The Ultra-Wealthy Who Argue That They Should Be Paying Higher Taxes
newyorker.com
newyorker.com
When these people say "I should be paying more in taxes", they mean that the marginal tax rate should be much higher than it is for high levels of income, not that they'd love to throw in an extra couple of million but can't figure out how to do so.
1.The rich propose higher taxes for themselves
2.The middle class and the poor approve that gesture, as it's "distribution of wealth"
3.Legislative and executive branches approve higher taxes for people who earn above $100k/year
4.The rich manage to not pay those taxes using all sorts of devices
5.The middle class now pay more taxes
5.The government uses the extra income to grow its own size and support the rich through cronyism
I'm not saying your scenario is invalid or unlikely, but it's not the one I've been part of.
If you try for a revenue-neutral change, and the rich somehow avoid paying their taxes, I fail to see how this would result in the middle class paying more taxes without a further tax change.
If the rich avoid taxes, then we should change the tax code, including incentives and enforcement to overcome this. Don't just throw up your hands when you face a problem.
I'm in for that. Make taxes optional, so that if you believe they are a good thing, you pay taxes. If I think they provide no value to me, I pay no taxes and instead I contract services in the free market. That way everybody is happy and get what they want.
That's why we have government because otherwise we can't have nice things (note: in many cases that even doesn't work either but that's the imperfect system we have and need to improve - the alternatives like "self regulation" have been proven throughout history to not be scalable).
On the contrary, self-regulation is now the preferred form of government. It used to be the case that most governments were led by an entity outside the government and outside the purview of the state and society (a monarch). Today most countries are democracies, which means self-regulation of the society by the people that constitute that society, typically via some kind of elected leadership positions (but not always).
Self-regulating markets have also proven to be the most straightforward way to feed and house and provide a middle-class life for most people. Certainly superior to the more planned economies that preceded it.
You probably know this, as do most people making this argument.
Yes, but this is not a valid criticism of the argument. If you believe in raising taxes on yourself and people like you, then you ought to lead by example, and voluntarily pay the extra taxes you would like to pay yourself, while proposing the law forces others to do the same. For example, it would be hypocritical of me to suggest that the law mandate parents care for their children while neglecting my own. Similarly, the 'ultra-wealthy' who are arguing for higher taxes while not voluntarily paying them are hypocrites.
You probably know this, as do most making this argument.
If you believe that instead of giving to charity or something that the best use of your money is taxes, why would it matter if there was an official change to the tax code or not?
Leadership would be paying extra taxes regardless of whether or not the taxes are raised across the board.
It feels kind of slimy to me to say "oh yes we should all pay extra taxes but I won't do so unless the government officially raises my tax rate" - uh so you mean you don't believe in paying more taxes unless the government forces you to? Like the rest of us?
It is definitely more along the lines of moral posturing to me. At least I know where someone stands when they don't want taxes to be raised.
It's like if I buy a big SUV and say that I think we should all drive EVs but I'm not going to do it until someone makes me, but I really believe it!
Uh. Ok. Sell the SUV and buy the EV?
To ensure everyone does it.
Are you suggesting no rich people should support higher taxes unless they volunteer more tax money now? Or what exactly is your point here other than a "ha ha, gotcha!"?
My ire is more directed at billionaires who do such things as publicity stunts as they lobby to lower taxes - especially for their corporations, but essentially, yes. Nobody forces people to use loopholes to lower their tax rates or take deductions, or use a variety of different methods to lower their tax burdens. If they think taxes should be higher on themselves, why do they need to wait until the government raises the tax rate?
* I pay $100,000 in taxes but I think I should be paying $200,000 because I'm altruistic (more likely you want to be well-liked and seem like a good person)
* Here is a link to pay an extra $100,000 in taxes
* ???
I'm not sure how that's a "gotcha". If you say you believe in it, what's stopping you?
There are a lot of things you can do that are not “complain but do nothing”.
-Khrushchev, probably
They're talking about solving problems on a scale of a country the size of the US. A few extra bucks from some small number of wealthy people is meaningless.
That implies that the tens of billions of dollars spent by the rich on charitable donations wouldn't make an impact if given to the government, doesn't it? If that's the case, why tax them for that amount?
The 2019 federal budget was $4.407 trillion. let's say we're talking about $20B in voluntary tax overpayment (good luck with that!), which would represent .004914% of the budget. That would pay about 3% of the interest on US debt in the last year. It would change nothing.
