https://www.forbes.com/sites/danalexander/2019/01/25/elizabeth-warrens-new-wealth-tax-could-cost-billionaires-85-billion-a-year/#e07c29ff540e"Presidential contender Elizabeth Warren suggested a new tax on the rich Thursday that could cost American billionaires $85 billion a year, according to a Forbes analysis. The plan would not directly affect anyone worth less than $50 million, but it would subject those with fortunes of more than $50 million to a 2% incremental wealth tax. The rate would rise to 3% for any fortune that crossed the $1 billion threshold.
That means billions of dollars would be transferred from the richest Americans to the larger population. Jeff Bezos, whose $137 billion fortune makes him the wealthiest person in the world, would have to fork over $4.1 billion annually under such a plan. Bill Gates would pay an additional $2.9 billion in taxes, and Warren Buffett would owe $2.5 billion more. President Donald Trump, whose estimated $3.1 billion fortune made him the 259th-richest person in America as of September, would owe an additional $80 million.
“We are now in an America where one-tenth of 1% has about the same wealth as 90% of America,” Warren, a senator from Massachusetts, said in an appearance on MSNBC. “And here’s the deal. Forty percent of America today can’t come up with $400 bucks in an emergency. That is not an economy that is sustainable, and it’s not a democracy that’s sustainable.”
Some billionaires who would be paying the tax characterized it as a step toward communism. “The leftists are ‘communist light’ for now,” Rockstar Energy Drink founder Russ Weiner, who is worth an estimated $4.5 billion, wrote in an email to Forbes. “They will continue to get more dangerous with their demands and actions. It will never be enough.”
Frank VanderSloot, who grew up poor and now sits atop a fortune worth an estimated $4.2 billion, offered a more measured reaction. “On the surface, it’s such an easy sell to sell people, especially young people,” VanderSloot said, “that hey, if we just took from those that had it, and we took it and kept it ourselves or gave it to people who don’t, wouldn’t that be a wonderful thing? I mean the whole idea of Robin Hood was Robin was the hero, right? But it’s been tried. And it creates an economic disaster.”
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Beyond the issue of Constitutionality which is interesting in and of itself, would this actually be effective and by effective I mean would it bring in more money over the long term compared to leaving that money in the hands of billionaires so they continue to invest and grow it and they keep paying taxes on the income from it? That's where I'm most skeptical. Warren talks about how much money it will take in but is she factoring in how much will be lost over time because income tax won't get paid on that money anymore?
There's also the concern that it will start at the top and work it's way down to your average Joe millionaires who may only have one to a few million dollars, and may eventually work it's way down even further still until people with a few hundred thousand dollars in savings may get a "nominal" 10k asset tax put on them per year. That won't kill anyone with that much money. So there's the camel's nose in the tent, foot in the door, slippery slope thing to worry about too.
I wonder if Warren and others would still support doing this even if it wouldn't really benefit the economy or the Treasury after all the dust settles and they'd still be in favor of that just because it's more "fair".
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