Logo
    Search

    The Carriage Tax (Update)

    enJune 26, 2024

    Podcast Summary

    • Taxing unrealized gainsThe Supreme Court ruled that unrealized gains, such as profits from foreign corporations, can be taxed as income, but larger questions about taxing wealth itself remain unanswered.

      The Supreme Court has ruled that unrealized gains, such as profits from foreign corporations, can be taxed as income. However, larger questions about taxing wealth itself remain unanswered. The case in question, More v. United States, involved American investors in a business in India who argued they were being taxed on unrealized gains, not income. The Court ruled in favor of the government, but did not address the broader issue of wealth taxation. This debate, which has been ongoing since at least 1794 when George Washington proposed taxing the rich based on their wealth indicators like carriages, continues to be a contentious issue in American politics.

    • Carriage Tax DebateThe first US wealth tax, a carriage tax, was imposed in the late 1700s but faced opposition from those advocating for limited government, sparking a constitutional debate.

      The first federal wealth tax in the United States came in the form of a carriage tax in the late 1700s. This tax, imposed by George Washington and Alexander Hamilton, was a precursor to modern wealth taxes and sparked a debate about constitutional taxes. The tax was specific to different types of carriages and was opposed by a growing political party, the Jeffersonian Republicans, who believed in limited government. James Madison, a key figure in the party, used a clause in the Constitution to challenge the tax. This historical event highlights the long-standing debate over wealth taxes and the role of government in redistributing wealth.

    • Southern economy and slavery safeguardThe Constitution's clause on direct taxes was not only about property taxes but also protected the southern economy's reliance on slavery by requiring proportional contributions from all states, making it less likely for a direct tax on enslaved people to pass.

      The Constitution's clause regarding the apportionment of direct taxes among the states was not just about taxes on property, but also served as a safeguard for the southern economy and its reliance on slavery. This clause was added to ensure that any potential direct tax on enslaved people would require proportional contributions from all states, making it less likely for the northern states to pass such a tax. The anti-carriage tax group, led by James Madison, attempted to challenge this tax in the Supreme Court by finding a wealthy individual with a significant number of carriages to meet the court's minimum threshold. However, the reported figure of Daniel Lawrence Hilton owning 125 carriages was likely an exaggeration or a mistake.

    • Carriage Tax ConstitutionalityThe constitutionality of a carriage tax was debated in the late 18th century, with Hamilton arguing for its validity and the Supreme Court ruling in his favor based on a reasonable interpretation of the direct taxation clause, setting a precedent for future taxation debates

      During the late 18th century, the constitutionality of a carriage tax was debated in the Supreme Court. The debate centered on whether the tax was a direct tax as per the Constitution, which required apportionment based on state population. Alexander Hamilton argued for the validity of the tax, and the Supreme Court ultimately ruled in his favor, stating that the Constitution's direct taxation clause should only apply to taxes on land and slaves, and should be interpreted reasonably. This legal precedent set the stage for future debates on taxation and constitutional interpretation. Fast forward to the present day, and the idea of a wealth tax continues to be a contentious issue, with proponents arguing that the wealthy should contribute more to society.

    • Wealth Tax ConstitutionalityThe debate over the constitutionality of a wealth tax in the US dates back to the 1790s, with some arguing that a provision protecting direct taxes was intended to protect slavery and should not apply, while others suggest a constitutional amendment could ensure its legality.

      The debate over a wealth tax in the United States is not a new one, with arguments for and against it dating back to the 1790s. A wealth tax, which would tax individuals on their net worth rather than their income, has been proposed as a way to generate revenue from the wealthy who may not have large incomes but significant assets. However, the constitutionality of such a tax has been a point of contention, with some arguing that a provision in the Constitution protecting direct taxes was intended to protect slavery and therefore should not be applied to a wealth tax. Supporters of the wealth tax argue that this interpretation is not a slam dunk and suggest that a constitutional amendment could be the solution to ensure its legality. Despite these challenges, some scholars and advocates continue to push for the implementation of a wealth tax.

