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What if -- bear with me here -- it's possible for bright, motivated founders to create startups that your kids can work in, but those founders could be content

What if -- bear with me here -- it's possible for bright, motivated founders to create startups that your kids can work in, but those founders could be content with merely making a hundred million dollars? Because, and I don't know if you know this so you may have to take it on faith, that is still so much money that said founder and their family and very likely their descendants can live in extreme luxury for the rest of their lives even if they stop working right then. I don't know what the best solution to the problem of wealth inequality is, but I know that we need to collectively get over this "but if people think they will be limited to a mere hundred million dollars in wealth they will have no motivation whatsoever to work" nonsense. You know what the motivation is? It's still a hundred million dollars, that's what.

hparadiz 3mo ago
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- calgoo 3mo ago
  what are you talking about????????? 100 million is a fortune, and only people in the SF bubble could even consider that a drop that is pissed into the wind. I would say that you need to take a serious step back and actually contemplate life around you. 100 million is a fortune, and no one actually NEED that much money, if they do, then they have lost touch with reality.
  - hparadiz 3mo ago
    In California that's only 100 homes. That's what's normal for us. Increased market efficiency should actually be lowering taxes, not increasing them just to make you feel good about yourself.
    - ceejayoz 3mo ago
      It's normal for someone to want 100 homes?
      - hparadiz 3mo ago
        Elon spent less than that to fund SpaceX and Tesla which are now bringing in money from abroad and therefore paying a lot more in taxes than whatever you would have collected from that 100 million. Now you can be a commie and seize more or of it to fund your healthcare or whatever but that person that is capable of earning 100 million will simply exit your tax jurisdiction and then you'll be poor. See Europe for the example.
        ceejayoz 3mo ago
        > Elon spent less than that to fund SpaceX and Tesla... So 100 million is enough to do quite a bit with? > that person that is capable of earning 100 million will simply exit your tax jurisdiction There are plenty of lower tax jurisdictions than Silicon Valley. Is it possible there's more to a jurisdiction than the raw marginal tax percentage it applies to one's paycheck?
        hparadiz 3mo ago
        It's not enough to build a data center these days. Or even run the government for a day these days it seems. Or are you saying salaries need to come down?
        ceejayoz 3mo ago
        The amount it costs to build a datacenter or run the government for a day is an unimaginable level of personal wealth to virtually every person on the planet.
        hparadiz 3mo ago
        My own wealth now would be unimaginable to myself when I lived in the USSR. Maybe don't look at the bottom for what should be. There's never any imagination there. I know better than most.
        3mo ago
    - bjustin 3mo ago
      Market efficiency as most people in the US mean requires the presence of things like roads in decent condition and regulation of RF spectrum use. Both of those are funded via taxes. Reasonable tax rates and uses of tax revenue are required for most non-trivial-sized markets to function efficiently.
photon_lines 3mo ago
There is an alternative: 1) limit how much descendants can inherit. Allow them only a maximum amount of let's say: 10 million and make sure that either the founder finds a way to redistribute his/her wealth to the rest of the world, or make the government find ways of redistributing this money. 2) make it mandatory for corporations to share their wealth (income) with the employees -- as an example make it mandatory to redistribute 50% of the income generated to the employees working for the company rather than paying CEOs insane amounts of money to return 'shareholder value'. The whole motto of maximising shareholder value has poisoned capitalism: the goal of a company should not be to become a cancerous growth -- but to serve as a net good for humanity. 3) seal the tax loopholes that make it easy for the rich to avoid paying taxes. There is no reason why the poor and middle class pay a disproportionate amount in taxes compared to the rich.
Geniuzz 3mo ago
> But those founders be content with merely making a hundred million? What does this mean? Without some insane wealth tax this is literally impossible. No founder chooses to become a billionaire. They just keep growing a business that is solving a billion dollar problem. The only other was is if after 100M they start turning down customers or restricting services.
- jrajav 3mo ago
  This is conflating businesses that solve billion dollar problems with people who individually contribute so much to a business that they solved the billion dollar problem all on their own. The latter is probably possible, but it's not necessarily the case that all billionaires and up today were such individuals. It might be that if personal wealth alone were (effectively, by taxation) capped to $100m, we would still have exactly as much collective wealth, innovation, and value creation as we do today. Possibly more, because of more wealth distributed onto shared infrastructure and into the fluid economy.
- therealdrag0 3mo ago
  They can continue growing the business while giving other employees a larger share of the asset. One person doesn’t create a billion dollar company, dozens or thousands do. After founding, other people who don’t become billionaires work similarly hard and are similarly smart as the founder. This is why people dispute “earning” a billion dollars.
  - nfw2 3mo ago
    You don't have a solution unless you can propose a way this gets legislated and executed. No hand waving. How specifically does this work? Suppose it is day one of my shares being worth more than 100m. What happens?
    - lkjdsklf 3mo ago
