Proportional to what, though? Can you give an example?
Like say a company is started with $1M of capital. Employees get paid $500k of that as salary/wage, and the remaining $500k pays for buildings, raw materials, etc. Say the company earns $2M of revenue. How would you split the revenue between whoever sourced the $1M, the employees, and taxes (the general public)?
What if the numbers were bigger? $10M invested, $5M in salary/wage, $5M in other expenses, $20M in revenue? What about $100M/$50M/$50M/$200M?
Now the bonus question: what if that startup capital didn't come out of someone's bank account, but was instead a loan of "new" money, created by fiat (or by minting a new coin, or whatever); that is - nobody 'had' that money in the first place?
Thinking this is "simple" strikes me as naive...
Proportional to what, though? Can you give an example?Gold. Silver. Precious metals. This was the traditional way of doing things for centuries. You pick an objective thing and compare everything else to it.
If you don't like that then a basket of goods It could be a set combination of things required to keep a human being alive or any other consistent grouping.
https://www.investopedia.com/terms/b/basket_of_goods.aspIt could include some measure of labor or anything else as long as it is consistent.
You can base it off just about anything and it is currently based on nothing or Fait "Faith." The bank doesn't have your money that you put in it and for every 10 dollars they loan out they have to actually have like 1 dollar in actual cash or whatever the reserve requirement is
https://www.federalreserve.gov/monetarypolicy/reservereq.htm . They literally can and do create money out of just about nothing.
We aren't naive. We're justifiably upset at the ultra rich people who have abused the system to the point it is breaking and if they don't stop it, then we'll eventually replace it with something else to save whatever we do have.
Parts of it are incredibly simple. Society is a machine. If parts of the machine are not maintained, then those parts and the machine will fail. You can't have 10 or 13% of society not having enough food while the top 1% hoards everything. This will eventually collapse, because people can't have kids or survive. We're already seeing it with more people "choosing" not to have kids, because they can't afford it. People are being forced out of the American Dream because the ultra rich want to be richer for no reason.
Two terrible things we are dealing with are:
1.) the idea that the super rich are somehow gods or have superhuman abilities. They aren't and they don't.
2.) The idea that bigger numbers are always better. It isn't about how much money you have. It's about how valuable it is based on what you can buy with it. Inflation has reminded everyone about this lately. The rich won't care as long as they come out on top by making more than inflation and pushing that problem on to the rest of us. If the rest of us starve they think we deserve it. Society does not have to have its benefits concentrated at the 1%.
"Like say a company is started with $1M of capital."
Let's not. Why does "private ownership equity" exist in the first place? It shouldn't. (This example isn't real but if we want to speculate) If people want to invest, they should get a government bond. The bond isn't taxed and gives you an interest rate return on investment. The bonds can be generalized or specific to a government created, owned and operated enterprise. You get a return on your investment ranging from 2% to 5% depending on how much the government wants to attract investment. The only say you have in the government enterprise is your vote. You have the right to sell or be repaid for your bond's purchase price. The interest is not taxed (and that is huge and more or less effectively raises the rate of interest you are getting), and the bond cannot default unless the whole country defaults because it is backed by the government. An private equity should not be ownership but licensed through the government for a large fee for the privilege of depriving society of government control of that market share. Say you can do it better than the government? Prove it by making enough to pay that licensing fee and make your profit.
The government creates the privilege of investment opportunities on government owned land, buildings and all that with government owned equipment (eminent domain). The projects create a certain number of products per year that must meet quality standards and achieve direct goals.
It can be done with enough labor. Goals for completed projects would include providing housing for a residents at a certain quality level, production of electrical power, water filtration, water desalinization, raising of livestock, raising of plants and food crops, production of goods, demonstrated tourism and natural preservation (e.g. the Grand Canyon),
Citizens are graded on testing for academic knowledge and demonstration of skills. They get ranked based upon how good their skills are. Those skill ranks + a base rate of universal basic income determines your pay. That goes for the managers too. Additional pay can be justified through extraordinary deeds or advances including competitive prizes. Just being able to compete at a competitive level gets you more money but actually winning gets you more. Once there you are assigned a reasonable amount of work product using your skill ranks. These would include various tasks in a profession like different types of welding, different types of surgeries or medical procedures.
