The prospects of 70% tax rates and special levies on the super-rich have gained increased support from the American public, despite warnings of socialism and economic disaster from some in Washington.
According to Politico, a new POLITICO/Morning Consult poll found that 76 percent of registered voters think that the wealthiest Americans should be taxed more. A Fox News Survey found that 70 percent of Americans are in favor of raising taxes on those who earn over $10 million. This 70 percent who are in favor includes 54 percent of Republicans.
The polls are reflecting the increasing inequality in America, as the rich grow much richer and the poor grow poorer. This will have important implications for the 2020 Presidential election.
“There is a deep wellspring in terms of perception of unfairness in the economy that’s been tapped into here that either didn’t exist five years ago or existed and had not had a chance to be expressed,” said Michael Cembalest, chairman of market and investment strategy at JPMorgan Asset Management. “This is quite a moment in American economic history where all of a sudden in a matter of months this thing has kind of exploded like this.”
Even radical proposals have been polling well.
Representative Alexandria Ocasio-Cortez (D-NY) proposed a 70% marginal rate on income earned over $10 million. A recent Hill/HarrisX poll found that 59 percent of people supported the plan.
The POLITICO/Morning Consult poll found that 61 percent of people favor a proposal like Senator Elizabeth Warren’s (D-Mass) “wealth tax.” Warren’s tax would levy a 2 percent tax on persons who have a net worth over $50 million. It would levy a 3 percent tax on those whose net worth is over $1 billion.
Conservatives, corporate America, and some moderates are rebuking Democrats for their embrace of higher tax rates on the rich. Former Starbucks CEO Howard Schultz called Warren’s wealth tax “ridiculous” and former New York City Mayor Michael Bloomberg, a moderate Democrat, compared the wealth tax to policies in socialist Venezuela.
Yet, the wealth tax idea is gaining support. Karlyn Bowman, a polling expert at the American Enterprise Institute said “There is certainly an appetite for more taxes on the rich, though the threshold matters. There is also some support for redistributing income.”
Last year, while 48 percent of people described their taxes as “about right,” 45 percent said that their taxes were “too high,” which helped fuel the fire for Democratic proposals to raise top marginal rates and institute wealth taxes.
Warren said that she was not surprised that there has been wide public support for wealth taxes.
“It’s not surprising to me at all. Washington has been working so long for the billionaire class that people around here cannot imagine crossing them,” she said. “It never even becomes a topic of conversation. The ultra-millionaires have gotten so much from this country that it’s not unreasonable to ask them to give back a little bit.”
Trump, who’s biggest legislative accomplishment as president was a $2 trillion tax cut that benefitted corporate America, may be in trouble for the 2020 election. While Republicans still think that his plan will eventually lead to faster growth and higher wages, polls are consistently showing that the tax cut is doing poorly. A POLITICO/Morning Consult poll found that 33 percent thought Trump’s bill helped the economy, 41 percent said that it hurt or made no difference, and 25 percent said that they had no opinion or didn’t know.