Metaphors flourish, like weeds in a late summer garden.
Democrats are trying to find fifty votes.
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| The complicated way to hitch-hike |
First, two disclosures. One is that I am making multiple contradictory metaphor allusions on purpose, attempting to have a bit of fun at a moment when the frustration of Democrats over the sausage-making of legislation is at its highest. The second is that I have followed Ron Wyden's career closely for decades. My wife and I donate to his campaigns. He is progressive enough to make this a more fair and just society, but bi-partisan enough to be effective in D.C. He wins elections. He gets a majority of votes even in Oregon's bright red 2nd Congressional district.
"I have the best job in the world," he told me. As a senior U.S. senator and Chair of the Finance Committee, he has put in the time to have an informed, nuanced, sophisticated view of our tax and financial system. He knows what can get passed into law.
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| A Hail Mary throw and catch |
He has introduced a Rube Goldberg, last minute, Hail Mary, bolt-on attachment to our tax system, a tax specifically on billionaires and on people who had taxable income of $100 million a year for three consecutive years. Readers of this blog likely understand a key element of tax-paying. One pays taxes on taxable income, not on wealth. Taxable income tends to have discrete dollar-amounts attached to it because it is money in motion--a verb. Wealth is static--a noun. A painting or yacht or 50,000-acre ranch is only "worth" what someone might pay for it, and that is a guess.
Democrats have 49 votes in the senate to raise taxes the normal way, by moving up the tax rates on income, by re-defining capital gains and write-offs. They can target those changes to corporations and the very wealthy. Raising taxes on the very wealthiest is popular, especially now, when billionaires are spending money conspicuously and lavishly. Krysten Sinema says no and she is the missing 50th vote. Republicans won't help. Raising taxes on billionaires is popular among Republican voters, too, but the GOP strategy is to deny everything to Biden and Democrats to create a narrative of Democratic failure. It is politically better show Biden's inability to persuade than it is to support popular things. It is un-intuitive, but it works politically for Republicans.
Wyden put on the table a wealth tax. It would treat as taxable some of the "unrealized" growth of wealth among the very wealthiest. The richest have gotten richer, and they have mechanisms for spending that wealth without triggering taxes on themselves.
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| Bezos in space. Fun, but bad PR |
Billionaires are showing off, and the tax system allows them to get away with things that come across as abusive. For example, in 2011, back when Jeff Bezos had a net worth of $18 billion, he showed zero "income" and claimed a $4,000 child tax credit, designed to assist children in poverty.
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| A complicated way to match soup-eating and napkin-wiping |
The Wyden wealth tax is a bolt-on addition to the tax system because the rest of the system is built around money in motion, not wealth itself. The plan requires a complicated system to define wealth. There needs to be a complicated way to compute losses. A wealth tax may not be Constitutional.
Possibly Senator Wyden is dead serious about this plan, but my uninformed, outsider guess is that we are watching political theater. Wyden has a primary audience of one, Krysten Sinema. He is putting this complicated tax program on the table so it can be shot down, but in doing so prove to Sinema that her fellow Democrats tried everything to accommodate her. Possibly the audience is bigger than that, an audience of progressive Democrats, again to show that establishment Democrats tried everything before accepting half a loaf.
I like Wyden. Wyden does not sound like Bernie Sanders. Wyden supports unions and higher wages, he supports programs that target middle income and poorer Americans, but he doesn't sound anti-wealth, to my ear, in the way Sanders does. Very left progressive voters in Oregon hear what I hear, and they criticize Wyden for it. I like what I hear. I think Wyden understands Americans very well. In my long career as a financial planner and wealth custodian, my observation is that most Americans like the idea of having money. People don't buy lottery tickets so they can find paradise as a member of the mass proletariat, working in solidarity alongside comrades on the shop floor. They buy lottery tickets for the chance to get rich.
The plan Wyden put forth is so complicated I will not summarize it here. Here are links, first Wyden's comment, and then some media descriptions:
I write here to put the plan into the context I think it needs. I don't think Wyden thinks this will pass. It is a straw man. I think it is a move in a chess game, perhaps like a flagrant sacrifice ofthe bishop, for a bigger purpose of moving the game toward victory.
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5 comments:
Oh, for the days that never were, when legislators worked together selflessly promoting everyone's best interests.
Taxing wealth shouldn't be that controversial. Property tax is exactly that and every property owner pays it yearly. It usually goes to local school funding and sometimes well off retirees gripe about it, which is an issue of interest in itself.
I think we have a fundamental problem with explaining the political danger of wealth inequality. Too many don't understand it well, especially those in the thrall of the Republican "trickle down" nonsense, as well as the larger concerns of materialism, greed and the spiritual poverty of so many Americans who worship money.
I don't see why they can't figure out a progressive VAT especially for luxury items--like private spacecraft--which must be paid by a rich individual OR a corporation he controls.
I still remember when Wyden came up. Most of his Gray Panthers are White Panthers or Late Panthers by now.
I deleted a post that wasn't too awful. It contained some false information but it wasn't obscene and it was not full-on troll name calling.
If the author of that comment wished to identify himself by name and location, instead of being anonymous, I would leave such comments up.
Peter Sage
I agree with Rick Millward. Let’s tax wealth, and tax it heavily.
Some may find this too extreme, but I propose taxing wealth (over a long enough period of time that the Uber rich can sell enough assets at a fair price, while leaving themselves-barely-billionaires). Who in hell needs more than a $billion, other than egotists who want bragging rights, e.g, Bezos, who gets bragging rights as the first civilian to fly weightlessly. Woop-de-do.
One sorta, kinda way to tax wealth would be to reenact the luxury tax. Oh, you want to buy a $50 million private jet? Ok, but the taxes are gonna really piss you off. Maybe consider traveling by Amtrak, instead. You can even meet “real people” on Amtrak, unlike all the fellow Uber rich pals you’re stuck with in your new toy jet.
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