Tag Archive: Wealth Tax


“Maybe Tribalism is just in her DNA.” — Lloyd Blankfein, Goldman Sachs senior chairman, on Senator Elizabeth Warren

Who gets hurt if the federal government requires Warren Buffett to sell 6 percent (approximately $5 billion) of his $86 billion in wealth each year, every year?

A.) The “Sage of Omaha?”

B.) Middle-class investors attempting to grow their portfolios for retirement, their children’s education or that special vacation?

How about … both?

If Warren’s punitive wealth tax takes effect, Buffett will be selling his shares … lots of stock … not as a result of market conditions but because Washington D.C. redistributors mandate these stock trades in the name of the greater public good.

And who decides what is “the greater public good?

Warren’s punitive 6 percent wealth tax (unconstitutional?) exercise applies to all billionaires. There would also be a 1 percent levy for all Americans with wealth exceeding $50 million each.

Wonder how many in coastal blue states (i.e., Massachusetts, Connecticut, New York, New Jersey, California, Washington … ) exceed that $50 million wealth figure? The vast majority of these households worked hard, invested wisely … and this is the thanks they receive?

How much money, which could be used for individual investment, would come out of our economy? How many shares will be forced sales in our public exchanges?

What are the unintended consequences of these arbitrary sales for those saving for retirement or their children’s education?

According to The Economist the cumulative impact of wealth taxes and many other planned hikes would constitute a cumulative 2 percent hit on our nation’s $21.4 trillion GDP.

Could a Warren Recession follow? Almost DailyBrett will take the “over.”

Selling Political Masochism In A Robust Economy

The debate that you have in America or Britain about taxing the super-rich just doesn’t exist here.” Janerik Larsson of Sweden’s Timbro

“Vilification of people as a member of a group may be good for her campaign, not the country.” — Blankfein on Warren

Almost DailyBrett has always contended that group masochism is a political loser.

Asking people to sacrifice their economic freedom, and to vote against their own personal and family best interests is a prescription for defeat.

The Economist reported this week that American retirees owned only 4 percent of all publicly traded shares in 1960.

Fast forward to 2015 and we find that retiree investments (i.e., IRAs, 401Ks, pensions) constituted 50 percent of all shares. Without doubt that figure sprinted even higher in the last four years considering the stunning continuation of the bull market.

Since November 8, 2016 (hmmm … what happened that day?), the Dow Jones has risen 52.8 percent from 18,332 to 28,015, the NASDAQ 66.6 percent from 5,193 to 8,656, and the benchmark S&P 500 47.0 percent from 2,139 to 3,145.

Should public policy compel American today’s and tomorrow’s retirees to sacrifice a significant slice of their financial future every year?

Shouldn’t we have the freedom to decide when to buy and when to sell? Does the government really understand the maxim: Buy Low Sell High?

Why should an ever-expanding  government go to war against achievers, and by doing so take direct aim at America’s Investor Class? Some see it as a socialistic assault on capitalism.

Let’s simplify the equation: Why should our government usurp our economic freedom?

Some will contend that we should all, chill out. Warren is floundering in the polls. She won’t win the Democratic nomination. Right?

Didn’t the experts say the same thing about Jimmy Carter? They were wrong, and years of economic malaise (i.e., double-digit inflation, unemployment, interest rates) and a crippling recession were the consequences.

Many in the political class point to Sweden as an socialist model for the U.S. to follow. And yet, Sweden has higher percentage of billionaires (e.g., founders of IKEA, H&M, Volvo and Spotify), and greater income disparity than the USA.

And yet Sweden abolished its inheritance tax in 2005 and its wealth tax two years later.

Hmmm … maybe we should look to Sweden for guidance.

https://www.forbes.com/billionaires/#b93a39d251c7

https://www.economist.com/leaders/2019/11/28/inequality-could-be-lower-than-you-think

https://www.economist.com/briefing/2019/11/28/in-sweden-billionaires-are-surprisingly-popular

https://www.cnbc.com/2019/11/14/lloyd-blankfein-mocks-elizabeth-warren-maybe-tribalism-is-just-in-her-dna.html

“I can understand wanting to have millions of dollars, there’s a certain freedom, meaningful freedom that comes with that. But once you get much beyond that, I have to tell you, it’s the same hamburger.” – Bill Gates speaking to university students

There are 25.7 million Google results of an image of a middle-aged dude standing all alone with his hands in his pockets.

He is patiently waiting in line for his cheeseburger, fries and a coke.

The maroon pullover guy is patronizing the original Dick’s (1954), which unofficially serves as a gateway to the upper class Wallingford neighborhood in Seattle.

