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In their last post, the Beacon’s Counterpoint columnists—liberal Rick Dollinger and conservative Geoff Rosenberger—debated whether politicians who complain that “the rich don’t pay their fair share” are violating the last of the Ten Commandments: “Thou shalt not covet thy neighbor’s goods.” Now they’re back, continuing their back-and-forth on such questions as: Who are “the rich” exactly? And would requiring them to pay more in taxes stunt entrepreneurial drive?
GEOFF: Rick, the left seems to be pretty worked up over Elon Musk’s crossing over the $1 trillion net worth threshold in June after SpaceX went public. Just Google “should anyone have a trillion dollars” and all sorts of vitriol pops up. Any thoughts on the subject?
RICK: Forget the vitriol. A trillionaire? How many zeros are in a trillion? How long would it take an average high school student, counting as fast as she could, to count to a trillion? If you laid out one dollar bills in a line, would they stretch all the way to Mars, like Musk wants to explore with his SpaceX toy? After all, that distance is a mere 140 million miles.
Bottom line for me: the concept of a trillion dollars in the hands of one person is “just out of this world,” as we used to say in the 1960s.
But, more importantly, what does he and other investors (the new billionaires) pay in capital gains taxes and what is he going to do with all that cash? Musk may be wise to remember King Midas. He had the power to turn things he touched into gold and it did not work out well for him.
In that regard, I note: has SpaceX ever made money? Do investors—left or right —care?
GEOFF:Hmm. The Tenth Commandment rears its head again. Anyway, the left talks constantly—and has for decades—about “the rich.” But generally only in vague, amorphous terms. I think we can all agree that $1 billion in net worth translates to “rich.” Ditto for $100 million. But just so we’re all on the same page, let’s define the term with some specificity. At what level of net worth does someone transition from solid citizen, from admirable small business owner, to evil, contemptable “rich” person? $1 million? $10 million? $50 million? What net worth number should aspiring entrepreneurs take pains to remain below in order to preserve their social standing?
Also, do we define “rich” by just liquid, spendable net assets or by total net worth? An Iowa farmer with 1,000 acres of corn and soybeans might own $12 million worth of land, plus another couple of million dollars worth of tractors, combines and structures on the property. But at current corn and soybean prices, that farm might be just barely breaking even or even operating at a loss, struggling to pay the bills. Is that farmer “rich”?
RICK: Geoff, you miss the point of the left’s criticism. It is not the accumulation of wealth that irks the “left”—whoever those villainous folks are.
Speaking of the left, just so we’re clear, were the founders “leftists” or the “right?” There were “rightists” in 1776, but they were called Tories and they favored the status quo—who could argue with living under the umbrella of the world’s number one power: the King of England. The conservative said: What’s wrong with England telling us what to do?
The “leftists” argued the status quo was not good enough. They—the liberal democrats or as they are now called “the left”—gathered in Philadelphia and said otherwise. I hope everyone thanks the “left” for founding the country and for continuing to press the idea that the status quo is not always good enough. We can do better, just as those guys did 250 years ago.
Back to the topic after that historical detour. What bothers most Democrats is that our system of laws—designed by elected officials—tilt the playing field in favor of the wealthy. Our laws, our tax policy and our campaign financing policies undeniably favor the accumulation of concentrated wealth.
Why? That’s what reasonable “leftists”—like our Founders—ask today.
GEOFF: Rick, it’s no wonder you won so many elections over the years. You did a masterful job of parrying my challenge to define “rich.” But it is a pretty fundamental question. Perhaps the honest answer for most people is “anyone who has twice as much as I do.“
Sure the Founding Fathers were leftists—they led a revolution! As Saul Alinsky succinctly wrote in “Rules for Radicals”: “There is no such thing as a successful traitor, for if one succeeds, he becomes a founding father.” But labels are specific to the times and circumstances that employ them. The “Solid South” meant Democrats in the 1950s and 1960s and Republicans for most of the last three decades, although it appears that tide may once again be in the process of turning. So yeah, the Founding Fathers were leftists in their time. But the Founders were also fans of limited government. They would be appalled that federal spending alone, before adding in state and local expenditures, accounts for nearly a quarter of today’s GDP. They would likely also be appalled at how loosely we’ve interpreted the Constitution’s General Welfare Clause.
