Lest you think that the senator covets your little stash of savings/ investments, think again. Warren's plan to apply a 2% per annum wealth tax only to net worth over $50 million would impact only about 75,000 really, really rich families. (Her "Billionaires' Surtax" would add another 1% to households worth more than a billion bucks.) So, let's say you're sitting on a $500 million nugget; after paying the multimillionaire's tax, you'd have to squeak by with only $491 million this year.
Meanwhile, the benefit of Warren's plan to America would be phenomenal. Two preeminent experts on tax inequality, Emmanuel Saez and Gabriel Zucman, calculated that it would add $2.75 trillion into our public treasury over 10 years that could fund health care, social security, student debt, infrastructure, and more.Chicken littles
Oh, Sweet Jesus, shriek the Koch brothers and other harpies of laissez-faire plutocratic rule. In a sweaty panic, they wail that Warren's wealth tax would kill incentive for individuals to innovate, crush the free enterprise system, and destroy America itself. Confiscation! scream the elites from their taxpayer-subsidized corporate suites.
Their attitude is typified by Michael Dell, billionaire chieftain of his eponymous computer corporation. In January, at the annual gathering of global corporate royalty in posh Davos, Switzerland, Dell was asked about Rep. Alexandria Ocasio-Cortez's proposal for a top tax rate of 70% on mega-fortunes. With the pompous self-assurance of a clueless CEO, Dell suggested that it would destroy an economy. "Name a country where that's worked," he scoffed.
Uh ... how about the USA? The very wealthy's tax rate averaged:
- 72% through the early years of the income tax, 1917-21
- 78% through the Depression years, 1932-45
- 91% through the prosperous Eisenhower years 1953-61
- 70% even through the corporate-friendly years of Nixon, Ford, and Carter, 1969-81.
So, Michael, for more than half the time we've had income tax, the assessment on extreme wealth has topped 70%. And those periods included many of the best-performing years of the US economy, while periods of skewed prosperity have mostly come in the years (Harding, Coolidge, Hoover, Reagan, Bush I, Clinton, Bush II, Obama, and Trump) when the ultra-rich hid behind the tax tree.
The privileged ones rationalize their special tax treatment because they believe they are, well, special: rugged, entrepreneurial individuals, self-made wunderkinds who built their own fortunes. Elizabeth Warren sets them straight:
"There's nobody in this country who got rich on their own -- nobody. You built a factory out there? Good for you! But I want to be clear: You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police forces and fire forces the rest of us paid for. You built a factory and it turned into something terrific ... God bless! Keep a hunk of it. But part of the underlying social contract is you take a hunk of that and pay it forward to the next kid who comes along."
There is no reason our society should be shortchanging the common good by coddling a few gilded families easily able to pay for the privilege of living in a country that has so lavishly enriched them. Indeed, putting that 2% to work expanding economic opportunity for all could enrich them further -- but, more importantly, would help reverse the toxic spread of inequality devouring our social cohesion, economic potential, and democratic aspirations.Getting it done
There's nothing inevitable about inequality. It's an injustice that the moneyed powers and their political hirelings have chosen. We The People can choose a brighter path, one that bends toward justice. Starting with a wealth tax.
But how can we best the billionaires and their brawny political blockers? Not by going around them, but by pushing right through them.
First, years of rank avarice and arrogance have caught up with the super-rich and their enablers, turning "billionaire" into a synonym for "thief," and focusing rising public anger on the inequality they've fostered.
Second, that anger has generated a stunning level of popular enthusiasm for the wealth tax. A New York Times survey found that 6 in every 10 Americans favor Sen. Warren's plan:
- 75% of Democrats
- 57% of Independents
- Wow! 51% of Republicans
Third, not all billionaires are jerks. Eli Broad, a former union auto worker who built two Fortune 500 corporations, is a leader among a small group of super-rich Americans who:
[S]imply believe that those of us with great wealth must commit to reducing income inequality, starting with the demand to be taxed at a higher rate than everyone else. "The old ways aren't working, and we can't waste any more time tinkering around the edges. I have watched my wealth grow hugely thanks to federal policies that have cut my tax rates, while wages of regular people have stagnated and poverty rates have increased. A wealth tax can start to address the economic inequality eroding the soul of our country's strength. I can afford to pay more, and I know others can too. What we can't afford are more shortsighted policies that skirt big ideas, avoid tough issues, and do little to alleviate the poverty faced by millions of Americans. There's no time to waste."
In June, 20 other extremely rich Americans sent an open letter to all 2020 presidential candidates, declaring...
"America has a moral, ethical, and economic responsibility to tax our wealth more. We're joining the majority of Americans already supporting a moderate wealth tax. We ask that you recognize its strong merit and popular support, and advance the idea to tax us a little more."