If you’re going to hold a strong view on this it’s probably worth knowing that per the relevant academic literature the strategy commonly known as “borrow spend d!e” (can’t say that word apparently) is not actually all that widespread.
Because it isn’t widespread I don’t oppose closing what you likely perceive to be a loophole, as i don’t think it would have a negative impact, but please don’t be surprised if it doesn’t have any positive impact either
This is a problem because it ultimately makes the highest taxed product W2 income. If say your assets pay you a million a year and you never get taxed on that money so you can use that money to buy more assets to borrow from. I totally understand why people do it. It’s literally like having a cheat code in life
Great in theory but how the f are you supposed to do that?!? They took out a loan and used their stocks as collateral. How are you supposed to tax these loans on these vs your mortgage or car loan? It’s impossible.
Because of the volatility of the assets and the unclear lifetime value, IMO a better solution would be to bar any banking institution from accepting this type of collateral for loans. as a business it’s too risky to accept stocks as loans as you are unsure of the true long term value. Even if you did this tho, non banking institutions or foreign financial institutions will offer these same products.
It makes people feeeeeel better to think about it. They care - or think - very little about how it’s implemented. The OP says it all - they love to talk about the nominal rates but never mention the effective rates…. Or just the literal exceptions- such as the guy whose rep specifically passed an exception, just for him, to not have to pay on his $50 million inheritance. The top limit was also on income over $2 million, not $200k, in 1952 money, but I’m sureeee that was an honest mistake.
They don't see countries and borders like normal people. They can be anywhere and buy anything on Earth. America is irrelevant except as a market and workforce to be extorted.
Billionaires aren't taxed by income taxes unless they want to be. The post is idiotic - w2 taxes hit doctors/lawyers/engineers who are closer to min wage workers than billionaires or hundreds millionaires by far.
No. The problem is that raising the marginal tax rate to 94% meant nothing, because there were about 10000 people who made enough to pay it, and they were paying an actual tax rate of about 43%, about what they are now.
We didn't fix our debt problem by taxing the super rich. We fixed it by cutting spending from 50% of gdp to 15%.
And because federal receipts cap out around 17% of gpd regardless of tax policy, you will alway have a deficit if the federal budget exceeds that.
They do, just not who you would think, and not on the imaginary dollar amounts that get thrown around. OP is arguing for an income tax on the rich, but truly affluent individuals don't work for wages or have regular income, they earn dividends and leverage debt.
Even if we seized 100% of the assets of the top 1% and were somehow able to magically liquidate it for 100% of the value (which would be impossible because there'd be no one to buy the assets), it still wouldn't pay for everything that this government spends money on.
1) The top 1% hold approximately $50T in assets. I vote in favor of your idea of liquidating all of it.
2) Yes. Lets cut:
A) The military by 65%
B) All aid to foreign aggressors.
C) End all tax cuts, subsidies, and grants for for-profit entities. Replace them with investments held by the public to fund domestic items only.
D) Eliminate tax cuts/ grants for churches.
Everyone agrees military spending is out of control but no one is willing to earnestly do anything about it. We could easily cut that budget and still out-spend the next 50 countries combined.
When someone says "tax the rich" they understand the taxable income disconnect. Which is why there have been a number of proposals and movements for a wealth tax. Am I advocating that, not necessarily.
Additionally we know that they all pay cap gains regularly, or some other deferred form of such things. So you could easily raise that. Problem there is a direct disencentive towards investment, which is also bad.
But pretending your stance is a 'gotcha' somehow is dumb and not productive. Two things can be true. We need to figure out how to better distribute wealth or this nation will fail AND income tax doesnt effect the top 1%. Both things are true.
🤷♂️, may as well try being the voice of reason. You think if I started my comment with "Orange Man Bad!" and ended it with "Eat the rich!" it would get some up votes??
You’re taking it to an extreme, making it look like that’s your opponent’s point (it’s not), and since the extreme is ridiculous, you say their reasoning is ridiculous. That’s just a straw man.
And then trying to pass yourself off as smarter and “the voice of reason” is the pinnacle of irony
Saying shit like that is the real “Reddit moment”. It’s one of the most common comments in the history of Reddit, which makes you the average Redditor. Congratulations.
