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The world’s best example of the evils of unearned wealth argues against it. Of course, it should read “…discourage them from working and achieving…” but, hey, if he could speak the language he wouldn’t be who he is. Whom?
In the 1970s, Republicans discovered they could reliably win elections by pronouncing taxes to be anathema, which is to say, evil, irredeemable, on a par with the seven deadly sins. Henceforward, they declared, there would be no new taxes and no tax increases. Also henceforward, members of the other party would be referred to exclusively as “tax-and-spend” Democrats. It worked so well that now, Republicans are in control of everything.
But taxes, it turned out, were essential to the functioning of a free republic. Our nation’s roads, bridges, airports, trains, water pipes, sewer mains and power grid have rotted almost completely away for lack of maintenance, repair and replacement. Yet taxes remain anathema.
When, from time to time, in the brief interludes between elections, the Untaxables had to come up with some money to keep a school open here and there or put a bridge back up (just enough to get the torches doused and the pitchforks put away), they found they could get away with imposing a tax — although it was a very great sin to do so — as long as they imposed the taxes on a sin. Cigarettes became a favorite, after Big Tobacco became too poor to own and operate legislatures like it used to, and today in West Virginia, for example, there is a tax on each pack of cigarettes of about $25,000.
The thing about sin taxes is, they tend to be self-extinguishing: the rising cost of sinning reduces the number of people who can, or will, indulge. There are only about six people left who can afford to be smokers of commercial cigarettes in West Virginia, everybody else is smoking oak leaves. Now West Virginia at the moment — and I do mean this very moment — has a budget shortfall of half a billion dollars. The federal debt has reached $20 trillion, and in a couple of weeks the debt limit (the law Congress passed that says, “stop us before we borrow again”) is once again going to throw a monkey wrench into the government money-printing press.
Our legislators are laboring mightily to solve these problems by not raising taxes, even on sins. The West Virginia solons are urgently debating prohibiting bestiality and making the Bible the state book. I swear I am not making these things up. Go ahead, check the links, I’ll wait.
What we need here, obviously, is a new sin to tax. As it happens, I have a candidate. No sin has done more damage to the Republic, the world, or indeed to the souls of men, than unearned wealth.
Those who become wealthy through pure dumb luck — those who inherit fortunes, or marry them, or win the lottery or pick a stock — are a worse plague on the world than pollution. Insulated from the real world by their wealth, they never learn anything about how the world works. Nevertheless, surrounded by sycophants, they develop an overinflated opinion of themselves. Unable to actually use more than a small fraction of their money, they send the rest of it off, in the hands of hedge fund operators and personal wealth managers and other con men, in search of outrageous profits, thus inflating and exploding various financial bubbles around the world.
These periodic tsunamis of money that create and then pulverize vast fortunes in dot-coms, shale-oil, farmland, residential real estate, high tech, on and on, are the modern day equivalent of the periodic plagues of locusts described in the Bible. Whatever brief benefits there are, go to the already wealthy. When the bubbles collapse the pain is felt only by those already poor.
Solution: A confiscatory tax, 90 per cent would be about right, on all inherited and otherwise luck-induced wealth. Including lottery and casino winnings, such as stock trading profits. It would be a lot of money, that could fix a lot of highways and bridges, while preventing a great deal of destructive behavior around the world.
And it’s not like it would be hurting anybody. Most of these people have no idea how much money they have or where it is. All they know is, they want more.
Let us go forth, and tax sinners. There simply is no down side.
It certainly isn’t just lack of money ( or political will for that matter ) that is causing our infrastructure collapse but lack of energy and material.
The GOP will approve the debt ceiling by 3/15 and barely blink an eye.
If I remember correctly, there’s supposed to be a Franciscan (?) saying that goes: Whatever you have and do not need is stolen from those who need it and do not have it.
Pure poetry, Mr. Lewis. Great suggestion, too.
It’s not like anyone is in control of anything.