However, increase the marginal tax rate and you're talking about real money. Maybe in the meantime we can spend a little less on the military, but that's a tough sell too.
This is basically why the first iteration of the United States fell apart: the Articles of Confederation basically made taxes voluntary, and they only had to convince 13 states to pay them! Spoiler alert, they couldn't do it, and the first US government collapsed.
https://en.wikipedia.org/wiki/Articles_of_Confederation#Taxa...
This is no different than saying "We don't need laws to prevent dumping industrial waste into water. If your company thinks it's so important, they should just do it." Which will just result in the environmentally-conscious company being outcompeted by everyone else.
Oh boo hoo. I feel so sorry for the multi billionaire who has one less billion than the other multi billionaire.
It's like skinny people who complain about how eating will make them balloon up like a whale.
(My brother was an Army recruiter for his last couple of years before retirement. Oh man the stories he had. How to sour a career no matter how well any of the prior years went.)
I enlisted right out of high school, and yes, my recruiter told me some whoppers. My favorite (boy, was I green): "They don't count weekends days in basic training. You get weekends off!"
https://markets.businessinsider.com/news/stocks/bill-gates-c...
> In the U.S., executive compensation has increased, on average, by nine hundred and forty per cent since 1978, according to one estimate; during the same period, worker pay has risen twelve per cent. Income inequality hasn’t been this extreme since the nineteen-twenties.
(...)
> It might seem disingenuous for people to try to change the rules after they have already amassed fortunes via the old, “rigged” system; some might also see their efforts as a way to generate flattering publicity or to alleviate feelings of guilt. But the group’s members say that they are concerned about the future of the nation. Some of them feel that severe inequality fuels corruption and has led to the election of Trump and other right-wing leaders across the world. Many of them believe that inaction on inequality could lead to the kinds of violent street protests recently seen in countries like Chile.
(...)
> the entrepreneur Nick Hanauer, one of the first investors in Amazon, gave a TED talk called “Beware, Fellow Plutocrats, the Pitchforks Are Coming.” After describing his multiple homes, his yacht, and his private plane, Hanauer argued that the U.S. was at risk of becoming a neo-feudalist rentier society similar to France before the Revolution. In an essay in Politico, he wrote, “Revolutions, like bankruptcies, come gradually, and then suddenly. One day, somebody sets himself on fire, then thousands of people are in the streets, and before you know it, the country is burning. And then there’s no time for us to get to the airport and jump on our Gulfstream Vs and fly to New Zealand.”
Just for those reading along, he wasn't making a rhetorical statement.
Many rich US citizens have acquired citizenship in NZ as their Plan B so they can bug out. It's a nice, stable remote location that probably isn't targeted by any weapons.
Also, "If you don't like war, what's stopping you from laying down your weapons?"
It's no different than saying "Why do we need environmental laws? What, precisely, is stopping companies from not dumping industrial waste into the water?" Even if one party plays nice, they'll be outcompeted by all the others that do not.
Same thing here. You might become less well off than some other rich person? So? Do what you think is the right thing anyway. Or do you care more about your ranking on the Forbes list than you do about what you think is right? If you care more about Forbes, why should the rest of us care about what you claim is right?
You aren't stuck with a change in tax law or nothing. Do it voluntarily, yourself, if you think it's a big deal. Encourage others to do it voluntarily also. And lobby for the law change.
But if all you're going to do is lobby for the law change, well... not everyone will think that you are serious.
You can't fix a tragedy of the commons with individual action.
Back to the actual topic at hand. We're actually talking about wealthy individuals, not about companies. If Bill Gates, say, falls another 10% off of the leader on the Forbes wealthiest list, how much power and influence has he really lost? Not enough to use that as an excuse for inaction, that how much.
Why would he pay additional taxes on top of that? If he were one of the ones advocating for higher taxes on the wealthy (he's not, so far as I can tell from the article), then he should so that his actions match his words. Otherwise, why should anybody listen to his words?
I'm not criticizing Bill Gates. He has done an admirable job of putting his money where his mouth is. (So, in retrospect, me choosing him as an example in the post that is grandparent to this was an error.)
Because he's already giving his money away. I thought that was obvious.
Regardless of how much wealth one has, it's perfectly natural to want a sense of fairness. Warm fuzzies from doing the right thing only go so far.
Warren Buffett and Charlie Munger are also calling for higher taxes and have also taken the Giving Pledge. I don't know how much of an overlap there is between the group in this article and signers of the pledge, but I'd bet it's significant.