Let me pose another question: What if Elon Musk had stopped working after cofounding and then cashing out of PayPal? Gavin Newsom recently proposed a national billionaire’s tax. What if there had been a billionaire’s or millionaire’s tax back then—once a billionaire’s tax is implemented, history shows that the threshold at which the tax kicks in will keep ratcheting down—and Elon had concluded: “You know what, at this tax rate, further entrepreneurship isn’t worth the aggravation. I’ve got enough money. I’m heading to the beach”?
Of course, had he done that, there would be no Tesla, no Boring Co., no Neuralink and no SpaceX. Nor would there have been all the jobs those companies created, nor the wealth that the other shareholders and investors in those companies have attained. After all, the stock market value of Tesla and SpaceX combined totals to approximately $3.3 trillion, two-thirds of which is owned by people not named Elon Musk. Those investors wouldn’t have paid the capital gains taxes on the money they made investing in those companies. The charities they donated to with their profits would have had to do without all those donations. And, of course, there would be no Starlink, which has massively assisted Ukraine in their defense against the Russians. The outcome of that conflict would likely look very different than it does today without Starlink.
After SpaceX’s initial public offering, there were reports that, thanks to the stock many SpaceX employees took in lieu of market-rate cash compensation over the years, 4,000 SpaceX employees are now millionaires and 400 of them are now worth $100 million or more. The stock has backed off some since the first days of trading, so those numbers may have moderated a bit. But even at the current stock price, a whole bunch of everyday people have enjoyed a financial windfall thanks to Elon’s entrepreneurial drive.
So, which is the better scenario? Elon having all that money or Elon quitting and heading to the beach after his first successful startup?
RICK:Wait, you assume that if Elon “headed to the beach,” his ideas would never have come to pass? In fact, I have no doubt that his ideas would have come to pass, by others who would advance the ideas and concepts. You seem to suggest that American entrepreneurship would have gone underground if Musk was not at the helm. Nonsense. American ingenuity would have reached the same conclusions.
But that misses the point. America’s laws—our stock laws, our government spending, our laws designed to encourage innovation, the LLC, the spending on new science, the substantial depreciation of new acquisitions in the tax laws, the 401(k) tax deferral—paved the way for the concentration of wealth. In short, the protection of our laws, the strength of our courts and enforcement procedures designed by elected officials, allowed enormous capital formation in America.
I acknowledge that the “new capital” created jobs and opportunity—you’d have to be blind not to see it. But why can’t new laws put some limits on the concentration of wealth that followed? Why can’t we go back to the higher tax rates for individuals with substantial incomes? Is raising the highest marginal rate by 5% going to curb investment in the only secure financial country in the world? It never has in the past. Would higher capital gains jolt the stock market? Meanwhile, how much did Musk—and all those newly minted millionaires—pay in capital gains taxes?
Our laws facilitate the creation of wealth and have forever. Wouldn’t “fairness” dictate that some of the “law created and protected wealth” serve the many—through modest tax rate increases—rather than just the few?
GEOFF: 401(k) tax deferrals “concentrate wealth”? Really? Over half of American households participate in a 401(k) program. That’s not exactly “concentrated.”
Someone else founding SpaceX? Who might that have been? There are over 8 billion people on the planet and to date, only two, Elon Musk and Jeff Bezos, have been willing to take on the enormous risk—and capital commitment—that private space exploration entails. And, even if someone else not named Musk were to have come along and successfully started an alternative SpaceX-type enterprise, Democrats would be ranting about the wealth accumulated by that theoretical entrepreneur. The names would change, but the rant would not.
Here’s what I don’t hear. I don’t hear Democrats talking about all the entrepreneurs who failed—the ones who bet their life savings on a idea that didn’t work out. And there are a whole lot more of those folks out there than there are billionaires. But it’s the shot at the brass ring, the shot at making their fortune, that motivates people to bet the farm and take the risk. When someone beats the odds and succeeds, we ought to celebrate that success, not demonize it.
