Not since the Great Recession has the top 1% received as much spite. The rise of socialism in the Democratic party, the rising popularity of policies such as increased taxes on the wealthy and the overall success of companies like Amazon or Wal-Mart have been largely the source of the spite.
Presidential candidate and Democratic Senator Elizabeth Warren (Mass.) for instance, is running on a wealth tax in her bid for president.
Warren’s plan specifically would stamp a 3% yearly tax on households with a net worth over $1 billion and 2% yearly tax on households with a net worth between $50 million and $1 billion.
This plan would hopefully cover, “clean energy, affordable housing, Social Security benefits, universal childcare, increased spending on public schools, student debt cancellation, free college and Medicare for All.”
However, Warren’s proposals would cost $49 trillion in a 10-year span. Even the doubling the 3% to 6% tax households with a net worth over $1 billion would only cover $3.75 trillion in a 10-year span.
After receiving criticism from Wall Street, Warren tweeted, “We hear a lot of crying from billionaires about my #WealthTax that will make them slightly less outrageously wealthy. I want to hear more from the families whose lives would be transformed by universal child care and student loan debt cancellation.”
Warren’s wealth tax cannot explain how it would cover her proposals, and that’s a symbol for how dysfunctional a wealth tax can be.
Simply put, the wealth tax has been attempted and failed.
The countries of France, Germany, Sweden, Denmark and the Netherlands have implanted a wealth tax, only to repeal it. France for example lost a net 3.5 billion euros a year, according to French economist Eric Pichet. So the country actually lost money with wealth tax.
The reality is that 1% do their “fair share” in taxes. In 2016, the 1% accounted for 37.3% of all income taxes paid, with the amount totaling $538 billion according to the Tax Foundation.
“The 2016 IRS data shows that taxpayers with higher incomes pay much higher average income tax rates than lower-income taxpayers,” the Tax Foundation reported.
Also, notion that the middle class is dying is simply untrue. The upper middle class has doubled since 1979, rebutting the middle-class dying mentality.
“The upper middle class made up 12.9% of the United States population in 1979 and had grown to 29.4% of the population in 2014,” reports the Urban Institute.
Looking at policies such as the wealth tax, it seems like the push against the 1% isn’t out of attempting to decrease poverty, but rather rage against the wealthy.
As President Calvin Coolidge once said, “Don’t expect to build up the weak by pulling down the strong.”