The top is obscenely high and the bottom is unconscionably low.
The issue is that the upper middle class and billionaires both have incentives in opposition to the bottom 50% in many areas. Healthcare affordability would cut into the hospital’s profits and doctor’s salaries. If we try to isolate the effects of any kind of left wing policy from people outside the billionaire class we’re going to fail to respond to a lot of issues effecting lower classes.
Also while I agree that largely the upper middle class is doing something that has direct value to society and pays very well, that isn’t the reason for all of their wealth. It is true that once you make enough, your money makes money in the same way (but on a smaller scale) that Warren Buffet’s does which the lower middle class doesn’t get to take advantage of.
Well yeah, but is it worth screwing the upper middle/middle class as collateral damage to screw the billionaires (of which there are slightly less than one thousand in the country)?
That’s largely the question here I feel; how do you limit your policies to screwing that particular “billionaire” class (I think I’d expand it to anyone with maybe 500 million dollars or more) without screwing everyday people with a few million in assets?
The jump from “a few million in assets” to “500 million dollars or more” seems… a bit questionable.
Is this a trick question? You do it with tax brackets and other policies that specifically and only target wealth well above the level of a few million.
A hospitals profits, yes. But the ordinary doctors* that are actually practicing medicine don’t see those profits. As for our salaries, I don’t think the low six figures for general practitioners and medium six figures for specialists is unreasonable. In my particular field, for example, an average physician ends up earning around $30 for an average patient encounter. You aren’t going to get much in the way of making healthcare more affordable by trying to cut into that.
*. By ordinary, as I say, I mean those of us who make our livings by proving medical care to patients. I’m excluding people who make their money in management and just so happen to have a medical degree.
But a hospital isn’t making all that much money either. Median operating margin for a US hospital is around 5%.
There are definitely ways to bring down healthcare costs that we can and should pursue, but you aren’t going to get much in the way of making healthcare more affordable by trying to cut into that either.
Also, why frame it in terms of “screwing” anyone? Is a billionaire screwed if they have to pay taxes like everybody else?
[Not directly related, there have been some interesting cases in, e.g., Sweden, where even mere multi-millionaires had to pay fines like $300,000 and $1,000,000 for (extreme) speeding— they take your income into account]
Well, some people in this thread are saying they want to punitively tax billionaires out of existence.
I agree with you regarding what everyone else in the thread is saying, though. Billionaires paying a significant share in taxes isn’t “screwing” them over, it’s only fair.
Income and wealth inequality are a major reason why the masses hate billionaires and corporations. Let’s briefly review the history of income and wealth inequality in the USA:
America began as a “Land of Opportunity.” Some land was almost free, while Europe’s land was owned by ancient families. The notion of opportunity and America’s “specialness” became part of the national psyche.
Industrialization pushed up wealth and wealth inequality, culminating in the “Gilded Age” of the 1870’s, 80’s and 90’s. The super-rich like Carnegie and Rockefeller controlled as large a portion of total wealth as their counterparts today. But despite high inequality, immigrants flooded in – wages were higher than in Europe. High inequality persisted until 1940 but the working-class could “fight back” with labor unions, progressive politicians like Teddy Roosevelt; and the “American dream” of home ownership was well within reach. And inequality as measured by GINI was lower than in many other countries, e.g. France and Mexico.
The 1940’s, 50’s, and 60’s had unusually low inequality in the USA and around the world. Many Americans look back on this as a “Golden Age.” There were various reasons for the low inequality such as labor unions, progressive income tax and progressive policies like the GI Bill. Low GINI persisted during the 1970’s.
Beginning in the early 1980’s, GINI began a steep rise. This is often blamed on deregulation, Reagonomics (and Thatcherism in the UK). GINI rose until today it exceeds the levels of the Gilded Age. GINI in the USA now exceeds that of France and Mexico. The dream of home ownership is dead for many Americans. Labor unions are in decline. The gap between the super-rich and the working class is blatant, “in your face.” Workers are often deluded into supporting the pro-rich right-wing. Progressive politicians are often powerless.
