They should pay something back to the society that made their unprecedented wealth possible.
And they should pay for the system of capitalism that has allowed them to get rich simply by being properly positioned to take advantage of the unregulated financial markets.
But, as Charles Koch famously stated a few years back, “I want my fair share – and that’s all of it.” The wealthiest Americans, especially those who hide their assets and balk at paying higher taxes, have the perfect role model.
Pandemic Profits: The Outrageous Numbers
From mid-2019 to the end of 2020, U.S. wealth grew by about $20 trillion. The richest 10% (who are roughly speaking America’s millionaires) took $15 trillion of that. These massive profits derived largely from passive stock market gains, as the Wilshire Total Market increased by about $10 trillion during that time. Since March, 2020 the market capitalization for Super Big Tech alone (Apple, Microsoft, Amazon, Google, Facebook) has more than doubled to $9.5 trillion.
The average millionaire in America gained about $600,000 during that year and a half. The “poorest millionaires” gained about $200,000. The average member of the richest 1% saw their wealth increase from $15 million to nearly $18 million.
The 25,000 very richest Americans (the .01%) each took an estimated $80 million during that time.
On the faintly bright side, the average wealth for the poorest half of American adults increased from $10,000 to $14,000. But less than two percent of pandemic wealth gains went to this struggling half of America.
Taxes May NEVER be Paid on Much of this Enormous Wealth
Conservatives pride themselves in talking about “self-made” millionaires who “made it on their own.”
But in a blatant example of a system rigged for the wealthy, the tax code includes a so-called stepped-up provision which allows the super-rich to leave much of their multi-trillion-dollar stock market fortunes to their children with all the accumulated gains magically erased, and thus, in many instances, without a single dollar in taxes coming due.
If daddy and mommy’s stock has grown from $100,000 to $1,000,000 over the years, the kids won’t pay any taxes on that $900,000 gain, and society’s potential revenue is wiped out. As baby boomers age and pass away, more and more privileged children will become accidental millionaires.
The U.S. taxpayer paid for 75 years of government research to develop all the technology that a few well-positioned corporations eventually appropriated as their own. Those corporations and their stockholders should be paying society for the unique privilege of being in position to reap most of the benefits of our parents’ and grandparents’ successes.
But the very richest Americans seem far removed from the notion of shared prosperity that could have made us a nation to be envied.