Wednesday, January 22, 2020

Tax the rich! - the rich say it's OK

Here's something you don't see every day: a bunch of rich, old, white guys who want to pay more tax.
As a movement, the Patriotic Millionaires still in its infancy, but in the wake of this year's Davos meeting, they are becoming more vocal. It's an American operation - hence the "patriotic" part - this far, but they want to go international.
So, these are people who have made it, and who want to give back. Examples include Disney heiress Abigail Disney, ex-Blackrock managing director Maurice Pearl, Men's Wearhouse founder George Zimmer, real estate developer Jeffrey Gural, Oscar Meyer heir Chuck Collins, MOM's Organic Market co-founder Scott Nash, etc, etc.
Some of them just feel that it is unpatriotic for rich people to evade taxes; some see the growing inequality as a threat to a healthy society (what you might call "enlightened self-interest"); some want to see a wealth tax, some just an increased income tax on the rich; some think it is just plain wrong for rich people to salve their consciences by making splashy charitable donations, because spending priorities should be set by the people (or at least their elected representatives) and not by rich folk who want to see their names up in lights; and some see a huge irony in the fact that "the Trumps, the Zuckerbergs, the Buffets of this world pay lower taxes than the teachers and secretaries".
In 2018, American billionaires paid 23% of their income in federal, state and local taxes, while the average American paid 28%. If you were wondering how, there are several different ways in which billionaires can reduce their tax burden: by mainly taking their income as lower-taxed capital gains rather than as earned income, by taking tax write-offs for charitable donations, by employing highly-paid tax lawyers and accountants to look for loopholes and schemes, by taking advantage of tax breaks for job creation, and by voting in fellow billionaires like Donald Trump, who substantially reduced corporate taxes and introduced billionaire-friendly perks like the bonus depreciation of fixed assets.
So, while "Patriotic Millionaires" doesn't immediately sound like something I would approve of, it actually sounds like a worthy enterprise, and long overdue.

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