Skip to comments.To Reduce Inequality, Tax Wealth, Not Income
Posted on 11/19/2012 6:03:29 AM PST by reaganaut1
WHETHER youre in the 99 percent, the 47 percent or the 1 percent, inequality in America may threaten your future. Often decried for moral or social reasons, inequality imperils the economy, too; the International Monetary Fund recently warned that high income inequality could damage a countrys long-term growth. But the real menace for our long-term prosperity is not income inequality its wealth inequality, which distorts access to economic opportunities.
Wealth inequality has worsened for two decades and is now at an extreme level. Replacing the income, estate and gift taxes with a progressive wealth tax would do much more to reduce it than any other tax plan being considered in Washington.
When economists try to measure inequality, they typically focus on income, because the data are most readily accessible. But income is not always a good gauge of economic power. Consider a group of people who all have high incomes but differ widely in their wealth. Whos going to get into the country club? Whos going to have the money to finance a new venture? Moreover, income data may not reveal the true economic power of people who are retired, or who receive their pay in securities like stocks and options or use complex strategies to avoid taxes.
Trends in the distribution of wealth can look very different from trends in incomes, because wealth is a measure of accumulated assets, not a flow over time. High earners add much more to their wealth every year than low earners. Over time, wealth inequality rises even as income inequality stays the same, and wealth inequality eventually becomes much more severe.
This is exactly what happened in the United States. A common statistical measure of inequality is the Gini coefficient, a number between 0 and 100 that rises with greater disparities.
(Excerpt) Read more at nytimes.com ...
I'm sure that if a wealth tax comes, it will be on top of an income tax, not instead of it.
No wonder they’re going out of business.
Only the suckers who actually work for a living are to be plucked.
If you want to see the Rats bail out on tax increases..the GOP should propose a wealth tax. All those trust fund babies and billionaires would be on the phone to DC so fast.
One thing he does overlook..is that we do have a partial wealth tax..it is real estate tax..plus dividend tax tends to be related to wealth.
Once ‘the people’ (read the state) possess all the wealth, the Marxist revolution is complete!
Who controls the means of production, (land , factories, etc.) controls the nation.
A tax on net worth would be better than an income tax. However hiding tangible and liquid assets is 100 times easier than hiding income. End all individual federal taxes and go back to tariffs and user fees.
This is the same idea that causes people to have to sell family farms or small business to pay death tax. No thank you. If the government needs revenue it isn’t because its not taxing enough, its because it is spending too much.
Actually, we had such a thing in Florida. In lieu of a state income tax, there was this creation called an intangibles tax that was levied on all personal financial assets. Each year, you toted up the value of your cash, savings and checking accounts, stocks, mutual funds, bonds, and any other monetary instrument (retirement savings were exempted) and paid a small percentage (around 1%-2%)of that amount. The system was scrapped several years back due to enforcement difficulties.
I think imposing a similar assessment on rich DemocRATS is a fine idea, but at a much higher percentage (say 25% annually). Dillweeds like Buffett and Gates dont have much in the way of real income, so they can piously (and hypocritically) talk about raising income taxes on everyone else. I suspect they’d start singing a different tune once their wealth and assets were targetted and they actually had some skin in the game.
Once "the people" possess all the wealth, it's all just parasites finishing off the long-dead carcass.
“From each according to their means to each according to their needs.” - NYT, Obama, Marx.
The mask is coming off.
i wasn’t able to find reader comments.
am i going blind or do they not want to hear what people have to say in about the piece?
No. Tax consumption, not wealth or income.
As night follows day, proposals to tax wealth will leave us with a permanent tax on wealth AND on income. The result will be bigger government, which is the Time’s real objective. But this proposes that society and the economy would be better off when government seizes $1.00 from the private sector and spends it on the welfare-warfare State.
What has previous spending given us? ObamaPhones and Solyndra.
Is Narcissim more about wealth or power. Soros worships money and power, but which one does he worship more? Barry likes power, but is too lazy to work hard at it.
Income/wealth inequality is a phony issue designed to rationalize hatred of the wealthy and theft from high earners. If my neighbor makes 100X as much as I do it has no effect on my income, freedom or lifestyle. In England they used this justification to steal 95% of income from high earners. It didnt increase revenue, so they abandoned it. Leftys never learn.
Yep. Consumption tax, and a consumption tax alone, would be the real only fair tax.
Income taxes punish hard work and tax the measure of your contribution to the economy (your salary).
Wealth taxes and investment taxes punish another input to the economy, because without investment, we have no economy.
Consumption tax taxes/punishes how much you take OUT of the economy.
Inequality is the primary motivator for the athlete on the field of any sport.
“I can win.”
Inequality is the primary motivator for the newly hired worker.
“I can improve my skills with this company.”
Inequality is the primary motivator for an inventor.