      It's pretty easy. You can just cap total compensation for executives relative to the lowest paid worker and include equity in that calculation. If you want to pay yourself, 10 million a year in stock, great... You need to pay the lowest paid person 10k in stock or whatever. Or, you can mandate that after a certain size a worker owned trust/union will own some percentage of the company. There's dozens of ways you could address this problem. Each have pros/cons. It's not that hard to fix if we actually wanted to fix it though.
sillysaurusx 3mo ago
pg has an essay addressing exactly that: https://paulgraham.com/inequality.html https://paulgraham.com/inequality.html The problem is that when you cap earnings to $100m, most investors lose motivation to invest in startups, because their investment isn’t likely to yield a reward. Unless you think all investments should be less than $100m, this kills large investment rounds. That would have killed OpenAI, for example, since their recent round was larger. In other words, it’s fine to say “you can only earn a hundred million dollars.” The hard part is implementing it without killing the investment ecosystem. Every investor is chasing the big return that covers the 20 investments that didn’t pan out. If that big return is capped, there won’t be investment, and hence no startups.
- yunwal 3mo ago
  I don't understand. Just because one person can't own 100 million doesn't mean an investment firm can't make a 100 million dollar investment and make returns on it. Those are 2 different things. The firm is managing the money of multiple people.
  - sillysaurusx 3mo ago
    And when one of those people breaks $100m, does the excess money go to the firm, or to taxes? Or are you saying that a company can have unlimited money, as long as the shareholders don’t extract more than $100m over the course of their lifetime? The ultimate point of money is for someone to have it. And since corporations are owned by people, it’s not enough to say that corporations aren’t bound to the $100m cap. Otherwise people will just hoard money using corporations, and take loans against their value, a bit like how it already works today. What counts as $100m? If you buy a million dollar house, then sell it a few years later for a million dollars, are you now limited to $99m since you already spent $1m? Does the money from selling the house go to taxes, or to you? If it goes to you, what’s to prevent someone from hoarding equity and only taking out $100m at a time, effectively living the life of a billionaire while keeping their balance under $100m? If you own some stock, and it rises in value to $150m, you forfeit $50m to taxes, right? But then if the value of the stock goes down by half, would you have $75m or $50m? And if the answer is “you have $150m, the cap only applies when selling stock,” then what stops people from putting the money under the custody of a business (which you said isn’t bound by the cap) and then taking loans against that extra $50m? These aren’t contrived scenarios. Stock goes up and down all the time, and it’s important to be clear about how the proposed system will work. I’m genuinely interested in answers. It’s easy to say “just cap someone’s wealth at $100m,” but people seem to shy away from proposing specifics.
imgabe 3mo ago
Who is going to cap how much a company is allowed to be worth? Or how much of the company you start you are allowed to own? Why should anyone have the power to do that? That is a far more evil power than any billionaire has.
- seventytwo 3mo ago
  We are. All of us. If enough of us agree, we can make any rule we want.
  - IcyWindows 3mo ago
    So "enough of us" can take anything by forcing the asset to be valued at an artificially high value, force them to sell it for taxes, and then reduce the price down again to keep it ourselves?
    - seventytwo 3mo ago
      Yep. That’s how democracy and law work.
      - imgabe 3mo ago
        Mob rule is not something to celebrate.
        HauntedDrum 3mo ago
        How do you, personally, distinguish between democracy and mob rule?
        imgabe 3mo ago
        In the extreme there is no distinction. This is why the US and almost every other democracy are not direct democracies.
        3mo ago
bluedino 3mo ago
> that is still so much money that said founder and their family and very likely their descendants can live in extreme luxury for the rest of their lives even if they stop working right then. Professional athletes and lottery winners prove otherwise.
lumost 3mo ago
bear in mind, elon musk now has the wealth of 10k "100 millionaires" - we truly lack comprehension of how wealthy the wealthy have gotten.
WarmWash 3mo ago
I think the most chronic misunderstanding in the "billionaire" rhetoric is that billionaires are in it for money. People who work a job they don't like because they need money to live, view money as the objective in life, because the equivocate it to escaping and freedom. So wearing that lens, and looking at billionaires, these motherfuckers are greed driven psychopaths who blew past the "escape with freedom" bank account ages ago, and are now just taking money off the table from others trying to get ahead. But that is not how it is at all. Virtually every billionaire is crazy focused on their work, and the money is a side effect that they don't really care that much about, besides it being a tool to enable more work they can do. It's very hard to get this across when speaking to people who view work as an obstacle, money as god, don't have personal business experience, and whose passions are things that aren't very productive.
- bjustin 3mo ago
  One of the problems is that rather than billionaires being it for money, they’re in it for money. They don’t lack for money to live, sure, but they do want more money for the power it provides.
  - butlike 3mo ago
    One thing I'm gathering from reading this thread is that the 'spending money' is different than the 'power money.' The 'power money' may not actually exist as it's tied up in valuations. If your company is the 'power money' generator, then of course you'll need to work more, since you're in it to be more powerful
- barnabee 3mo ago
  If they’re not in it for the money, they’ll be happy to pay more tax
  - WarmWash 3mo ago
    Taxes are money that they lose control of. There is a reason Bill Gates didn't just write the IRS a check for $175B and created the Gates foundation instead.
