In the 1970s, Republicans discovered they could reliably win elections by pronouncing taxes to be anathema, which is to say, evil, irredeemable, on a par with the seven deadly sins. Henceforward, they declared, there would be no new taxes and no tax increases. Also henceforward, members of the other party would be referred to exclusively as “tax-and-spend” Democrats. It worked so well that now, Republicans are in control of everything.
But taxes, it turned out, were essential to the functioning of a free republic. Our nation’s roads, bridges, airports, trains, water pipes, sewer mains and power grid have rotted almost completely away for lack of maintenance, repair and replacement. Yet taxes remain anathema.
When, from time to time, in the brief interludes between elections, the Untaxables had to come up with some money to keep a school open here and there or put a bridge back up (just enough to get the torches doused and the pitchforks put away), they found they could get away with imposing a tax — although it was a very great sin to do so — as long as they imposed the taxes on a sin. Cigarettes became a favorite, after Big Tobacco became too poor to own and operate legislatures like it used to, and today in West Virginia, for example, there is a tax on each pack of cigarettes of about $25,000.
The thing about sin taxes is, they tend to be self-extinguishing: the rising cost of sinning reduces the number of people who can, or will, indulge. There are only about six people left who can afford to be smokers of commercial cigarettes in West Virginia, everybody else is smoking oak leaves. Now West Virginia at the moment — and I do mean this very moment — has a budget shortfall of half a billion dollars. The federal debt has reached $20 trillion, and in a couple of weeks the debt limit (the law Congress passed that says, “stop us before we borrow again”) is once again going to throw a monkey wrench into the government money-printing press.
Our legislators are laboring mightily to solve these problems by not raising taxes, even on sins. The West Virginia solons are urgently debating prohibiting bestiality and making the Bible the state book. I swear I am not making these things up. Go ahead, check the links, I’ll wait.
What we need here, obviously, is a new sin to tax. As it happens, I have a candidate. No sin has done more damage to the Republic, the world, or indeed to the souls of men, than unearned wealth.
Those who become wealthy through pure dumb luck — those who inherit fortunes, or marry them, or win the lottery or pick a stock — are a worse plague on the world than pollution. Insulated from the real world by their wealth, they never learn anything about how the world works. Nevertheless, surrounded by sycophants, they develop an overinflated opinion of themselves. Unable to actually use more than a small fraction of their money, they send the rest of it off, in the hands of hedge fund operators and personal wealth managers and other con men, in search of outrageous profits, thus inflating and exploding various financial bubbles around the world.
These periodic tsunamis of money that create and then pulverize vast fortunes in dot-coms, shale-oil, farmland, residential real estate, high tech, on and on, are the modern day equivalent of the periodic plagues of locusts described in the Bible. Whatever brief benefits there are, go to the already wealthy. When the bubbles collapse the pain is felt only by those already poor.
Solution: A confiscatory tax, 90 per cent would be about right, on all inherited and otherwise luck-induced wealth. Including lottery and casino winnings, such as stock trading profits. It would be a lot of money, that could fix a lot of highways and bridges, while preventing a great deal of destructive behavior around the world.
And it’s not like it would be hurting anybody. Most of these people have no idea how much money they have or where it is. All they know is, they want more.
Let us go forth, and tax sinners. There simply is no down side.