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All of the productive ones are. Those would be the ones that create wealth and income on which the progressive income tax is paid.
Well yes, Productive forms of investment are productive. Very astute.
Sarcasm aside, it addresses your observation that investment is not productive. I assumed you meant to address something relevant to the topic.
But there are investments that make money which wouldn't necessarily be called "productive" if the only benefit goes right back into their pockets.
That doesn't make sense. What specific form of investment makes money, but is unproductive.
For something to be productive it has to have some benefit to the whole, not just to one individual.
This is a dubious proposition. Whether an act creates wealth is not logically dependent on how the resulting wealth is distributed. That standard is, on its face, irrational.
Maybe we're not on the same page on what it means to be productive; if so, I apologize for misunderstanding and ask for clarification.
I suggest that an activity is productive if it creates wealth and makes money, our best metric for wealth. Do you have a better definition?
Money inherited from people productive enough to produce value and wealth.
And again, not necessarily. A lot of old money in the south came from slavery. A lot of old money in the north came from crime. A lot of old money in the west came from thievery and stealing land from natives.
Slavery was unjust, but productive, though not optimally. I dispute your conclusion that "a lot of old money in the north came from crime." If you mean from the era of prohibition, the example shows that providing a service illegally still has value, and is a form of productivity. Settling the west for greater productivity had obvious value.
Yet, impugning the source of capital does not mean that the current investment of the capital provides income unjustly or unproductively. The descendants of slave holders can invest money current, and that investment can create wealth.
There are plenty of families that rose up from nothing but I think we'd be hard pressed to prove which ones fall into which category and which category is more prevalent. However the point remains that people who inherited money did not work for that money nor did they do anything productive for it. That's not to say they shouldn't get it - I certainly don't have a problem with people passing along their money to whoever they choose - but it's another factor to dispel the myth that rich people are harder workers or provide a greater benefit to society.
I thought we agreed that how hard a person works is not relevant to his productivity.
You write that you do not object to inherited wealth, but your reflex appears to treat it as an improtant difference.
Whether you worked very hard to accumulate your wealth, or it was inherited, it is just as much yours, and your right to it is every bit as indisputable, correct?
Indeed. I was very poor as a student, but not especially lazy. I was also economically unproductive, hence the poverty.
Well here's an idea, why not help more people become students and get the higher education that will allow them to be more productive?
We do that.
Of course it does. Discouraging productivity reduces economic resources. If poverty is a lack of resources, then the taxation of productivity increases the amount of poverty in any system.
This is easily seen in economic comparisons of the old west and east Germany. One system vigorously discouraged productivity and accumulation of wealth, while the other didn't.
Which was poorer?
It doesn't "discourage productivity". If we were taxing people 75% for being wealthy then I'd agree that it does such a thing but it's nowhere near that point.
If results of one man's efforts are taxed at 35% and the resluts of another man's efforts are not taxed at all, which has the greater incentive to produce?
A system that decreases the incentives for its most productive members discourages productivity. Stated differently, things you tax, you get less of. Things you subsidise ,you get more of.
Now while that dollar may have been taken from a productive investor it could be going toward feeding and educating other future productive investors that will eventually produce three dollars each for every dollar they got from the government.
I will suggest that a system that teaches people they can't keep the results of their investments will create relatively few investors.