Moderates and progressives converge on Capitol Hill to support a targeted tax multi-millionaires.
America’s billionaires have made so much money they could fund two-thirds of President Biden’s American Rescue Plan (ARP) with just their pandemic wealth gains.
Using the jump in their wealth since last March, three men alone—Jeff Bezos, Elon Musk and Mark Zuckerberg—could foot the nearly $250 billion cost for supplemental unemployment benefits contained in the ARP that will pay millions of jobless Americans $300 a week for the next six months.
The collective net worth of the nation’s 657 billionaires stood at $4.2 trillion as of Wednesday morning, March 10, 2021—up $1.3 trillion, or 44 percent, since the pandemic recession began about a year ago— based on Forbes data compiled in this report by Americans for Tax Fairness (ATF) and the Institute for Policy Studies (IPS). The combined fortune of the nation’s billionaires was just under $3 trillion on March 18, 2020, the rough start of the pandemic crisis.
This billionaire wealth growth represents two-thirds of the $1.9 trillion cost of Biden’s pandemic rescue plan, which has been attacked by the GOP as too expensive. No Republican voted for the measure as it made its way through Congress.
There have been 43 newly minted billionaires since the beginning of the pandemic, when there were 614. As billionaire wealth soared over 78 million lost work between March 21, 2020, and Feb. 6, 2021, and 18 million were collecting unemployment on Feb. 13, 2021.
There are other startling matchups of the pandemic wealth growth of individual U.S. billionaires and components of Biden’s bill meant to help millions of Americans cast into crisis by the virus.
- Musk, founder of Tesla Motors and Space-X, saw his wealth skyrocket $142 billion since March, or 567 percent—enough to solo fund the bill’s support for farmers, small businesses, and other industries ($108 billion) and for bars and restaurants ($25 billion). He would still be $9 billion richer than he was when the Covid-19 shutdowns began last year.
- Bezos, founder of Amazon, had wealth growth of $67 billion, or 59 percent, the last 12 months—which could fund the assistance the ARP provides to renters and homeowners ($42 billion) and to veterans ($17 billion). He would still pocket an $8 billion pandemic profit.
The ARP contains many forms of pandemic relief, including $1,400 payments for 60 percent of Americans. The $1.3 trillion wealth gain by U.S. billionaires since March 2020 could pay for a stimulus check of more than $3,900 for every one of the roughly 331 million people in the United States. A family of four would receive over $15,600. Republicans in Congress resisted sending families stimulus checks most of last year, claiming we could not afford them.
Under current tax law, none of the billionaires’ $4.2 trillion in wealth will be taxed during their lifetimes, unless the underlying assets are sold at a gain. Thanks to a weakened estate tax and aggressive estate-tax dodging by the rich, much of the money will also escape taxation when passed onto the next generation.
Sen. Elizabeth Warren (D-MA) and colleagues in the House have introduced the “Ultra-Millionaire Tax Act” to reap some revenue from huge fortunes that otherwise sit untaxed year after year. The tax rate would just be two cents on the dollar (2 percent) for people with wealth between $50 million and $1 billion and just three cents on the dollar (a total of 3 percent) for wealth above $1 billion.
According to an ATF and IPS analysis of Forbes data, America’s billionaires alone would owe $114 billion for last year if Warren’s wealth tax had been in place and $1.4 trillion over 10 years. The law would raise a total of about $3 trillion over 10 years.
Taxing some of the towering wealth of billionaires would be the diametric opposite of the last overhaul of the U.S. tax code, 2017’s Trump-GOP tax cuts. Those tax cuts, which coincidentally cost the same estimated $1.9 trillion over 10 years as the ARP, mostly benefitted the wealthy and corporations—very much including billionaires and the businesses they control.
According to the Tax Policy Center, 65 percent of the TCJA’s benefits will go to the highest-income 20% of American households. By contrast, about 90 percent of the ARP’s benefits will go to the bottom 80 percent of households, with nearly a quarter (23 percent) going to the lowest-income fifth.