JumpCrisscross 3mo ago
> it's possible for bright, motivated founders to create startups that your kids can work in, but those founders could be content with merely making a hundred million dollars? Making a billion dollars doesn’t require becoming a billionaire. Someone who makes a billion dollars in a balanced society generates wealth and taxes. (One who does in an unbalanced one has the choice to donate.) Also, liquid versus illiquid. Founders shouldn’t be under obligation to cap their ambition or force liquidate if their companies do well.
- bubblegumcrisis 3mo ago
  This is why the guillotine will either be taxes or blades. It's either Bernie or Luigi. There is a sizable segment of the population that just doesn't have any empathy for society at large. "There should never be a cap to my selfishness." You might think: I can argue with them. No. You can't. They literally couldn't care less about you or anyone else. They do, however fear retribution.
  - JumpCrisscross 3mo ago
    > This is why the guillotine will either be taxes or blades There is legitimate debate around whether the French aristocracy came out of the Revolution richer than they were before. > They do, however fear retribution They don’t. They haven’t been targeted. Luigi potted a middle manager with a glorified title. The billionaire who owns the group is fine. We need to raise taxes. We need new tax brackets. But pretending violence is a check on a globalized rich is just self-congratulatory fantasy. Worst case, they lose billions when they flee.
    - bubblegumcrisis 3mo ago
      I don't know about this. Pre-Trump I would have agreed with you. Post-Trump. The mask is off, and they are evil. How many billionaires are there? I don't think we'd miss them if they were gone. And it goes farther than this actually. Should we have publicly executed the cigarette CEOs, and those CEOs of the drug companies who knowingly destroyed so many lives with opiates? What about the company CEOs who poison water. Before Trump I would have said, "no." But now, "yes." They deserved it, and by not sufficiently punishing them for their crimes against humanity we sent a message to the likes of Facebook and OpenAI and the new batch of psychopaths, that there are no real consequences for their actions, no matter how base they are. If Trump and his family does not sit in jail after he leaves office, if the democrats do not exact retribution for all he and his ilk have done, I think there will be rioting against both sides. I don't know. Maybe I'm wrong. I actually hope I'm wrong. But I think I'm right. And even though this post will be down-voted for referencing violence as leverage, I think these ideas are mainstream now.
nfw2 3mo ago
How exactly do you propose keeping a founder from becoming wealthier once their company scales past the point where they are worth a hundred million?
- didibus 3mo ago
  tax?
  - pclowes 3mo ago
    On what? You force the company to break up and liquidate so they can pay taxes? You force the founder to give up their private property just because it is valuable? Remember these are not dollar bills in the founders bank account. It is just the company they created is now very valuable. It does not mean it is liquid.
    - paulryanrogers 3mo ago
      Owners being able to lock the value generated by workers solely within their family for generations has been tried. It ends in feudalism.
      - seventytwo 3mo ago
        It doesn’t end in feudalism. It ends in guillotines.
      - nfw2 3mo ago
        Are you proposing changing inheritance laws or are you proposing forcing companies to sell their stock in a firesale to be in accordance with the IRS? Be clear in your propositions please.
        paulryanrogers 3mo ago
        Progressive taxation, taxes on CG, inheritance taxes, and a well funded and non-partisan IRS.
anbende 3mo ago
The primary issue with this is the way shares and equity work. Elon Musk is a trillionaire on paper. He pays himself famously little. That net worth is, under our current system, tightly linked with his interest and control in his various enterprises. He can borrow against it which gets around taxes and that should probably be addressed, but he like the hypothetical fresh billionaire startup founder don’t have that money. And the mega rich on paper can’t access more than a small percentage of that money without reducing their control of the company they built or are building. Ideas like a wealth tax, or the new sovereign fund paid into by an equities tax or grant are all interesting, but they are all more complicated on the ground than “wouldn’t $100m be motivating enough?” FWIW, I think that some sort of public endowment and/or sponsored healthcare, education and safety net and/or tax or management of hyper wealth is one of the problems of our age. But part of that problem is that it’s not clear how to do that in a way that is workable in an increasingly multipolar world of tech and soon healthcare giants that are as powerful as small but growing nation states. Economically and in some cases militarily linked to great powers.
- jonfromsf 3mo ago
  Just don't step-up cost basis at death and you solve the problem. Elon's fine, we can wait until he dies and his heirs sell their shares.
  - the_sleaze_ 3mo ago
    1. End step-up cost basis at death 2. Tax or end lending against portfolios Seems like a solved problem to me.
- rwmj 3mo ago
  Who is it that implements the rights around ownership? Who is it that will (possibly literally) go to war to defend this right? Maybe he should pay a bit of tax on this right since he expects others to defend it.
- peab 3mo ago
  >He can borrow against it which gets around taxes and that should probably be addressed, but he like the hypothetical fresh billionaire startup founder don’t have that money. And the mega rich on paper can’t access more than a small percentage of that money without reducing their control of the company they built or are building. Yes, this is a good take. I wish more people understood this. Things like sales taxes could address this. Land value tax, with single homestead exemptions are another.
pclowes 3mo ago
