Are you a billionaire?


Elizabeth Warren has a calculator to determine how much you’d pay in taxes under her plan. It’s disappointingly small. What are those people afraid of?

Comments

  1. brucej says

    They’re terrified of having to contribute their own hard-earned-by-sombody-else money to help build a society where they might just have to work a teensy bit for their hard-earned-by-sombody-else-and-a-token-bit-of-work-by-themselves money.

    More frightening, though is that the society built will make the serfs a little more powerful.

    What they should be afraid of is the guillotines, not the taxes if they don’t acquiesce to paying their fair share.

  2. says

    I spent an hour playing with that thing last night. You can enter numbers less than $1 billion. At $100 million you would pay $1 million a year which implies that without any earnings or losses over time, that Warren’s tax would still take 100 YEARS! to eat up your wealth. However, since the tax doesn’t kick in below $50 million then after 50 years the tax wouldn’t apply at all any more. So if you’re some silicon valley wunderkind who made $100 mill by the time you’re 30, you’d be 70 before the government even “stole” half your wealth. Then you could still live on $1 million a year for another 50 years until YOU ARE 120 YEARS OLD.

    I know it’s more complicated than that, but I don’t think Warren picked $50 million out of thin air. It really is simply the fact that at $50 million you can live the rest of your life in comfort and security so why not give some back. Unfortunately most billionaires seem to be sociapathic megalomaniacs, or at least that’s what you get from the ones on TV.

  3. PaulBC says

    @2

    It really is simply the fact that at $50 million you can live the rest of your life in comfort and security so why not give some back.

    I think you can retire pretty well on less than that. You can also blow through that much money if you suddenly believe you are rich enough to own a fleet of private jets and you attract hangers-on, etc. So $50 million really does seem like it’s out of thin air to me.

  4. christoph says

    I used to worry that these taxes weren’t fair to rich people. Then someone took me aside and said, “Don’t worry about the rich. They’ll be fine.”

  5. brucegee1962 says

    I’m going to say something truly un-American here: I have waaaay less than a billion dollars, but I have enough money. As in, if I had 2x my current amount, or 4x, or 10x, I don’t think it would make any significant difference in my lifestyle. I can’t think of anything that I could afford to buy then, that I can’t afford to buy now if I really wanted to. When I see things advertised, I tend to think more in terms of “do I have room for this” or “is this justifiable in terms of resources used and environmental cost” rather than “can I afford this.” (The answer to both questions is usually “no”.)

    Furthermore, when I think of why more money in the bank might be nice, I come back to three main things. First of all, it’s important to be able to send my kids to the college of their choice. Second, I want to have enough put away so I won’t get wiped out if someone in my family gets sick. And third, there’s such wrong with the world, that charitable giving feels nice. But actually, Warren’s plans would cut down on all of those concerns — if we lived in a more equitable system, we wouldn’t need so much charitable giving.

    What I’m saying is, if she boosted my tax bill to help people who need help, I would absolutely cheer her on.

  6. anchor says

    Their cynicism is showing. They’re so hardened to the growth and preservation of their bottom line that they fear if the government takes so much as an inch of it, they’ll take the whole mile. Besides, they couldn’t bear the thought of losing their modest investment of many millions toward the effective protection of their interests and operations by greasing the appropriate channels. They can’t afford to lose that control, especially since its so much more economical than reasonable taxation.

  7. says

    Not yet, but I might be one day so I oppose taxing them. Also, they keep promising me jobs and if I let them keep their very hard-earned money one of these days they are bound to deliver.

  8. PaulBC says

    brucegee1962@5

    If I had significantly more money, I would not have to work on things other people want me to do. That’s a big deal. In other words, I still want my FU money. I have a modest lifestyle, but I do have kids approaching college age, and in the US, it is still nice to have a job with medical benefits. Other than that I’m OK, but either my needs or my assets are different from yours.

    I feel no shame about seeking money, because it’s how the game is played here, and I can defer the choice of worthy recipient indefinitely (as long as I’m alive anyway). The day I believe I actually earned my money, I’ll start to worry. Or maybe there is a kind of brain rot that sets in with wealth.

  9. ardipithecus says

    They are afraid of the slippery slope. Once wealth taxation starts, where will it stop? If it stops at all.

    Because, why should it stop?

  10. PaulBC says

    But to be clear, I’d be happy with higher taxes all around. I’m doing fine, but the so-called “tax cut” of 2017 was a shifting around for me if anything. I don’t get to deduct most of my state tax and property tax, and I claim the standard deduction like a schlub (what idiot thought I wanted a “simpler” tax form–there’s software for that!). On the other hand, the corporate give-away probably serves as a useful backstop to an actual stock market crash that would wipe out my assets. Actually, if I lost 4% of my SF Bay Area home value as one analysis claimed, then it’s again bad news for me. It is unambiguously payday for billionaires though.

    Billionaire tax libertarians also seem to forget that all their money comes from businesses that rely heavily on public infrastructure (not to mention the labor of those whose wages they work to suppress). All those Walmart trucks aren’t paying by the mile. This is the real outrage. They take more money from the public till than individuals with modest incomes and then they claim the government is robbing them. And a lot of Americans believe it. Yes, definitely raise taxes. I am not sure at this point if it harms or hurts me, but I would rather see the money going to public investment. Health and social safety net of course. But is it a controversial point that we should repair bridges on the verge of collapse and that businesses relying on these bridges ought to pay their fucking share?

