Pro-government spending advocates don’t like to emphasize this because people become a lot less supportive of these things when they see members of their own community getting hit.
That's very much untrue. What is true is that no one even bothers reducing the favorable tax treatment of the ultrawealthy, only taxing high-end labor income and pretending. As long as both long-term capital gains and pass-through business income are extremely tax-favored, it doesn't matter what rates or brackets you set for normal income, you arent really taxing the ultrawealthy. You could raise tremendous revenue by eliminating those favorable categories and treating all income as income, and only raising nominal rates by adding new brackets above the current top bracket. The reason that isn't done isn't that you can't raise enough revenue that way, its because the ultrawealthy are very good at propagandizing that the forms of income they earn vastly disproportionately ought to be untouchable.
Nah, it's coz any bill that attacks the ultrawealthy can be spiked to attack the moderately wealthy instead (ideal) or as well as (failing that it's better to make them allies).
This is where lobby $$$ really pays off - when tweaking the less overtly visible finer details of bills.
This pairs with a PR campaign of:
* We simply dont have that much money.
* You'd be better off not taxing it because then we wont innovate and then youll be sorry.
* We will leave the country entirely and then youll be sorry.
* You're next on the government hitlist (weirdly this one works even seems to on people who earn, like, $40k a year).
How so? It’s basic math. The middle and upper middle class is still responsible for the vast majority of income.
> you arent really taxing the ultrawealthy. You could raise tremendous revenue
See, you’re getting confused because it’s not “tremendous” in the scheme of tax revenue. The only thing that would accomplish is helping with income inequality (i.e. it’s punitive towards the rich). This is fine if that’s your goal but it’s not going to pay for anything like basic income, universal healthcare, or major infrastructure. It won’t even balance the existing budget.
> The reason that isn't done isn't that you can't raise enough revenue that way,
Yes it is, full stop. A 100% tax rate on the top .1% would bring in about 500 billion annually (~$3 mil * 150 mil filers * 0.001) . That’s not even enough to cover the “cheap” infrastructure bill being proposed.
> they earn vastly disproportionately ought to be untouchable.
Careful with that. You’re also talking about how much of the middle classes retirement is structured there. Long term capital gains are used by everyone.
The USA cannot even properly finance the IRS to go after the super wealthy tax cheats. Their bought-and-paid-for politicians would rather the IRS stick it to the little guys, ffs.
do you know of any societies that managed to sustain a dynamic where that's not the case?
I literally cannot think of any at all. Just some very brief temporary aberrations.
Of course the powerful write the rules. Most people access an individuals power based on their ability to make and break rules.
The question is how far the powerful are willing to push the system in order to maintain their relative status (relative to each other, not to 'us') and how much the disenfranchised are willing to take.
If the powerful are careless, an angry mob will spice up the game. But of course that's just opportunity for other powerful entities to advance their relative status.
I think Biden has tried get ahead of that issue with his no higher taxes on 400k pledge. We'll wait to see the reality though.
Suddenly all those dual tech worker couples in Silicon Valley are wealthy!
They aren't ultrawealthy members of the capitalist class, sure. But they are definitely wealthy, and pretending that they aren't is just phenomenally out of touch.
$400k per year barely lets you buy a home in the Bay Area.
And regardless, what makes you think they’ll stop at $400k? That’s the point. Eventually a tax bill gets passed some couple making $150k need to “pay their fair share”.
If you're talking about buying a house anywhere, you're already outside the "I'm poor" status.
Train for 10 years to be a doctor to make $400k a year for 10 years at 50% taxes or just work for 20 years at 150k at 30%?
0: https://dqydj.com/income-percentile-calculator/
1: https://dqydj.com/income-percentile-by-state-calculator/
2: https://dqydj.com/2018-income-percentile-by-city-calculator/
It’s no longer a tax on the rich, it’s just a tax on successful upper middle class.