The Future has full Freedom and
Sovereignty
The future fully owns itself, our future selves are no more than inheritors of the past who happen to carry our same names.
There are two ways to think about capital gains. One is an upward price correction. Sometimes we don’t realize what something is actually worth until it becomes popular and widely used. The other way is as a constant rate of growth to the value claimed by ownership of the means of production.
What we may not immediately realize, is that to make gains from ownership alone, is just a way of taxing people. If owner’s gains do not require work, then they must be somehow taking from or taxing the people who do work. And when people claim that ownership rights come from the just desserts of work, that the first person to work a resource owns it, this becomes a most perplexing self contradiction.
Importantly, assets definitionally do not change in any real sense, unless work is applied to them. This is not just a metaphorical analogy to newton’s first law of motion, but rather a generalization of it. The same way we apply work to move or accelerate an object at rest, Capital does not accelerate or grow of its own accord, only living things grow autonomously, and they have self sovereignty.
If work is a necessary element to any gain in value, then how do we fairly assign relative income between workers and capital? Or rather, more accurately, how do we apportion income between those who work today, and those who both worked and saved in the past?
This question brings us full circle, an upward price correction, is very different from a rate of growth, in that we would not expect a continuation or propagation of that trend. So an upward price correction cannot be used as a discount rate, by assuming that past price changes will continue.
So perhaps the question is not "What is the proper way to tax capital gains" but rather that capital gains, which continue passively and indefinitely, are themselves a tax.
An upward price correction is fine, if people had the foresight to build something whose full value was not appreciated until it became popular. But for real assets, the normal state of affairs is gradual depreciation. Firstly from maintenance and storage costs, but secondly from loss of relevance and popularity, as new things are discovered and built which better meet the needs of the future.
It is a simple arithmetic fact that total wealth can increase, even as all assets gradually depreciate or decrease in market price. This is because we can make and build new things, as opposed to polishing and organizing metal coins. In fact, this juxtaposition of losses to individual assets but constant gains to total wealth may very well be the normal default state of affairs. While crops may grow on their own, are they then our crops if we do not tend to them? Or are they just a living thing we can tax?
By partitioning society into workers and owners, we can structure a system in which one group can continuously tax the other, when this might not be the normal state of affairs. We justify it by the fact that workers can buy ownership, but at what price? That price, like all prices, is set by the owners, and accepted or rejected by the other party. And even if workers can rise through the ranks to come out on top, is social permeability a justification for oppression?
Does the past own the future?