It is not like the money is in his bank account. And it’s not like he took the money from somebody else. He spent a ton of time to create something that he owned the majority of and to make that thing more valuable. He paid other people to help him and they were happy with that exchange. The government also helped them and they were happy with that exchange. Suddenly, people have assigned a concrete value to the thing via the IPO and it is very valuable. It’s not like he suddenly has $1 trillion in his account. It’s just the thing that he made and has ownership of is suddenly worth that much.
- CPLX 3mo ago
  Of course he took the money from someone else. Is your theory that he dug it out of the ground with a shovel or something?
  - schoen 3mo ago
    That must be why there is exactly as much wealth now as there was in the year 600. We've all just been stealing it back and forth.
    - pclowes 3mo ago
      Thank you, I never thought debating economics on hacker news of all places would be the equivalent of discussing orbital mechanics with flat earthers.
      - CPLX 3mo ago
        I have a degree in economics and wrote my economics thesis on the application of complex adaptive systems to economic theory. I'm still quite attached to economic analysis, it's even the story behind my user name. You can be assured I understand the concept of wealth creation. But the fact that there are, in fact, other people involved here is hilariously hand-woven away here: > He paid other people to help him and they were happy with that exchange. The government also helped them and they were happy with that exchange. OK I will bite. Who determines what "the government" thinks in a democracy? The general public, right? Does the general public seem happy?
fn-mote 3mo ago
Surely this would just create an industry of ways to dodge the “$100m tax”. Just waiting for my company’s top 10 shareholders to be anonymous entities owned by other companies based in the Cayman Islands.
- sumeno 3mo ago
  Let's give it a try and see. Maybe better things ARE possible
- paulryanrogers 3mo ago
  The rich being willing to cheat doesn't mean we should just give up and let them consume all surplus value in the system, until people are literally working 3 jobs for rent and food.
- rwmj 3mo ago
  UK companies are forced to list beneficial owners, in order to cut through these kinds of shenanigans. It did take decades to get this change implemented because capital was deeply opposed to it. For some reason, I'm sure it's not because they want to avoid paying taxes like the little people.
soerxpso 3mo ago
The entity you're implicitly proposing should take the money doesn't have a good track record of spending it wisely. I'd much rather let the startup founders keep their money and build rockets with it, than spend another few trillion on building 100 meters of high-speed rail.
- patagurbon 3mo ago
  The whole problem with CalHSR is precisely that they can’t spend any real money… There were governmental barriers like CEQA and local NIMBYs but the primary cost culprit is that the legislature has continuously kicked fully funding the project down the tracks for the past two decades. Funding it fully with a 10-20 year construction timeline in the early 2010s would’ve far cheaper at this point. Every American economic miracle has been precipitated by the government building basic infrastructure and doing basic research.
  - ericd 3mo ago
    Does this contradict the comment you're replying to, somehow, or are you trying to prove their point?
  - anon291 3mo ago
    So it's pretty clear it's not the billionaires but random thousandaire loudmouths that are the problem then.
fallonator 3mo ago
How about we set a maximum wage instead of a minimum wage? But it's not a set number. It is a maximum multiple of the lowest paid employee at a company? 10x should do it. If the CEO wants a million each year then the lowest paid employee still gets 100k. I'm trying to think of why this wouldn't work.
- tensility 3mo ago
  The only reason it doesn't is the greed of folks who become billionaires.
- perilunar 3mo ago
  Probably won't work because the ultra-wealthy don't get ultra-wealthy by earning wages.
yowlingcat 3mo ago
What if -- bear with me here -- the very thing that makes those founders able to make the $1B they would otherwise make would drive them to also ask why it is that someone else who had no hand in building or funding it gets lion's share of the $900M while they get only $100M? You don't /know/ that people need to collectively get over "this" -- you have a feeling that it seems more fair to do that than the alternative. But you can look at what happens elsewhere in the world with regimes that implement exactly what you are describing. And what happens is the people who are most equipped to be the golden gooses that you are proposing are just as equipped to simply most somewhere they can do so unencumbered. That's why what you're proposing will just never really work.
peab 3mo ago
I don't understand why people argue for a limit on wealth - the line of reasoning, when reasoned out, concludes with a majority of people having the exact same amount of wealth. How so? Well, suppose we say, nobody should be a trillionaire - is this an arbitrary number, or is it aimed at the richest person? Clearly, the latter. Now if we carried this out, now there are billionaires remaining. Well, nobody should be a billionaire, one might say. Most will agree. So the wealth of billionaires is taken away, and redistributed evenly. This will continue, with the majority of people below the average wealth level, demanding a more equal playing field. You can see how it ends
- joquarky 3mo ago
  Is this not an exemplar of the slippery slope fallacy?
  - peab 3mo ago
    no, it's not. It's math. If you make a rule that you lower the person at the top of the pile, over time, there will be nobody left to lower - everybody will be at the top of the pile. The fact people say 1 billion is too much money, or 1 trillion is too much is something to dig into - the number is relative! 1 billion is only a lot because not many people have a billion dollars. If inflation keeps up, one day everybody will be a billionaire.
    - butlike 3mo ago
      > everybody will be at the top of the pile. Why is that a bad thing? Or will it exemplify some other non-financial inferior trait of the person which might be existentially 'scary?'