OP’s question might be paraphrased: “Why did Americans retain optimism even during the Gilded Age, but have lost it today?”
This “brief review” is losing its claim of brevity so I’ll stop here.
Ordinary doctors make a ton of money in the US.
And in industries like healthcare in the US that have massive institutional bloat, those administrators are upper middle class. It’s pretty consistently brought up that many types of universal healthcare reform would put tons of administrators and people who work at insurance companies out of work.
I don’t think being upper middle class is morally wrong and deserving of punishment (I don’t think this about billionaires either) but politicians avoid anything that could harm the upper middle class to the detriment of the bottom 50%.
The only real positive on that is that we’ve all but repealed the SALT deduction.
Depends on how you define a ton of money. The average pediatrician makes around 200K per year. The average family medicine physician around 250K per year. For psychiatrists and non-specialist internal medicine practitioners it’s 300K, and for ob/gyns a little over 300K. That covers the physicians I would consider PCPs. Is the low 6 figures a ton of money? I suppose that depends on your point of view.
Okay, question.
Are there even enough billionaires to provide a robust safety net for all Americans through taxation?
The only other way I can think of to come up with the money is to stop spending so much on the military.
Not directly. The problem of billionaires and large corporations is that too much capital is underutilized by them. By taxing them and investing that capital into society, it will improve the long-term development of the country. It’s the opposite of trickle-down economics, it’s rising-tide economics. When most people don’t have to worry about sustenance, shelter, health, or education, it frees them to be more economically productive.
There are just under 1000 billionaires in the US.
Who control an estimated $6-9 trillion in wealth. If that was redistributed to every US citizen it’d be $17-26 thousand each. That doesn’t sound like a huge amount in comparison to per capita income and other annual figures, especially as a one-off redistribution. However, those 1,000 people have more wealth than HALF the population of the US. I guarantee those 175 million people will make much better use of that money than the 1,000 billionaires.
They almost certainly would make better use of it than those billionaires, but in a way, that would exacerbate the problem of ~$20,000 not going a very long way. If that money entered the “normal person” economy and was spent on basic goods and services, the price of those goods and services would naturally increase, meaning that the $20,000 wouldn’t go all that far.
Further, this ignores the fact that the billionaires’ money mostly exists as valuation in their companies. If you confiscated and redistributed the billionaires’ billions in a form that normal citizens can spend, that would require liquidating those companies, which runs into a few problems. First, who is going to buy these companies if we took the money from the billionaires? Second, if we liquidate the companies, who will produce the things that people will buy? And third, a good chunk of that money exists as valuation of companies in the financial sector, which wouldn’t really exist anymore after you do this, so there wouldn’t even be any value to turn into money you can give the citizens.
None of this is to say that wealth inequality isn’t a massive problem that should be addressed, but the point is simply that it’s nowhere near as simple as just taking money from billionaires and giving it to people who can use it better.
The fact that all of the money that all of the billionaires have barely covers healthcare cost for a year for an average American should be evidence enough that we can’t tax billionaires only in order to fix the problem. We need a wider tax base to address these issues, which means higher taxes on upper and, yes, middle class Americans. And that’s OK; in the case of healthcare, I think providing healthcare to every American is a moral imperative; but we DO need to be honest about what it will take to get there, not just repeat populist slogans about billionaires until our brains fall out.
It’s not just about getting money from the billionaires, it’s about eliminating their individual power, which comes from that massive wealth. That power is grossly damaging, and distorting, everything – politics, media, the environment, the value of work, health care… everything. Simply put, it should not be legal to have the kind of individual wealth that makes that kind of individual damage and distortion possible.
Fair enough, but where is that line drawn? 1 billion seems arbitrary to me.
If you agree with me, then that’s the starting point. Then we can study and discuss and commission research and all that to find the right number, then enact policy.