This line of thinking though assumes it would have no impact on the largest players though. It hinges on a "calling their bluff", that high NW individuals won't change anything despite now being forced to annually liquidate assets to cover taxes. And this doesn't even touch on the immense impracticality of annually valuing assets. Or how to manage assets in illiquid markets, or how to sell 30% of a painting to cover 1% of it's mark-to-market value by year end.
The reason wealth taxes never go anywhere is because when you sit down and learn what wealth is, how it works, and what is practical, it makes the most sense by far to just tax things whenever they go back to cash.
Really the only genuine tax loop-hole is the step-up basis on inheritance. Everything else is just an elaborate deferral to pay taxes later.
> despite now being forced to annually liquidate assets to cover taxes
Allow paying the tax with assets. Put the assets into a black box sovereign wealth fund that's controlled by some mechanical algorithm which sells things at random as needed to fund the government budget. At scale this will be indistinguishable from a whole-economy index fund.
The best part about this is rich people can't beg off by saying "I have to liquidate stuff".
How do you pay with assets for real estate or boats or paintings? An IOU that can be cashed in when the asset is sold. Oh the boat is owned by an LLC so it never changes hands? No problem, the government has a share in the LLC too. (IANAL, IANAA so working out the loopholes is left as an exercise for the reader).
A second benefit is startup shares don't have to get hit with a capital gains tax before the startup goes public. Right now people sometimes pay taxes on shares that are eventually worth zero. Instead if this tax could be paid in startup shares, then there's no unfair tax bill.
As a condition of paying in assets, forbid the government from exercising any control over the assets. No shareholder voting, no board seats, not even choosing the paint color on the boat.
Additionally, this tax can't be on top of income tax. The whole point is to fix the worker-funded tax pyramid scheme. It has to be revenue-neutral with respect to income tax.
The bigger issue is, at least in the US, roughly 2/3 of assets of the wealthy have no meaningful liquidity. There is also no mark-to-market because in many cases these are idiosyncratic goods that may only find a buyer once over decades. Even some real estate markets only clear a single transaction on the scale of decades so any valuation is mostly fiction -- there are no comparables.
You could pay for these using the 30% of the assets that have some practical degree of liquidity but now you are putting massive downward pricing pressure on those because it is essentially a leveraged liquidation. Effectively, the total percentage of assets that are non-liquid would increase.
People tend to underestimate just how non-liquid the assets of the wealthy are. Most of that wealth isn't in stocks and bonds.
Real estate is a bad example because it's already subject to property taxes, which is a form of wealth tax. Maybe it doesn't need another wealth tax.
Private businesses are a better example. They don't trade on markets, sometimes don't have multiple shareholders. There already exist methods for valuing businesses (discounted cashflow, for example). Let the taxpayer pick one and make them stick to it.
> You could pay for these using the 30% of the assets that have some practical degree of liquidity
I already said "no liquidations, pay with assets". For non-liquid assets pay with IOUs on said assets. The government cashes in the IOU when the asset changes hands - whether it's by sale, gift, or inheritance. Yes that's an inheritance tax; who cares? If you want to add a wealth tax to real estate, this is the way to do it.
There are a surprising number of edge cases out there.
Quite a few assets can never clear a market — they have value in some abstract sense but no concrete sense. For example, assets that are legal to own and transfer but illegal to buy or sell.
Some commodity assets have value that it is nonetheless not always transferrable. A common example relevant to wealth taxes is intangible assets where value is bound in who owns it and not the asset per se. Most of the value vanishes the instant you transfer to e.g. the government.
Another common issue is that wealth taxes can directly conflict with existing load-bearing contracts. As a practical matter, these government can’t just void most contracts, including contracts the government is a party to, for the purposes of generating tax revenue.
All of which is why most real-world wealth taxes limit scope to a handful of liquid, legible securities and similar. But as a percentage of wealth, these are pretty small so you don’t collect much revenue.
You also have the state which pays for most of the top line expenses of having kids. Once you start making money, those benefits don't fade, they instantly disappear entirely.
It's pretty obvious the outrage around datacenters has nothing to do with datacenters and everything to do with knee capping AI progress.
People should just focus on that, because you really really have to reach to make a metal box that hums into an existential environmental crisis. Ultimately you end up looking stupid and uninformed, because you have to lie and half-truth to make datacenters look evil. And the people protesting are all factually incorrect about what they are protesting.
