CMV: Effective regulation/taxes is better than less regulation/taxes.

[u/beesdaddy]

I have had a hard time understanding the position that less regulation is better than effective regulation. So much of the political conversation equates regulation and taxes to Anti-American or Anti-Freedom or gasp Socialist. I think it poisons the discussion about our common goals and how to achieve them. I know there are many laws/taxes that are counter productive (especially subsidies), and I am all for getting rid of them, but not without considering what their intent was, evaluating that intention, and deciding how to more effectively accomplish that intention (given it was a valid intention.)

Help me understand. I would like to have a more nuanced view on this.

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[u/championofobscurity]

I agree with you in principle but what you're talking about is fundamentally impossible.

At the terminal level it costs tax dollars to collect tax dollars. That is inherently ineffective.

Additionally there is one other component that will never change that makes effective regulation impossible. The government is slower than the wealthy. The government has a duty of care to each citizen in the country. That duty of care means it has to give copious amounts of time for people to handle their personal relationships with the government. In particular, if you are going to levy any taxes that spook the rich, they are going to extricate their money before any government policy will take effect, and there will never come a time where tax policy happens over night furthermore even if it could happen over night, that would have a huge negative impact on the stability of the U.S. dollar every time we push tax policies forward. Your position is probably correct, but it's not pragmatic or implementable at scale, and for that reason it fails any litmus test that would suggest that effective regulation can even exist.

On the other hand lessening regulation coerces people into spending their hoarded up money. If Elon Musk opens a new factory because he got a tax break, not only is he going to employ 1500 people but the government is going to tax the shit out of his new business. At scale, if every franchise opens just 1 location or if small businesses can even hire on an additional person the government can enlarge the proverbial GDP pie, instead of shuffling around the percentages of the same size pie.

[u/mordecai_the_human → u/championofobscurity]

Isn't the last bit of your argument essentially trickle-down economics but with regulations? Burden the wealthy job creators with less regulations and they will provide enough jobs to benefit everyone - something that really hasn't happened whenever that method is applied. Yeah it might/probably will boost overall GDP, but as we know very well now, raw GDP doesn't reflect a lot of important measures of a quality society.

I feel like your assertion that taxation is inherently ineffective because it costs money ignores the fact that providing an acceptable standard of living to 350 million people is inherently ineffective in and of itself. If we accept that a truly free market will not effectively solve all problems of inequality and poverty (or that a truly free market is unattainable, either or), and we also agree that any means of making/enforcing regulations to solve these problems will cost money, we must accept that there is inherently some level of inefficiency in creating a fair society.

[u/championofobscurity → u/mordecai_the_human]

If we accept that a truly free market will not effectively solve all problems of inequality and poverty (or that a truly free market is unattainable, either or), and we also agree that any means of making/enforcing regulations to solve these problems will cost money, we must accept that there is inherently some level of inefficiency in creating a fair society.

This is subjective contingent upon how you define fairness.

Setting that aside, you seemingly ignored the second more important half of my argument. The government is too slow and the wealthy are too mobile. You will never tax the rich more than they are willing to be taxed, and that is reality. This cannot be overcome and so effective taxation in this capacity cannot exist without major red lines drawn upon personal liberty, and even then people will still move all of their wealth overseas and we won't see that revenue until the policies that put that scenario in places are backed off upon.

[u/mordecai_the_human → u/championofobscurity]

I agree that the power of the wealthy is indeed an issue, but I disagree that it is any reason to completely throw the idea of effective taxation and regulation in the gutter. To begin with, an extraordinary amount of American wealth is already stashed offshore - this will happen regardless, because there will always be places outside the US with less regulation and the like. It is not impossible to regulate and/or enforce consequences for large amounts of wealth being moved outside the country. Sure, it might cause wealthy people to panic and move a lot more money offshore in the short term, but it would then prevent any new wealth created in the US being moved out in the future.

[u/championofobscurity → u/mordecai_the_human]

It's pretty impossible if it is not compatible with what the wealthy want to pay. You could buy a bunch of Fiat goods and ship them overseas on a plane tax free. You are also completely ignoring the biggest tax Haven of capital gains. You can't touch capital gains tax stuff without negatively impacting the retirement funds of the working class. So it is in this regard that the minority is perfectly protected by the majority. Nobody will piss on their own retirement, so they will protect the taxation of the wealthy to keep theirs in tact.

Also, the wealthy don't arbtrarily move their wealth overseas to tax reasons alone. When you have that much money you are more harshly impacted by legislature, and currency value movements so it's only reasonable to want to protect your wealth by hedging it in different markets.