America's Hereditary Plutocracy
If you don't follow the news cycle too closely, you might think the news narrative around the blockbuster report by ProPublica revealing how the richest Americans avoid paying taxes, is really a story about the Biden Administration dealing with dangerous illegal leaks. The ProPublica report began simply enough: "ProPublica has obtained a vast cache of IRS information showing how billionaires like Jeff Bezos, Elon Musk and Warren Buffett pay little in income tax compared to their massive wealth-- sometimes, even nothing. In 2007, Jeff Bezos, then a multibillionaire and now the world’s richest man, did not pay a penny in federal income taxes. He achieved the feat again in 2011. In 2018, Tesla founder Elon Musk, the second-richest person in the world, also paid no federal income taxes.
Michael Bloomberg managed to do the same in recent years. Billionaire investor Carl Icahn did it twice. George Soros paid no federal income tax three years in a row. ProPublica has obtained a vast trove of Internal Revenue Service data on the tax returns of thousands of the nation’s wealthiest people, covering more than 15 years. The data provides an unprecedented look inside the financial lives of America’s titans, including Warren Buffett, Bill Gates, Rupert Murdoch and Mark Zuckerberg. It shows not just their income and taxes, but also their investments, stock trades, gambling winnings and even the results of audits. Taken together, it demolishes the cornerstone myth of the American tax system: that everyone pays their fair share and the richest Americans pay the most. The IRS records show that the wealthiest can-- perfectly legally-- pay income taxes that are only a tiny fraction of the hundreds of millions, if not billions, their fortunes grow each year.
At a time when polling consistently shows that the majority of Americans insist that the wealthy pay their fair share, the status quo political establishment whose members' careers are underwritten by the wealthy donor class, is less concerned with content of the ProPublica report and more concerned with how ProPublica got its hands on the information.
How about this Forbes headline yesterday? IRS Commissioner Warns Of Prosecution If Bombshell Tax Records Were Leaked Illegally To ProPublica. Sarah Hansen wrote that "After the release of a major investigation by ProPublica based on over 15 years of confidential data from the Internal Revenue Service showed that the wealthiest Americans often pay little to no federal income tax, the agency’s Commissioner Charles Rettig told lawmakers that internal and external investigators are working to determine whether the data ProPublica used was illegally obtained." Rettig is far more concerned with the privacy of our billionaire class than with the fact that they don't pay taxes.
Republicans line up with the IRS on this. Progressive members of Congress don't. Elizabeth Warren, Bernie, Pramila and others in Congress have been advocating more progressive taxation. This morning Pramila told me that: "As working families have struggled to put food on the table during this pandemic, the rich have only gotten richer and the wealth of billionaires has jumped by at least 40%. On top of that, ultra-millionaires and billionaires haven’t even been paying their fair share for years. Working families across America are paying a higher tax rate than Bezos, Buffett, Bloomberg, and other billionaires-- if these guys are paying anything at all. It isn't just the tax loopholes, it's also how we structure our taxes. That's why we need a wealth tax, and my Ultra-Millionaire Tax Act with Senator Warren will help level the playing field, ensure the wealthiest finally begin to pay their fair share, and invest trillions of dollars into our communities. It's time to make it law-- and it's time to tax the rich."
Republicans and conservative Democrats from the Republican wing of the Democratic Party-- the Democraps like Manchin and Sinema-- are currently blocking even the laughably modest increases the White House has asked for. Short of a revolution, the only way to change the game board, is to stop electing conservatives-- regardless of party-- to Congress. Just stop with the lesser-of-two-evils voting. Now! You can help progressives running for the Senate here and progressives running for the House here.
"'How do we pay for it?' How do we pay for it, said North Carolina Senate candidate Erica Smith today. "That’s the question we get more than any other when we’re on the campaign trail and talking to skeptical voters. We pay for it by making billionaires pay their fair share. We pay for it by not allowing the wealthiest Americans to pay less than working folks. These people have benefited from a rigged economy and in turn had the resources they need to keep it rigged by buying politicians votes. The challenge is not in convincing the average American that we can be better than a country that has food lines as far the eye can see at the same time that billionaires aren’t paying taxes and are doubling their wealth, it’s in finding enough elected offficials with the courage to do something about it. This shows what we already know to be true, our laws are written by billionaires to benefit billionaires and too many legislators are just a vessel in that transaction."
Chris Larson is running for a Wisconsin Senate seat held by one of Congress' most right-wing-- and wealthiest-- members, Ron Johnson, who married into his fortune. Today Larson told me that "The richest of the rich are not paying their fair share because they rigged the system that way. Our hardworking neighbors have to make up for their selfishness because, on a bipartisan basis, the richest of the rich who serve in congress have written laws that favor wealth over work. You don’t have to look far for an example: Senator Ron Johnson even added a provision to the 2017 Trump Tax Cuts that allowed him to nearly doubled his own wealth and vaulted him to being the 6th richest US Senator. It's beyond time we have Senators who pay their fair share in taxes and represent working people in Washington. With an army of grassroots supporter who are also fed up with the broken system, I look forward to defeating Johnson and getting to work to unrig the system."
San Fernando Valley progressive Shervin Aazami is having a baby today-- his wife is literally in labor right now and he's with her in the hospital-- but he asked me to include a tweet he sent out before taking her there:
Earlier, Jason Call, the progressive challenger and reformer taking on status quo New Dem Rick Larsen in northwest Washington, told me that "As others have remarked on the reveal of how little the ultra-wealthy pay in taxes: this is nothing we didn’t already know. The real story is that our Congress-- Democrats and Republicans alike-- continues to allow it while simultaneously telling the public that we can’t afford basic human services. And while the Republicans are openly specious, with Mitch McConnell almost daring the Democrats to call him a fraud, he’s able to get away with his duplicity because the Democrats are just as bad on economic issues. Consider who the richest men in the country donate to. Bezos, Buffett, Gates, Zuckerberg-- all align with the Democrats far more than Republicans. Warren Buffett in 2013 even famously identified and bemoaned that he pays a lower tax rate than his secretary. But what has been done about that? Nothing. We can’t get a pitiful minimal wealth tax passed. We can’t even get the Biden administration to reset the corporate tax rate to pre-Trump levels. This inaction on taxation, more than anything else, that continues to widen the economic divide. The wider that gap becomes, the more undemocratic this country gets and we are already a proto-fascist state. The general populace seems to be in a state of corporate media induced paralysis when it comes to politics. That doesn’t appear to have an end in sight but we must keep trying."
Alan Grayson followed up from another perspective. "It’s simply a function," he wrote, "of the fact that capital is taxed differently from labor, in two respects:
Capital gains taxes are lower than ordinary income taxes.
Asset profits are taxed only when the assets are sold.
You could write a one-page bill that would wipe out this discrimination against labor entirely." I asked him if he would write that bill were he elected to replace Marco Rubio in the Senate. He had a pretty clear answer: "Yes."