Just go after AI directly, or at least frame the arguments against datacenters in the context of AI.
I can assure you that people protesting the the one near where I live barely know or care about AI, but they know something is up when a giant evil fuckass building shows up seemingly overnight. Who knows what sort of horrible things are going on inside, it's not like you'll be allowed in to check. The only connection to AI is that the AI companies placed the order for it.
My town also protested when Walmart decided they wanted to install one of their mega shopping centers here. A big building means someone has too much money, and its only a matter of time until they use it against YOU.
> It's pretty obvious the outrage around datacenters has nothing to do with datacenters and everything to do with knee capping AI progress.
Is it? Data centers are being built with tax incentives given to the operators, no regard for impact on the local utilities, and they bring no local jobs (at least not long term). Seems like lots of negatives to communities if development continues like this.
We already know that that data centers impact the environment in many ways and can be harmful for the water, air, and the health of the people around them. It's the dose that makes the poison though and so the push for more and more data centers increase the harms.
Did you read these or did you just post them to illustrate my point? Like the only real datacenter centric point made in all three is that you can detect air being a couple degrees warmer within 1,700ft of a datacenter.
The rollingstone article is crazy, because it's actually just about agricultural runoff which is poisoning a well Amazon uses for cooling.
My point here isn't that datacenters have zero impact, my point is that if people actually cared about any of these things, datacenters are way down on the list of causes. Unless I suppose you live within 1,700 ft of one.
> The rollingstone article is crazy, because it's actually just about agricultural runoff which is poisoning a well Amazon uses for cooling.
Did you actually read that article? The issue isn't that amazon is the source of the nitrates, the problem is that the data center is concentrating them and pushing them into the aquifer. Saying that the data center isn't responsible is like arguing that desalination plants don't cause pollution because the brine came from the ocean.
When the Port sprays that water back over the farms, some of the nitrates are absorbed by the crops, but there’s a limit to how much the sandy soil and shallow-root plants can hold before it leaks all the way through the dirt, polluting the aquifer below. “The aquifer is basically one giant sandbox, and the water flows through there very quickly,” says Chad Gubala, a hydrologist who managed Oregon DEQ’s oversight of the Port of Morrow’s wastewater permit from 2018 to 2022. Once the crops have absorbed what they can, the rest of the nitrates “get flushed right through [to the basin].”
Experts say Amazon’s arrival supercharged this process. The data centers suck up tens of millions of gallons of water from the aquifer each year to cool their computer equipment, which then gets funneled to the Port’s wastewater system. All of the data center water gets mixed into the dirty lagoon wastewater, which only increases how much water the Port must then discard over the fields. As Greg Pettit, who served at the DEQ for 38 years and led the development of Oregon’s Groundwater Quality, explains, “the more water you put on, the faster you’re going to drive the nitrogen through the soil and down into the aquifer.”
...
As the underground aquifer became tainted with more nitrates, even the ostensibly clean water that the Port pulled from the aquifer’s deepest wells — which it used to service its large industrial customers like Amazon — became polluted. Soon, Amazon was using water to cool its data warehouses with nitrates as high as 13 ppm — above the federal and state limits.
When that tainted water moves through the data centers to absorb heat from the server systems, some of the water is evaporated, but the nitrates remain, increasing the concentration. That means that when the polluted water has moved through the data centers and back into the wastewater system, it’s even more contaminated, sometimes averaging as high as 56 ppm, eight times Oregon’s safety limit.
I don't see how you can make the case that Amazon is responsible for cleaning up farmer's waste...
The water utility and the farmers need to solve the problem, not Amazon. If the farmers are dumping shit in water, they can pay to remove it.
The whole article is the bad faith desperate reaching I'm talking about. What's the takeaway? "Datacenters are bad because they make it harder for polluters to dilute/hide their pollution levels"?
Don't get yourself in a knot trying to defend this, because like I said, it's incredibly shaky and bad faith compared to "AI is going to take jobs and I don't want to be destitute"
> If the farmers are dumping shit in water, they can pay to remove it.
Amazon isn't responsible for causing it, they're responsible for having made the existing problem much much worse. Amazon didn't start the fire, but they poured millions of gallons of gasoline all over it and as a direct result that fire spread farther and faster than it would have.
