Frankly just remove tax breaks completely and make the whole system simpler and cheaper.
The real point I want to make is in order to simplify the tax structure, you rob the politicians of their main economic design power. No more tax incentives for solar, high efficiency windows, developing in high crime areas, and the like. I'm willing to pay that price, but are you? (The royal you, i.e. us).
The final point, the real crux of the matter, is that politicians cannot predict all the consequences of the tax breaks they create. If tax breaks exist, people should try to get them, otherwise the whole incentive structure doesn't operate. Then some people who were not intended to get the break find edge cases in the legal language to exploit. If the politicians can't predict all the edge cases of the incentives they design (which they can't) then we end up with things that seem outrageous until you read the law and go "oh, that's the loophole. Shitty, but seems legal.". This is why the federal code is so complicated. People making the tax code more complicated over time to try to specifically target the incentives. Just like a legacy codebase, in fact. Except that it's subjective when you evaluate it.
Edit: typos
Of course politics has zero room for nuance, so we shouldn't hope that the tax code will become simpler in the foreseeable future.
I suspect if we didn't hear from our politicians for 2 years, everyone across the country would like the outcome.
But in the days of Twitter, you can't take a breather.
Devoid is an overly strong word. There has never been zero nuance, and there isn't zero nuance today.
It also creates an incentive structure that can have toxic implications for the company and products, since the government is effectively a customer, but the product being purchased is subsidy qualification -- potentially at the expense of the laborers or customers. Imagine if your product manager had to take the politicians' product whims into account when prioritizing your backlog.
Edit: my political commentary: this is the fundamental problem that converted me to conservatism from center-leftism. I believe it's not possible to create an equitable structure and a level playing field while the government meddles in the economy.
I'm trying to understand your change of beliefs, so honest question: is government setting and enforcing safety standards (which otherwise companies would reliably fail at), and pricing in externalities (e.g. pollution) considered by you "government meddling in the economy" and interfering with an equitable market structure?
it's really not, and it certainly isn't when you speak in terms of revenue instead of profit.
I know this isn't the same as distinguishing between cost of labor and cost of non labor things like keyboards and shovels. But the cost of those things benefits the average person that build them, or built their components, and so on.
Even the profit taken by the rich ends up benefitting the average person because, well, where does all that loan money come from?
Not sure what your point is beyond a humanities professor ignorantly preaching saying "profit bad"
>Not sure what your point is beyond a humanities professor ignorantly preaching saying "profit bad"
Not sure why you felt the need to throw that in. Your argument (what little there is) is essentially trickle down economics, which is BS.
If you have a thousand wealths and I have one wealth, that's worse than if I have a million wealths and you have a quintillion wealths.
No, not trickle down economics. It's history. The standard of living of the impoverished is dramatically higher than the rich of yore, and continually rising. And the reason is unequivocally capitalism.
Your view of the wealth gap is just not relevant because economics is not a zero sum game. The pie is not a fixed size. The promise of capitalism is that we get to grow the size of the pie. This isn't speculation or opinion. It's one of the few things we know for certain in economics.
Yes, the wealthy are getting wealthier faster than the poor are getting wealthier. But the one thing people who think that's a bad thing cannot explain is why that's a bad thing. It's not obvious that it's even possible to dramatically enrich everyone like capitalism very definitely did in the past without disproportionately enriching the few. That just may be a consequence of the only process of collective enrichment that appears to have ever existed on the planet.
That is to say, there exist people who would be happier if everyone was equally a medieval peasant, rather than today's status quo.
Given that scarce goods exist and will always exist, you can't even say this viewpoint is irrational. When the range of status is minimized, it makes status mobility easier. Human happiness is also adaptive to a sort of baseline norm; it's not clear that increasing prosperity in Western countries actually makes people happier past a certain point.
Edit: it kinda goes like this
"I'm not happy because i don't make enough money"
"Here's some money"
"I'm not happy because i don't make enough money"
"Here's some money"
"I'm not happy because i don't make enough money"
"Ummm.... Maybe you should find a better metric for meaning in your life, because we're getting nowhere."
Beyond a certain point, which appears to be "bill collectors aren't knocking down your door", more money does nothing for your mental health. Look up Jordan Peterson to find the non-controversial reasons why.
Edit 2: the great tragedy of the leftist economic designer seems to be that subsidizing the poor seems to have no effect. If you do that, the labor costs of goods rises to meet it. So all you did is eat into already-narrow profit margins to, at best, raise prices for everybody including the middle class, or at worse, kill local small businesses.
The real darkly funny part about this whole thing is that, in America, controlling for factors like disability, poor individuals don't stay poor very long. You work hard, you're not poor for much longer. If you don't work hard, you're poor forever.
Edit 3: I often hear a politician say a thing that's false, that people "can't get ahead". It might be true that they can't get ahead as fast as they would like. But so what? We can't fix that problem. Literally, it's not possible. How fast you get ahead is a function of how hard you work. That's how capitalism works.
Status seeking is something you see in all animals, not just humans, and we shouldn't deny the effects of it on happiness. Trying to make social policy without considering it is ignoring a valuable piece of information.
I make no comment on the effectiveness of the US' current social safety net and income redistribution policies. Just that there is a principled argument for having them.
It comes from the central bank. The rich don't loan out their money for a negative interest rate.
I think this is in contrast to highly automated industries (tentatively). I think the train of thought is that lower labor costs results in a higher concentration of wealth as less wealth is distributed since there are lower labor costs.
However, I would posit that the more direct measure is profit percentages. Hypothetically, if labor costs go down, and profit margins stay the same (ie if the savings are passed on to consumers), then I would imagine there would be an increase in consumption.
Where the money gets back to workers may change (as increased consumption would mean increased demand for the materials McDonalds uses, which likely have higher labor costs). High profit percentages, however, typically benefit those that own some of the company.
This is entirely conjecture, I am not well versed in economics. If there is some flaw in this (and I'm sure there are several), I would love to be corrected for my own education!
I reject mercantilistic views of economy. They belong in the 1600s where they died.
I'm pretty comfortable abandoning the view. It wasn't built on a strong basis.
Honestly, income inequality is a red herring of left politics and public schooling. If the most prosperous societies have high income inequality, then the question must be asked: does it matter?
Unless you want to design a utopia. That goes swimmingly every time, I promise.
Edit: If income inequality is a consequence of freedom, it's a very, very tiny price to pay. Don't optimize for the economy. Optimize for freedom. Empirically, that's how you create prosperity.