hparadiz 3mo ago

[flagged]

calgoo 3mo ago
what are you talking about????????? 100 million is a fortune, and only people in the SF bubble could even consider that a drop that is pissed into the wind. I would say that you need to take a serious step back and actually contemplate life around you. 100 million is a fortune, and no one actually NEED that much money, if they do, then they have lost touch with reality.
- hparadiz 3mo ago
  In California that's only 100 homes. That's what's normal for us. Increased market efficiency should actually be lowering taxes, not increasing them just to make you feel good about yourself.
  - ceejayoz 3mo ago
    It's normal for someone to want 100 homes?
    - hparadiz 3mo ago
      Elon spent less than that to fund SpaceX and Tesla which are now bringing in money from abroad and therefore paying a lot more in taxes than whatever you would have collected from that 100 million. Now you can be a commie and seize more or of it to fund your healthcare or whatever but that person that is capable of earning 100 million will simply exit your tax jurisdiction and then you'll be poor. See Europe for the example.
      - ceejayoz 3mo ago
        > Elon spent less than that to fund SpaceX and Tesla... So 100 million is enough to do quite a bit with? > that person that is capable of earning 100 million will simply exit your tax jurisdiction There are plenty of lower tax jurisdictions than Silicon Valley. Is it possible there's more to a jurisdiction than the raw marginal tax percentage it applies to one's paycheck?
        hparadiz 3mo ago
        It's not enough to build a data center these days. Or even run the government for a day these days it seems. Or are you saying salaries need to come down?
        ceejayoz 3mo ago
        The amount it costs to build a datacenter or run the government for a day is an unimaginable level of personal wealth to virtually every person on the planet.
        hparadiz 3mo ago
        My own wealth now would be unimaginable to myself when I lived in the USSR. Maybe don't look at the bottom for what should be. There's never any imagination there. I know better than most.
        3mo ago
  - bjustin 3mo ago
    Market efficiency as most people in the US mean requires the presence of things like roads in decent condition and regulation of RF spectrum use. Both of those are funded via taxes. Reasonable tax rates and uses of tax revenue are required for most non-trivial-sized markets to function efficiently.

photon_lines 3mo ago

There is an alternative: 1) limit how much descendants can inherit. Allow them only a maximum amount of let's say: 10 million and make sure that either the founder finds a way to redistribute his/her wealth to the rest of the world, or make the government find ways of redistributing this money. 2) make it mandatory for corporations to share their wealth (income) with the employees -- as an example make it mandatory to redistribute 50% of the income generated to the employees working for the company rather than paying CEOs insane amounts of money to return 'shareholder value'. The whole motto of maximising shareholder value has poisoned capitalism: the goal of a company should not be to become a cancerous growth -- but to serve as a net good for humanity. 3) seal the tax loopholes that make it easy for the rich to avoid paying taxes. There is no reason why the poor and middle class pay a disproportionate amount in taxes compared to the rich.

Geniuzz 3mo ago

> But those founders be content with merely making a hundred million? What does this mean? Without some insane wealth tax this is literally impossible. No founder chooses to become a billionaire. They just keep growing a business that is solving a billion dollar problem. The only other was is if after 100M they start turning down customers or restricting services.

jrajav 3mo ago
This is conflating businesses that solve billion dollar problems with people who individually contribute so much to a business that they solved the billion dollar problem all on their own. The latter is probably possible, but it's not necessarily the case that all billionaires and up today were such individuals. It might be that if personal wealth alone were (effectively, by taxation) capped to $100m, we would still have exactly as much collective wealth, innovation, and value creation as we do today. Possibly more, because of more wealth distributed onto shared infrastructure and into the fluid economy.
therealdrag0 3mo ago
They can continue growing the business while giving other employees a larger share of the asset. One person doesn’t create a billion dollar company, dozens or thousands do. After founding, other people who don’t become billionaires work similarly hard and are similarly smart as the founder. This is why people dispute “earning” a billion dollars.
- nfw2 3mo ago
  You don't have a solution unless you can propose a way this gets legislated and executed. No hand waving. How specifically does this work? Suppose it is day one of my shares being worth more than 100m. What happens?
  - lkjdsklf 3mo ago
    It's pretty easy. You can just cap total compensation for executives relative to the lowest paid worker and include equity in that calculation. If you want to pay yourself, 10 million a year in stock, great... You need to pay the lowest paid person 10k in stock or whatever. Or, you can mandate that after a certain size a worker owned trust/union will own some percentage of the company. There's dozens of ways you could address this problem. Each have pros/cons. It's not that hard to fix if we actually wanted to fix it though.