As for who is paying to remove it, Amazon's currently paying out $20.5 million in settlements with the residents. Those whose drinking water is now polluted well above legal limits will get a new source of clean drinking water.
> it's incredibly shaky and bad faith compared to "AI is going to take jobs and I don't want to be destitute"
The environmental harms are measurable and real and happening right now. The idea that AI is going to take our jobs is entirely theoretical. Right now, AI hasn't even managed to successfully take over even extremely basic jobs that children often perform like taking drive thru orders at fast food restaurants. There have been attempts to use AI for such menial tasks, but they have been plagued by embarrassing failures. It's a lot more reasonable to be worried about the environmental harms of AI data centers than AI putting people out of work.
I really don't disagree that the agriculture industry has pollution problems they need to address. It's just also true that one of the environmental problems data centers can cause is making existing problems with water quality much much worse. That's also a major problem. Maybe Amazon knew about it before they built their data center. Maybe they didn't. Each community where data centers pop up gives us more information about the harms they cause, but we're learning those lessons the hard way. It's smart that NY and other places are being cautious. The fact that we have plenty of other environmental problems to deal with makes it all the more important that we're careful about introducing new ones.
Amazon can just mix in more water post cooling and then by your metric the problem would be solved. They can just rely on dilution like the farmers do.
Or we can use our brain and actually hold the right people accountable.
I'm finding it interesting to reason about this subject, not being a geologist and what not. It seems that there is a relatively stable rate at which the farms output nitrates regardless of how much water Amazon pumps from the aquifer. The issue RollingStone seems to have identified is that as Amazon pulls more water, it effectively concentrates the solutes by evaporating some of the water. As a result, less water going into wastewater treatment, so the pollutants are more highly concentrated. But the total amount of contaminants is unchanged, right? Unless Amazon's water consumption somehow increases the solutes output by the farms. Not sure how that would work, but it doesn't seem impossible.
Do you two think I've framed this issue correctly?
It also drastically accelerated the rate that those nitrates entered the aquifer. Amazon pulled in and spit out tens of millions of gallons of water which forced the nitrates deeper and deeper into the earth until they contaminated the water source. Then amazon was pulling in contaminated water, concentrating the nitrates, and then spitting that out too pushing that even more polluted water into the earth.
The total amount of nitrates is basically the same. Where those nitrates ended up and at what concentrations is what changed once amazon came into the picture. People had clean drinkable water before amazon's data center. They'd have had to deal with the soil contamination eventually, but by forcing the pollution into their clean water supply and increasing the concentration of it amazon's data center made their water undrinkable.
Those things are cash cows for local municipalities. I don't think that aspect is communicated at all, or at least the media leaves that part out.
A town a with a $50M budget can easily have a single large datacenter cover the townsfolk's entire tax bill, and then some. The worst part is the fan noise, but I am sure they can figure that out.
Generally datacenters are built in less dense areas that already have low taxes. So the cost to "buyout" the town council (i.e. "We will cover 75% of your municipal budget") is a rounding error for the datacenter builders.
Its states and federal usually offering tax breaks. But at least on the lowest level, it's pretty cheap to buyout a rural town, and that's why you get these town councils voting 9-0 to approve the projects before anyone even hears about it.
Actually irrelevant to an index calculation. If your index manufacturer is taking this into account at any level, they're actively managing. S&P predates the modern active-versus-passive dichotomy, but it functions within it in practice, and despite being a leader of committee-based indexing philosophy, they've broadly found success by also being champions of passive management. And part of doing that is rejecting judgement over how the market is weighing this or that.
That would be true IF the stock was already being traded.
All we have at the moment is just Elon saying "I think this is worth $1.5T, convincing a small subset of people to buy shares, and then because of this change, market following funds will be forced to pile in before the market has had time to discover the actual true fair price, thus artificially propping up the price until Elon has had time to unload a load more shares. The rule changes serve only Elon, not regular investors.
Historically, the share price falls sharply after an IPO in the vast majority of cases. In this case, with the asking price masssively over earnings, significantly more than any other company, it should be expected that the price will fall significantly in the weeks after IPO.
Shortening the window before it gets included in the index is a cheap trick to force passive investors to pile in at the inflated prices, in an attempt to artificially boost demand and prop up the share price.
If the company genuinely was worth the valuation being asked for in the IPO, they would have no problems with just waiting a few months before it would be included under the existing rules.
