r/PoursTea • u/Veshaad Timendi Causa Est Nescire • 25d ago

PoliticalTea 🗳️ Eventually something has to give...

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The bill would provide a $3,000 direct payment to every person in households making $150,000 or less during its first year, which equals $12,000 for a family of four.

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u/Eleventhousand 25d ago

I mean, I'm just a regular worker and my RSUs are taxed when they vest. Stock options are taxed when exercised. What's the big deal about taxing them a measly (to them) 5% more?

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u/Available_Reveal8068 25d ago

The RSUs are taxed because when they vest, they are treated as income (since you didn't buy them). You will also be taxed on capital gains (from the vested price) when you sell.

You don't get taxed annually on the same stock holdings.

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u/Eleventhousand 25d ago

Yeah, I know.

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u/Available_Reveal8068 25d ago

Can you imagine how different your situation would be if you had to pay the value of 5% of your holdings every year?

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u/Eleventhousand 25d ago

Yeah, if I had a few hundred billion net worth, and paid five percent tax on that each year, I'd be in a much different situation.

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u/Available_Reveal8068 25d ago

So you think you would have 25 billion dollars in liquid assets available to pay the tax each year?

(assuming $500 billion net worth)

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u/Due-Commercial7299 25d ago

Are you kidding? You can earn between 20 to 25 billion in interest alone each year on $500 billion of principle, and that's doing zero investments.

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u/Available_Reveal8068 25d ago

You don't get interest from stock holdings.

That's the whole problem with Sanders' plan--the wealth he's seeking to tax isn't cash money sitting in a bank account earning interest. That wealth needs to be liquidated to pay the tax.

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u/figurative_me 24d ago

Yes, when they take out a loan against their holdings, we should tax that.

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u/hmccringleberry615 24d ago

They already have to pay it back with interest dum dum it’s not free money

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u/Hamtrain0 25d ago

I’d probably be able to figure it out, yeah

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u/Due-Commercial7299 25d ago

I do this already. I pay more money in property taxes every year for a house I own.

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u/Available_Reveal8068 25d ago

What percentage of your net worth is your house, and what percentage of the value of your home is the tax?

My property taxes are a lot less than 5%, and it's still a burden to pay.

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u/olivebranchsound 24d ago edited 24d ago

You shouldn't be overextended like that. I could pay 5 percent of my wealth every year and be fine. That's your fault for not maintaining adequate liquidity.

You go to the casino and don't separate and save what you make in profit? People need financial literacy classes.

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u/hmccringleberry615 24d ago

So if you are gonna blame this guy then you have to blame the people that need $12,000 for not maintaining adequate means. Ridiculous

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u/xkxe003 24d ago

You serious comparing a billionaire to someone making the median salary? Like you think the rules are applied equally?

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u/Available_Reveal8068 24d ago

Is your wealth tied up in business equity, or is it in an investment account or what?

It's not easy to liquidate ownership of a business worth hundreds of billions of dollars without crashing the value.

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u/olivebranchsound 24d ago edited 24d ago

Am I supposed to feel bad for the stock billionaire? Wahhh my business might lose 5 percent of its value cuz I had to sell some stocks to pay my wealth tax! Stocks aren't allowed to go down. Infinite growth is the only thing keeping my theoretical wealth so astronomically high!

Tough. Maybe don't avoid taxes by giving yourself a 1 dollar salary then, Zuck. Maybe don't subscribe to buy borrow die tax dodging strategies. 

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u/Available_Reveal8068 24d ago

Its not about feeling bad for the billionaires. Its about the value drop of the stocks when they (and other billionaires) need to dump stock to raise billions of dollars in cash.

Stocks are allowed to go down. They do all the time. There is no 'infinite growth'. Everyone's 401k and pension fund drops along with it, so our net worth drops too.

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u/whowhaohok 24d ago

Explain property tax then

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u/Available_Reveal8068 24d ago

Property taxes are horrible and regressive.

They are also typically around 1% of the home's market value, not like the 5% of the person's net worth that Sanders is talking about.

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u/WaferResponsible4978 24d ago

Property taxes have nothing to do with your property and all to do with your participation in your local community. They go to your local schools, fire departments, etc. It's the price you pay for enjoying the public services, open shops, and roads of your town, regardless if you use every single one of them. It's saying "the permanent residents of our town will have to participate generally if they want to remain permanent residents"

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u/soleceismical 24d ago

I don't understand why they have to implement new taxes when they could just add more tax brackets for billionaires.

The top tax bracket for short term capital gains right now starts at $640,600 and the top tax bracket for long term capital gains is $579,600.

Why not just make higher rates for people making a million, 100 million, a billion, etc. instead of a wealth tax that has a proven bad track record in other countries?

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u/Available_Reveal8068 24d ago

They aren't making that much money, so they aren't going to fall into those brackets.

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u/lakimens 24d ago

They don't realize any gains. They want to tax unrealized gains.