sillysaurusx 3mo ago

pg has an essay addressing exactly that: https://paulgraham.com/inequality.html https://paulgraham.com/inequality.html The problem is that when you cap earnings to $100m, most investors lose motivation to invest in startups, because their investment isn’t likely to yield a reward. Unless you think all investments should be less than $100m, this kills large investment rounds. That would have killed OpenAI, for example, since their recent round was larger. In other words, it’s fine to say “you can only earn a hundred million dollars.” The hard part is implementing it without killing the investment ecosystem. Every investor is chasing the big return that covers the 20 investments that didn’t pan out. If that big return is capped, there won’t be investment, and hence no startups.

yunwal 3mo ago
I don't understand. Just because one person can't own 100 million doesn't mean an investment firm can't make a 100 million dollar investment and make returns on it. Those are 2 different things. The firm is managing the money of multiple people.
- sillysaurusx 3mo ago
  And when one of those people breaks $100m, does the excess money go to the firm, or to taxes? Or are you saying that a company can have unlimited money, as long as the shareholders don’t extract more than $100m over the course of their lifetime? The ultimate point of money is for someone to have it. And since corporations are owned by people, it’s not enough to say that corporations aren’t bound to the $100m cap. Otherwise people will just hoard money using corporations, and take loans against their value, a bit like how it already works today. What counts as $100m? If you buy a million dollar house, then sell it a few years later for a million dollars, are you now limited to $99m since you already spent $1m? Does the money from selling the house go to taxes, or to you? If it goes to you, what’s to prevent someone from hoarding equity and only taking out $100m at a time, effectively living the life of a billionaire while keeping their balance under $100m? If you own some stock, and it rises in value to $150m, you forfeit $50m to taxes, right? But then if the value of the stock goes down by half, would you have $75m or $50m? And if the answer is “you have $150m, the cap only applies when selling stock,” then what stops people from putting the money under the custody of a business (which you said isn’t bound by the cap) and then taking loans against that extra $50m? These aren’t contrived scenarios. Stock goes up and down all the time, and it’s important to be clear about how the proposed system will work. I’m genuinely interested in answers. It’s easy to say “just cap someone’s wealth at $100m,” but people seem to shy away from proposing specifics.

imgabe 3mo ago

Who is going to cap how much a company is allowed to be worth? Or how much of the company you start you are allowed to own? Why should anyone have the power to do that? That is a far more evil power than any billionaire has.

seventytwo 3mo ago
We are. All of us. If enough of us agree, we can make any rule we want.
- IcyWindows 3mo ago
  So "enough of us" can take anything by forcing the asset to be valued at an artificially high value, force them to sell it for taxes, and then reduce the price down again to keep it ourselves?
  - seventytwo 3mo ago
    Yep. That’s how democracy and law work.
    - imgabe 3mo ago
      Mob rule is not something to celebrate.
      - HauntedDrum 3mo ago
        How do you, personally, distinguish between democracy and mob rule?
        imgabe 3mo ago
        In the extreme there is no distinction. This is why the US and almost every other democracy are not direct democracies.
        3mo ago

bluedino 3mo ago

> that is still so much money that said founder and their family and very likely their descendants can live in extreme luxury for the rest of their lives even if they stop working right then. Professional athletes and lottery winners prove otherwise.

lumost 3mo ago

bear in mind, elon musk now has the wealth of 10k "100 millionaires" - we truly lack comprehension of how wealthy the wealthy have gotten.

WarmWash 3mo ago

I think the most chronic misunderstanding in the "billionaire" rhetoric is that billionaires are in it for money. People who work a job they don't like because they need money to live, view money as the objective in life, because the equivocate it to escaping and freedom. So wearing that lens, and looking at billionaires, these motherfuckers are greed driven psychopaths who blew past the "escape with freedom" bank account ages ago, and are now just taking money off the table from others trying to get ahead. But that is not how it is at all. Virtually every billionaire is crazy focused on their work, and the money is a side effect that they don't really care that much about, besides it being a tool to enable more work they can do. It's very hard to get this across when speaking to people who view work as an obstacle, money as god, don't have personal business experience, and whose passions are things that aren't very productive.

bjustin 3mo ago
One of the problems is that rather than billionaires being it for money, they’re in it for money. They don’t lack for money to live, sure, but they do want more money for the power it provides.
- butlike 3mo ago
  One thing I'm gathering from reading this thread is that the 'spending money' is different than the 'power money.' The 'power money' may not actually exist as it's tied up in valuations. If your company is the 'power money' generator, then of course you'll need to work more, since you're in it to be more powerful
barnabee 3mo ago
If they’re not in it for the money, they’ll be happy to pay more tax
- WarmWash 3mo ago
  Taxes are money that they lose control of. There is a reason Bill Gates didn't just write the IRS a check for $175B and created the Gates foundation instead.