If someone is trying to bend the rules of my passively managed index fund to their will, are they trying to actively manage my passively managed index ETF ?
Historically a $1T market cap with a PE of 20.0 would be achievable with a $50B/yr profit. That seems easily achievable eventually for SpaceX, as it has actual hardware and services and IP.
> Historically a $1T market cap with a PE of 20.0 would be achievable with a $50B/yr profit. That seems easily achievable eventually for SpaceX, as it has actual hardware and services and IP.
It seems crazy to me to make a comparison between a company being valued on it's current profit and then to say it's reasonable for another company to have the same market cap because it could eventually have the same profit.
It does have real hardware, but it’s not in wild growth areas. They’re making their most consistent money from Starlink, which is a solid product but has growth limited by competitors from conventional ISPs with far-superior fiber networks, and the space launch business is similarly not the kind of thing where you get Google/Facebook-level growth curves. That’s not a slight, it’s just different industries: advertising companies can grow rapidly because scaling customers is so much easier than launching cargo into orbit.
The wildcard there is AI, and that seems especially dangerous to project long-term revenue from their current performance: xAI is barely in the market except renting capacity to Anthropic, so you’re gambling that they’ll continue to pay $1¼B/month for what is largely a commodity offering. Even if you’re bullish on Anthropic, that doesn’t mean xAI gets part of their profits, and given the way they blindsided the local authorities there’s a substantially greater than zero chance that they’ll get a major setback if the neighbors win their lawsuits. That doesn’t mean they’re doomed, but anyone estimating their future performance has to factor in some real risks.
Yet, I, a relative peasant financially has been hit by 3 different brokers that I'm eligible to participate in the offering. I would hazard a guess they are not getting the uptake in institutional money they were hoping for.
> I would hazard a guess they are not getting the uptake in institutional money they were hoping for.
I would say exactly the opposite. They (really, Elon) want more retail uptake. This follows a similar strategy that Tesla used. Also, retail ownership is much less likely to be disruptive during shareholder meetings (proposals, objections, etc.).
Math is a tool for solving problems, and people will do work to create value that they will share with you for helping them solve a problem which will ultimately create even more value.
In short, math is a powerhouse tool for carrying society forward.
Art, while cool to look at and experience, has a pretty low efficacy in terms of "motivating people to do work, or removing obstacles, to carry society forward"
In short, starving artists.
There is also the whole thing where art is an abstract concept with a subjective definition, and a solar cell sporting new tech with 33% efficiency objectively being better than one with 24% efficiency.
I cannot support such thinking. Art is foundational to human experience. People crave that their free time is filled with good food, good music, good books, good movies and shows in beautiful houses with beautiful gardens. All of these are various forms of art.
There were humans for tens of thousands of years before there was high technology. But there were hardly any humans around before there was art.
> Art, while cool to look at and experience, has a pretty low efficacy in terms of "motivating people to do work, or removing obstacles, to carry society forward"
Idk, the soviets didn't invest in socialist realism propaganda for nothing.
Less sarcastically, art has had an outsized influence on society and culture. Take any social movement you want, and there was probably some novel or work of art that galvanized it.
Firstly, measuring art in $ terms ignores the benefits that extend way beyond $ terms. Most fine art produced has a value approaching 0. My wife and I buy art from time to time, but we've never spent more than about $100 or so, yet get disproportionate pleasure from it.
As a first order approximation the "price" of art (as distinct from its value) is a function of branding not asthetics.
Secondly most artists get paid, not from doing fine art, but from adjacent careers that require good color, balance, composition, and so on. Industrial designers (think Jonny Ive), interior design, food presentation, magazine layout, web design, architecture and so on. Art skills are all around us. In the same way engineering is around us.
Put another way, engineers build ugly (think beige PC boxes). It took an artist to give us the iMac. And it was a marketing genius (yet another important skillset) to bring the artist and engineer together.
Teaching math goes far beyond creating mathematicians. Teaching art goes far beyond teaching artists. Societies that drop art because it is unproductive get ugliness permeating everywhere.
I'm not sure i agree witb the ratio. I think its much more lopsided. E.g. 100,000 artists in, one trillion dollar work of art out. (I'm counting indirect value. e.g. All the people who read Dune or a silent spring and become environmentalists as a result should have their value attributed to that work of art)
Also i'd point out the selection bias of not counting people who fail out of engineering school but still counting every unsuccessful artist.
