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A Wealth Tax Could Raise Trillions — and Save Our Democracy

A Wealth Tax Could Raise Trillions — and Save Our Democracy

Chuck Collins

Sen. Elizabeth Warren (D-Mass.) has jolted the body politic with a bold proposal to tax the concentrated wealth of the richest 75,000 households in the United States. It’s about time someone took up this mantle.

I agree with everything Chuck Collins said. But we must go further: We also need to prevent people from accumulating vast wealth in the first place. One way to do this is to implement a maximum wage. This could take the form of a 100% tax on all income over $1 or $2 million. See, for example, Sam Pizzigati’s book, “The Case For a Maximum Wage”. This book makes the case that we need a maximum wage in order to prevent the dangerous formation of politically-powerful dynasties built on fantastic wealth. The author proposes a maximum wage that is based on a fixed multiple (say, 100) of the minimum wage. This would be achieved by a 100% tax on income above that multiple of the minimum wage. The genius of this idea is that, if passed and enforced, it would give the super rich an incentive to support raising the minimum wage.

“I don’t have a billion dollars. Oh, that? That’s a trust account for my dog.”

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HI Robert_ Baillie:

That’s a great idea, a MAXIMUM wage. The nation would be the better for it, because maybe good deeds or good works would become the items to covet! Humans do seem to have a covet gene.
In ancient Greece, the rich were expected to improve the city-- and another thing —ALL men citizens went to war, so in that ancient culture a person couldn’t vote for war and then stay home . AND----- losing generals were ostracized : )

The wealth tax should replace almost all taxes; the $300 billion per year tax, which is the Senator Warren proposal, is about 1/10th the appropriate size of the tax. A wealth tax could easily bring in $3 trillion a year, and it would make our economy healthier. Consider that in January 2009, after the fall of the stock market, the total net worth of all U.S. households was $48 trillion. Net worth had fallen by 24%, from $63 trillion to $48 trillion. (You can check the Federal Reserve’s Flow of Funds report for the years 2005 and up, especially looking for the $48 trillion figure.) Today total private U.S. household net worth is over $109 trillion, as of December, 2018. Net worth increased nominally by $61 trillion in under ten years, that’s an average of $6.1 trillion a year. The federal government this year had $4.1 trillion in expenditures, and that is less than the growth of total wealth. The ratio of wealth to GDP is at a historical high. The value of financial assets has increased with little relation to its underlying productive value. Value is distorted, resulting in excessive valuation for financial assets. That chimerical, fantasy value is also real, those are real dollars. They should be taxed. The property tax on residential property collected about $500 billion last year, see the Tax Policy Center for exact amounts. If financial assets were taxed at the same rate as “tangible property”, then about $1.2 trillion would be raised. But they should be taxed at about double the $1.2 trillion rate. Roughly we could raise $2.9 trillion and balance the budget, while including revenue from the payroll taxes. My argument is that the surplus of our society’s production, GDP, is syphoned off by the richest, the 1%, and they have no productive outlet for the surplus, so they stuff it into financial assets which accelerates and inflates the value of these paper assets. This process is a sign of a dysfunctional economy. Resources are being wasted, human well-being is sacrificed. The ALICE report from the charity United Way examined well-being across the nation and finds that 40% of households cannot afford seven basic needs of life: food, shelter, utilities, medical care, transportation, phone services and child care. So we, the nation, are strangling our well-being for the sake of the super-wealthy who have no practical purpose for all their wealth. It’s time for a big change. James Kwak, economist and co-author with Simon Johnson on two books, has proposed a wealth tax that should be looked into. But Warren’s tax is too small, but a good beginning. My blog: http://benL8.blogspot.com, Economics Without Greed. One might also read the EPI.org report called The New Gilded Age, which shows that since 1973 58% of the economic growth of the nation went to the top 1%, (see page 12 of the pdf version of the report).

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I proposed something similar a while ago, with excess income going back into the company, or reverted to the treasury.
Someone rightly commented that giving the excess to taxes is taking a chance it ends up in the hands of the Pentagon or MIC.
I like the idea of top end returns though. It would mean ultimate success. No need to chase rainbows any longer.

Not meaning to rain on any parade, but, wage-slavery is more often a well-paid occupation. How wages are spent is the pertinent question, whether oil or electric, where is the investment? Then, wait for it,
Tell self-driving car jokes! Badahboom~Pchyeuw!

I would hope that if we implemented a plan to limit how rich someone can be, that we can make sure the money is put into the right hands.
But the chances for either are probably quite small. First the chances that we will be able really tax the rich so that they are merely rich is nigh impossible. And getting the money pass all the special interests that demand the money that is taken from the rich will be another nigh impossibility.
I like the optimism though. Maybe we can get angels to dance on the head of a pin.

