Carte Blanche: The Billionaire Tax Is Just Plain Lazy
Jamie McCarthy/MG21
“The real goal should be reduced government spending, rather than balanced budgets achieved by ever rising tax rates to cover ever rising spending.” - Thomas Sowell
As Elon Musk becomes the first recorded trillionaire in human history, the calls to tax the rich have grown louder. On March 2nd, Sen. Bernie Sanders (I-Vt.) and Rep. Ro Khanna (D-Calif.) introduced the Make Billionaires Pay Their Fair Share Act. The bill would establish an annual 5% wealth tax on the 938 billionaires residing in the US. With an estimated $8.8 trillion in wealth held by private citizens, the bill aims to raise around $440 billion a year. The list of what the money would be applied to is as follows:
Provide a $3,000 direct payment to every man, woman, and child in a household making $150,000 or less — $12,000 for a family of four.
Reverse the $1.1 trillion in Medicaid and Affordable Care Act cuts in Trump’s so-called “Big Beautiful Bill,” which are estimated to cause more than 50,000 unnecessary deaths.
Expand Medicare to cover dental, vision, and hearing for millions of seniors.
Build, rehabilitate, and preserve over seven million affordable homes to eliminate the affordable housing gap and end homelessness.
Ensure no family pays more than 7% of their income on childcare.
Establish a $60,000 minimum annual salary for every public school teacher in America.
Expand Medicaid home health care for seniors and people with disabilities.
It is an ambitious plan to tackle some of the pressing issues facing the country and target the growing wealth inequality that Senator Sanders has built his political career on. On his trips around the nation during his Fighting Oligarchy Tour, he has repeatedly called for taxing the rich and using the money to create a more equitable nation where people no longer have to struggle just to survive. That goal is attainable so long as there are billionaires whose money and assets can be raided by the federal government to fund the high-minded ideas of politicians. The key factor is that those billionaires both pay the tax and keep themselves and their wealth in the nation, which is highly unlikely, ensuring the tax will have diminishing returns.
The US national debt exceeds $39 trillion, with a debt-to-GDP ratio of 122% or more. The highest in total amount or debt-to-GDP in the nation's history. The US tax code exceeds 75,000 pages and 10 million words from start to finish. Americans pay Federal Income Tax, State Income Tax, Sales Tax, Inheritance Tax, Property Tax, and a Payroll Tax. Yet, despite these taxes, the federal government is flat broke and borrows roughly $2 trillion a year to cover the spending deficit it just can’t seem to talk itself out of. States are not immune from the debt either. All 50 US states have debt, and nearly half are running a deficit. These financial quagmires are the government's fault, not the taxpayers'. Americans are struggling. Senator Sanders is correct in that statement and deeply held belief. However, the way he seeks to solve the issue has never worked before. Every nation that has had a wealth tax has lost tax revenue and then abolished it. But the questions raised by the proposed legislation are far more nuanced and dangerous than he is willing to admit. For instance, the plan is to give every man, woman, and child in a household making less than $150,000 a year. Over 100 million households qualify, and if each is only three people at $9,000 each, that comes to roughly $900 billion a year alone. Over double what it would bring in, and that’s before addressing any of the other areas that it intends to spend money on. The legislation is correct in only identifying what progressives and many Americans believe is wrong in the country, and, as idealists do, it has created an outlandish and unsustainable system that devalues other human beings based on their wealth and insists that a government that spends it without a care in the world is the answer. If government spending and redistribution create a fairer, more equal world, why has it never worked?
There are many problems facing the nation and everyday Americans. The government has created almost all of them. Senator Sanders has a long career in politics, during which he has made it his mission to highlight these problems. However, he chooses to focus on grand and elaborate plans that may prove popular but will ultimately lead to violence, a mass exodus, or the creation of new and more dangerous problems. If the cost of living is too high, it has nothing to do with billionaires or corporations and everything to do with government regulations on housing and food production, or the worst of all problems created by the government, printing trillions upon trillions of dollars that devalue the money people try to save or spend on essentials. If people have too little money to get by, then by all means, the government should do everything it can to stop taking so much. If there is anything telling about the bill or its authors, the simple fact is that it intends to add to the tax code and levy even greater tax burdens instead of simplifying or easing it on those who are most at risk of losing their homes or struggling to get by, tells you everything you need to know about their intentions. The US spent Trillions on the War on Terror, the Great Society social programs, 2008 bailouts, and hundreds of other flawed and terrible schemes and plans. Despite a proven track record of corruption, violence, incompetence, and insidious social engineering, it’s considered evil for Elon Musk and others to have trillions in wealth that took lifetimes to generate, wealth the government could spend in less than a year.
There are far better alternatives to give Americans a better shot at life, education, healthcare, and housing. Firstly, stop taxing their income so that they can afford more of it. Secondly, stop taxing everything else so that they can generate their own wealth to invest in their families and their communities. Lastly, stop treating adults like children who must be minded and told how to live their lives so that they can live according to the standards of others, who often make it all up. Thomas Jefferson is often quoted by those who argue the necessity of government involvement. His famous words, “If men were angels, no government would be needed,” implying to them that only the government can make things fair and safe. These words are so open to interpretation and definition that those who use them as their justification often change the answer to meet their needs, not those they are busy dictating to. If Senator Sanders wants to help Americans get by and live fuller lives, he can start by fixing the budget and then the tax code, so they aren’t robbed every time someone in government has a new idea that disregards property rights or liberty and shows no interest in the cost.