I also don’t hear the media talking about Elon as much anymore now that SpaceX shares are trading about 50% below their peak and Tesla’s shares are roughly 26% below their 2026 high. Wealth can be fleeting. But somehow that reality escapes the headlines.
The late Democrat Sen. Paul Tsongas said it best back in 1992: “The problem with Democrats is that they love employment but hate employers.” Not much seems to have changed in the years since.
RICK: Since when does asking someone to pay a fair share of taxes constitute “demonizing” their success?
We—Democrats across the board—support success. We back the laws that enable that success. For example, Democrats in Congress passed the Revenue Act of 1978— which created the 401(k) savings plan and cut tax rates across the board—and another Democrat named Jimmy Carter signed it
We extoll the entrepreneurs, as we—as Democrats—have supported allowing them, if they fail, for example, to deduct their losses from their incomes for income tax purposes in some instances, which, in essence, creates a “sharing” of those losses with the rest of taxpayers.
I could go on and on. Let’s let the readers chip in and go onto the next issue.
GEOFF: How generous! You can deduct losses against gains. Unless, of course, it’s a “capital loss.” Then the loss is only deductible against ordinary income at a capped annual rate of $3,000 a year.
As we turn the debate over to the readers, it will be interesting to hear their collective definition of “fair share.” The left has demanded that the “rich”—a term still yet to be quantified—pay their “fair share” for as long as I can remember. But the left never specifies what would, in their mind, actually constitute “fair.” For the 2022 tax year, the top 1% of income earners paid 40% of all federal personal income tax collected. The top 5% paid 61% and the top 10% paid 72% of the total federal individual income tax levy. The bottom 50% of income earners contributed just 3% of the total. IRS data for income earned and federal income tax paid broken down by income category is available here for years 2021, 2020, 2019. How should we alter those percentages to achieve fairness? Should millionaires foot 90% of the personal income tax burden so that everyone else can enjoy a free ride?
Beacon readers, please weigh in.
Rick Dollinger is a retired Court of Claims judge and a former state senator who lives in Brighton. Geoff Rosenberger is retired co-founder of Clover Capital Management Inc.
The Beacon welcomes comments and letters from readers who adhere to our comment policy including use of their full, real name. See “Leave a Reply” below to discuss on this post. Comments of a general nature may be submitted to the Letters page by emailing [email protected].
According to Americans for Tax Fairness, top U.S. billionaires pay a “true” effective federal income tax rate of roughly 3% to 5%.
Mr. Pudup, it’s Doctor Scholl. You can call me Doc.
Geoff has the stronger argument here, but I think the discussion raises an even broader question.
Most Americans, regardless of political philosophy, believe there should be a safety net for people who are truly unable to provide for themselves. I certainly do. The disagreement is not over whether we should help the unfortunate. It is over how large government should become, how much it should spend, and how much responsibility government should assume for providing benefits that individuals once provided for themselves.
For decades, politicians have discovered that promising benefits paid for largely by someone else is an effective way to win votes. The result is a federal government that spends enormous sums, runs persistent deficits, accumulates debt and then continually asks the same relatively small group of taxpayers to contribute still more.
That is why the phrase “fair share” bothers me.
The top 10 percent of earners already pay roughly 72 percent of all federal individual income taxes. The top 1 percent alone pay about 40 percent. Reasonable people can debate tax rates, but at some point fairness ought to include a little appreciation for the people paying most of the bills.
And we should remember where much of that income comes from. Successful entrepreneurs, business owners and investors create companies, jobs, technologies and wealth that did not previously exist. They take risks that frequently fail. When they succeed, government taxes their income, their employees’ income, their companies’ profits, their investments and eventually, in many cases, their estates.
Rather than continually asking how much more we can take from successful people, perhaps we should occasionally ask whether government is spending too much of what it already takes.
A compassionate society needs a safety net. But a safety net and an ever-expanding government are not the same thing.
Success should carry responsibilities. It should not carry an obligation to apologize for succeeding.
