Saturday, October 30, 2021

Billionaire Tax Is A Ploy To Take Eyes Off Bigger Problems

In sports, the term head-fake is used to describe the act of moving the head in such a way as to deceive an opponent as to one's intended direction or move. The idea of a billionaire tax to tax the super-rich with the idea they will pay for all the gifts the government wants to shower on the people is such a distraction. The idea we can level a playing field that is totally tilted to favor the rich by taxing them after billions of dollars are transferred into their coffers through questionable policies is bullshit. 

Small Businesses Provide Choice
Politicians are about to embark on a bit of expensive theater to give the impression they can address inequality through increasing taxes on the ultra-rich, this will fail. What we need are policies that promote small businesses. Small businesses provide choice, and choice is freedom. Freedom to live as you wish and options on how you shape your future. Freedom stands in total opposition to the World Economic Forum idea that by 2030 you will own nothing and be happy. 

Let us assume that what ProPublica found is true; While the median American household earning roughly $70,000 per year paid 14% in federal taxes each year, the 25 richest Americans (by Forbes’ tally) paid a “true tax rate” of just 3.4% on wealth growth of $401 billion between 2014 and 2018. If so, you can understand why those households with a $70,000 per year income are steamed. ProPublica also claims that since the beginning of the COVID-19 pandemic, billionaires have seen a 70% increase in their wealth, from nearly $3 trillion to almost $5 trillion.

So, what exactly is in this "billionaires tax bill" and how would it work? Nobody really knows because the devil is in the details and those remain few and far apart. Supposedly, the proposal would only impact taxpayers with more than $1 billion in assets, or those with incomes of more than $100 million for three consecutive years. This means the tax would apply to only about 700 of the wealthiest people in America. 

The billionaire tax is an attempt to convince the American people the government can bring in more revenue to help offset the massive spending proposed by progressive democrats and the Biden administration. Such a ploy massively distracts from addressing the unfolding economic nightmare unleashed upon the American people. It also does little to alter the reality of growing inequality, a weakening economy, and the growing political divide that rips at our nation. The hole being created by the loss of choice and options can never be corrected by merely transferring wealth to the least wealthy. Once spent, this money quickly returns to those at the top.

Growing Inequality Was a Problem long Before Covid-19

I contend that today many of the super-rich are capitalist crones and shills of the government. They have been anointed to carry out the mission placed upon them by the super-powerful that pull the strings of society. Make no mistake, this bullshit is a pile of crap dished out to us by progressives so they can unleash their massive spending plan and transfer wealth to those supporting them. When you label something as free you tend to get a lot of takers and this time they are promising a gift to almost everyone.

The answer is to create a system where certain individuals have not been given favored status in the first place. Governments are often behind where many of these billionaires have gotten their profits in the first place. Jeff Bezos and Amazon had the aid of a tax system (no sales tax on online sales) and the United States Postal Service (below-cost deliveries) to propel it forward. Also, politicians rushed to give the company special deals for locating distribution systems in their area, local longtime businesses be damned. 

Tesla and Apple follow the same storyline. Elon Musk has sucked on the government teat to where everything he does is subsidized. While it is still debated whether electric vehicles are better for the environment the masses told by the mass media and a government that has never demonstrated much insight to creating a compelling sustainable future have declared them our savior. Before that it was Steve Jobs, people tend to forget how much of Apple's success flowed from the government buying and filling schools with Apple computers that were produced overseas. 

Two big issues, the first these taxes will not stay on the super-rich, they will morph into a system that works its way downward to the upper-middle-class. Second, the super-rich will avoid such a tax like the plague and shape any legislation to avoid affecting them. The super-rich employs an army of pencil pushers and experts with only one intention and that is to exploit loopholes in the tax code.

It is difficult to ignore how our government has battered small businesses since Covid-19 entered the picture. The one thing you can count on is that it is more about giving the impression we are now asking, no, requiring the wealthy elite to give back some of the wealth showered upon them. If that were ever to happen, which I doubt, we can expect to be told to stop criticizing them for taking so much. All in all, I call this noise about a billionaire tax bullshit.  Pigs will likely sprout wings and fly before anything gets done to address the true causes behind inequality, tomorrow politicians will be off on another tangent. 


 (Republishing of this article welcomed with reference to Bruce Wilds/AdvancingTime Blog)

1 comment:

  1. Hey Bruce, would it be fair to say you're an Austrian school economist?

    Have you thought through the many problems that would arise from a society functioning on Austrian school principals?