Yesterday all we heard about Build Back Better was two things-- a- yes, it's gutted and hardly worth all the bad p.r. that it engendered getting this far and... b- any minute now. The final bill is minutes or hours away. This morning, it seems even further away than it was yesterday, as both the billionaires (and their handmaidens) and the progressives express dismay over what a piece of crap a once beautiful package has turned into.
First the billionaires: After reluctantly agreeing to go along with a modest tax on the 700 richest families in America, Manchin, who doesn't make move without acquiescence from the billionaire class, is now waffling. Imagine if he had a tenth of the concern for his constituents as he does for his "contributors!"
Biden, desperate now, seems far more concerned with passing the conservative, inadequate hard infrastructure bill-- which progressives only agreed to vote for in return for the social infrastructure bill. The inability to even put together a framework of agreement-- Democratic Party vs Manchin and Sinema-- calls into question, wrote the PunchBowl crew this morning, whether Pelosi can pass the long-delayed $1 trillion fake-bipartisan infrastructure deal by their self-imposed Oct. 31 deadline. The White House badly wants to clear the public works bill, as do corrupt conservative Democrats in both chambers. "However, without the framework agreement, we’re pretty sure it won’t pass. Pelosi says it should, progressives say they’ll continue to block it as they await a social spending deal. Another short-term patch to surface transportation funding could be necessary. We’ve asked administration sources if the president would press for an infrastructure vote without a framework agreement, and they think it would be foolhardy... Manchin and Sinema, not the Democratic leadership or the White House, have been calling the shots on the direction of the talks. Individual senators and members have even taken to negotiating directly with Sinemanchin in order to win their support-- or overcome their opposition-- to provisions in the package. While this role for Manchin and Sinema has generated enormous outrage on the left, Biden has been forced to acknowledge that in a 50-50 Senate, each senator 'is a president. Every single one. So you got to work things out.'" Every single one is a potential president; only 2 are as corrupt as Manchin and Sinema and only one-- Sinema-- is an absolute psychotic.
Here's the bullshit ad the NRCC is running in 15 districts against Katie Porter (CA), Jahana Hayes (CT), Stephanie Murphy (FL), Cindy Axne (IA), Marie Newman (IL), Jared Golden (ME), Dan Kildee (MI), Chris Pappas (NH), Andy Kim (NJ), Tom Malinowski (NJ), Tom Suozzi (NY), Antonio Delgado (NY), Susan Wild (PA) and Kim Schrier (WA). Republicans, of course, oppose the super-rich paying their fair share of taxes. Conservative Democrats like Manchin and Sinema generally agree with them. Here's some recent polling on the subject. First one from the end of August:
And this one is from mid-September. Basically they both say the same thing. The rich should pay their fair share and voters will punish conservatives who block that.
So... which demands made by Sinema and Manchin have the feckless, weak Democrats agreed to? First and foremost, all the new climate provisions that would force utilities to move to clean energy, something even Manchin's own constituents want!
They've also killed Medicare expansion that would have included dental, hearings and vision care-- something overwhelming popular everywhere in the country and evensong Republican voters. Ditto for lowering the cost of prescription drugs, although the corrupt conservative Democrats who have killed that are literally getting big ad buys from PhRMA that mislead their districts into believing that anti-family fanatics like Blue Dog Kurt Schrader (OR) are trying to lower the costs of drugs. Also-- no more tuition-free community college and no more 12 weeks of paid family and medical leave.
The billionaires, wrote Judd Legum early this morning are angry, even though they've made more money since the beginning of the pandemic in March, 2020 than the cost of the whole social infrastructure package. Three of them-- Bezos, Zuckerberg, and Gates-- saw their personal wealth go from $400 billion to $896 billion (up 125%). And that doesn't include scumbag Elon Musk who's net worth increased by $36 billion just yesterday and increased his wealth by around 80 billion since March, 2020.
"But Musk and his fellow billionaires," wrote Legum, "pay an extremely small percentage of these gains in taxes. Leaked tax records obtained by ProPublica revealed that in 2018, when Musk was the second-wealthiest person in the world, he paid no federal income taxes. Between 2014 and 2018, Musk's wealth increased by $13.9 billion and he paid $455 million in taxes-- a true tax rate of just 3.2%. Over the same time period, the 25 wealthiest Americans paid an average true tax rate of 3.4%. How do the billionaires do it? Yes, there are complex tax avoidance strategies. But the core reason is simple. Most billionaires increase their wealth almost entirely from the appreciation of assets, mostly large quantities of stock. (Musk, Zuckerberg, and other billionaire CEOs pay themselves a salary of $1 per year.) Under the current tax system, stocks and other assets are only taxed at the capital gains rate (about 23.8%) when they are sold. Billionaires can get as much cash as they need by borrowing money against the value of their assets. Financial institutions provide them with loans with interest rates under 1%. (In 2020, Musk had 'pledged more than 92 million of his 227 million Tesla shares to secure personal debts.') While average Americans get their taxes deducted automatically from every paycheck, billionaires can avoid paying most taxes indefinitely. And many of them do."
Legum suggested that "this gravy train may be ending soon." I doubt it, but the billionaires are angry its even been brought to the public's attention. I wonder if I'm the only person who decided in the midst of this not to buy a Tesla.
Democrats were initially planning to pay for the Biden administration's Build Back Better plan by raising the corporate tax rate from 21% to 26.5% and restoring the top income tax rate from 37% to 39.6%. This would partially roll back Trump's 2017 tax cuts. The money would pay for a genuine effort to combat climate change, universal Pre-K, expanded Medicare benefits, the nation's first paid family leave plan, and other investments.
But recently, Senator Krysten Sinema (D-AZ), who voted against Trump's tax bill, abruptly said she opposed any increase to the corporate or individual tax rate. This sent Democrats scurrying for alternative sources of revenue. Soon, that attention focused on a proposal being developed by Senator Ron Wyden (D-OR) to increase taxes on billionaires. The Wyden proposal would tax the unrealized capital gains of people whose wealth exceeds $1 billion. Currently, that threshold applies to 745 people, or .0005% of the population.
But since these people have such an immense amount of wealth, Wyden's proposal could raise an impressive amount of money.
Musk is not happy.
...On Sunday, Nancy Pelosi estimated that the billionaire tax could raise $200 to $250 billion over 10 years. And that might significantly underestimate the revenue potential.
In the first year, the tax would apply to all the unrealized capital gains held by the nation's billionaires. According to the latest figures, billionaires currently hold about $5 trillion in wealth. Of that total, $3.5 trillion is in stocks. Gabriel Zucman, an economist that teaches at the University of California, conservatively estimates that 60% of billionaire stock holdings represent unrealized capital gains. That's a tax base of $2.1 trillion. If you tax that at 23.8% it would generate $500 billion in revenue. $275 billion would come from the top 10 billionaires alone.
That excludes revenue from any non-tradable assets that are sold during the 10-year budget window and any additional unrealized capital gains over that period of time. So a tax that impacts fewer than 1,000 people could pay for a major portion of the entire reconciliation package.
Is it fair to wonder if-- like in France in the 1790s, when the super rich refused to pay their fair share of taxes, people finally got fed up with it, confiscated their wealth and cut off their heads. That would be good. Would you like to see Elon Musk guillotined? On TV? Would you watch?