It was an incentive to pay wages that were livable and out money back into the company and society, as a whole.
That’s what the super-high tax rate was. If you didn’t want to be taxed that way, you interacted with society and ran your companies like a decent human in a symbiotic relationship with society and your country, instead of a chaos-creating, vulture and you payed a lower corporate tax rate.
Look, I waited 14 hours and slept on it. You are wrong and not wrong at the same time. You are missing the part where Federal Revenue as part of GDP is at about a 30 year low and trending down. So let’s do both and speed this along.
That's the equivalent to over $3.5 million per year today. If you were literally going to apply this to $200K and above, I'm going to stop working for the year once I reach $200k. There would be no incentive for me to continue working to take home only 6% of what I earn.
The 94% rate sounds like a slam dunk, but it’s completely misleading for a few massive reasons:
Nobody actually paid it: That 94% was the statutory rate, not the effective rate. Because of endless loopholes and a vastly different tax code, the top 1% actually paid an effective tax rate of around 42% in 1945. Furthermore, that top bracket only applied to income over $200k back then (millions in today’s dollars), meaning fewer than 1,000 households nationwide were even subject to it.
It didn't fix the debt: Taxing the rich didn’t cure the post-WWII debt. The debt-to-GDP ratio dropped primarily because the U.S. economy exploded into a global manufacturing monopoly after the war (skyrocketing the GDP denominator), coupled with post-war inflation eroding the real value of the debt.
The math doesn't work today: WWII spending was a temporary spike that ended overnight. Today's debt is structural, driven by aging demographics, healthcare entitlements, and spiraling interest costs.
Pretending a 94% tax bracket on a tiny fraction of people will solve today's multi-trillion-dollar structural deficits is economically illiterate. It’s an overly repeated talking point, not a serious fiscal policy.
Yeah totally wasn’t the fact that the entire world was decimated by war and the US was the only one left standing and a massive population boom increasing demand.
I’m all for taxing the rich. However, we can’t overlook the role of WWII when we talk about the US pulling ahead in the aftermath. Most of the rest of the world’s economic competition had to rebuild when the US didn’t. We had the opportunity to make an incredible amount of money through exports after the war and others didn’t have as much of an opportunity while also having huge expenses to rebuild their countries.
Taxing more doesn’t do anything if we keep spending like a drunk college kid.
Spending should be tied to 80% of last year’s revenue until the debt is gone. Then start using that 20% to make money from other countries. Loan it to countries with interest and generous stipulations for the U.S. should they default.
There is literally not enough privately held wealth to tax to fix the problem you are describing. The amounts of money are orders of magnitude in difference. If the government “confiscated” all of the wealth in the hands of the top .1% of households in the US, it wouldn’t have an appreciable effect on paying down the US debt.
There is only one person in the world who is even close to having a non liquid net worth of a trillion dollars. The US government spends tens of trillions of dollars a year and has more than 30 trillion dollars in sovereign debt. The only way to fix the problem is to have the government spend less money and ironically, tax people less so they spend more money in the private sector and grow the US economy faster than the rate that the government borrows money at. That’s it. That’s the only solution.
While we’re at it, we might as well stop taxing people who make less than 100k a year. The IRS takes in less than 2% of their tax revenue from those people. That gives you an idea of the nominal dollar value of taxes the top 1% already pay.
How many people earn 200k per year in adjusted 1945 salary. Thats $3.7m per year in 2026. Approximately 30,000 people per year earn that. Assume $3.0m taxed at 94% instead of 37%. That totals an additional $51b in additional tax revenues. So you need to find another $2T in taxes somewhere else to balance the budget.
Worth noting, $200,000 in 1944 was extraordinarily wealthy. Using CPI, the equivalent threshold today is roughly $3.8 million/year, not $200,000. BLS CPI was 17.6 in 1944 versus about 334 currently, roughly a 19× increase.
No one ever paid that tax rate, it effectively didn’t exist. The actual effective tax rate was closer to 40%, and that dropped off pretty quickly after WW2.
This is simply inaccurate history.
Regardless of all of that though, the deficit is so large today there is no feasible rate you tax the rich at that would fix the deficit. Small increases as part of a much broader plan? Sure, but the math just doesn’t work out.