    Recent Episodes from Planet Money

    Do immigrants really take jobs and lower wages?

    Do immigrants really take jobs and lower wages?
    We wade into the heated debate over immigrants' impact on the labor market. When the number of workers in a city increases, does that take away jobs from the people who already live and work there? Does a surge of immigration hurt their wages?

    The debate within the field of economics often centers on Nobel-prize winner David Card's ground-breaking paper, "The Impact of the Mariel Boatlift on the Miami Labor Market." Today on the show: the fight over that paper, and what it tells us about the debate over immigration.

    More Listening:
    - When The Boats Arrive
    - The Men on the Roof

    This episode was hosted by Amanda Aronczyk and Jeff Guo. It was produced by Willa Rubin, edited by Annie Brown, and engineered by Valentina Rodríguez Sánchez. Fact-checking by Sierra Juarez. Alex Goldmark is Planet Money's executive producer.

    Help support
    Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.

    Learn more about sponsor message choices: podcastchoices.com/adchoices

    NPR Privacy Policy

    Planet Money
    enJune 29, 2024

    The Carriage Tax (Update)

    The Carriage Tax (Update)
    (Note: A version of this episode originally ran in 2019.)

    In 1794, George Washington decided to raise money for the federal government by taxing the rich. He did it by putting a tax on horse-drawn carriages.

    The carriage tax could be considered the first federal wealth tax of the United States. It led to a huge fight over the power to tax in the U.S. Constitution, a fight that continues today.

    Listen back to our 2019 episode: "Could A Wealth Tax Work?"

    Listen to The Indicator's 2023 episode: "Could SCOTUS outlaw wealth taxes?"

    This episode was hosted by Greg Rosalsky and Bryant Urstadt. It was originally produced by Nick Fountain and Liza Yeager, with help from Sarah Gonzalez. Today's update was produced by Willa Rubin and edited by Molly Messick and our executive producer, Alex Goldmark.

    Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+
    in Apple Podcasts or at plus.npr.org/planetmoney.

    Learn more about sponsor message choices: podcastchoices.com/adchoices

    NPR Privacy Policy
    Planet Money
    enJune 26, 2024

    The Vapes of Wrath

    The Vapes of Wrath
    When the vape brand Juul first hit the market back in 2015, e-cigarettes were in a kind of regulatory limbo. At the time, the rules that governed tobacco cigarettes did not explicitly apply to e-cigarettes. Then Juul blew up, fueled a public health crisis over teen vaping, and inspired a regulatory crackdown. But when the government finally stepped in to solve the problem of youth vaping, it may have actually made things worse.

    Today's episode is a collaboration with the new podcast series "Backfired: the Vaping Wars." You can listen to the full series at audible.com/Backfired.

    This episode was hosted by Alexi Horowitz-Ghazi and Leon Neyfakh. It was produced by Emma Peaslee and edited by Jess Jiang with help from Annie Brown. It was fact checked by Sofia Shchukina and engineered by Cena Loffredo. Alex Goldmark is Planet Money's executive producer.

    Help support
    Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.

    Learn more about sponsor message choices: podcastchoices.com/adchoices

    NPR Privacy Policy
    Planet Money
    enJune 21, 2024

    Why is everyone talking about Musk's money?

    Why is everyone talking about Musk's money?
    We've lived amongst Elon Musk headlines for so long now that it's easy to forget just how much he sounds like a sci-fi character. He runs a space company and wants to colonize mars. He also runs a company that just implanted a computer chip into a human brain. And he believes there's a pretty high probability everything is a simulation and we are living inside of it.

    But the latest Elon Musk headline-grabbing drama is less something out of sci-fi, and more something pulled from HBO's "Succession."

    Elon Musk helped take Tesla from the brink of bankruptcy to one of the biggest companies in the world. And his compensation for that was an unprecedentedly large pay package that turned him into the richest person on Earth. But a judge made a decision about that pay package that set off a chain of events resulting in quite possibly the most expensive, highest stakes vote in publicly traded company history.

