[initially posted Wednesday July 9, 2008 - 03:39pm (EDT) on 360.yahoo.com by me, but they are soon closing the 360 site]
So we have a bunch of basic ways to tax the population to pay for all the wonderful public works projects, and the other necessary things, plus some impropriety and nepotism. The big ones are consumption tax, income tax, property tax, and estate taxes. My idea is to phase them all out for a net worth tax; just about 3% a year on net worth... ...you know, what you own minus what you owe. Rough estimates show it would cover the budget deficit and pay down the debt over time.
I saw an interview of Bill Gates and Warren Buffet once and I'm adding something to what Warren Buffett (perhaps a marvelous person), said about having his taxes as a percent of his income being lower than his secretaries... While researching this idea I got side tracked with a fun fact that helps show the difference between powerful people of great wealth and ordinary people. Rupert Murdock (perhaps a lousy person), is a fairly wealthy man. My source claims he's 33 in America at about $8.8 billion net worth. (Mind you I'm not against the accumulation of wealth since I like Buffett a lot from what I have seen of him and he's estimated as having $62 billion of net worth.) If we just taxed 1% of the net worth of people in that top 33 wealthiest Americans, that would be well over an extra $3 billion dollars a year. One percent shouldn't hurt them at all. The potential revenue above is a gross underestimate too because if the top 33 all had a net worth the same as Murdoch, the revenue would be $2.9 billion. If we only taxed 2 people in that group at 1% of their net worth (Warren Buffett and Bill Gates), we would pull about $1.2 billion. That's the top two of 33 that have the potential to deliver a third of the previous estimate. Our top 1% wealthiest Americans are holding over 1/3rd of all the wealth. Their number is just under 3 million people. (their's way too many threes in this post!; just calling them as I see them) So if a one percent tax on the wealthiest 0.00001% of Americans (yes that's a single hundred-thousandth of a percent), brings in way over 3 billion dollars per year, what would happen if we taxed the top 3 million Americans one percent of net worth? Better yet lets tax all Americans 1% of their net worth! Think about it... If you are poor you most likely have a negative net worth, and obviously won't be taxed. If you are middle class, you likely have close to a zero net worth when you weigh the value of your home against the outstanding mortgage, and the other big assets compared to the balance riding on your credit cards, etc., thus the middle class will have very little to be taxed. The "investor" class of people (which I believe used to be referred to derogatorily as the trust-fund babies), will certainly be taxed because they nearly all have a sizable positive net worth. The rich will be paying more dollars total than the prior classes because they have way more net worth in their control. The wealthy will be shelling out big-time cause they have sickening amounts of net worth. Many times I spoke out against flat taxes, and this suggestion is in a meaningful way a flat tax, but what makes it extremely different is it's not a tax on consumption, it's a tax on power. I put together some fast and loose numbers on the nations worth, and it appeared that if we instituted a 2.5% tax on all net worth in America, we could erase all federal income taxes, and federal sales taxes, and have enough revenue to be paying for all existing programs and have a surplus to pay down the national debt. The whole current Federal spending (which is out of control), is $3 trillion, or $3 thousand-billion. You see by the population numbers above that the 1% tax may just cover the existing budget. I think it would be the most fair tax ever to let the ones who benefited the most from our society pay the most; all we have to do is tax ourselves on our assets! Rush Limbaugh and other hosts like him talk a shell game that makes you think that taxing the rich won't work because their aren't enough of them, and that if you did tax the rich more than the non-rich, that all industry would crumble and all people would be laid off or fired due to lack of profits. Hog-wash. No it's worse than hog-wash, his words are like 4:00AM bile on men's room floor of a rundown gin mill. I have a strong desire to start a game of Roshambo with him. First of all a few million wealthy is not too few people to tax to start off with, let alone adding in the non-wealthy but rich (about 29 million people); second, we are all in the game together if every business owner wanted to sell theirs to buy another business somewhere else their would be no buyers because they would all be trying to sell first; they can't all drop at once or even close up shop, and the economy is better when their is a thicker middle-class and a tiny population in poverty. My idea above only takes money from people that have it to spare, not from people that are broke and trying to get by. Love to hear what you think...