Members of the billionaire class have used their clout to rig the economy in their favor while blocking popular actions, such as reducing student debt and boosting the minimum wage. A wealth tax chips away at the money power that circumvents campaign finance rules. It puts a brake on the build-up of democracy-distorting concentrations of wealth and power.
One real concern is that the wealthy will find ways to avoid a wealth tax. Billionaire investor Leon Cooperman recently objected to the tax because “people are going to rush to find ways of hiding their wealth.”
The super-wealthy will be able to hire a “wealth defense industry” of tax attorneys, wealth managers and accountants to play shell games with their assets. In my new book, The Wealth Hoarders, I chronicle how these advisors are paid millions to hide trillions using offshore bank accounts, anonymous shell companies and dynasty trusts.
But with political will and leadership, this global wealth-hiding system could be fixed through increased enforcement and by banning trusts and tax scams that exist solely for the purposes of tax dodging. The U.S. should join other nations in boosting transparency and information sharing to shut down illicit money flows.
A wealth tax could begin to reverse four decades of extreme income and wealth inequality and build an economy that works for everyone, not just the wealthy.
Originally published at The Progressive