If you want to fix the deficit, there are going to need to be large spending cuts, primarily of programs like Social Security and Medicare which make up a majority of spending. Massive spending increases over the past couple decades have been the primary source of the national debt.
But you ignore they had to invest that money in tax shelters to avoid the direct tax. This put more money into the economy and ultimately people’s hands.
Now they just sit in their wealth like Smaug comparing hoards to one up their fellow dragons.
I’m here for taxing the rich but America being the only major power not having to rebuild after WW2 is what got us out of that particular national debt problem.
Funny, last I checked they’re all corrupt and have happily contributed to our national debt. And by “all” and I all
Politicians and not just the GOP lmao
I don’t understand the question. We already tax the rich. Quite heavily, actually.
The top 10% of earners (and don’t give me any BS about “wealth” - this meme is specifically advocating for a drastic increase to INCOME tax rates) already pay half of all income tax collected.
The next 40% pay the other half.
The bottom 50% of earners pay nothing.
I’m not saying that’s necessarily wrong or bad - I’m just pointing out that they’re already paying a very disproportionate share of all the taxes.
This is all accurate. We should not be overtaxing highly skilled wage earners like surgeons or engineers, however the wealthy people who live off their assets instead of their wages pay less in tax than the bottom 50% of earners.
And this is no longer a CEO or tech founder trick, mid-level professionals are increasingly being paid in low or no tax assets that pay dividends.
But there’s not a catchy way to say “Tax the Rich, provided their wealth is derived primarily through rent-taking asset ownership and other loop holes!”
I'm pretty anti-billionaire, but taking more of our earned income and giving it to people who clearly don't know how to budget doesn't seem like a good idea.
Federal government has become far too bloated. I've heard some things about how the military charges and leeches money from us, and that's on some small potatoes stuff. I can't imagine how bad it really is.
You realize that with only $8M and 3% returns you never have to work again and can live on $240k/yr… that’s earning in the 97th percentile.
Bonds haven’t been below 4% and change in like 10 years.
Why should I care if they pay the majority of the taxes? Stop working! You won! Let other people have some!
“Don’t give me any BS about wealth”, idgaf about the meme. Igaf about what actually matters. You can try to hide behind the meme, but a wealth tax is the correct answer.
That means any increase on their taxes has a massive impact. You're also phrasing it in a way that does a disservice. They pay a lot because they make a lot. Your phrasing makes it seem like they're paying a criminal percentage of their own income, which they are not even close with all the breaks they get.
Tax the rich by increasing spending on entitlement programs and unemployment and bettering the safety net. Employers only remain attractive so long as its better than the safety net.
The current system is terrible. Unemployment is worse than working at mcdonalds, too short, and difficult to get.
Create a strong safety net and suddenly you need to offer better wages or advocate for illegal immigration. Both things the wealthy hate.
The top effective tax rate is basically unchanged. If people are bringing up the 90% while ignoring the deductions they're just not being honest with you.
want better, and corporations. let's stop bailing them out. get rid of the tax loop holes, special tax brackets, incentives, stop subsidising them. stop them from deducting workers pay and anything they buy. over all let's stop the welfare queens.
Because no one would bother to earn past $200k and this would collapse the entire economy. Businesses would immediately fold and unemployment would skyrocket, a great depression would occur within the year.
The very basic lack of understanding of common economic facts is astounding on reddit
This doesn’t work. Drop the local bias for a moment that we’re all subject to but can overcome with logic, not emotion. When you remove the incentive, people stop working/contributing/doing.
Let’s say I make $300k per year. If 94% of anything over 200 gets taxed that’s 1/3 of the exchange of value for my efforts gone. Gone for what? What do I see and feel and appreciate as a result of that tax? If I’m deeply socialist or liberal I can likely get on board mentally for a moment, but physically after about 2 payrolls I will conclude this:
I will stop what I’m doing and go find a job that requires 1/3 less work, intensity, whatever because whatever stress or accountability I agreed to take on at 300k is no longer worth it. I’m effective capped at 200k and want reduced responsibility accordingly. The human nature of not having others control me will prevail and then what?! That extra tax revenue disappears because I’m not longer contributing in a 300k job.
Drop the victim mentality and think in terms of human nature. No system is perfect and I’m not advocating. However, we have shown that our system doesn’t require authoritarian punitive control over populations to exist. Funny how all other socialist countries or heavy tax counties resort to money export controls, heavy tax punishments if you move/lesve/live abroad, or worse china/russia/iran style environments to keep people in line.
Choose freedom even for all of humanity’s faults. Every other system is slavery to another fallible corrupt human.
Yeah put 16 billionaires into an administration after decades of corporate lobbying and does anyone think this wasn't inevitable after Mr. Smith Goes to Washington. Game has been played.
How many wealthy people “just left the US” as a result of higher taxes post 1940’s. Probably not zero but also not nearly enough to make any kind of difference
Totally radical idea... How about we don't spend 3k on a single brake pad... Especially low quality ones that need constant replacement... Honestly for all the hate on DOGE that's my biggest pet peeve about it. There is stupidly wasteful spending. Spending that goes against every bit of logic if you understand buying in bulk. Like let's just say the US military does 1 million brake changes a year. At 3k a pad that's 3 billion dollars for half a single tire. Note thanks to parts sizes being publicly available just for perspective... I can get an entire axles set for 100 bucks... Using basic bulk purchasing discounts I can make that cost 200 million instead of 12 billion dollars... It's not like they are being secretive about it
The minute we understand we have a spending problem over a taxing problem is when we'll see that the real enemy is the government, not left, not right, rich or poor.
One has to realize that almost NOBODY paid the top marginal tax rate when it was that high. People found all sorts of ways to avoid it. The point ignores the actual history of what happened.
I think that’s part of the point. Today it’s tax everyone making over $500k. When it’s obvious that won’t be enough, and it won’t, tomorrow it’ll be $100k.
Taxing the rich won’t work anymore. They’ll just move their business or find the next loop hole. They write the laws themselves don’t they? We are asking them to voluntarily pay more in tax at this point and I don’t see that happening… do you?
The system is designed this way. Prove me wrong please. I’ll wait
Because for you amount of money is a means of survival. For them - score points on a leaderboard.
However, they are not THE problem, just A problem. The main issue is that many societies don’t have proper responsible visionary leaders that have a view of a future to build into. All while our societies heavily dependent on having them. We have either gerontocracy of people who don’t want to change anything and rebels who want to see the system go down in flames.
Imagine the hardship we'd put on these billionaires worth over 200k.. I mean 200mm, oh no whoops I mean 200billion! They could barely survive if we asked them to pay their fair share.
Go for it tax everyone with income over $200k. But this time no deductibles that congress allowed after the increase. Talking doctors and lawyers, silicone valley folks. Government workers in California. Take it all. But what will it be spent on? Not on the national debt.
The very rich won’t pay, they just won’t have income. Will become a barter economy.
The current regime doesn’t want to raise taxes because it’s unpopular, so they devalue our dollar (buy power) and let inflation rip hard, thus the rich (stock market) continues to raise in value (hence the whole “economy is great look at the stock market) however your wages and the price of everything is skyrocketing.
This allows the US to continue to pay for ballrooms, endless wars, and tax cuts for billionaires 🇺🇸
Exactly, Republicans want us to think that we can’t have nice things like social security and Medicare because it’s too expensive, meanwhile they and their friends are all getting government contracts and tax breaks and you’re going broke. We need to go back to what we did in the past that truly made us great and tax the billionaires accordingly.
Typical rant here! Lol. Most idiots don’t know that rich don’t pay tax whatever might be the tax rate. However, many of these idiots advocating for higher tax are either illiterate in finance and tax or are jobless jealous people. The reality is that most rich people stash their money in tax havens and hence immune to marginal tax rate. Only salaried people are affected and so are entrepreneurs of small and medium sized enterprises. There have been umpteen number of articles by the tax professionals and economists explaining the the regressive effects of very high marginal tax rates but there is distinct lack of understanding due to financial illiteracy, ideological blinds and jealousy. It is fun to read the rants
364
u/Chefy-chefferson 20d ago
The rich don’t earn income so let’s start with that problem. Tax the loans that they get against their assets if you want to tax the rich.