The World Economic Forum (WEF) last week heard from Patriotic Millionaires (PM), an American organization whose members must have a minimum annual income of $1 million or assets of at least $5 million. Self-described as “proud traitors to their class,” the organization boasts the likes of Abigail Disney (granddaughter to Roy Disney), musician Moby, and co-founder of Ben and Jerry’s ice cream, Ben Cohen, among its members.
It appeared at the WEF to say something that we don’t hear very often from the wealthy: that they should pay more taxes.
The letter it released at the WEF and addressed “To Our Fellow Millionaires and Billionaires Across the Globe” begins with the bald statement that:
“Studies show that, at the low end, at least $8,000,000,000,000 – 10% of the world’s GDP – is hidden in tax havens.”
It goes on to note that extreme economic inequality is driving the world towards a crisis point, including a potential uprising by the poor. The threat of revolution, the letter warns, creates a trade-off between “those who prefer taxes and those who prefer pitchforks.”
The Canadian Centre for Policy Alternatives 2018 report “Born to Win: Wealth Concentrations in Canada since 1999” establishes that the gap between rich and poor in this country is getting larger over time. The net wealth of Canada’s 87 wealthiest families grew by an average of 37% between 2012 and 2016, while the net wealth of the country’s middle class grew by just 16%. Those same 87 families have 4,400 times as much wealth as the average Canadian. Or, put another way, they have as much wealth as 12 million average Canadians combined.
And, as the report notes, that wealth stays in those 87 families from generation to generation, aided by the fact that Canada (alone among G7 countries) does not have an inheritance, estate or gift tax on “tremendous” family wealth.
The report’s author, CCPA’s Senior Economist David Macdonald says:
“Canada’s dynastic families have got it all – more wealth, more inheritance, and are as lightly taxed as they were the last time we looked in 2014.”
Taxing the rich
In last year’s federal election, the New Democratic Party proposed implementing a 1% tax on wealth above $20 million, which could generate up to $70 billion over 10 years. According to a poll conducted for North 99, 67% of Canadians support a 2% wealth tax on those with assets of more than $50 million and just 14% oppose it. Support for such a tax came from all political party affiliations and from all regions of the country.
Those who oppose social programs that support the poor often say they give people free money. But, as University of Manitoba professor Evelyn Forget, who studied Manitoba’s 1970’s basic income trial, notes:
“we give people free money all the time through the tax system . . . . we give away $122 billion worth of tax expenditures every year to people who aren’t anywhere close to the poverty line.”
Basic Income Canada Network released a report earlier this month showing how a basic income program, supported in part by increased taxation of the wealthy, could eliminate poverty, support the middle class and significantly reduce the gap between rich and poor.
Report co-author Sheila Regehr says:
“Would we rather have tax breaks for wealthy Canadians or dignity and security for low-income Canadians and the middle class?”
Please, sir, let us pay more
None of the members of the Patriotic Millionaires is going to become impoverished as a result of their activism for a more equitable tax system. Certainly, some of their enthusiasm stems from the self-interest of wanting to avoid a global confrontation between the rich and the poor, where they could lose everything.
However, their wealth and social status means they get listened to. As Abigail Disney said in an interview with The New Yorker, if she were an unknown person with less money, she would not be invited to speak on major TV networks and in other forums.
She freely admits that she does not know what it is like to be poor and that her activism makes her feel good:
“I’ve never worked a day in my life, and look at me! I’m sitting here in total comfort. You can work all your life and you will never find yourself where I am today. . . . If I feel good, that doesn’t undermine the credibility of what I do. And I do feel good doing it. I am the happiest rich lady you will ever meet. I always keep coming back to the idea that you just keep investing in the future. If I were to lose my hope, where does that leave the people around me? I feel a responsibility. I don’t know how to do it any other way.”
Perhaps Disney and her fellow Patriotic Millionaires prove the exception to the suggestion made in the 1993 Aerosmith lyrics:
“Eat the rich/There’s only one thing that they are good for/Eat the rich/Take one bite now and come back for more.”