    The first and most significant “tax” is the difference between the value created by labor and the wages proffered in return for that labor.

  11. PaulBC says

    @9 Oh man. It’ll stop as soon as any random billionaire whines like a baby. Meaning it’ll stop before it starts. That’s what the “Tea Party” did in 2010, making any significant stimulus politically impossible. Rich people are the world’s biggest cry babies and for some reason they get a sympathetic ear from working people.

  12. cartomancer says

    The Athenians in the 5th Century had a wonderful system for making sure that the richest of the rich paid their taxes.

    Athens didn’t really go in for taxing people very much. Apart from an annual tax on resident foreigners, who made up a sizeable proportion of Athens’s mercantile community, the only significant taxes were the leitourgia (liturgies) – expensive public duties performed by the wealthy for the good of the state. The most common one was the trierarchy: the funding of a state of the art trireme warship for the Athenian fleet, but there were also cultural/religious duties in providing a dramatic chorus for the public drama festivals or a troupe of athletes for the games.

    Each liturgy was assigned by the Athenian ruling council to one of the wealthiest men in the state. There wasn’t any kind of internal revenue service, so the council’s list of men eligible for a liturgy was necessarily vague and inferential, but it didn’t matter because any citizen who was assigned a liturgy could challenge the assignment in court. What you did was find another Athenian citizen who you thought was wealthier than you, and challenge them to do the liturgy instead. If they agreed and admitted they were wealthier then they shouldered the burden instead of you, if they did not agree then their entire estate was swapped with yours and you had to do the liturgy with your newfound wealth. Liturgies were also extremely prestigious, and the wealthy seemed to actually want to undertake them for the prestige and kudos they brought.

    Bring in that system and I’m sure there would be countless millions of challengers willing to shoulder their existing tax burdens using Bill Gates’ or Charles Koch’s money.

  13. PaulBC says

    @13 cartomancer

    If they agreed and admitted they were wealthier then they shouldered the burden instead of you, if they did not agree then their entire estate was swapped with yours and you had to do the liturgy with your newfound wealth.

    This seems a little broken*, because if I misjudged the other estate by mistake and not maliciously, then I’m left with a smaller estate and the obligation. Is there a way to make it at least as fair as the classic pie-cutting algorithm? (You slice in half. I choose who gets which.)

    Suppose the challenged party B chooses which estate gets the obligation of liturgy. The original challenger A now chooses who gets which estate along with its obligation. It’s still not as fair as pie cutting, but it leaves more strategy. Let a, b, and l be the value of the challenger’s estate, value of the challenged party’s estate, and the cost of the liturgy, respectively.

    Assume both parties have perfect information. It’s in B’s interest to assign the liturgy to the largest estate and thus minimize the difference in net value (since A gets to choose), and in A’s interest to pick the estate with the largest net value. If b>a, then A was right to make the challenge. If b-l>a, then they get B’s estate along with the obligation (gain for A). If b-l<a, then they keep their estate and B does the liturgy (fair outcome). If a>b they were wrong to challenge. If a-l>b, they take back their estate and the obligation (fair outcome). If a-l<b, then they swap estates and leave B with the obligation (gain for A).

    Hmm… this is unfair because A can find someone just a little bit less wealthy and transfer their estate with the obligation for a net gain. All the other outcomes seem OK. In the first one, A is rewarded for identifying a richer estate. The others are washes. Any mistakes above? (Haven’t thought about what happens if you switch the moves around).

    *I realize the Athenians may have had the goal of applying an extra penalty for a frivolous challenge.

  14. rydan says

    I don’t get it. Warren said it was just 2 cents (meaning 2%) but now it is 6%. I know this is just a tax that we’ll never see ourselves but if she’s changing the numbers on the fly like that mid campaign what is to say she isn’t going to do the same to us? I could easily see her going from “no new tax on the middle class” to 10% or more increase before she’s done.

  15. PaulBC says

    rydan@16 Uh, so? The GOP changed corporate tax numbers on the 2017 big bucks giveaway at the very last minute. The final corporate tax rate was 21%, which they reached after promising 20% (I believe, anyway, less than 21%) for most of the year since Trump entered office. The only reason for not cutting further was that they had to ram their bill through without a possible filibuster and had to compensate by raising other taxes.

    Note first that the only purpose of the 2017 bill was to drastically lower corporate tax. The rest was window-dressing and punitive elements like eliminating the SALT deduction that applies more often in “blue” states (Funny, guys! I pay at least 2.5x as much SALT as I can deduct). They really didn’t want to go higher on corporate tax, but at the last minute found that raising personal income taxes across the board to lower corporate tax was oddly unpopular even among their own constituents. So they reached a compromise that allowed for a substantial corporate tax cut while throwing some nominal reductions on income tax (unless you live in places like the Bay Area, like I do. Yeah, you Republicans are a regular riot! You sure got me! Good one!).

    So what about Warren. She is proposing a wealth tax. Will she be elected? Will it even pass? Who knows? Will it pass with exactly the numbers she claims on the campaign trail? Obviously not. So 2%, 6%, whatever. I agree it sounds a little sloppy, but I don’t know the context, and I’m quite certain the numbers she states now will have little bearing on the outcome.

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