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u/Eleventhousand 24d ago

Yes, I know. I was just giving an example, and I'm not against changing rules. That's what the whole thing is about right? I would start with increasing taxes for the ultra-wealthy on exercising stock options. And also add in some form of tax on unrealized gains as Bernie mentions.

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u/rjw1986grnvl 25d ago

On that much money, the gains are likely only coming in at close to 5% per year. So basically it’s a 100% tax on gains.

I don’t see a moral justification for a 100% tax rate.

The people who really want to see that tax though are not going to be persuaded with numbers and percentages. Emotionally they want to receive more and see the more prosperous pay more. No data on earnings, taxes, or gains is going to convince anyone to feel differently on that.

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u/Eleventhousand 25d ago edited 25d ago

Yeah that's fine. Everyone wants to concentrate on the current rules and regulations, explain that and use that as the final word.

I don't really care what the exact implementation would be to create a system that lessens income and wealth inequality, whether that be increases in pay for ordinary workers, returning back to the old 70% Republican-established top marginal rate, taxing the ultra wealthy on their wealth, other things, or a combination thereof. I'm sure Bernie has studies the ins and outs more than you or I.

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u/rjw1986grnvl 25d ago

I presume you mean inequality and not lessen equality. Phones and Reddit and all that, I’m not trying to be pedantic about a typo. I just want to make sure we’re on the same topic.

I get why people want to lessen inequality but arguably there’s nothing wrong with inequality. Inequality is a highly valuable tool for the market economy.

Inequality rewards those who have careers or create wealth from less supply and more demand. Those who tend to spend their labor on greater supply and less demand tend to see greater losses. Same with those who place more emphasis on investing compared to those who spend close to 100% of their earnings. Those unequal results are important incentives to preserve.

Even within families we see inequality amongst siblings as they live through adulthood. If we cannot even achieve equality with siblings, then I don’t see the government having some moral mandate to make things more equal across society.

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u/Eleventhousand 24d ago

Yeah thanks, I fixed my typo.

I don't understand your point though. It doesn't make sense to me.

Making things a little bit more fair is not going to take away the incentive for billionaires.

In fact, the family of four, with both parents working two jobs to scrape by might have more incentive to go to night school and get a degree for a better career if they don't have to each work those two jobs.

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u/rjw1986grnvl 24d ago

It’s not about taking away the incentive to be a billionaire. I agree, that’s not going away.

However, taking those finances away takes money away from the bankers who make investment decisions. I generally think they’re good at what they do considering the United States is the best at finance in the world and also the top place for entrepreneurs.

The incentive to get a better education also already exists. We also already tried to make that easier with no underwriting student loans. People did not flood engineering, accounting, and medicine like we had hope. On the other hand the education and humanities majors exploded.

People scraping by are not likely to put a huge sum of money in to a great investment with strong ROI. Consumer spending data tends to show that when government provides a stimulus that you see new car sales, televisions, cruises, and luxury consumer goods reap the benefits.

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u/Eleventhousand 24d ago

I'm not sure if you're implying that the level of wealth inequality and income inequality that we have here in the US in 2026 is the most optimum level, or if you're vouching that we go even more extreme, as in a Ferengi dreamworld.

Nothing you say is going to convince me that narrowing the gap back closer to what we've had in the past, in this very country, that was extremely innovative, is going to ruin it for everyone.

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u/rjw1986grnvl 24d ago

Like I said in my original comment, nothing we say is going to convince anyone.

It’s an emotional desire to try and reduce economic inequality.

When there was less inequality there was also far greater poverty and less disposable income. Personally I would rather the poor be better off financially even if they’re less equal.

I remember growing up in the 90s without air conditioning, because that was normal if you were middle class and in rural Ohio. Now households with an income of $25,000 or less per year (i.e very poor) have air conditioning in 83% of homes. Of the 17% which do not, most are located in the Pacific Northwest, Alaska, and Maine where air conditioning rates drop off even for the middle class due to lack of necessity.

But none of that will matter. People will see trillionaire and they will see person with multiple debts and want to change that because of emotion.

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u/Eleventhousand 24d ago

Yeah, I'd rather you debate more genuinely, than dismiss my point of view as emotional, and lump me in with this grouping of people that you've created.

Anyway, your collection of anecdotes doesn't really do much to persuade me that we'll collectively be worse off if things become a little bit more fair.

I really don't want to get derailed on side topics, but I'm sure you understand that homes built in the 50s, 60s, 70s and 80s were built differently than today, requiring less A/C, especially given that the Midwest was cooler then. I'm sure you must also realize that A/C doesn't equal affluence. I grew up in the 80s and 90s, in a mobile home, with an A/C and a swamp cooler. The fact is that its much more difficult for a family to afford a home, college, or vehicle now than it was in the 90s.

Because I'm not, and won't be persuaded, that doesn't make me emotional. Being compassionate is not the same thing as being emotional.

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u/rjw1986grnvl 24d ago

The climate is about 1.5 degrees warmer, that is not why air conditioning is more prevalent. Air conditioning is closely correlated to disposable income if you look at the data.

