“Raise my taxes,” says millionaire Chuck Collins.
The scion of the Oscar Mayer family supports a House panel’s healthcare plan that would boost taxes for families earning more than $350,000 a year. He also advocates ending the Bush tax cuts for the rich right away, rather than when they expire at the start of 2011, and closing foreign tax havens to Americans.
Although the financial burden would be sizable, Mr. Collins is busy urging other wealthy Americans to sign a tax-me petition.
“The good news is there are still people out there willing to pay for the common good,” says Collins, whose nonprofit Wealth for the Common Good is collecting the names.
As of July 21, some 210 wealthy people had signed. Collins hopes to get more than 1,000 signatures before delivering it to President Obama and House leaders.
The idealist wealthy are “not as small a minority as one might think,” says Eric Schoenberg, an investor and Columbia University Business School professor, who also signed the petition.
It is “reasonable and fair” for “the people who have done best out of the economic system in the last 20 years” to pay in extra taxes the bulk of the cost of healthcare reform, says Mr. Schoenberg. “Healthcare ought to be a basic right of citizenship.”
His research suggests the really rich are more willing than the modestly rich to share their wealth for the common good.
There are other indications of idealism among business people and the well-to-do:
•Responsible Wealth, a nonprofit group that includes several wealthy members, has been advocating for years that the estate tax be retained.
•A group of business owners and leaders called Business for Shared Prosperity welcomed the July 24 rise in the federal minimum wage from $6.55 to $7.25 an hour, although it costs their firms more money.
“It is an unsustainable and dangerous downward spiral to push American workers into
poverty and expect taxpayers to pick up the bill for the consequences,” states Margot Dorfman, CEO of the U.S. Women’s Chamber of Commerce.
But wait! Don’t these taxes on the rich burden the very people who start the most firms and create the most jobs? Statistics suggest the burden is not overwhelming. Households with incomes over $250,000 have saved more than $700 billion from the Bush tax cuts of 2001 and 2003. The proposed graduated surtax under the House Ways and Means Committee’s healthcare plan would take back $544 billion over the next 10 years, providing about half the cost of the entire plan, calculates the Joint Economic Committee of Congress.
What that means is that even after digging deeper to help pay for expensive healthcare reform, the wealthy would still be paying less in taxes than during the Reagan administration – and far less than in President Eisenhower’s time.
In 1955, the top 400 US taxpayers paid 51 percent of their average income of $12.3 million (adjusted to 2006 dollars), according to Sam Pizzigati, a fellow at the Institute for Policy Studies in Washington. In 2006, the most recent data available, the top 400 paid 17.2 percent of their average income of $263 million in federal taxes.
That 17.2 percent rate is also “much lower” than tax rates for the rich in Britain, France, Germany, or Japan, he adds.
Nor, some economists note, did the US economy grow more slowly when taxes on the rich were far higher in the 1950s and 1960s – or grow more swiftly after the Bush tax cuts.