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Dear John,
Why is it that the rich person’s money is worth more dollar per dollar than the working person’s labor?
Certain income gets preferential tax treatment: financial gains from Wall Street investments and inheritance income are taxed less than hard-earned dollars earned by the labor of hard-working Americans.
That’s right, income from your work is taxed at higher rates than their money from investments.
Why is the tax code warped like this?
Could it have anything to do with the disproportionate influence of the rich on the politicians who determine tax policy?
Most importantly, how do we fix it?
Congress can level the playing field. Sign the petition calling on Congress to tax all income over $1 million at the same rates, whether it comes from work, inheritance, or Wall Street investments now.
The tax code as written is designed to pool the wealth as it grows and keep it among the wealthiest.
Inheritance tax policy is a major contributor to the accumulation of wealth passed down through generations. That sounds like a good thing, but it serves to make income inequality worse -- and perpetuates decades of systemic racism built into the system.
As the law stands, the wealthiest few are able to pass on over $22 million to their heirs at once without paying a penny in taxes.
The results of the compounding of wealth only among the wealthy are profoundly destabilizing. In just fifty years since the 1970s, the wealthiest 10% of Americans more than doubled their share of household wealth, from 33% to 75% of the nation’s total.
Accumulations of dollars pull in more dollars like black holes pull in light. Already, the top one-tenth of one percent of Americans owns as much as the entire bottom 90% put together!
The heirs of the WalMart fortune, for example, own more than the bottom 42% of Americans combined. And it is anticipated that in the U.S. over the next 30 years, a full $30 trillion will be inherited.
These concentrations of wealth are dynastic and anti-democratic, magnifying existing inequities of racism and sexism. The wealthy decide in what companies the nation’s money will be invested, what non-profit organizations and charities will succeed, and what political candidates to fund who will sustain these unfair practices for generations to come.
Taxing capital gains and inheritance at rates comparable to earned income would enable crucial funding of human needs such as health care, education, and infrastructure, bringing balance to the system, and strengthening democracy.
We need an economy that works for the many, not just the few. Sign the petition to demand that Congress tax the massive accumulations of the rich, not just the labor of those who work for a living.
Thank you for bringing lawmakers’ attention to this crucial issue.
Robert Reich
Inequality Media Civic Action
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