American Consequences - September 2020

for rosy projections, arguing that it may have the unintended consequence of bringing in less revenue to state coffers. The Oakland Democrat optimistically claims that his wealth tax would generate $7.4 billion a year in revenue, but the Times notes that it could force “people to sell assets potentially at a loss in order to pay their tax bills.” Would such a scenario, the paper asks, cut “into the capital gains revenue upon which California is inordinately dependent?” Sound tax policy, it writes, “requires more than just deciding which trees to shake.” That advice, though, has fallen on deaf ears. The Democrats who’ve co-sponsored this legislation (at least a dozen of them) are intent on shaking as many trees as they can get their grubby hands on. As Bonta concedes, “Asking these well-resourced Californians to give a little more to keep our people working and support our most vulnerable is the right thing to do.” Bonta has called his tax “patriotic” and “fair,” which are curious adjectives to describe what he’s trying to get passed. The demonized “one percent” already shoulder nearly 50% of the income tax burden. Are they presently not patriotic? Does fairness require rendering that ratio more lopsided than it now is? Apparently so… California is a laboratory for bad ideas. And these bad ideas have a habit of spreading across the country. Case in point, Governor Andrew Cuomo is fending off efforts by leftist politicians in his state to adopt a wealth tax for New Yorkers. Cuomo wisely maintains

that such a tax would only accelerate the great pilgrimage down to Florida. It’s uncertain whether California Governor Gavin Newsom will show similar resolve. And although Joe Biden hasn’t endorsed a national wealth tax, progressive leaders in his party like Elizabeth Warren and Alexandria Ocasio-Cortez continue to make a punitive wealth tax central to any tax-reform package. Your stuff is their stuff , or so they think... What’s wild is that the wealth tax may only be an appetizer for California’s Democrat Party. Simultaneously, it has introduced legislation that would raise the state’s current top marginal tax rate of 13.3% to a mind-boggling 16.8%. And it would apply retroactively, from the start of 2020. Fairness, baby! Progressives in the Golden State seem intent on putting Margaret Thatcher’s observation on what ails socialism to the test... “Eventually, you run out of other people’s money.”

Jason Mattera is a New York Times best-selling author and Emmy- nominated journalist. Follow him on Twitter @JasonMattera.


September 2020

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