We’ll all be muddling along, the politicians arguing about everything, misallocating funds while our infrastructure rots out, and suddenly they’ll be an earthquake in a large populated area or the grain belt will overheat and all the crops will be lost, there won’t be enough money to rebuild (even where to start will be dicey), the national economy will tank (the disruption will be so large), the insurance industry will vaporize, the big banks will fold (they’re already insolvent), Wall Street will close up shop and we’ll begin the end of civilization in proper fashion. Money will become worthless and all of it, including precious metals, bearer bonds and bitcoin won’t be able to buy food that can’t be grown.
But there’s always enough money for war, you can count on that. Maybe humanity will “pull the trigger” on themselves, rather than face a lingering death of starvation. We’ll see.
Excellent essay, Mr. Lewis – and timely, seeing as how the FED’s coming rate increase may implode the global financial system after the 15th.
Your words always inspire me to go off on these (hopefully not too annoying to everyone) tangents.
I think that the rise of AI and the expanding use of robots has opened up a possibility for a new tax. It is becoming more and
more obvious that the human work force will be decimated by the
implementation of these technologies. The revenue stream for
the government will be severely diminished. I would propose a
tax on automation. Corporate income taxes will be slashed. Let’s make them pay something to make up for the tax payers they are
eliminating in their drive to ever higher profits.
There were 1,810 individuals “worth” One Billion Dollars (or more) in the world according to The World’s Billionaires with the list sorted on “2016 Ranking” and their combined wealth was $6,482 Billion. The top 10 spots range from $75B to $39.6B and total $505.4B. The Forbes list includes 852 people with at least $1B but less than $2B (totaling $1,167B), 364 with at least $2B but less than $3B (totaling $859B), 203 with $3B < $4B (Ttl: $689B), 106 with $4B < $5B (Ttl: $470B). The groups in the previous sentence comprise 1,525 people (84% of the 1810) who possess "only" $3,185B which is slightly less than half the wealth of all 1810, the top 285 possessing the other 50+%. It may also be interesting to note that the combined wealth of the top 20 is $825.5B, the top 30 has $1,066B and the top 50 hold $1,426B.
Now for some perspective. Please, let’s see a show of hands from all the people reading or commenting on this blog, how many of you have (or had) a $250,000/yr income ($120.19/hr based on 40-hrs per week & 52 weeks/yr)? Anyone? Bueller? Now, how many, regardless of your previous answer, would love to have the aforementioned income? Answers notwithstanding, I’m guessing it would be a pretty safe bet to say that a majority of Americans (North, South, Central), a majority of Europeans, and, really, a majority of the population of ANY country would be completely content making that kind of money, I KNOW I would!! At $250K per year, it would take you 4,000 years to “earn” your first billion dollars. Achieving $75B would take 300,000 YEARS!! Depending on whose guesstimate you “trust,” that’s nearly the same length of time that’s elapsed since “humans” first managed to use/control fire. Serving as additional perspective, according to IMF estimates, the GDP for the United States was $18,562B (#1), the entire European Union was $17,111B (#2) China was $11,392B (#3), Japan was $4,730B (#4, ~$1.7B less than the 1810 individuals in the Forbes list) and for the entire world $75,213.
When one considers that these exceedingly wealthy assholes are often heralded as “Job Creators,” does anyone have any idea how many jobs they’re “creating?” Does anyone have any idea what, exactly, they are actually doing with their amassed (and growing) wealth? Does anyone wonder “Why?” they incessantly proclaim THEY are being “taxed too much?” Does anyone wonder how/why the toadies, who support the rich assholes ongoing financial rape of everyone else, keep getting “elected” into government/law-making positions? Does anyone wonder why ANYONE keeps working for these abject examples of “humanity?” I could go on but I’m sure the above is more than most anyone else has taken the time to consider. I only see one “resolution” and the “Good News” is that there is still time to bend over and kiss your asses, and those of your loved ones, “Good-bye!”
Ooops, a couple minor(?) “brain farts.” After citing Japan’s GDP @ $4,730B, the parenthetical “aside” SHOULD read “~$1,700B less than…” and I inadvertently omitted the the “B” after the figure for world GDP which SHOULD be $75,213B. Mea culpa, flog me if such is your wont. The rest is unequivocal.