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The issue was first raised in a revealing way by Amazon’s top lawyer, David Zapolsky. He was asked by Bloomberg’s local tech reporter Matt Day about the suddenly escalating financial involvement in Seattle politics by members of Bezos’ “S-Team,” or senior leadership group. Especially in opposing socialist City Councilor Kshama Sawant.
“I mean, in that particular race, you have a candidate who quite openly called the employer of some of these people the enemy,” he said, referring to Sawant. “Literally. She said Jeff Bezos is the enemy. I don’t think people should be surprised that people who live in this city, like my colleagues on the S-Team, are engaged in the political process.”
All this makes me wonder what’s about to go down now that national Democrats are signaling they’re going after Bezos and every other billionaire in ways that make Sawant look timid and the Seattle head tax look like a rounding error.
On Friday presidential candidate Elizabeth Warren released her plan to pay for universal health care. Among the new taxes is a “wealth tax,” an annual levy not on profits or income but on the total net worth of the ultrawealthy, at a rate of 6 percent.
The cost to Bezos alone would be $6.7 billion, per year, at his current net worth of $112 billion. That’s about 350 times more money than Amazon would have paid to Seattle per year under that head tax that caused such an uproar.
Bill Gates, the second-richest American, would pay $6.4 billion annually to the federal government for Warren’s new wealth tax.
Yet in the race to tax the rich, Warren is being lapped by her rival, Vermont Sen. Bernie Sanders. His proposal, released last month, hits the uber-rich at 8 percent. Again this is not on income or profits but total wealth. So Bezos would pay $9 billion a year to start. After only five years, assuming his fortune otherwise stayed roughly stable, he would have paid north of $40 billion just for this one new tax.
“I don’t think that billionaires should exist,” Sanders said.
He clarified that he wants to vaporize the billionaires’ money, not the actual human beings. But you can see how statements like this might get taken personally, … a la Sawant’s “Bezos is our enemy” line.
Readers know I’m in the camp that the rich should pay more in taxes, especially in Washington state where there is no income tax. But these proposals by Warren and Sanders are off the charts.
Even Nick Hanauer, our local “tax me” plutocrat who has been lobbying for a wealth tax, said recently that what he supports is a “moderate” rate of 2 to 3 percent, so that wealth can still grow and be invested.
“To me, a moderate wealth tax simply slows the growth of large pools of assets. And so … a 3 percent tax slows the growth rate from, let’s say, 8 percent to 5 percent — which means you’re still getting a ton richer than everyone else in the country. If you take the growth rate to zero, that’s no longer moderate. And I guess, that begins to test even my comfort with a wealth tax,” Hanauer told NPR.
Politically, these proposals from the leading national Democrats are nuts. Taxing the rich is moderately popular. Using tax policy to annihilate them I’m guessing won’t be. Like I said above, it even made me feel a tinge of sympathy for poor Bezos.
I know, he’ll probably be OK. But seriously, people around here generally like and admire Bezos and Gates, especially Gates. Smart politics would be taxing them without taxing the hell out of them. Without making them the full-on enemy.
A while back Bezos talked about how he shrugs off being criticized.
“My advice, if someone wrote something and hurt your feelings, is to stand on a street corner, and watch all the people walk by,” he said. “I bet you none of those people are thinking about you.”
True. But it looks like they are thinking hard about your money.
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