I applaud your concern for the safety net. We have the highest child poverty rate of any major country. Percentages of vast wealth is still a phony argument when from 1981 t0 2022, 70 trillion in wealth was transferred to the richest 10% form 90% of Americans. Jeff Bezos paid an effective Federal tax rate of 1% last year and Amazon makes Billions in profits and received tax refunds in two of the last three years. Like Walmart much of his payroll is subsidized by taxpayers. To hail Musk if he paid a billion dollars in income tax, but he made a $100 Billion, one percent of income, is absurd when teachers, cops, laborers and other middle-class workers pay 15% t0 22%. Two tenured college professors married to each other paid more in SS/Medicare than Bezos or Musk. If Bezos paid a 5% wealth tax it would be $12.7 billion and he would ONLY have $240 billion left over. Sorry, that’s beyond success and not penalizing success in any way.
James, that’s a lot of numbers, but you still didn’t answer the central question: What percentage of the nation’s income-tax bill should the top 10 percent have to pay before you would say they are paying their fair share?
They already pay roughly 72 percent of all federal individual income taxes, while the top 1 percent pay about 40 percent. At some point, shouldn’t the discussion turn from how much more government can take to how much government spends?
I agree that we need a reasonable safety net and should help children and people who genuinely cannot help themselves. But poverty and the existence of very wealthy people do not automatically prove that government needs more money.
I also think comparing a teacher’s income-tax rate with Bezos’s increase in net worth is misleading. Income and unrealized wealth are not the same thing.
And saying Bezos could pay a 5 percent wealth tax and still have $240 billion left gets to the heart of our disagreement. That argument is essentially that government is justified in taking more simply because someone has more than we think he needs.
Successful people should pay substantial taxes, and they do. I just think a little more attention should be paid to how much they already contribute, and a little less time spent assuming that every government problem can be solved by asking them for more.
The question I have been asking is, do the wealthy pay a similar percentage of their total income as the middle class? If so, what is that number? Since you know all these other numbers, perhaps you know the answer to this?
It is a lot of numbers Mark, but progressive taxes are what did it. During WW II
FDR had it to about 70% after about $6 million in income and still during the war raised that top rate to 90%. Under JFK the top rate was again 70%, but many say due to looph0les it was really 50%. This seemed pretty fair and the economy was healthy and gave rising standards of living to workers as well to business, with opportunities for entrepreneurs. There are two arguments. One is what level of income requires the higher rate to kick in, and it has to be at least twice the percentage of what an average worker makes, and two, there are so many loopholes in the current tax code that the best way to get fairness is a straight wealth tax. Whatever the result would be a fair share. However, it will not solve the deficit problem if one triples Defense spending in ten years, from a little over $500 billion to a trillion and a half dollars. Increases Homeland Security another $70 billion and add a new war to the tune of about a $100 billion. This is where we need real audits. We have total welfare and corruption in defense contracting. They break up contracts to smaller pieces because in each one they can include hundreds of thousands of dollars for executives making millions under “labor costs”. There is much waste and corruption. It is not coming from those making twenty dollars an hour or less, underfed kids, or those needing health care. It comes from the large campaign contributors mostly.
So perhaps we have found some common ground: let’s attack waste, corruption and unnecessary government spending first. Then we can have a much more meaningful discussion about whether Americans are paying enough in taxes.
Mr. Mars; So, you have experience working with NASA and your REAL name is Tom Mars?? I sense you may be using an alias.
From the Peter G. Peterson Foundation, which is rated as unbiased by Media Bias/Fact Check,
https://www.pgpf.org/article/who-pays-taxes
The problem conservatives have is when their leader brags about about how he pays no taxes because he is smarter than the riff-raff.
https://www.youtube.com/watch?v=uBZR1-onmAo
That never goes down well.
I did. The link is in the last paragraph of the article “2022 Income Tax Paid”. The link shows the aggregate dollar amount of taxes paid by each income group and the aggregate adjusted gross income for each income group. The data is there. All you have to do is divide the taxes paid by the adjusted gross income to get the percentages .
Why don’t you just tell us? Why obscure it?
So, Mr. Scholl, did you work for a shoe insert company and your REAL name is Scholl?
