I am not committing to a presidential candidate right now, but Elizabeth Warren is off to a fine start with her idea of a wealth tax. One aspect of inequality that doesn't get addressed is the difference between wealth and income. Wealth is the combined net accumulation of all our assets minus our debts. Income is simply what we make in a given year. The problem is that wealth accumulates over time and across generations.
Warren is proposing a tax on great wealth, and it's a really good idea. Some things will have to happen to make it a reality, including control of the Senate, but my guess is that this will be very popular. Taxing wealth over $50M at 2% and wealth over a billion at 3% could raise close to $3T over a decade. You want to pay for new infrastructure or universal pre-school? There's your piggy bank. A wealth tax would also allow us to get rid of the complicated estate tax, because wealth itself would be taxed, whether it transferred or not.
A few things would have to occur though to make this really work. We would likely have to make sure that we didn't create some sort of parasitic class of billionaires who have a Singapore passport and a US address. Ideally, you would get all the G20 countries (or most of them) to pass a similar tax.
But there are two long term threats to our Republic: climate change and rampant inequality. Climate change will alter our world in ways we can't begin to fathom, whereas inequality will erode our democratic institutions.
This is an excellent step to address at least part of that issue. Use that $2.75T to create a Green New Deal, and suddenly America's future would look a lot brighter than its present.
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