I have this inner model of something i call "the rock star economics": many people want to do music but only one becomes a rock star and makes serious money. But he gets so much attention that many more people want to become rock stars.
Applies to art, fashion, media.
Most practical (including engineering) successes are much less externally attractive but do make decent money for everybody involved.
I know this is going to seem reductive, but especially with young children we teach art due to the value it gives them as individuals developing. Not for the GDP or individual fiscal benefit.
Further, judging the value of art to society by how much it costs is ridiculous and an asinine comparison.
People want news online, and they do not want to see ads, they do not want to pay a subscription.
So if you are media company and want to stay afloat, you need to appeal to the people who are either willing (or don't know otherwise) to load ads or willing to pay a subscription. In both cases, it's in large part people on the fringe. Not your average person.
This is wrong in 2026. Lots of people want to pay. See: TFA
What they don't want is and _still_ see ads, get hassled by needy marketing emails. See: TFA
If you're saying "we're gonna show you ads and datamine you because you're getting it free", then when I do pay, you have to take that stuff out. Try to have your cake and eat it too = sub canceled, adblock on, ad nauseam enabled.
NYTimes is probably spending less than $1-2,000,000/m to run their tech systems including the salaries of the tech people that keep it up and running. They made $2.82B in 2025, an increase of OVER 50% since 2020.
Let me preface this that I am a huge advocate for renewables, and have been spending borderline unreasonable amounts on turning my home green.
The rub with "solar is cheaper" is that those values are almost always calculated using an ideal environment. Solar is cheapest when you are using flat barren land in Arizona where an acre costs $500, the sun shines 330 days a year, you are bulk buying 750 MW of panels, and the bureaucracy is a single rubber stamp. Those are the numbers that ultimately trickle to headlines.
Things get much more complicated (read: expensive), when you are in the North East, an acre costs $12,000, the sun shines 170 days a year, you're bulk buying a few dozen MW of panels, and the bureaucracy is 6 different government bodies full of permits and assessments.
In that situation, a gas plant that produces 10x more power on 10x less land becomes very appealing to people who are already getting crushed by soaring electricity bills. (My take: we're just going to have to deal with higher costs).
So I am all with you on abandoning fossil fuels, but to someone who is firmly in gas camp, they will have legitimate ground to stand on when balking at costs. "It's cheaper" is unfortunately not all encompassing.
As someone in New England: We don't have enough gas infrastructure up here either, you can't just add more gas plants to our grid and accomplish anything.
As it is, in the coldest periods of winter you will at times see the ISO-NE grid running on 40% oil because we don't have enough natural gas pipeline capacity to run all of the gas plants and meet natural gas heating demands. So many of the gas plants have to kick back over to burning oil.
Building it out and maintaining it isn't free. And per a friend who's been selling consumer solar installations for years in the North East and gotten disillusioned: the equipment maintenance, repairability, and replacement story isn't great at the company they last worked at and results in a lot of environmental waste. One of the reasons they left. Of course, this is just second-hand information - I don't personally have much intuition for how widespread the issue is.
Every gallon of gas you use was produced far away, shipped halfway around the world for processing, and shipped back to you. Even if you are in the US, we basically don’t have the equipment to process our own gasoline from the crude we produce.
This means that millions and millions of machines have to be maintained, shipping lanes have to stay open, infrastructure has to stay profitable, distribution has to stay easy and cheap. The web is invisible to the end user, but it is massively complicated and expensive to upkeep.
Solar, once you have the panels you have to clean them every once in a while, and replace a failing panel every once in a while. But they produce for ~30 years after being made once.
So it’s funny to argue about environmental waste in this way. It’s an issue, but everything in a solar panel can basically be recycled and we are seeing the facilities start to come online as the first wave of PV panels starts dying off.
Residential solar doesn't make that much sense from a system point of view - it's a lot more expensive than utility grade solar for the same amount of energy, but with the way the energy market works retail electricity prices are much higher than wholesale prices and that makes the upside of rooftop solar a lot bigger for consumers.
The reason wealth taxes never go anywhere is because when you sit down and learn what wealth is, how it works, and what is practical, it makes the most sense by far to just tax things whenever they go back to cash.
Really the only genuine tax loop-hole is the step-up basis on inheritance. Everything else is just an elaborate deferral to pay taxes later.
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