🙂
Mr. Mars, you ducked the point.
Mr. Buffett was clearly talking about personal taxes, and you counter by pretending Buffett was talking about corporate taxes.
You can do better!
Yes, I did conflate the two. (because they are related). Mr Buffett lamenting that his secretary pays a higher tax rate than himself, leads us to the conclusion that Buffett must be compensated via stock/capital gains (which are taxed at a lower rate). Here’s the SEGWAY into corporate taxes. Since Mr Buffett (one of the richest men on earth) was calling for higher taxes in general at this time, it is notable that he employed a army of accountants assigned to ensure his company(s) paid the lowest (Corporate) taxes possible. Since he has not said otherwise, we must assume he has paid the lowest amount of personal taxes that the tax code allows also. I find this somewhat hypocritical, given at the time he seemed to be a advocate for higher taxes (supported Hillary and her platform), and was carrying a “burden” that his secretary paid a higher tax rate than he did. He could of eliminated the hypocrisy by simply paying higher personal taxes (the US Treasury will take your money if you wish to pay above what you owe) and he could also direct his Corporate accountants to do the same with Berkshire Hathaway’s taxes (since he has deemed paying more taxes is a worthy cause). To my knowledge he did neither. Therefore, I do not take Mr Buffett seriously when he sits on TV drinking a Coke with his Will Rogers demeanor generating a ruse that he is for higher taxes when he has declined at every opportunity to pay more taxes.
Why can’t anyone just come out and say what they think “fair share” means? Does it mean we all pay the same dollar amount in taxes? The CBO estimates that the federal government revenue in 2025 was about $6.6 trillion. If we were to spread that evenly (fairly?) over our 320 million citizens, that would mean each US citizen, regardless of income or wealth, would be responsible for about $17,500 in taxes. A family of four would have owed $70,000. That doesn’t seem fair to me. Our current system is set up as a percentage of income, which kind of makes sense. I am fortunate to fall into the 37% tax bracket. After all my deductions and credits, when comparing my taxes to my income, my effective tax rate was 31.2%. I have read that 97% of all tax-paying Americans will pay a rate lower than my effective tax rate. It is estimated that as much as 75% of taxpayers will pay an effective tax rate of less than half of my 31.2%. I am not gloating and I know I am blessed and fortunate to have a good income. I am making a point. In the vane of trying to define “fair share’, is it fair that I pay an effective tax rate that is double what the majority of Americans pays? Maybe that is exactly what your definition of fair-share means. That’s what Congress thinks is fair share. What about a flat tax like presidential candidate Steven Forbes suggested? Everyone gets a basic income exemption from taxes, say $15,000 each, and then everyone pays the same flat tax rate of 17% after that, regardless of income or wealth. That seems to me to be the fairest system in terms of tax rates. To Mr. Rosenberger’s point, the higher-income earners and wealthiest in the country are definitely already carrying the tax burden of the lower-income earners. Yet, the democrats and liberals are saying that the 72% of taxes paid by the top 10% it isn’t enough. What is the right number for those in the top 10% of income earners? 100%? Maybe your definition of fair share means no one can have a higher income or more wealth than anyone else. If that is the way you think, then just say it. Please don’t villainize the wealthy or victimize the general public as a way of disguising your distaste for financial success.
Fun with numbers! What is the percentage of total income paid by the wealthy? Middle class? That is what Warren Buffett was addressing. Your thought about Steve Forbes idea is interesting. Author David Cay Johnston is an expert on tax policy and is currently writing a book on what a new tax code should entail. I wonder if he will touch on Steve Forbes idea?
All of this babble does not address the core issue. Are the rich paying their fair share? The data would suggest the answer is YES. In fact, the personal income taxes in the US are more progressive than any country in the OECD, including all in Europe where a regressive VAT is pain on all purchases. The top 20% in the US earn 52% of the income and pay 67% of the taxes. The top 1% pay 35%.
The wealthy few citizens receive all of the generous benefits of living in the United States, plus all of the additional benefits they can buy. If you agree that the billionaire class would not be able to (legitimately) generate the wealth they possess in another country then it follows that they should have a proportionate stake in the continued success of our country.