JumpCrisscross 3mo ago

> it's possible for bright, motivated founders to create startups that your kids can work in, but those founders could be content with merely making a hundred million dollars? Making a billion dollars doesn’t require becoming a billionaire. Someone who makes a billion dollars in a balanced society generates wealth and taxes. (One who does in an unbalanced one has the choice to donate.) Also, liquid versus illiquid. Founders shouldn’t be under obligation to cap their ambition or force liquidate if their companies do well.

bubblegumcrisis 3mo ago
This is why the guillotine will either be taxes or blades. It's either Bernie or Luigi. There is a sizable segment of the population that just doesn't have any empathy for society at large. "There should never be a cap to my selfishness." You might think: I can argue with them. No. You can't. They literally couldn't care less about you or anyone else. They do, however fear retribution.
- JumpCrisscross 3mo ago
  > This is why the guillotine will either be taxes or blades There is legitimate debate around whether the French aristocracy came out of the Revolution richer than they were before. > They do, however fear retribution They don’t. They haven’t been targeted. Luigi potted a middle manager with a glorified title. The billionaire who owns the group is fine. We need to raise taxes. We need new tax brackets. But pretending violence is a check on a globalized rich is just self-congratulatory fantasy. Worst case, they lose billions when they flee.
  - bubblegumcrisis 3mo ago
    I don't know about this. Pre-Trump I would have agreed with you. Post-Trump. The mask is off, and they are evil. How many billionaires are there? I don't think we'd miss them if they were gone. And it goes farther than this actually. Should we have publicly executed the cigarette CEOs, and those CEOs of the drug companies who knowingly destroyed so many lives with opiates? What about the company CEOs who poison water. Before Trump I would have said, "no." But now, "yes." They deserved it, and by not sufficiently punishing them for their crimes against humanity we sent a message to the likes of Facebook and OpenAI and the new batch of psychopaths, that there are no real consequences for their actions, no matter how base they are. If Trump and his family does not sit in jail after he leaves office, if the democrats do not exact retribution for all he and his ilk have done, I think there will be rioting against both sides. I don't know. Maybe I'm wrong. I actually hope I'm wrong. But I think I'm right. And even though this post will be down-voted for referencing violence as leverage, I think these ideas are mainstream now.

nfw2 3mo ago

How exactly do you propose keeping a founder from becoming wealthier once their company scales past the point where they are worth a hundred million?

didibus 3mo ago
tax?
- pclowes 3mo ago
  On what? You force the company to break up and liquidate so they can pay taxes? You force the founder to give up their private property just because it is valuable? Remember these are not dollar bills in the founders bank account. It is just the company they created is now very valuable. It does not mean it is liquid.
  - paulryanrogers 3mo ago
    Owners being able to lock the value generated by workers solely within their family for generations has been tried. It ends in feudalism.
    - seventytwo 3mo ago
      It doesn’t end in feudalism. It ends in guillotines.
    - nfw2 3mo ago
      Are you proposing changing inheritance laws or are you proposing forcing companies to sell their stock in a firesale to be in accordance with the IRS? Be clear in your propositions please.
      - paulryanrogers 3mo ago
        Progressive taxation, taxes on CG, inheritance taxes, and a well funded and non-partisan IRS.

anbende 3mo ago

The primary issue with this is the way shares and equity work. Elon Musk is a trillionaire on paper. He pays himself famously little. That net worth is, under our current system, tightly linked with his interest and control in his various enterprises. He can borrow against it which gets around taxes and that should probably be addressed, but he like the hypothetical fresh billionaire startup founder don’t have that money. And the mega rich on paper can’t access more than a small percentage of that money without reducing their control of the company they built or are building. Ideas like a wealth tax, or the new sovereign fund paid into by an equities tax or grant are all interesting, but they are all more complicated on the ground than “wouldn’t $100m be motivating enough?” FWIW, I think that some sort of public endowment and/or sponsored healthcare, education and safety net and/or tax or management of hyper wealth is one of the problems of our age. But part of that problem is that it’s not clear how to do that in a way that is workable in an increasingly multipolar world of tech and soon healthcare giants that are as powerful as small but growing nation states. Economically and in some cases militarily linked to great powers.

jonfromsf 3mo ago
Just don't step-up cost basis at death and you solve the problem. Elon's fine, we can wait until he dies and his heirs sell their shares.
- the_sleaze_ 3mo ago
  1. End step-up cost basis at death 2. Tax or end lending against portfolios Seems like a solved problem to me.
rwmj 3mo ago
Who is it that implements the rights around ownership? Who is it that will (possibly literally) go to war to defend this right? Maybe he should pay a bit of tax on this right since he expects others to defend it.
peab 3mo ago
>He can borrow against it which gets around taxes and that should probably be addressed, but he like the hypothetical fresh billionaire startup founder don’t have that money. And the mega rich on paper can’t access more than a small percentage of that money without reducing their control of the company they built or are building. Yes, this is a good take. I wish more people understood this. Things like sales taxes could address this. Land value tax, with single homestead exemptions are another.

pclowes 3mo ago

It is not like the money is in his bank account. And it’s not like he took the money from somebody else. He spent a ton of time to create something that he owned the majority of and to make that thing more valuable. He paid other people to help him and they were happy with that exchange. The government also helped them and they were happy with that exchange. Suddenly, people have assigned a concrete value to the thing via the IPO and it is very valuable. It’s not like he suddenly has $1 trillion in his account. It’s just the thing that he made and has ownership of is suddenly worth that much.