    The ensuing battle over Musk's compensation is not just another wild Elon tale. It's a lesson in how to motivate the people running the biggest companies that – like it or not – are shaping our world. It's a classic economics problem with a very 2024 twist.

    Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.

    Learn more about sponsor message choices: podcastchoices.com/adchoices

    NPR Privacy Policy
    Planet Money
    enJune 19, 2024

    What's with all the tiny soda cans? And other grocery store mysteries, solved.

    What's with all the tiny soda cans? And other grocery store mysteries, solved.
    There's a behind the scenes industry that helps big brands decide questions like: How big should a bag of chips be? What's the right size for a bottle of shampoo? And yes, also: When should a company do a little shrinkflation?

    From Cookie Monster to President Biden, everybody is complaining about shrinkflation these days. But when we asked the packaging and pricing experts, they told us that shrinkflation is just one move in a much larger, much weirder 4-D chess game.

    The name of that game is "price pack architecture." This is the idea that you shouldn't just sell your product in one or two sizes. You should sell your product in a whole range of different sizes, at a whole range of different price points. Over the past 15 years, price pack architecture has completely changed how products are marketed and sold in the United States.

    Today, we are going on a shopping cart ride-along with one of those price pack architects. She's going to pull back the curtain and show us why some products are getting larger while others are getting smaller, and tell us about the adorable little soda can that started it all.

    By the end of the episode, you'll never look at a grocery store the same way again.

    Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.

    Learn more about sponsor message choices: podcastchoices.com/adchoices

    NPR Privacy Policy
    Planet Money
    enJune 14, 2024

    Bringing a tariff to a graphite fight

    Bringing a tariff to a graphite fight
    Graphite is sort of the one-hit wonder of minerals. And that hit? Pencils. Everyone loves to talk about pencils when it comes to graphite. If graphite were to perform a concert, they'd close out the show with "pencils," and everyone would clap and cheer. But true fans of graphite would be shouting out "batteries!" Because graphite is a key ingredient in another important thing that we all use in our everyday lives: lithium ion batteries.

    Almost all of the battery-ready graphite in the world comes from one place: China. That's actually true of lots of the materials that go into batteries, like processed lithium and processed cobalt. Which is why it was such a big deal when, earlier this year, President Biden announced a tariff package that will make a bunch of Chinese imports more expensive. Included in this package are some tariffs on Chinese graphite. He wants to create a new battery future—one that doesn't rely so much on China.

    In this episode, we get down on the ground to look at this big supply chain story through the lens of one critical mineral. And we visit a small town that realizes that it might be the perfect place to create an American graphite industry. And we find that declaring a new battery future is one thing, but making it happen is another thing entirely.

    Help support
    Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.

    Learn more about sponsor message choices: podcastchoices.com/adchoices

    NPR Privacy Policy

    Planet Money
    enJune 12, 2024

    How much national debt is too much?

    How much national debt is too much?
    Most economic textbooks will tell you that there can be real dangers in running up a big national debt. A major concern is how the debt you add now could slow down economic growth in the future. Economists have not been able to nail down how much debt a country can safely take on. But they have tried.

    Back in 2010, two economists took a look at 20 countries over the course of decades, and sometimes centuries, and came back with a number. Their analysis suggested that economic growth slowed significantly once national debt passed 90% of annual GDP... and that is when the fight over debt and growth really took off.

    On today's episode: a deep dive on what we know, and what we don't know, about when exactly national debt becomes a problem. We will also try to figure out how worried we should be about the United States' current debt total of 26 trillion dollars.

    This episode was hosted by Keith Romer and Nick Fountain. It was produced by Willa Rubin and edited by Molly Messick. It was fact-checked by Sierra Juarez with help from Sofia Shchukina and engineered by Cena Loffredo. Alex Goldmark is Planet Money's executive producer.

    Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+
    in Apple Podcasts or at plus.npr.org/planetmoney.

    Learn more about sponsor message choices: podcastchoices.com/adchoices

    NPR Privacy Policy
    Planet Money
    enJune 07, 2024

    The history of light (classic)

    The history of light (classic)
    For thousands of years, getting light was a huge hassle. You had to make candles from scratch. This is not as romantic as it sounds. You had to get a cow, raise the cow, feed the cow, kill the cow, get the fat out of the cow, cook the fat, dip wicks into the fat. All that--for not very much light. Now, if we want to light a whole room, we just flip a switch.

    The history of light explains why the world today is the way it is. It explains why we aren't all subsistence farmers, and why we can afford to have artists and massage therapists and plumbers. (And, yes, people who make podcasts about the history of light.) The history of light is the history of economic growth--of things getting faster, cheaper, and more efficient.

    On today's show: How we got from dim little candles made out of cow fat, to as much light as we want at the flick of a switch.

    Today's show was hosted by Jacob Goldstein and David Kestenbaum. It was originally produced by Caitlin Kenney and Damiano Marchetti. Today's rerun was produced by James Sneed, and edited by Jenny Lawton. It was fact-checked by Sierra Juarez. Engineering by Valentina Rodríguez Sánchez. Alex Goldmark is Planet Money's executive producer.

    Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+
    in Apple Podcasts or at plus.npr.org/planetmoney.

    Learn more about sponsor message choices: podcastchoices.com/adchoices

    NPR Privacy Policy
    Planet Money
    enJune 05, 2024

    How the FBI's fake cell phone company put criminals into real jail cells

    How the FBI's fake cell phone company put criminals into real jail cells
    There is a constant arms race between law enforcement and criminals, especially when it comes to technology. For years, law enforcement has been frustrated with encrypted messaging apps, like Signal and Telegram. And law enforcement has been even more frustrated by encrypted phones, specifically designed to thwart authorities from snooping.

    But in 2018, in a story that seems like it's straight out of a spy novel, the FBI was approached with an offer: Would they like to get into the encrypted cell phone business? What if they could convince criminals to use their phones to plan and document their crimes — all while the FBI was secretly watching? It could be an unprecedented peek into the criminal underground.

    To pull off this massive sting operation, the FBI needed to design a cell phone that criminals wanted to use and adopt. Their mission: to make a tech platform for the criminal underworld. And in many ways, the FBI's journey was filled with all the hallmarks of many Silicon Valley start-ups.

    On this show, we talk with journalist Joseph Cox, who wrote a new book about the FBI's cell phone business, called Dark Wire. And we hear from the federal prosecutor who became an unlikely tech company founder.

    Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+
    in Apple Podcasts or at plus.npr.org/planetmoney.

    Learn more about sponsor message choices: podcastchoices.com/adchoices

    NPR Privacy Policy

    Planet Money
    enMay 31, 2024

    So you've been scammed, now what?

    So you've been scammed, now what?
    We are living in a kind of golden age for online fraudsters. As the number of apps and services for storing and sending money has exploded – so too have the schemes that bad actors have cooked up to steal that money. Every year, we hear more and more stories of financial heartbreak. What you don't often hear about is what happens after the scam?

    On today's show, we follow one woman who was scammed out of over $800,000 on her quest to get her money back. That journey takes her from the halls of the FBI to the fraud departments of some of the country's biggest financial institutions. And it offers a window into how the systems that are theoretically designed to help the victims of financial cybercrime actually work in practice.

    This episode was hosted by Alexi Horowitz-Ghazi and Jeff Guo. It was produced by Willa Rubin and edited by Keith Romer. It was engineered by Neal Rauch and fact-checked by Sierra Juarez. Alex Goldmark is Planet Money's executive producer.

    Help support
    Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.

    Learn more about sponsor message choices: podcastchoices.com/adchoices

    NPR Privacy Policy
    Planet Money
    enMay 29, 2024