I am against welfare for the rich.
I agree David. When during WW II FDR raised the top end rate to 91%, they biggest taxpayers in dollar amounts screamed. FDR said they still can afford their mansions, chauffers, and maids while our boys are fighting and dying for $600 a year to protect them from Hitler. I welcome their hatred. Last year 15 billionaires added a trillion and a half dollars in wealth. If those fifteen paid an additional trillion dollars in tax, they would be paying much more in federal taxes billion dollars in tax as a percentage of revenues, but all 15 billionaires would still be a half billion dollars richer. Percentage of Federal taxes collected is a rich talking point that is meaningless. It does nothing to address the quote from Justice Brandeis. Elon Musk could cash out all investments and pay $150 billion in taxes, and his heirs could live like kings for a thousand years or more. He could still spend a half billion to buy elections and continue such spending as if it were pocket change. The one percent, in spite of some initial job creation, spend most of their time deskilling the tech and skilled jobs to pay less and/or eliminate jobs to increase their wealth and pro monopoly market share. Someone making $40,000 a year is paying in affordable Rochester a thousand a month for a one-bedroom apartment. Their rent includes property and school taxes, a gallon of gas, a gas and electric bill, and a phone bill include federal taxes. They pay 7.65% off the top in SS/Medicare tax. There are many who work hard and make less. That leftist organization Goldman Sachs says billionaire AI will eliminate 300 million jobs worldwide in ten years, maybe as soon as five years. Worker’s productivity, including slave and exploited labor creates an economy’s wealth and CONSUMER DEMAND creates jobs. Back to Justice Brandeis on democracy and great wealth. The rich and their apologists are going to need many more Gestapo/ICE and police to protect their yachts and mansions. The apologists claim doing the most for those that need it the least is real democracy. Might want to try a history book instead of a straw man about percentages of revenue paid.
What do you call someone with a trillion dollars while children die from malnutrition and people die from curable diseases?
Not innovator…but jerk.
BYW, if NASA had crashed a rocket into the moon certain congress members would have tied themselves into a knot about the incompetence of government.
Instead of focussing on those who have and bash them for what they have, focus on those that have and give, consistently, back to the community. To say nothing of the job opportunities created. Or…or we can follow the path of the Mayor in NYC and tax, tax and tax some more. Tax them, those entrepreneurs, out of existence and let socialism and maybe even communism take the lead for a while. Then when those who sit on their butts expecting a free ride run the well dry, we can go back to the system that made this country what it is today.
It seems those who disagree with my statement have not addressed Justice Brandeis statement/quote. Is it more likely true or more likely false? In the Roaring Twenties of the continued decades of Robber Barons, over two thirds of Americans were below the federal poverty level. The majority were not in extreme poverty, but under the poverty level none-the-less. After the New Deal, and the continuing policies of progressive domestic policies of Dems, from 1945 to 1980 our country produced more wealth for more people than any society/country in the history of the world. From 1980 t0 2020, the last figures I saw, $70 trillion has been transferred from 90% of the people to the richest 10% and we had a little over 400 billionaires. We now have over 800 billionaires. Again, is Justice Brandeis statement a true observation?
” Then when those who sit on their buts expecting a free ride run the well dry, we can go back to the system that made this country what it is today.” Another sick talking point. workers and the working poor, it’s their own fault their lazy, etc. The poor have always worked and still do. Some worked from 1619 to 1865 as slave labor producing untold wealth they never received. Even many of the great scientists and inventors did not receive the wealth due as it was taken by the Elon Musks of the world.
There is no reason to think that by adjusting the tax code entrepreneurs would suddenly disappear and a socialist system arise. It’s a false argument debunked by examples of history. One need only look to the failure of socialist systems to see this, they simply do not succeed, evolving into capitalist systems driven by entrepreneurs. It’s a cycle they succumb to. It’s unrealistic to think people by their nature will not start businesses, hire others and strive to make profits. It what drives black markets in socialists experiments.
