A Wealth Tax on Jeff Bezos Doesn’t Go Very Far
Jeff Bezos became the second billionaire this month to reach the edge of space when his New Shepard’s suborbital flight took his four-person crew beyond the Kármán line–the internationally-recognized boundary of space nearly 330,000 feet, or roughly 62 miles above the Earth. For approximately four minutes of weightlessness in suborbital space, the richest man alive spent around $5.5 billion. Unsurprisingly billionaires spending large amounts of money on short space flights has brought out calls from the left for a wealth tax.
The progressive left, most notably Sen. Elizabeth Warren, has better ways for Jeff Bezos and other members of the ultra-rich to spend their money. Warren tweeted that under her plan, Bezos would pay a $5.4 billion tax. This she assures us will invest back into the nation in programs like universal childcare. Not to take all the fun out of life, Warren promises to leave the Amazon founder with enough money for his space flights and superyachts “if thats where he gets his kicks.” Progressives have an endless list of programs and make-work projects that would finally come to fruition when those evil billionaires pay their fair share
Lack of taxation is not the reason why the United States does not have universal childcare. We have a wasteful spending problem. In 2020 the Federal government spent a record $6.55 trillion. The spending problems go beyond the pandemic. For more than a decade, federal government spending has average $3.9 trillion a year–over a trillion dollars increase in spending per year from 2007. Did the one trillion dollar increase per year of spending lead to universal childcare, universal college, or student debt relief? Of course not. Government spending is not an investment in the nation. It is a cash cow for the politically connected at the expense of everyone else. It would be beyond naive to believe that the problem with education, infrastructure, or any other public ill will be solved by taxing Bezos or his million friends an extra $5.5 billion.
How far will $5.5 billion get you these days? As my dad likes to say, “not as far as it used to.” According to usspending.gov, the federal government spent $19.8 billion on Monday, July 26. More than $825 million per hour. Therefore the wealth tax on Jeff Bezos would fund government spending for less than seven hours. Does that sound like a plan to fund universal child care? Even if you were to tax the entirety of Bezos's $211 billion net worth (which is impossible for a host of reasons), you would only fund the federal government for ten days. What is the progressive plan for day 11?
According to edweek.org, in an article titled How Much Would High-Quality, Universal Early Care Cost? Try $140 Billion a Year. A wealth tax is not going to deliver the goods that most people things it will. Wasteful spending, which parties cannot quit, is the reason why these programs don’t exist. So if a wealth tax won’t actually pay for the programs that the left so desperately desires, why do they demand it? This phenomenon is what Austrian School economist Ludwig von Mises called “the anti-capitalistic mentality.”
The “the anti-capitalistic mentality” is the irrational fear and hatred many intellectuals and others feel for capitalism. Progressives like Senator Warren know that an extra $5 billion a year don’t feed a $4 trillion beast for long. Their desire to tax the superwealth goes beyond an altruistic goal of increases welfare. Mises explains that the intellectuals, the limousine liberals, and the power-seeking politicians, desire for taxes and regulations is an attempt to “ram a poisoned stake into the heart of capitalism.”