CPLX 3mo ago
Of course he took the money from someone else. Is your theory that he dug it out of the ground with a shovel or something?
- schoen 3mo ago
  That must be why there is exactly as much wealth now as there was in the year 600. We've all just been stealing it back and forth.
  - pclowes 3mo ago
    Thank you, I never thought debating economics on hacker news of all places would be the equivalent of discussing orbital mechanics with flat earthers.
    - CPLX 3mo ago
      I have a degree in economics and wrote my economics thesis on the application of complex adaptive systems to economic theory. I'm still quite attached to economic analysis, it's even the story behind my user name. You can be assured I understand the concept of wealth creation. But the fact that there are, in fact, other people involved here is hilariously hand-woven away here: > He paid other people to help him and they were happy with that exchange. The government also helped them and they were happy with that exchange. OK I will bite. Who determines what "the government" thinks in a democracy? The general public, right? Does the general public seem happy?

fn-mote 3mo ago

Surely this would just create an industry of ways to dodge the “$100m tax”. Just waiting for my company’s top 10 shareholders to be anonymous entities owned by other companies based in the Cayman Islands.

sumeno 3mo ago
Let's give it a try and see. Maybe better things ARE possible
paulryanrogers 3mo ago
The rich being willing to cheat doesn't mean we should just give up and let them consume all surplus value in the system, until people are literally working 3 jobs for rent and food.
rwmj 3mo ago
UK companies are forced to list beneficial owners, in order to cut through these kinds of shenanigans. It did take decades to get this change implemented because capital was deeply opposed to it. For some reason, I'm sure it's not because they want to avoid paying taxes like the little people.

soerxpso 3mo ago

The entity you're implicitly proposing should take the money doesn't have a good track record of spending it wisely. I'd much rather let the startup founders keep their money and build rockets with it, than spend another few trillion on building 100 meters of high-speed rail.

patagurbon 3mo ago
The whole problem with CalHSR is precisely that they can’t spend any real money… There were governmental barriers like CEQA and local NIMBYs but the primary cost culprit is that the legislature has continuously kicked fully funding the project down the tracks for the past two decades. Funding it fully with a 10-20 year construction timeline in the early 2010s would’ve far cheaper at this point. Every American economic miracle has been precipitated by the government building basic infrastructure and doing basic research.
- ericd 3mo ago
  Does this contradict the comment you're replying to, somehow, or are you trying to prove their point?
- anon291 3mo ago
  So it's pretty clear it's not the billionaires but random thousandaire loudmouths that are the problem then.

fallonator 3mo ago

How about we set a maximum wage instead of a minimum wage? But it's not a set number. It is a maximum multiple of the lowest paid employee at a company? 10x should do it. If the CEO wants a million each year then the lowest paid employee still gets 100k. I'm trying to think of why this wouldn't work.

tensility 3mo ago
The only reason it doesn't is the greed of folks who become billionaires.
perilunar 3mo ago
Probably won't work because the ultra-wealthy don't get ultra-wealthy by earning wages.

yowlingcat 3mo ago

What if -- bear with me here -- the very thing that makes those founders able to make the $1B they would otherwise make would drive them to also ask why it is that someone else who had no hand in building or funding it gets lion's share of the $900M while they get only $100M? You don't /know/ that people need to collectively get over "this" -- you have a feeling that it seems more fair to do that than the alternative. But you can look at what happens elsewhere in the world with regimes that implement exactly what you are describing. And what happens is the people who are most equipped to be the golden gooses that you are proposing are just as equipped to simply most somewhere they can do so unencumbered. That's why what you're proposing will just never really work.

peab 3mo ago

I don't understand why people argue for a limit on wealth - the line of reasoning, when reasoned out, concludes with a majority of people having the exact same amount of wealth. How so? Well, suppose we say, nobody should be a trillionaire - is this an arbitrary number, or is it aimed at the richest person? Clearly, the latter. Now if we carried this out, now there are billionaires remaining. Well, nobody should be a billionaire, one might say. Most will agree. So the wealth of billionaires is taken away, and redistributed evenly. This will continue, with the majority of people below the average wealth level, demanding a more equal playing field. You can see how it ends

joquarky 3mo ago
Is this not an exemplar of the slippery slope fallacy?
- peab 3mo ago
  no, it's not. It's math. If you make a rule that you lower the person at the top of the pile, over time, there will be nobody left to lower - everybody will be at the top of the pile. The fact people say 1 billion is too much money, or 1 trillion is too much is something to dig into - the number is relative! 1 billion is only a lot because not many people have a billion dollars. If inflation keeps up, one day everybody will be a billionaire.
  - butlike 3mo ago
    > everybody will be at the top of the pile. Why is that a bad thing? Or will it exemplify some other non-financial inferior trait of the person which might be existentially 'scary?'