This has been the point missed by many in this defense of percentages, and criticism of Buffet. It’s not the percentages it’s the loopholes. As our president has said, the wealthy may be taxed at a higher percentage of their income, but it’s the technicalities that allows them to take exemptions effectively lowering their paid tax. That’s what some are missing here.
Buffet saying he believes that the current code is rigged so that the wealthy effectively pay less as a percentage than the common man is valid.
It’s a false argument to criticize Buffet for his position, it is not inconsistent to argue this is the system, the system is rigged, and it’s not fair. Playing the game and recognizing the rules are unfair is legitimate.
From the debate: “For the 2022 tax year, the top 1% of income earners paid 40% of all federal personal income tax collected. The top 5% paid 61% and the top 10% paid 72% of the total federal individual income tax levy. The bottom 50% of income earners contributed just 3% of the total.”
The real question is how much, or what percentage, of what those highest earners made is sheltered from taxation, something most middle- and low-income earners do not do either because they cannot afford accountants or because (and here’s a novel idea) they think it may be their responsibility to contribute to the general welfare of the nation. Those words of Leona Helmsley come to mind: “only the little people pay taxes.”
Agree!
The Founders were NOT leftists. They were generally for Pursuit of Happiness (NOT a Federal guarantee of happiness), property rights, no taxation w/o representation, tax collections from tariffs and sin taxes like whiskey taxes, freedom to publish etc (that’s about as far away from the Mamdani Central Committee as you can get). The obsession with sending more money to DC certainly IS Coveting . If you think $5.5T isn’t enough Federal spending then there is no help for you. The tax system already leans on high earners. (It follows roughly the 80/20 rule). ~80% or the taxes are paid by the top ~20% in income. We have a lesson in history of higher taxes. Famously during the 1950s the top rate was ~90%. Why was that a problem? Virtually nobody paid it. The victims of such a tax system (justifiably) hired lobbyists to craft loopholes to evade such a confiscatory tax rate. Think of it, would the movers/shakers of the era (Howard Hughes, Henry Kaiser, Henry Ford II, David Sarnoff, Alfred P Sloan etc) have gotten out of bed in the morning to surrender 9o% of their income? (NOT). I have some experience in working with NASA, w/o Musk’s influence on shaking it up and changing the way they do business (like normalizing reusable rockets) the taxpayers would be carrying a lot higher launch costs. Speaking of Musk, the recent SPACEX IPO was made available to all @ the IPO price (unusual for IPOs) which would of allowed for individuals to make a nice profit on June 11. The answer is to make it easier for people to own Capital Gains. (not harder). The people benefit, and the country benefits with the investment.
About 30% of total taxes collected in the 1950s came from corporations. It’s about 9% now.
Loopholes in the 1950s reduced the corporate profits tax to about 70% then 50% under JFK. The main Loopholes were removing from profits the entire cost of hiring and benefits and on any expenses for expanding R&D and new production, not stock buybacks which were illegal.
The additional loopholes are due to the one percents increase in power and control of government. It is laughable that anyone on the right complains about deficits when 80% of the deficit came under GOP leadership, over 20% just from Trump. That’s math. How about increasing the Defense Budget from a little over a half trillion ten years ago to one and a half trillion now, which does not include the huge increase for ICE under Homeland Security or the Iran war. Satellites and their technology should be nationalized for National Defense, taxpayers paid for most of it and should not be in control of a racist illegal immigrant who grew up wealthy with black servants in apartied South Africa. Top attorneys like you, who worked for the multi-billionaire Waltons and Walmart, who pay the majority of their employees so little that taxpayers pay a ton for SNAP, Medicaid, and housing vouchers in lieu of Walmart wages do not have credibility with working people.
Amazing in the gloomy world in which you live, tax revenues to the Federal Govt increase annually… (For the record, I’m not a Attorney nor do I play one on message boards…)
They may not have been “leftists” but they were certainly liberal, especially for time. The idea that all are created equal was a radical idea born of the enlightenment. It was an idea that took the enlightenment to another level, something far more “left” of the already more liberal British system of the day.
