Politicians are screeching of the inherent evil of Elon Musk becoming a trillionaire. They act like Musk has a big, giant vault somewhere with piles and piles of cash in it and somehow he has cheated everyone out of paying his fair share of taxes.
That's bull$hit.
"He isn't paying taxes on that money!" is a common gripe.
What money? It's not like he was handed cash. The value of his stocks in SpaceX just went up.
What's even more interesting is that when Musk broke the trillionaire cap he created 4400 millionaires in the process. Employees that took advantage of SpaceX's stock options had their shares go up at the same rate Musk's shares increased and 4400 people became instant millionaires, some made tens of millions.
Umpteen years ago I won a company whatever and became the proud owner of $5K worth of company stocks which I simply sat on it a while paying no attention to it whatsoever. I had no tax liability because it wasn't income and had no negotiable value.
Later on several years later there was a buyback from the company and I sold it back to the company for about $8K. Because I had cashed it out it had generated income and I paid taxes on the entire $8K.
Meanwhile the usual suspects are screeching to their minions about a 'wealth tax' which would force the on paper rich to sell off assets to pay the taxes. Not only would this hurt the wealthy but it would hurt the rest of us in varying degrees.
Personally I'm a pretty spiteful kind of guy when I get riled up.
If they enacted a tax on unrealized capital gains I would sell it all, pay the taxes immediately and shift about $100 million cash offshore and retire someplace that has good weather.
If Musk did this it's pretty likely that the stock market would take a very serious dive and throw us all into a recession. Fortunes would be lost, people would lose jobs and there would be sadness throughout the land.
Someone put it better than I did.
Musk is not sitting on a pile of cash.
His wealth is simply his part ownership in corporate assets of production.
Worse yet, his trillion dollar worth is not current cash.
He has to produce enough goods and services in the future to make the present value of those expected revenues come true,
which means making things people actually want,
instead of being taxed.
That is the essence of free market enterprise.
You only get income if people want to buy your goods and services of their own free will, not at gunpoint or the prospect of jail,
as with all government so-called services.
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