The vastness of options for the super rich to shelter their money is unprecedented , so realistically there is not any silver bullet solution. Usually if only one solution is proposed it is a fake populist slogan. I am not suggesting against it raising taxes but if you rock the boat doubling it might very well cusize it. Moderate increase inline with other countries must be done but paired with other policy changes.

HI Wellan. I thin the sorties wage slavery can be beneficial----because the minimum in Congress rate is $174,000 a year, and there are a lot of not only useless, but stupid people in Congress----so for many of those, $174, ooo is way too much! : ) I agree on some monetary levels. But, for example, for Mitch McConnell —to still have a $7.25 minimum wage rate, but apparently waiters and waitress make under $3---------that just seems i human treatment, from the supposed “richest nation in the world.”
Then too, from what I have read of the scary Feudal NAFTA, I cannot reconcile how that could possibly exist ina democratic republic-----but then Mr. Clinton always had other----hmmm let’s say "distracting things on his mind. : )

“A great idea, a MAXIMUM wage. The nation the better for it because good deeds or good works would be the items to covet. In ancient Greece, the rich were expected to improve the city. In that ancient culture a man couldn’t vote for war and then stay home.”

Have you played my domino game yet?

Play a game of dominoes:
30 domino, all fossil fuel uses - transport, household, manufacturing, agriculture, chemical, etc in category or class, 2% and under to 25% for transport, 40% for household/industrial uses, etc. The object of the game is to guess which domino to tip first, the others to follow. Answer to the game: ONE hint: The first domino is assumed to be a near 2% or least polluting domino. Write your guess in simple terms the first fossil fuel domino to tip. Projection: Measurable progress in 5 years, after the next 2 years of wasted effort fighting warmonger thiefdom.

Hi Wellan, I think the 1st domino choice will vary depending on a person’s circumstances.
For example, my heater is broken but fortunately I am not in Chicago. : ) And the repair os coming tomorrow. However, I would choose heating oil today. Maybe tomorrow, if I had to be some where far away I would want gasoline, or if the day after that I wanted some more warm clothing, I would spend that domino on an industrial use to create clothing.
It would all depend on the state of the society at that moment and in America things can change faster than ever with gains and loses happening so often. : )

Here’s another hint which domino gets tipped first:
I do not support efforts to reach 100% off fossil fuel energy.
Fuel distribution for many purposes cannot be replaced.
The question is for what purposes may some fossil fuel use continue.
The object of the game is to think fossil fuel uses through.
For your effort you get a shiny little star to stick on your lapel! yea!

HI Wellman: I still think it depends on who is using and for what.
As an Earthling, I would want fuel for heat and cooking----but Mr. Bolton would choose planes, ships , bombs and drones.
AND SO, since the Bolton is larger and crazier than I-----I think WAR uses would be the chosen thing-----because when people are warring they forget about needful things like food and heating. However, once the planet is destroyed, there won’t be much need for lots of things----but if Bolton is still alive, I think a lot of people would vote to boil him in oil, : )

I’ve been lately listening to Claude de bussy Claire de lune, often in reverse rewind. German English translation Trump namesake, Drumpf - “doo doo butt”

and not in a good way doo doo butt. Like outhouse contractor/builder/maintenance personel janitorial dispensable human beings.

Read Jules Vernes First Man on Moon pioneering Sci-fi novel. U wonbeleevit future.

HI Wellman, I’ll look up that Jules Verne story. : )

Jules Vernes in the 1890’s decided an anti-gravity device was the means to reach the moon. I’ve been having a little fun toying with that idea. I don’t believe in colonizing Mars though the moon could see a base. Space exploration for science purposes only. OTOH, I’m thinking anti-gravity could reach perhaps 1/60th the speed of light and run on hydrogen. Too bad the world’s so messed up right now with the fascist ruling class ready to start WWIII.

HI Wellan, I’m still reading Jules Vern re : his moon story and trying to get used to the style of writing, but I will finish by tomorrow. Hmmm well as the speed of light is a constant, if I divide 186,282 miles per second by your for 1/60---- that gets 39,000 and some seconds----but I don’t know what lif toff requires----so after knowing a few space things—the rest and the most of it is as mysterious as pi is to me: ) However, I will finish the story of the Gun Club people as I want to know how it ends!

If our 536 s/elected officials don’t agree, it’s time for a “tar and feathers” party!

Though a Wealth Tax proposal is a step ahead, it won’t pass the best government money can buy. Also, giving tax revenues for corporate politicians to spend doesn’t seem like a good idea.

A Wealth Cap, established by yearly referendum would do the trick. All cap excesses could be shared equally by the public who can better use the money. Capping wealth would prevent power centralization and oligarchy. A Wealth Tax would not.