Example: You are a level 10 welder who has been tested and demonstrated certified tested ability of welding techniques on a certain set of metals using methods like arc welding. You have demonstrated you can weld in difficult to reach places and high places, but not underwater. The government produces a list of tasks it requires with specifics such as quality of work, time frame, safety requirements, final product, and working conditions. You see one of these tasks requires welding on a bridge underwater and you can't take that one because you are not certified in underwater welding. There is another welding task above water level on the bridge and you can take that one. You are required to either take a certain number of these tasks per year, or to show that you made an effort to look for these tasks but none were available. When/if the government sees unused labor (because no tasks are available, a government manager is notified and made aware that this capacity is available but unused. (e.g. Hey, there's a perfectly good welder we are not using that is available to us. We need to find something for that welder to do. Surely there is something that needs maintaining or constructing. Or we can offer this welder an incentive payment to travel to an area with a current shortage of welders to either work as a welder or teach a class in welding. They could only teach the class in welding if they had the teaching level required or if they did it as a demonstration under a teacher with the required level teacher who would use their demonstration in the teacher's lesson plan.Alternatively, the person can take additional classes to get their underwater welding skill or another skill like cement work, plumbing, carpentry, management, disaster rescue, firefighting, engineering design, landscape flood control, agriculture, power generation and storage, precision machining operation, hospitality or recreational worker {hotel or proven tourism} accounting,customer service representative, tester [to be the person giving the aptitude tests] or a range of others. This end result is a highly skilled and versatile workforce that can respond to whatever comes up.). Some of these would be to be available to do the job and reserve a talented individual for a term of time like a year or longer. Testing happens along with performance reviews as verified by both the manger and independent outside testers who give the aptitude tests who are not allowed contact with the managers. An outside third party has the final say based on the inputs from managers and testers. Another option is to provide for yourself self sufficiently and to provide for others as a bonus income for you. This can be done through the task system but instead of a job it is production of resources like growing x amount of food, or taking x amount of food and producing y amount of finished meals. The end result is providing a quantity of support for human life at a given quality level. Farmer Mr. A grows X amount of crops and is paid based on this by the government, which provides them as raw material to Cook Ms. B, and she uses those raw materials to feed Z number of people. Might be a difficult but not impossible and when we have how many kids not being fed, how many old people not being fed and how many homeless veterans, yeah. It's better than just letting people rot and charging them with a crime for sleeping on the streets. Then you just have to pay to jail them and that doesn't solve anything anyhow. Same thing with building materials and housing. The people inside get basic universal income (either that or we let them starve and that's not cool) and they can participate in the same task program as the welder but probably without those skills unless they can learn them. They might be able to be tested into initially lower level skills (if they are coming from not having enough food) and get education to rank up those skills. This of course creates education tasks and presumably recreation tasks to provide it for those who are well behaved and not getting into jails for doing bad things. Is it perfect, no? Is it better than letting people starve, I would say something is better than nothing. Plus it's just an internet message board and nobody cares anyhow.
But let's go with your example, even though we don't have to. The government tells you how to do the taxes through tax law. If it allows a write off of the initial investment against the revenue because that money had to be spent to make the revenue then fine. Otherwise, you pay whatever the corporate tax rate is on whatever amount is properly declared as income.
If you mean do I get to set the tax rate, then you know my personal answer, but we're not going there in this example.
Whoever "sourced the capital" didn't just give that to the business. Again, there's some kind of arrangement. It is either a loan or a bond where they get a certain interest rate, or they get "private equity" in the company and get a stock ownership vote as shareholders. So whatever is left of that $2,000,000 in revenue after taxes and whatever other expenses I guess is currently declared "profit," and given to the shareholders either as the stock price going up or dividends
https://www.forbes.com/advisor/investing/what-is-dividend/ The idea is supposed to be that the private equity owners have risk and share in the ups and downs. So, if the company makes money, they get money and if it loses then they lose. This is in my opinion a stupid capitalist casino and it doesn't have to be this way.
Other options currently available under the system as it exists today would be to keep the money in the company's bank account or to pay off the company's debts. This would save them interest payments and make the company more financially stable with a cushion of cash in case crap happened. That doesn't happen most of the time though, because the investors just take everything they can. There are tons of things that could be done with that cash.
As for the employees, your model probably assumes that the $500K going to them as salary/wage is fair compensation. We don't know how many there are or what type of skills they have or anything so the only possible outcome in your example is to say they get their salaries/wages and not much else. If some of these assumptions are broken down, then it is possible to split some of the $2M in revenue with the employees, but under the current system this is unlikely.
The "bonus question" you had gives a loan as an example. That almost certainly has interest. If it is "new" money "created by fiat (or minting a new coin, or whatever)" then you have my answer on that, but it would depend on how it was created and if it has to be paid back or if it is a deduction on taxes.
*****
I get what you're trying to say and what you are saying isn't evil or anything. You're trying to show details and that it isn't as simple as the usual slogans that get thrown out there. That's true no matter what you decide, it is not easy. There are parts of it that are simple. For example, we can't have more than 10% of society without enough food, because eventually things will fall apart. We can't have what was the number from wikipedia? 8% of kids with food insecurity issues, and we can't have senior citizens not having enough food or deciding if they want to be hungry or not take their medication. Yes parts of it are complicated but that doesn't mean the only answer is the one we currently have, because the answer we are currently doing is deeply flawed. I don't think what you are saying is "wrong" but it could be improved upon a lot.
Jesus, let's try something simple like the idea of a business having cash reserves. Let's say the stock price is multiplied by a certain number depending on how large the cash reserves are and what its income to debt ratio is with the best rating being for a business that was fully paid off. All it a "stability modifier," or whatever. So the stock price x 1.1, or 1.2. or 1.3. This would make things more stable and reward companies that were less risky and actually had a way to deal with it when crap hits the fan.
In other news: More nutty right wing hurricane "weather control" conspiracy theories from Marjorie Taylor Greene sitting congressowmanMTG as a sitting congresswoman is continuing her "they control the weather and hurricanes" garbage and the sane republicans are saying Congresswoman Green is nuts and has been told by sane republicans to knock it off but she just will not. The nuttier conspiracy theory republicans are saying Biden is to blame for people not getting hurricane relief along with everything else under the sun. This isn't true. We can't control the weather. How is this a thing? The federal government is providing hurricane relief and only Trump has done things like deny disaster relief unless the leaders of the people suffering suck up to him.
https://www.theguardian.com/us-news/2024/oct/07/marjorie-taylor-greene-hurricane-helenehttps://imgur.com/gallery/biden-ignoring-hurricane-victims-right-5247t8chttps://www.cbsnews.com/news/government-not-controlling-the-weather/https://www.newsweek.com/marjorie-taylor-greene-hurricane-helene-conspiracy-theory-1966255https://www.politico.com/news/2024/10/03/helene-trump-politics-natural-disaster-00182419We have flat earthers, people who think the government is incompetent but also controls the weather and just I don't know because who can keep track of the insane conspiracy theories anymore. None of what some of the weird and wacky parts of the right wing is saying makes any sense. I mean "weather control?" I just really?
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