technocritWe Desperately Need Maximum Wage Laws
owenfromcanadaThe solutions aren’t complicated. What’s complicated is getting the solutions implemented when enough representatives are bought out by the wealthy.
This is a much more difficult problem than you suggest. Taxing standing wealth of 1.8 million would limit so much of the upper middle class that actually drives economies.
Given how many people have their wealth invested in theor home, how do ypu propose to do this or is everyone constantly downgrading the home they are invested in?
Nothing in economics is ever “easy”.
Real estate is a good example of the trickiest thing about “simple” wealth tax.
I bought a house, and 20 years later I have to pay more taxes because my neighbourhood is more desirable?
Okay, easy solution, you get one free house you need to reside in for x% of your time per year.
But say I bought a painting from a local artist, even a friend, and decades go by and they’ve gone on to become ultra famous. Do I now have to pay more tax because I possess something that has become valuable?
Obviously thats a very unlikely scenario, but you can see the principle issue.
For the numbers I suggested, I don’t think you’d realistically hit these types of cases.
1000x annual minimum wage is $14.5 million. Based on a quick search, the threshold for the top 1% of Americans with respect to net worth starts at $13.6 million in 2023. So over 98% of Americans would never see the impact of a wealth tax like this.
If minimum wage were brought up to a realistic level, say $20/hour (still low, but better than the current $7.25), that threshold jumps to $40 million. This would capture somewhere between the top 0.5% and 0.1%. This is excessive wealth.
In the case where your painting is suddenly worth $50 million, yes–you’d have to pay more tax. But I think that many dollars might be some reprieve from the pain of selling it.
Applying sensible economic policy to extreme wealth is easier than general economic policy.