A 70% marginal rate on incomes above $10m doesn’t phase me, but it’s worth keeping in mind that most European countries collect ~2x the share of GDP in taxes than does the US. That’s collected from broad, high ~40-50% taxes. Not just taxes on billionaires.
When society is broadly funded by everyone, there’s a very different stake in the project. Less “us vs them”, more “all of us”. Same with sense of being proud of what you’re paying for. Contributing ~half your pay so everyone can get healthcare and get higher ed isn’t a bad deal.
Besides, while it’s exciting to think of a 70% tax on incomes above $10m, much of the money very rich people make doesn’t come in the form of “income”, but in the form of capital gains. Unless you tackle that head on, you’re pissing in the wind.
Putting income inequality at the center of the political discussion is absolutely the right move. But it’d behove the cause to look at successful welfare-state models from countries that have figured out how to have high public trust in their institutions and structures.
While the average Dane or Spaniard or German might complain about taxes, I’ve found it exceedingly rare to meet normal people who would trade a tax rate of 45% for one of 20%, if that meant a US-style society of medical bankruptcies and student debt traps.
That is to say: Broad, social programs and institutions are worth paying for! Whether you’re a billionaire or not. How much would it be worth to you not to worry about medical expenses or student loans? I imagine quite a lot.
You can follow @dhh.
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