reason this is related to the GND is because it requires a fundamental restructuring of the energy sector. There are cities dependent on the 3GW coal plant nearby or the coal mine or the refinery. Without support they will evaporate destroying billions of dollars in value of the surrounding area. Not to mention the social cost. There's a reason deaths of despair are skyrocketing in the rust belt. Opioids were really just a spark after a deep economic drought that's only going to get worse for these areas.

Agreed. I just don't think big government is the one that should do it. Let it happen naturally (we all agree that fossil fuels are finite and this is inevitable, right?) or accelerate it with a revenue-neutral carbon fee/credit.

Steel mills have closed. Lumber mills have closed. Weaving mills have closed. Gold and silver mines have closed. Yes towns died - some were reborn, some were not.

We shifted away from an economy based on farm labor without central government planning. And that was 40% of the labor force - far more than work in the fossil fuel industry.

 

[juliusa]

And the estate tax is too easily dodged with trust funds.

Are you an estate attorney? Do you have a link that describes how this works?

The only way I know of to legally avoid estate tax is to give it away (or not have it in the first place). That is how Bill Gates and Warren Buffet are going to avoid it.

 

[juliusa]

You really think Donald sent a check for 40% of what Fred was worth to the IRS?

The estate tax was 55% at the time. No, I think he cheated on the taxes in many ways, including under-valuing real estate and outright fraud. As best I can tell he did not use legal "trust funds" to avoid the taxes. The higher the tax rate, the more people will cheat.

Maybe if we have a lot of unemployed people because they are displaced by robots, the IRS can hire them to catch the tax cheats. Half the country will be working, and the other half will be auditing them to make sure they are paying their taxes.

 

[nwdiver]

Are you an estate attorney? Do you have a link that describes how this works?

The only way I know of to legally avoid estate tax is to give it away (or not have it in the first place). That is how Bill Gates and Warren Buffet are going to avoid it.

How else do you think the Kochs and Waltons keep their wealth?

Maybe if we have a lot of unemployed people because they are displaced by robots, the IRS can hire them to catch the tax cheats.

Computers are already WAAAAY better But hey... leaves more time for hiking the great outdoors or whatever else floats your boat

 

[Merrill]

My point is that we're entering an economic phase where that is increasingly difficult bordering on nearly impossible. The only way to get wealth will be to grow it from wealth.

The reason this is related to the GND is because it requires a fundamental restructuring of the energy sector. There are cities dependent on the 3GW coal plant nearby or the coal mine or the refinery. Without support they will evaporate destroying billions of dollars in value of the surrounding area. Not to mention the social cost. There's a reason deaths of despair are skyrocketing in the rust belt. Opioids were really just a spark after a deep economic drought that's only going to get worse for these areas.

I guess we need to define wealth, I’m certainly not what I would call wealthy but was able to sustain a comfortable life style.

 

[juliusa]

How else do you think the Kochs and Waltons keep their wealth?

There is a reason that person is making peanuts writing a blog, and not millions.

1. Gifts while you are alive. Yes, you can gift up to $15,000 to as many people as you want each year you are alive. So if you have 100 children, grandchildren, and great grandchildren you can gift $1.5 million each year without paying taxes. But remember that money is going to 100 different families, so it is not like it makes them billionaires. Sure $15,000 per year is a nice tax-free income, but it is not enough to live large.
2. Insurance. Instead if giving money to your children / granchildren each year, you can pay insurance premiums with it and when you die they get the insurance tax-free. So pretty much the same as #1 - believe me, the insurance companies are not writing insurance policies to lose money.
3. Give it away. Yep - but that does not pass it on to your heirs. Just goes to charity instead of the government.
4. FLP. Same limitations as #1 and #2 - you can only transfer $15,000 per year per individual.
5. QPRT - a few million perhaps.

So basically you can transfer $15,000 in various ways to individuals tax free each year as long as you are alive, and you can give it away.

This was just a click-bait article because these are all nice ways for middle class and rich people to pass on some of their wealth to their heirs without paying estate tax, but it does nothing for the people with more than $100M like Trump's father and the Kochs, Waltons, Soros, Buffet, Gates, Bezos, Bloomberg or thousands of other people in the US that have that kind of wealth. When they die it can go to charity, or give it to their children after paying 40% to the federal government and (if they live in CT) 12% to the state government.

And they can't skip a generation either - or they pay generation skipping tax which is basically the estate tax again. So it gets taxed every generation.

 

[nwdiver]

When they die it can go to charity, or give it to their children after paying 40% to the federal government and (if they live in CT) 12% to the state government.

Judging by the fact that the wealth of the richest families never dip ~40% when a patriarch dies I'm guessing none of that ever happens. David Kochs nephew inherited his power and influence ($$$). Welcome to post-modern feudalism

 

[juliusa]

David Kochs nephew inherited his power and influence ($$$).

Power and influence? If you say so.

$$$? Yes, after paying 40% to the feds - or do you have something that suggests otherwise? I think his estate is something like $50B. If it all goes to his nephew, it should be subject to about $20B in estate tax, leaving him with a paltry $30B.

 

[juliusa]

How else do you think the Kochs and Waltons keep their wealth?

Here is a good article on the Waltons. Says they seem to have found a way to shelter about $9B of $150B from estate taxes, saving about $3B. Sure loopholes should be closed - but using some complicated way of saving $3B out of $60B in taxes is annoying, but not material.

https://americansfortaxfairness.org/files/Walmart-on-Tax-Day-Americans-for-Tax-Fairness-11.pdf

 

[JRP3]

We shifted away from an economy based on farm labor without central government planning.

New Deal - Wikipedia

 

[JRP3]

So basically you can transfer $15,000 in various ways to individuals tax free each year as long as you are alive, and you can give it away.

Actually you can transfer up to 11 million total Sitting on $11 million? Give it away to save on estate taxes

 

[JRP3]

if you want something you can have it if you are willing to work your butt off.

Tell that to the people working 2 or 3 jobs and still struggling. Hard work guaranteeing success is not necessarily true.

 

[juliusa]

New Deal - Wikipedia

We have 3.7% unemployment. Solution looking for a problem. But if people think we need a New New Deal, make the case for it - don't hide behind global warming.

Actually you can transfer up to 11 million total Sitting on $11 million? Give it away to save on estate taxes

Actually I think it is a lifetime $12.5M exemption (Edit: actually $11.4M) - in addition to the $15,000 per person per year. Pennies for the Waltons, Buffet, Bezos, Gates, Koch, Bloomberg, Trump, etc. That is for people that own farms or have accumulated some wealth to pass on to their heirs.

 

[SDRick]

Tell that to the people working 2 or 3 jobs and still struggling. Hard work guaranteeing success is not necessarily true.

Agreed, hard work is no guarantee. There always was and probably will always be the lower class. Besides hard work, you also need some luck but most importantly financial discipline and saving consistently.

"Discipline and consistency. These two factors outweigh a high-paying job, inheritance, and luck every time. And the good news is, we can all choose discipline and consistency. They aren’t reserved for special or “lucky” people; anyone can commit to being financially disciplined. The problem is that most people don’t want to take the long road. They want instant success".

How Many Millionaires Actually Inherited Their Wealth? | Chris Hogan