Is the pale dude (gasp) … privileged?

What gave him the right to buy a “Deluxe,” fries and a coke in Wallingford?

Did his parents dote on him? Where did he go to school? Where did he go to college?

Did he ever invent anything of value to society? Did ever provide a living to people?

Did he ever give back to make our world a better place?

And if the answers to these questions do not meet communal approval – Privilege? Family? College? Inventions? Philanthropy? – should we as a collective society even the score in the name of social justice?

It may seem silly to some to have this public good discussion, and yet 25.7 million Google results are triggered in 0.28 of one second, when one inquires about the guy in the sweater standing all alone in line at Dick’s.

Our Obsession With Wealth?

How many billionaires — members of the three comma club — would stand-in line all alone for a burger and fries?

And yet there was Microsoft founder Bill Gates, 63, waiting in line at Dick’s on Sunday evening, January 13.

In our always-on digital imaging world, it did not take long for the celebrity dude doing normal things to go viral, generating stories and impressions about Gates and his love of hamburgers.

The latest estimates place his net worth at $96.5 billion. Couldn’t Gates simply buy Dick’s as opposed to standing in line for a burger? Where was his entourage? Couldn’t he feed the homeless with Dick’s burgers?

And how did he make that money? Did he take full advantage of his privilege? Did he inherit the money?

As many Almost DailyBrett readers know, Gates and the recently departed Paul Allen founded Microsoft in 1975. Their entrepreneurial spirit and those that followed (i.e., Steve Ballmer and Satya Nadella)  resulted in the ubiquitous Windows operating system, X-Box gaming console, Microsoft Surface PC, Microsoft Cloud and so much more.

Microsoft is one of the three largest competing companies in market capitalization (share price x number of shares) at $814.5 billion, generating $96.5 billion in total revenues and employing 134,944 around the world.

After departing the daily operations of Microsoft, the guy in the maroon sweater with his spouse established The Bill and Melinda Gates Foundation. The charitable organization bearing their names has given a reported $36 billion to date to alleviate third world poverty and suffering. They are without any doubt the most generous philanthropists in America.

And yet …

No Good Deed Goes Unpunished

“The problem with socialism is that you eventually run out of other people’s money.” – Former UK Prime Minister Margaret Thatcher

In her quest to become the 46th President of the United States, Massachusetts Senator Elizabeth Warren has proposed a 2 percent surcharge on net assets – not annual income – exceeding $50 million, and another 1 percent on billionaires.  Is Warren’s  “wealth tax” really confiscation in disguise?

There are questions about whether a confiscatory surcharge of assets – not an income tax – is permissible under the U.S. Constitution. This legal question is above the pay grade of Almost DailyBrett.

Having said that, your author must ask: Why do so many Washington elites want to punish achievement, service and philanthropy?

Some rationalize this obsession with wealth as a quest to reach some far-reaching social justice nirvana when the solution is the same-old tired remedy: wealth redistribution targeting those who provide great products, create jobs and give back to the less fortunate.

The answer always comes down to new and more burdensome taxes, but in Senator Warren’s case she calls for outright confiscation of assets. One thing is certain is the redistribution does not stop there. There will also be increases in tax rates, most of all the top rate from 39.6 percent, hiking it to 70 percent, 80 percent, 90 percent or beyond.

Once you have raised taxes and confiscated assets is that the end … or worse … is that just the beginning?

What’s next? Fees on stock and mutual fund transactions? Surcharges on bank accounts? Is the sky the limit?

How about a wealth tax/surcharge on Bill Gates’ hamburger?

https://www.geekwire.com/2019/billions-served-bill-gates-photographed-standing-line-burger-dicks-drive-seattle/

https://www.ddir.com/

https://www.seattlepi.com/seattlenews/article/Billions-served-Bill-Gates-photographed-standing-13539669.php

https://www.washingtonpost.com/outlook/2019/01/24/senator-warrens-plan-tax-ultrawealthy-is-smart-idea-whose-time-has-come/?utm_term=.251e17e49629

https://www.microsoft.com/en-us/Investor/earnings/FY-2018-Q4/press-release-webcast

https://almostdailybrett.wordpress.com/2015/08/23/three-comma-club/

https://almostdailybrett.wordpress.com/2012/09/25/taxing-uncle-phil-to-death/

https://www.businessinsider.com/biggest-projects-of-generous-philanthropists-bill-and-melinda-gates-2018-8

https://www.goodreads.com/quotes/138248-the-problem-with-socialism-is-that-you-eventually-run-out

 

%d bloggers like this: