We need to stop coddling and pandering to the ultra-wealthy billionaire class. Giving them tax breaks, tax loopholes, and cabinet-level government appointments, accepting their every word as if it were gospel, admiring their excessive lifestyles of mega-yachts and private jets and palatial homes.
Unfortunately, the ultra-wealthy billionaire class in this country have so much wealth that they have removed themselves from our society and live a separate kind of existence. For many of these people, society exists to be exploited in ways that allow them to further increase their wealth.
This was not always the case. Fifty years ago, there was only one billionaire in the United States, Daniel K. Ludwig. During these past fifty years, the ultra-wealthy have benefited from the economic success of this country and the excessively favorable changes to our tax laws. There are now over one thousand billionaires in the United States, a 100,000% increase statistically speaking.
The people of this country could really use the $5.5 trillion of cash that the billionaire class has secreted away. After all, it was our labor that created this wealth. It is about time that we shared in the prosperity we created.
So, where to begin?
First, we must make sure that the ultra-wealthy actually pay their fair share in taxes and social security. We must eliminate the tax breaks and loopholes that allow the ultra-wealthy to avoid their fiscal social responsibility
Second, we must provide incentives to the ultra-wealthy so that they voluntarily spend a portion of their wealth in ways that actually benefit society.
Third, we must change our estate and inheritance laws so that a greater portion of this accumulated wealth will eventually be repatriated with the working people whose labor created it.
A Return to Pre-Reagan Tax Brackets
President Ronald Reagan believed in the inherent selflessness and generosity of the ultra-wealthy. He believed that the ultra-wealthy, through their corporations and business entities, would share their economic good fortune with their workers. He termed this concept trickle-down economics.
President Reagan used this concept to justify reducing the tax bracket for the wealthy from 70% to 28%, and for corporations from 48% to 34% as part of the Economic Recovery Tax Act of 1981. Currently, the maximum personal tax rate is 37%, and the maximum corporate tax rate is 21%.
This, accompanied by a reduction in the capital gains tax rate to a current rate of 20%, along with a myriad of special tax adjustments that for all practical purposes can only be used by the wealthy, means that the ultra-wealthy pay taxes at an effective tax rate that is lower than the rate that applies to most Americans.
The wealthiest Americans receive preferential tax treatment compared to most Americans because of their financial influence and resulting corruption. There is no justification for shielding and protecting the wealthiest Americans from having to pay Federal income taxes at anything less than the applicable tax rate, which is what the rest of Americans have to do.
Something similar can also be said for corporations, many of whom are able to avail themselves of special tax incentives, breaks, and exclusions to the extent that they pay no Federal income tax at all.
A return to a 70% maximum personal tax rate and a 50% maximum corporate tax rate, with all capital gains on realized investment income taxed at the same rate, and the elimination of all special tax incentives, breaks and exclusions, would force the ultra-wealthy and corporations to be fully part of the progressive income tax system that applies to the rest of Americans.
And that concept of trickle-down economics and the inherent selflessness and generosity of the wealthy? It now seems like a quaint and naive fairytale.
Capping Borrowing Against Appreciating Assets
One of the clever ways that wealthy people use to avoid paying taxes is to replace income with debt. By borrowing against appreciating assets and using these assets as collateral, cash flow is preserved by using borrowed money for living expenses instead of either earned income or realized capital gains. If the return on investments exceeds the interest rate of the loan, so much the better.
At the time of death, the wealthy then use a stepped-up cost basis provision in the inheritance tax code that allows assets to be valued on a current cost basis instead of the original cost basis, thereby allowing the transfer of assets to the heirs who then avoid paying any significant capital gains taxes.
This tax provision is of great benefit for the transfer of family businesses and farms that would otherwise have to be sold to pay estate taxes. However, it represents a financial windfall for ultra-wealthy family dynasties, preserving wealth as it is passed on from generation to generation.
The use of appreciating assets as collateral for loans needs to be regulated much more than it is now.
Loans obtained in this manner should be directly linked to specific and documented capital investments. Money obtained from this type of loan without such linkage should be considered to be income, and should be subjected to Federal income tax. Money obtained in this manner that does not result in capital investment should be considered to be a fraudulent loan, with both borrowers and financial institutions subject to severe financial penalties and possible imprisonment.
Uncapping Social Security
There has been a taxable income limit for social security withholding since the inception of the Social Security system in 1937. For 2026, this limit is $184,500. Earned income above this amount is not subject to social security withholding.
There is no constitutionally or legislatively mandated requirement that there must be an income limit for social security withholding. It is estimated that eliminating the income limit and applying the social security withholding to all earned income would result in the elimination of 75% of the projected social security shortfall, and possibly more.
Having a taxable income limit for social security withholding is a benefit that is only enjoyed by the top 5% of workers in the United States. Interestingly enough, there is no taxable income limit for Medicare withholding. Social Security could and should be treated in the same way.
By itself, this change would not generate earth-shattering revenue for this country. However, it would ensure that the wealthiest 5% of Americans no longer receive an arbitrary, unearned, and unneeded benefit. As a very positive consequence of this change, the Social Security program would become financially sustainable, and the safely net that retired and disabled Americans rely on, many to avoid living in abject poverty, would be preserved.
Creating A Legacy A Billion Dollars At A Time
Once you’ve made your first billion, what’s the point of the second? To see if you can do it again, I suppose. But at some point, making more and more money just to say that you are one of the wealthiest people in the world becomes an empty excuse for a life, certainly not a life well lived, super egos not withstanding.
$300 million for a floating palace of a mega-yacht that you rarely use, $150 million for a few luxurious private jets that you rarely use, $100 million for a few vacation homes in beautiful locations that you rarely use – such a pointless, selfish, and wasteful extravagance.
Would it not be better and more satisfying to spend your billions to create something tangible, something that would be of true benefit to the society that made your wealth possible, something that would last beyond your own lifetime, something that would have people remember you not just as a greedy person but as a good person?
There is still time for all of you billionaires to reconsider your life choices.
According to the Forbes 400 list, there are 123 American billionaires who are worth 10 billion dollars or more.
For perspective, the Mario Cuomo bridge that spans the Hudson River, which was completed in 2018, cost approximately $4 billion. Any of these billionaires could pay for a beautiful new bridge like the Mario Cuomo bridge, and still have a minimum net worth of more than $5 billion, worst case scenario for the poorest of these very wealthy billionaires.
There are a multitude of public works that billionaires could champion, among them:.
- Replacing some of the thousands of deteriorating bridges and dams located throughout the United States. The cost of replacement varies depending on the size and scope of the work, but $4 billion would pay to replace a great many smaller bridges and dams located in rural parts of the country, or would pay to replace a major urban bridge that could serve as a legacy project. It is estimated that replacing the worst of the rural bridges would cost $35 billion, and replacing the worst of the rural dams would cost $35 billion.
- Providing additional electrical capacity for the United States. The cost of a 300 mW wind or solar plant with a supplemental energy storage system is approximately $1 billion. A small-scale 300 mW nuclear power plant is approximately $4 billion, although this technology is still in development. Decentralizing electrical generation by constructing new smaller-scale power plants in underserved locations may be a cost-effective alternative to a wholesale upgrading/replacement of the aging electrical grid of the United States.
- Developing water control, flood protection and flood damage mitigation systems along waterways throughout the United States. Changing weather patterns are becoming more extreme, with periods of very heavy rain and snow, followed by periods of very little rain. The means to control water to protect against catastrophic flooding and, at the same time to collect it for later use, is currently inadequate in many parts of the country. The cost of constructing levees, water transmission tunnels, pumping stations, and underground water storage facilities at critical locations is very site specific, but certainly $4 billion would be an impactful investment.
- Managing Federal and State forests to minimize the potential for catastrophic forest fires that result in the loss of life and billions of dollars in property and infrastructure. There are approximately 800 million acres of forest and woodlands in the United States. an assumption can be made that 10% of this, 80 million acres, is within five miles of cities, towns, and other developed areas. Controlled burning, and removal of deadwood and other highly flammable biomass from the forest floor and converting it into energy or some other carbon-based end product is expensive and must be periodically redone. At $100/acre, an $8 billion investment could clear all 80 million acres.
- Ensuring that medical facilities in rural areas throughout the United States are fully funded. Many of these facilities require financial subsidies from the government because these facilities are not financially sustainable on their own. This funding is vulnerable to politically-based reduction or outright elimination. It is estimated that there is a potential shortfall of $2 billion per year. A $2 billion annual investment would provide financial support for the entire rural hospital system and ensure that quality healthcare is available throughout this country.
- Increasing the domestic capacity for the production of generic drugs and their precursor chemicals, 90% of which are currently sourced from India and China. This is a strategic vulnerability of the United States. The cost of a basic pharmaceutical manufacturing facility, including the capability to produce the necessary precursor chemicals, is approximately $1 billion, so an investment of $4 billion could conceivably construct four facilities. As an additional benefit, these facilities would be able to produce necessary vaccines should another epidemic occur.
- Modernizing and expanding the recycling and reclamation system in the United States so that there is essentially 100% availability for residential, industrial, and construction waste. The use of landfills, ocean depositories, and foreign facilities are all inefficient and unsustainable ways to dispose of potentially valuable materials that have already been mined, harvested, or processed. A recycling facility capable of producing a usable grade of reclaimed material costs approximately $250 million, so $4 billion would be sufficient to fund sixteen regional facilities.
The point is, this country has many immediate needs that cannot be addressed by our current system of government because there is simply not enough money to address them. Immediate needs such as a new bridge or forest fire prevention or rural access to health care are not as sexy as, shall we say, helping to cure cancer, or drilling water wells in African villages, or any of the other works being done through grants made by private foundations/tax shelters that require little thought or action other than to sign a check.
And that’s the point, isn’t it – making a real, tangible difference without needing to make a profit or obtain a tax deduction, or needing to attend gala events with your fellow billionaires to celebrate your magnanimous giving while being served by waitstaff and cooks who are on Medicaid and SNAP.
This giving will never happen without incentives. One commonsense incentive would be that any capital gains realized in the sale of assets to fund such socially-responsible works would not be taxed. At least then any billionaires who did such works would not be penalized for making a positive difference on behalf of society. An additional incentive would be to allow a nominal tax credit to be taken based upon a percentage, e.g., 10%, of the investment made.
Expanding The Scope of Estate and Inheritance Taxes
There are a number of ways that wealth can be passed from generation to generation. To some extent this transfer of wealth is a good thing. For example, a family-owned business or farm should be able to be passed down from one generation to the next without an inheritance/estate tax burden that essentially requires the sale of the business or farm to pay the taxes. So too, passing down a certain amount of accumulated wealth from generation to generation can provide a measure of financial security for the next generation.
The current Federal Estate Tax schedule provides for an exemption of $15 million for an individual, and $30 million for a married couple, to be indexed to inflation going forward. This is believed to be sufficient to protect the transfer of family businesses and farms, and certainly is sufficient to provide financial security for the next generation.
The current Federal Estate Tax rates are progressive in nature, with the maximum tax rate of 40% applying to $1 million or more of estate value in excess of the $15/$30 million exemption. A combination of raising the maximum tax rate to 70% and requiring that asset appreciation be valued on an original cost basis and not on a stepped-up current cost basis may or may not generate significant additional revenue, given the many ways that wealthy individuals are able to protect their wealth. However, it would be a significant statement of the intent of society to limit financial inequality to the generation who created it.
Those who inherit a previous generation’s wealth did not create this wealth, and instead are only the fortunate beneficiaries of this wealth. Should a more robust Federal Estate Tax program be instituted, and the various special tax breaks, considerations, and exclusions that allow wealth to be shielded from taxation be eliminated, then taxing inherited wealth would seem to be excessive.
To the extent that this inherited wealth becomes income-generating, then this income, along with capital appreciation and any realized capital gains would be subject to taxation in accordance with established tax law. In the very end, of course, the Federal Estate Tax awaits.
The Rockefeller and Carnegie Family Legacies
In the late 19th century, John D. Rockefeller founded Standard Oil and created an oil empire that would have been worth $350 billion dollars today. Many generations later, the current combined wealth of the Rockefeller heirs is approximately $10 billion dollars, a significant amount of money but nowhere near the value of the original Rockefeller fortune.
Once he had made his fortune, John D. Rockefeller decided to devote himself to doing good works. This is something his heirs have embraced as well. Billions of dollars have been given away and invested over the past 100 years to support various endeavors, from the University of Chicago to improving crop yields worldwide.
Another extremely wealthy man, Andrew Carnegie, had a similar epiphany and invested much of his fortune in such endeavors as the Carnegie-Mellon University, Carnegie Hall, the Peace Palace in the Hague, and the establishment of over 2,500 public libraries worldwide.
A contemporary of John D. Rockefeller’s, Andrew Carnegie founded Carnegie Steel and created a steel empire that would have been worth $309 billion dollars today. In his book “The Gospel of Wealth,” he called on the rich to use their wealth to improve society, stating that there was a moral imperative to do so. He believed that “a man who dies rich dies disgraced.” True to his belief, Andrew Carnegie gave away over 90% of his wealth before he died.
These men and their heirs created true legacies that continue to benefit us all. These wealthy people returned their family wealth back to the society that gave them the opportunity to succeed.
When you consider the eleven richest men in this country – Elon Musk, Mark Zuckerberg, Jeff Bezos, Larry Ellison, Larry Page, Sergey Brin, Warren Buffett, Steve Ballmer, Jensen Huang, Michael Dell, and Bill Gates – few of them seem particularly interested in anything other than accumulating more and more wealth.
To be sure, these men have their charitable foundations, but much of what their foundations are involved in is focused on intangible goals such as curing disease, addressing climate change, preserving the environment, and improving education, among others. None of these goals provide tangible, real-world, implemented solutions to any of society’s needs. It may not be all smoke and mirrors and tax-deferred strategies, but without substantive results, these foundations appear to be of questionable value.
In addition, these foundations are typically funded with multi-billion dollar endowments, which sounds impressive until one realizes that these endowments represent less, sometimes far less, than 5% of the total wealth of the men and families who established the foundations. Moreover, many of these foundations are secretive in nature, which raises questions as to where and how the foundations distribute their funds.
As an over-generalized observation, there seems to be no real commitment, and certainly no financial sacrifice or sense of personal and heartfelt investment in what the ultra-wealthy do through their foundations. Their efforts and their intentions cannot be compared to those of John D. Rockefeller and Andrew Carnegie.
Before they became philanthropists, both John D. Rockefeller and Andrew Carnegie were considered to be ruthless businessmen who engaged in unethical and monopolistic practices to eliminate competition, utilized corrupt political influence, faced little or no business regulation, paid their workers low wages, suppressed attempts to unionize, and generally put profit before worker welfare.
Unfortunately, few of the ultra-wealthy contemporaries of Rockefeller and Carnegie believed in any moral imperative to give back to society. Most just wanted to make more and more money. Sadly, and disappointingly, the same can be said for the ultra-wealthy billionaires of today.
And this would be why we need to make the bastards pay.