May 03, 2016 3:10 PM GMT
now clickable: http://goo.gl/rkBXBY
We can't just tax billionaires’ paychecks. We should tax the wealth they've already amassed.
...The problem with wealth inequality, after all, isn't simply that it's been growing steadily over the past 30 years. The problem is that it's showing no signs of stopping in the near or distant future.
And things are going to get worse.
The Long View
Short of an all-out, torches-and-pitchforks revolt, reducing structural inequality means going through the legislative process—most particularly, reforming the tax code. But with an intransigent Republican Congress, a campaign-finance system dominated by wealthy donors, and a dispirited and deeply divided public, it’s clear that legislative change isn't going to come soon.
That places us in what Alperovitz calls “pre-history.” We have to lay the foundation for change without knowing when it will come.
His heroes, Alperovitz says, are the civil rights workers of the 1930s and ‘40s. They took on insurmountable odds—as well as serious personal risk—to lay the groundwork for what would become the very successful civil rights movement of the 1960s. They knew they might never see the fruits of their labor—Jim Crow and its supporters in Washington seemed impossibly entrenched—but their efforts made it possible for success in the unknowable future.
With the benefit of this long view, we can look past election cycles to see what solutions would actually solve our serious problems. On wealth inequality, that means a direct tax on concentrated wealth...
...The Rumblings of History
Consider a flat, 1 percent wealth tax levied exclusively on the wealthiest 1 percent of households.
The top 1 percent controls 42 percent of the nation’s household wealth, about $26 trillion in total. In its simplest form, a 1 percent tax would raise $260 billion annually—more than the federal government now spends on education and environmental protection combined.
Because most money managers are able to deliver investment returns greater than 1 percent, the impact on those taxed would be negligible. Of course, implementing a progressive wealth tax with even higher rates on the 0.1 percent could yield more revenue still.
Taxing wealth directly strikes at the heart of the problem Piketty describes using his mountain of historical tax data: Capital, left unchecked, will inevitably concentrate at the very top. That’s why other solutions won’t solve the problem...