Wait long enough, and great ideas come back around, although not necessarily wearing the same garb. Elizabeth Warren has just come out for a 2% wealth tax (above $50 million).* But this is simply an annualized version of my lump sum stochastic jubilee. What’s the advantage of redistributing the whole thing every 50 years (on average) vs a steady trickle? A periodic reset would interrupt long run processes of wealth inequality more fully than a tax, so long as the rate of return on financial assets is high enough to compensate for the extra annual pinch, which it most likely would be, since wealth holders would demand a higher rate of return. It would also be a lot more fun. On the other hand, it would be more complicated to administer and might be resisted by force.
On balance, I’d go for the jubilee, but I’ll take Warren’s version as a close second.
*There’s also an extra 1% on wealth in excess of $1 billion, but this is largely symbolic.
Constitutional question about fed tax on wealth? ??? Apparently we can acquire pretty much the same 2% of wealth revenue from roughly the same people with an income tax surcharge of 20% on income above $50 million. Income tends to be pretty regularly 10% of wealth for this group. (graph provided)
“In 1999, billionaire Donald Trump proposed a “one-time” net worth tax of 14.25 percent on people worth $10 million or more to help pay off the national debt. He claimed it would raise $5.7 trillion … ”
https://www.usatoday.com/story/opinion/2018/07/31/trump-1999-wealth-tax-lower-deficits-reduce-inequality-column/826224002/
Guess no one plays board games anymore. But there was a time when most people were familiar with the game Monopoly. And it is a pretty good teaching tool regarding end stage capitalism and extreme unequal distribution of wealth. At first the game is fun. Everyone has a grand time. But near the end of the game just a couple of people have all the property with hotels on everything. Every time you roll the dice, no matter where you land you have to pay one of those assholes. There is no escape and there is no doubt who is going to win. If you insist on keeping the game going you will have to spread the wealth around. Otherwise you will have to dump the whole board and start over.
SW,
Maybe we could program an every loop redistribution tax (maybe every so many times around) to keep the game going almost forever. Guaranteed to get Democratic presidential candidates’ endorsement. :-O
This are funny ideas, if we think about who controls the government.
As neoliberal oligarchs are the real winners of each Presidential election theoretically it might be logical to have Election tax: a “wealthy tax” after each Presidential election.
Say 10% for those who continued to the winner, and 5% for those who contributed to the loser, and 2.5% for whose who did not make any election contributions 🙂
But, of course, this is just a dream…
I think all wealthy people keep track of their net worth. There are a lot of online tracking applications out now.
It is misleading to glibly say thus will be administratively hard to have sych a regime.
Compliance efforts also assist with the income tax regime too as most audits in compliance start with wealth depictions over a period so income flows can be lawfully explained. So current tax audits are already doing net worth compliance (afterall, this is a stock and flow analysis fir both regimes).
Misleading to imply otherwise about administability, though you can see why the wealthy do not like the ideas here, better compliance on income taxation and net worth taxes too, my goodness, we might be able to lower tax rates elsewhere if people if weakth actually paid what was truly owed!
JF:
Welcome to AB. First time posters go to moderation which allows us to weed out advertising and spammers.
JF,
I am sure that most wealthy people know their net worth on a specific day. How do you treat someone whose wealth can decrease so suddenly in a short time?
Friend of mine bought Lehman over the years. His net worth plummeted when it died. Qualcom, etc. Real estate values?
How does that work?