By Chuck Collins
Presidential candidates should take a pledge: The middle class should not pay one dollar more in new taxes until the super-rich pay their fair share.
Already candidates are outlining ambitious programs to improve health care, combat climate change, and address the opioid crisis — and trying to explain how they’ll pay for it.
President Trump, on the other hand, wants to give corporations and the richest 1 percent more tax breaks to keep goosing a lopsided economic boom — even as deficit hawks moan about the exploding national debt and annual deficits topping $1 trillion.
Eventually someone is going to have to pay the bills. If history is a guide, the first to pay will be the broad middle class, thanks to lobbyists pulling the strings for the wealthy and big corporations.
Here’s a different idea: Whatever spending plan is put forward, the first $1 trillion in new tax revenue should come exclusively from multi-millionaires and billionaires.
Four decades of stagnant wages plus runaway housing and health care costs have clobbered the middle class. In an economy with staggering inequalities — the income and wealth gaps are at their widest level in a century — the middle class shouldn’t be hit up a penny more until the rich pay up.
The biggest winners of the last decade, in terms of income and wealth growth, have not been even the richest 1 percent, but the richest one-tenth of 1 percent. This 0.1 percent includes households with incomes over $2.4 million, and wealth starting at $32 million.
They own more wealth than the bottom 80 percent combined. Yet these multi-millionaires and billionaires have seen their taxes decline over the decades, in part because the tax code favors wealth over work.
This richest 0.1 percent receives two-thirds of their income from investments, while most working families have little capital income and depend on wages. But our rigged system taxes most investment income from wealth at a top rate of about 24 percent — considerably lower than the top 37 percent rate for work.
One way to ensure that the wealthy pay first is to institute a 10 percent surtax on incomes over $2 million. This “multi-millionaire surtax” would raise nearly $600 billion in revenue over 10 years, according to an upcoming study from the Tax Policy Center.
The surtax would apply to income earned from work (wages and salaries) and to investment income gained from wealth, including capital gains and dividends. So those with capital income over $2 million would not get a preferential tax rate.
The multi-millionaire surtax is easy to understand, simple to apply, and effective — because it covers all kinds of income, making it difficult for the wealthy to avoid.
And it is laser focused on the super-rich. Anyone earning below $2 million a year will not pay a dime.
As a nation, we will need to raise trillions to protect Social Security, Medicare, and Medicaid, and to address urgent priorities such as health care, climate change, child care, higher education, opioid addiction, and more.
The middle class should have 100 percent confidence that they won’t be asked to pony up until Wall Street speculators and billionaires pay the piper. A multi-millionaire surtax is a good first step.
Chuck Collins directs the Program on Inequality at the Institute for Policy Studies.
Tim says
I think it’s about time all those baseball and basketball players, football and hockey players and actors and actresses give up the $$ so I don’t have to!
Jim says
I am going to retire in 3 years. After saving and scrimping for 40 years,I have now the ability to supplement my future social security with stock market gains. I do not have a pension. My stock market income will be 70 % of my yearly income. There are many seniors in the same scenario. So to increase capital gains tax will hurt the middle class way more then the super rich. Also this is America, I do not care how wealthy you are, No One should pay more then half their income to the government
Lorianne Lucienne says
Nobody would pay over half their income under any proposal, luckily. That’s not how tax brackets work, it would only be money earned above the 2 million dollar bracket. Everything they earn before hitting that bracket would be in the lower brackets, and thus taxed less.
Steve says
So I am 65 and have no retirement savings or 401 so I am not Rich or wealthy
I do not believe the “rich or wealthy” should pay any more than anyone else, obviously a 15% of 100,000 is more than 15% of 10,000
The Democrat’s pie in the sky programs are a complete waste of time and effort
The climate has been changing for millions of years and will continue to do so
Private health care always worked until the ACA then its been a nightmare ever since
Free market is ALWAYS better then any Gov run program
Congress has not been able to function at all so I have no faith then can run anything
Lou says
Why not 20%, or 30% or 40%… It never ends. The neverending quest to pay for everything you want with someone else’s money. Envy? Hate? Or just a free ride on the back of the “rich”? There aren’t enough of “rich” to pay for the neverending list of “wishes”.
How petty.
Marty says
I have saved and didn’t buy frivolous things all my life and have a nice nest egg and now you want to tax me more because i did the right thing and worked hard all my life? Why don’t you go after the do-nothings and make them pull their fair share!
JB17 says
Fair share to me is everyone paying the same percentage tax……
WILLIAM J NELSON says
It’s time congressional leaders pay there fair taxes–no loopholes, plus social security AND Medicare. We have allowed them to make us ALL second class while they pamper themselves at will.
Bill says
Ask NY how taxing the rich is working out.
Agkistrodon says
Is it “you and me” or “you and I”……..As far a taxes, they already pay more.
Cary says
The writer of this article must be a liberal New Yorker that moved to Florida with his big tax ideas. I thought the rich already pay 70% of the taxes now. I am not rich but I never got hired by poor person.
Sherry says
A FLAT tax with ZERO deductions would seem fair to everyone. We also need laws and ENFORCEMENT to STOP the uber wealthy from hiding their $$$$$ in secret accounts in other countries.
The truth is that the wealthy BILLIONAIRES very often pay LESS than the middle class because they hire teams of accountants to find loopholes and help them create shell corporations so they can hide their BILLIONS offshore.
If EVERYONE actually paid their FULL income tax bills, we could have free high quality education for everyone, reasonably price healthcare, clean air to breathe, clean water to drink, fully funded Medicare, Medicaid and Social Security. . . and, that promised infrastructure program with decent public transportation, etc. etc. Yes. . . a pipe dream. . . because the uber wealthy CONTROL everything! And their “cult” is brainwashed into thinking those things are “EVIL Socialist” policies.
yeppers says
Sorry to all the brown nosers, Tax them till the scream.
hawkeye says
this is the second time in 2 weeks that I agree with Sherry ,I have been in favor of a flat tax,or fair tax ,since I have been paying taxes(over 50 years),Eliminate the IRS and everybody,and I mean EVERYBODY pay 10%, this is fair to the rich , middle class and poor . I am upper middle class and I feel like I am getting screwed way harder than the rich and the poor.