Affording a home is complicated because technically people actually do have a greater ability to afford a comparable home as to what the median was in the 50s-80s. Homeownership is actually at near record highs. The demographics have shifted some, as in the median age of home ownership is higher. The problem is that a 1200 square foot home, no garage, no A/C, no internet, cheap shag carpet, popcorn ceilings, and composite countertops is much more difficult to find now. A starter home today was an upper class home in the late 1980s.

The reason I claim it’s an emotional argument is two fold. 1.) people just presume what is “fair.” More equal is not necessarily more “fair.” More fair can be we all keep the same of what we earn. What actual percentage of what another person earns is someone else entitled to? Arguably it’s 0%.
2.) the numbers continue to show that even poorer Americans are doing far better than they ever did previously. There’s some issues with younger Americans, but younger Americans have always struggled more than Americans at or near their peak career earning years.

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u/JonnyHopkins 24d ago

Moral? I don't see a moral justification to have a billion dollars. 

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u/notaredditer13 24d ago

The moral justification is simply keeping what's yours.  You start a company, you own it.

Taking things from people requires solid justification. 

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u/WaferResponsible4978 24d ago

The heavy implication, and pretty clear reality IMO, is that people only ever get that rich by taking more than their share in the first place. They own the company of course, but if they become rich through it by slashing wages and sending work overseas... If they pay their workers a fair share of the profits no individuals involved would ever become billionaires. Just being the owner of something shouldn't entitle anyone to society-changing levels of money, the profits are generated by the workers

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u/rjw1986grnvl 24d ago

Jeff Bezos only owns 16% of Amazon. He was the main person responsible for creating more nearly $2.5 trillion of wealth for other people.

I don’t think anyone thought that 16% was more than his fair share when the company was worth less than $1 million.

The reality is that there’s this misnomer when people think as a some third party they have any place to say “that percent is unfair” or “that total wealth is wrong” or “your business decisions were wrong.” The people who actually earned the right to be on those boards or sit in those C-suites are the ones who earned the right to make those decisions. Not the warehouse worker. The warehouse worker gets paid according to supply and demand because that labor is a commodity.

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u/notaredditer13 24d ago edited 24d ago

The heavy implication, and pretty clear reality IMO, is that people only ever get that rich by taking more than their share in the first place.

Yes, that's the implication and it's wrong.  See:

If they pay their workers a fair share of the profits no individuals involved would ever become billionaires.

That isn't true.  The only way for almost all of them to avoid becoming a billionaire is to give away the company itself.  Giving away profits isn't enough.  Heck, for most there aren't any profits to give away until after they/the company are worth billions.

Just being the owner of something shouldn't entitle anyone to society-changing levels of money, the profits are generated by the workers

The vast majority of the income (not profit) already goes to the workers.

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u/JonnyHopkins 24d ago

A billion dollars is beyond comprehension for an individual. To want that much, and not be willing to part with simply the annual interest earned on your principal, is excessively greedy. I'm not religious but it's clearly a sin. I believe it to be immoral. But, I respect your perspective. 

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u/notaredditer13 24d ago

A billion dollars is beyond comprehension for an individual. To want that much, and not be willing to part with simply the annual interest earned on your principal, is excessively greedy.

Evidently it is beyond comprehension for you.  They don't have that much money, they own a company worth that much money.  There is no bank account with billions in it earning interest. 

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u/JonnyHopkins 24d ago

Semantics. I understand. Perhaps you're not comprehending it. They can convert their company equity into cash liquidity through a loan anytime they'd like, without selling anything.

Further, if you think these billionaires aren't heavily diversified into other assets, you also aren't comprehending what is happening.

The one thing I truly can't comprehend, is why you feel compelled to defend billionaires. 

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u/WaferResponsible4978 24d ago

That's fine with me, "on that much money" is the problem

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u/rjw1986grnvl 24d ago

Because a certain amount of money is moral and another is amoral?

It’s an absurd way to look at a wealth levels. What even brings about that, like what is the moral frame work to say “that X dollar is immoral but X-$1 is fine.”? So many people have bought in to that idea, but it’s a strange concept to have ever been created. I think so much of this is just a leftover from the Occupy Wall Street and our country still has all these lingering impacts from the trauma of the Housing Market Bubble and Great Recession.

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u/MiamiGuy13 25d ago

Because they earned that "measly 5% more" not the USA Government.

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u/MushroomOk6938 24d ago

Their employees earned it for them and they collected it.

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u/MiamiGuy13 24d ago

The employees his company hired? How many employees do you have, what have you created?

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u/MushroomOk6938 24d ago

Why does it matter how many employees I have or what I've created? How many employees do you have? What have you created?

Oh wait, I don't care. Because it's irrelevant to the conversation, and tossing the question out there is just a tactic to dismiss my comment and avoid discussion.

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u/Austinskier 25d ago

If it’s a measly 5%, why bother?

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u/Fit-Marketing-1472 25d ago

Measly for them is not measly for you

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u/Austinskier 24d ago

$50 million per billion on unrealized gains is a start, just like income tax was for the wealthy. How did that work out for the 50% of us who pay federal taxes.