Miller is a local author, professor at San Diego City College and vice president for the American Federation of Teachers, Local 1931. He lives in Golden Hill.
President Joe Biden and the Democrats did quite well in the 2022 midterm elections by historical standards, but, despite this, the result has been a divided government and political gridlock. Thus, for the next two years, while we can expect an excess of political drama and chaos with a debt ceiling showdown and other pointless exercises in performative partisanship, we won’t see any major progress on the big problems we face as a nation, whether it be the climate, inequality, gun violence, reproductive rights or anything else.
With national politics at a standstill, that means all the real action moves to the states. So while places like Florida are busy censoring books, threatening teachers, and launching investigations into the COVID-19 vaccines, California and other blue states have an opportunity to do something big. In that spirit, as part of a campaign called Fund our Future, legislators in California are ing others in New York, Washington, Illinois, Hawaii, Maryland, Minnesota and Connecticut in proposing new taxes on billionaires to fund pressing needs.
California is facing a projected $22.5 billion deficit and Gov. Gavin Newsom’s proposed budget plan includes cuts to public health, transit, housing and climate programs. So despite some hopeful movement on climate with the Inflation Reduction Act nationally and a range of investment here in California, we risk moving backwards again on this and other essential needs — unless we can find the revenue to address the gap in the budget.
Fortunately, Assemblymember Alex Lee, D-San Jose, has introduced a wealth tax bill like similar proposals made at the national level by Sens. Bernie Sanders, D-Vermont, and Elizabeth Warren, D-Massachusetts, as well as tax increases on the wealthy briefly floated by President Biden. As the Los Angeles Times reported, Lee plans to introduce a bill that would impose new taxes on California’s “extremely wealthy,” at a rate of 1.5 percent on those worth more than $1 billion starting next year, and at 1 percent for those worth more than $50 million starting in 2026.
If ed, the tax would affect 0.1 percent of California households and would generate an additional $21.6 billion in state revenue, according to Lee.
Co-sponsored by nine other lawmakers and ed by my statewide union, the California Federation of Teachers, the bill aims to get billionaires to pay their fair share, rather than evading it as is currently the case. Indeed, a 2021 ProPublica analysis documented that the uber rich shell out a very small percentage of their wealth in taxes and little to nothing in income taxes, and pay a smaller percentage than most Americans. The $21.6 billion this measure would bring in would virtually erase the state’s budget deficit and provide a more stable, ongoing source of revenue to the general fund to help deal with everything from the climate crisis to the epidemic of homelessness, not to mention protecting the funding of current state services.
Despite the chorus of claims to the contrary, a 2022 analysis by the California Policy Lab, an initiative by the University of California, found “no evidence of a pronounced exodus from the state” due to increased taxes on the wealthy. In fact, the rich are doing just fine despite being pilloried on “White Lotus” and elsewhere.
To really see the big picture of American inequality, one needs to focus not just on the obscenely huge income gap but also on the even more significant wealth gap. As former Labor Secretary Robert Reich has pointed out, the wealth gap has exploded in the United States over the last few decades, with the share of household wealth controlled by the richest 10 percent of Americans going from one-third in the 1970s to 75 percent today. When one drills down a little deeper into the numbers, the level of inequality is even more dramatic, with the top one-tenth of one percent of Americans owning as much as the bottom 90 percent of the rest of us.
Thus, as prominent UC Berkeley economist Emmanuel Saez told the Los Angeles Times this month, a wealth tax would restore “tax justice.”
As is always the case, however, such an effort will be difficult, with a host of pundits already deriding Lee’s measure as dead on arrival without enough to make it through the Legislature. But while that may be true in the short term, the idea of taxing billionaires is extremely popular with the voting public with one survey by TargetSmart Research Solutions showing 76 percent ing the concept and 56 percent strongly ing it.
Perhaps that will help the Legislature find the political courage to buck the robber barons of our new gilded age.
