> Second, once you tax some wealth away,
> it's not there next year to tax, either
> thru a wealth tax or an income tax. You
> can't keep pounding on the same asset
> indefinitely, as you can with an income
> tax.
This is wrong. The only thing that's not there is the fraction you took. In your 8% return, 1% tax example it works out as follows:
year 1 wealth - $1,000,000 year 2 wealth - %1,000,000 + 80,000 - 10,000 = $1,070,000
The wealth isn't "taxed away". It just doesn't grow as fast.
-- bill