Unironically yes. The reason people want taxes on profits is they think large, powerful companies are a threat... but if you think that, why tax money that large, powerful companies don't waste?
The other reason is to tax the rich, but you can do that by simply taxing the rich directly. If we fear powerful companies, we can put some sort of scaling size tax on the largest ones.
A lot of companies are essentially on the welfare of their investors, who may or may not be stupid. Many companies purposefully do not turn a profit, because they're aiming to cheat the market and sell at a loss to push competitors out. A lot of very successful companies operate or have operated this way, and it's incredibly dangerous for the market. It causes the erosion of small businesses and further promotes monopolization. We can try to disincentive that by saying, "hey, you don't want to turn a profit, that's fine, but you still have to pay up".
This is part of the reason why if you look around America today it's going to be 99% big corporate players dominating markets and 1% small businesses barely staying afloat.
> We can try to disincentive that by saying, "hey, you don't want to turn a profit, that's fine, but you still have to pay up".
That doesn't make any sense. You're saying, instead of consumers getting lower prices, they should pay more and that money should go towards taxes. That means, essentially, that you're asking the consumers to pay taxes.
What you're describing is predatory pricing. People have mixed views on that, but if you want to address it, then address it directly. Taxing revenue is a strange, roundabout way of doing it that is going to harm a ton of non-predatory businesses without actually changing the market dynamics of predatory pricing -- because your taxes will be affecting the non-predatory companies even more! Since they, by definition, charge more money and therefore will be paying more taxes on the greater revenue.
The problem is that our current tax system incentivizes the kind of venture-capital fueled market manipulation we see. Companies actively try to optimize for the lowest amount of profit, similarly to how the ultra-wealthy try to optimize for the lowest income.
We have some methods to address predatory pricing but I think it's obvious they pretty much don't work on any scale that matters. When I look around the modern US, I see the least amount of successful small businesses I've ever seen in my lifetime. We're living in a corporate hellscape, and more and more business look to rent-seeking anti-consumerist behavior.
> The problem is that our current tax system incentivizes the kind of venture-capital fueled market manipulation we see.
It really doesn't at all. It's quite neutral in that regard.
> Companies actively try to optimize for the lowest amount of profit
This is self-evidently false. Companies actively optimize for the greatest total profit, considering the net present value of future profits. This does mean delaying profits if reinvesting them is expected to yield growth. This is desirable.
> We have some methods to address predatory pricing but I think it's obvious they pretty much don't work on any scale that matters.
Honestly it hasn't been a major policy priority. They could absolutely work if implemented, but not everyone agrees it's a problem that needs solving. Many people consider it to be hostile to a free market. I'm not taking sides here.
> When I look around the modern US, I see the least amount of successful small businesses I've ever seen in my lifetime.
The major culprit here is technology and economies of scale. The tax code has some quirks, but it is essentially irrelevant here. Even if predatory pricing accelerates the demise of some small businesses, they weren't going to last much longer anyways. Which is why predatory pricing isn't actually nearly as common as many people think, and why it's not always viewed as a problem. E.g. Uber and Lyft engaged in it for years, but traditional taxis are still in business. Small businesses have been disappearing because they simply don't have economies of scale. Their products cost more so people don't go there. It's that simple. Nothing to do with the tax code.
Yes! That's the VC funded model - money injection while you burn cash and run on losses until you're big enough for a huge return. Which incentivises all sorts of bad behaviours. Same with Hollywood accounting. Just tax a bit less on revenue.
Hard to get alarmed without knowing what the rate is. If the growth in miles driven is outpacing the growth in incidents, it's cause for the opposite of alarm.
i'm not sure where this idea arises, that parents doing things for their children is the root of all social evil. it's a bit ridiculous on its face, since it's a prime way to improve the lot of the next generation
Nobody was talking about "social evil". But it's plainly the root of much economic inequality, which is the topic.
Separate questions:
(1) Should we accept some level of economic inequality in society?
(2) Are the wealthy more "deserving" of their wealth than the non-wealthy?
It's perfectly consistent to answer (1) Yes and (2) No to those questions.
Capitalism is an economic system, not an ethical system. The "invisible hand of the market" is not God handing out rewards and punishment, though some people seem to believe that.
For sure. And I'd add that the acceptance of inequality as a reward does not imply anything about inherited inequality.
Even if we grant the proposition that a good way for society-wide progress is to harness the desire of some to have superior positions by forcing them to work hard at creating value for others, it doesn't really follow that inheritance is a good idea. Indeed, you could argue that it's just the opposite, if we really want a nation of hard workers, we have to make sure the youth can't get away with being lazy just because of some historic success that they didn't have any part in.
You’re assuming economic inequality will always exist, and using that to at least imply that the answer to “What should we as a society do about economic inequality?” is “Nothing.”
There’s a whole lot that a society can do to address the negative aspects of wealth inequality. Almost all of it means that the wealthiest people will have to make some sacrifices—in proportion to their wealth, *incredibly small* sacrifices—and will have to accept that just being poor shouldn’t be a death sentence, that everyone should have food, and water, and housing, and education, and medical care, and transportation, to a reasonable baseline level, simply for existing.
Our species is prosperous enough that no member need ever experience homelessness, nor hunger, nor untreated injury nor disease, nor unwilling ignorance, nor an inability to pull up stakes and move. The only reason the status quo persists is that it is to a small number of wealthy and powerful peoples’ benefit, not because it’s the best possible arrangement for society.
Did you notice what I didn’t suggest? I didn’t suggest that the rich should lose their wealth or position. In fact, they don’t even necessarily have to pay more in taxes than the middle class. They just need to pay around the same *proportionately* as the middle class.
Parents doing things for their children *to give them unearned advantage* is in fact *a* root cause of social evil.
It’s saying “Because this person is a Jones, they deserve a spot at Yale even though others are more academically deserving, and we will pay you for that privilege.”
This is also why grade inflation happens at these institutions: “You can’t fail him, he’s a Jones!”
I feel like objecting to the "government-funded media" label on the basis of purported implications of government control reveals more about the beliefs of the person objecting than about the label.
The current approach leaves it frustratingly judgmental and prone to lecturing the user about ethics from a very particular point of view (yes, I am aware the system has no conscious intention, but the abstractions work from the user's point of view). In that regard they are simulating a type of person quite well.