I have quoted the first Jewish Supreme Court Justice before, ” We can have democracy in this country, or we can have great wealth concentrated in the hands of a few, but we cannot have both”, Justice Louis Brandeis. How much wealth is too much wealth misses the point. Great concentrations of wealth always result in anti-democratic concentrations of power. We cannot have both. There was a reason they were called Robber Barons. The hated Jay Gould said it best when asked about his concern of unions. He said something like they did not concern him because he had enough money to hire half the working classes to shoot the other half. Most Republicans have been consistent in labeling anything that helps the people as socialism or communism since the Fifteenth Amendment. The neo-liberal Dems who are worried about democratic socialism need to review the New Deal. Almost on day one FDR closed the banks, audited them, and closed the worst forever while using taxpayer money to insure deposits creating the FDIC.
A cursory review finds over 40 laws labeled socialism. From the TVA, infrastructure, WPA, support of the Arts, shortening the basic work week by a third, workers’ right to collectively bargain, and while mandating increased wages. Military Keynesian economics gave us full employment at decent wages and saved the world from bigoted fascism. This increased the income tax of FDR’s 70% to 90% on income over about $6 million a year in today’s numbers. The Dems continued the New Deal (Fair Deal, New Frontier, War on Poverty) to achieve Civil Rights and Medicare and Medicaid. If one is against socialism, how about reforming capitalism so that it is consistent with democracy? Progressive taxes on the wealthy and corporations, a living wage, NO impediments to workers collective bargaining, only publicly funded political campaigns, health care not tied to employment, so people are free to take other jobs or start a business, and real anti-monopoly laws enforced. Corporations and money are not people and Socialism for the rich is the real corruption.
Well said!
Well said! Agree 100%.
Warren Buffett thought it was absurd that his secretary paid a much higher percentage of her total income in taxes than he did.
That’s the debate you should be having. Since rich folks write the tax laws to benefit themselves, they pay a tiny percentage of their total income, or no tax at all, than middle class Americans.
Jim Scholl
Mr Buffett was a wee bit disingenuous on this one. At the time he was trying to dissuade the “Occupy Wall St” movement from camping out at his modest house in Omaha. Odd that one of the then richest men in the world was advocating higher taxes while he simultaneously employed buildings full of accountants to minimize the tax paid by Berkshire Hathaway (and its subsidiary businesses). I’ll bet his “secretary” was well paid (like >$100K) and had some kind of stock incentive so I don’t feel sorry for her. This is where our broken education comes in. Mr Buffett’s Secretary allegedly paid a higher tax rate than Mr Buffet because Buffet’s income was derived from stock. Thus he paid capital gains on the appreciation of sold stock at a lower rate than his secretary did on via income tax on earned income (which included Social Security and Medicare taxes). The tax system is set up this way to encourage long term investment in risk. (which is how we got the Iphone, EVs, and the Internet to name a few innovations). This was proven to generate even more revenue for the Federal Government in the 90s when the Clinton Administration approved a Capital Gains tax cut on the front end of the internet boom. The resulting investment and increased taxable gains contributed largely to balancing the budget at that time. We have always treated investment income differently from a paycheck.
I did not know you were Mr. Buffett’s accountant. And a mind reader as well. And a more informed tax expert than people like David Cay Johnston. Great word salad!
reply to Mr James Scholl – I don’t have to read Mr Buffets mind. His company (at the time, symbol BRK.A and BRK-B) are publicly traded and fall under regulation by the SEC which means he must act in the fiduciary interest of his share holders and follow GAAP accounting procedures. If for some unforeseen reason his companies were paying higher taxes than the law requires, he would have to disclose that. There has been no such disclosure.
Click on the links provided at the end of the debate. You’ll find that the reality of who pays income taxes in the country today is radically different than a “tiny percentage”. The IRS publishes extensive breakdowns of income tax returns sliced and diced in myriad ways in the quarterly Statistics of Income Bulletin (SOI). You’ll find it interesting. Here’s a link: https://www.irs.gov/statistics/soi-tax-stats-soi-bulletins
If it were true that the wealthy pay a similar percentage of their total income when compared to the middle class, then you would have shown a link to that. You also should have copied my whole comment. What you did instead is misleading.