“I can build a better product.”
Without inequality there will be no fear of failure.
Without inequality there will be no grades at school,
No discipline at home,
No scores at a sports event,
No hope for change.
All will be equal
In the never-never land of Zombie Obamanation.
The ointment of Communist Equality
Will stifle all that it touches - - - .
The Slimes has really jacked up the liberal, progressive redistribution fight since the election.
Actually that might not be a bad idea. It would shut up The Gates and Warren Buffet and George Soros for while...either that or drive them out of the country. The reason why all these billionaires claim to be for higher income taxes is because none of them pay any income tax. They pay Capital Gains. The higher the income tax is on high earners the more exclusive their little club becomes and the harder it is for anyone else anywhere to attain their level of wealth.
Tax CRIME! (not income)
What's so great about reducing 'inequality'?
Seriously ... this is pure marxist class warfare ... steal from the rich and give to the
poor party members. "Inequality" in outcome is the right and necessary result of inequality in effort.
The whole premise of the article is Marxist, as several have already noted.
Perhaps a smart plan would be for government to require a pre-payment of the value of the foregone capgains and estate taxes to be remitted prior to establishing the tax exempt foundation. At least we'd be able to make honest men of those vocal tax advocates.
Wow, good catch...
What is the virtue or reducing inequality or equalizing outcomes. Inherently, with such a goal, you’ll reward bad decisions and slothful behavior while punishing good decisions and diligent behavior.
There’s no way around that.
We need to stop taxing production as well.
I wonder if any other nation taxes inventory on the factory floor the way we do?
Tax consumption, not income or property.
any sentient being that takes ten minutes to think this one through, will simply laugh. Just how would the government liquidate the “wealth”, so they can redistribute it? Or would the government just make in-kind transfers? Either way, the transactions costs would eat up all of the hoped for revenue, and the assets would no longer be productive. The Left assumes that incentives mean nothing, when they mean everything.
As an example, I hadn't know until now that the NFL is explicitly exempt for corp taxes under 501(c) sub-paragraph 6.
If you really want to make a dent in the national debt, withdraw the tax-exempt status of 501(c) organizations. Of course, the politician who tries that should ensure his life insurance is fully paid up.
When dealing with the leftists in Big Media, I find that one should always look for the hidden assumptions and covert premises. They’re not content to control the “what, where, when, and how” of the national conversation but must control the “why” as well.
So, is this not a method of taxing our IRAs and other pension funds? Those of who think it would be nice to hit the Buffets and other Lib-Dems, need to realize that this could easily be extended to home values as well!
As long as they start with Bruce Springsteen and Jay-Z, I’m good with it.
Oh, yeah, the Proverbs state “don’t answer a fool in his folly”, but to question the premises.
I’m fully aware of that and still started “wrestling with the pig” with arguing what kind of tax would be better.
Not that the Constitution matters to these people, but the 16th Amendment only specifically authorizes an income tax. Wealth taxes would have to be apportioned by states. Also taxing capital is one of the worst ideas ever.
To decrease inequality, tax the political ruling class elite for the benefits that they voted for themselves. Cost of living pay raises. Golden pension plans and health insurance plans.
From “You did not build it!” to “You do not own it!”
Good points. We should not concede that the goal is to remove inequality. The goal is to improve everyone’s standard of living
You might want to consider the recent election, its participants, and its outcome ... and then read Proverbs 26 in its entirety. I think it's a perfect description of the current American political scene.
When “you didn’t build that” was hot in the news,
I could not get a leftist to discuss what he policies he was trying to justify by stating that.
They simply denied that he was trying to justify policy, and was stating the concept that the society and infrastructure made success possible.
As for why he would state this (to justify a societal claim on the wealth of the successful), they would not even think about that, much less discuss it.
Perhaps those wealthy who are actually trying to good will get a waiver. Those involved in the green economy or those who support expanded female reproductive health services are most deserving.
God has given each of us different talents.
How we use these talents is dependent on each of us.
We are to be held accountable for our actions and inactions.
Communism is a lazy pipe-dream that ignores the reality of differences in each of our talents.
Thus the lazy take, but do not give.
The gullible give under pain of guilt from the lazy,
And thus there is NO Joy accrued to either the giver or the taker.
God loves a joyful giver.
There, fixed it.
Give no place hold for confiscation efforts
Oh yes, M2 Multipliers drop below 1 (Negative ROI)
New Investment, and hence, Employment, goes Bye-Bye
And Capitalism Fails.
When the economies move to a “World Bank”
I want me some Sulzberger fortune. Gimme gimme gimme!
I want me some Sulzberger fortune. Gimme gimme gimme!
Inflation is a very effective wealth tax.
If I remember correctly, Hillary broached this idea during her campaign. A classic way to make everyone “equal”. Don’t tax their earnings tax what they have.