Nothing symbolizes the inequality of sacrifice during the COVID-19 pandemic more than watching a few hundred billionaires gain while everyone else struggles through job losses, debilitating illness, or death.
But billionaire wealth is surging. Since March 18, the beginning of the pandemic lockdown, the 467 U.S. billionaires have seen their wealth increase by over $730 billion, or 30%, according to an analysis of Forbes data by Americans for Tax Fairness and the Institute for Policy Studies.
The Fed has used emergency measures to prop up the economy that reversed the stock-market SPX, +1.02% crash caused by the pandemic, even as the rest of the economy falters. The biggest beneficiaries have been the billionaire class, which keeps on growing wealthier.
It is time to levy an emergency wealth tax on billionaire profiteers and direct the funds to offset the cost of the nation’s health-care costs.
Independent Vermont Sen. Bernie Sanders—backed by Democratic Sens. Kirsten Gillibrand of New York and Ed Markey of Massachusetts—has introduced the Make Billionaires Pay Act to recapture over half the extreme wealth gains made by billionaires during the pandemic. The bill proposes a one-time, 60% tax exclusively on billionaires’ gains between March 18 and the end of this year. It would raise about $420 billion, based on the increased wealth of the country’s billionaires as of Aug. 5.
Sanders proposes directing funds to Medicare to pay all out-of-pocket health-care expenses for uninsured and underinsured households over the next year, including prescription-drug costs. That would “guarantee health care as a right to all for an entire year,” said Sanders in a press statement.
Of course, other members of Congress might have their own ideas for how to spend $420 billion—including putting it toward helping state governments provide public services, maintaining those weekly $600 expanded unemployment payments, or paying out another round of $1,200 stimulus checks, all of which the House-passed Heroes Act would do.
Even with the new tax, billionaires would still have an estimated $310 billion in gains during the worst economic downturn since the Great Depression.
Amazon AMZN, +2.85% founder Jeff Bezos, whose wealth has increased a stunning 63% during the pandemic, is now worth an estimated $184 billion. Under the emergency pandemic wealth tax, Bezos would pay an estimated one-time tax of $42.8 billion. After the tax, Bezos would remain the richest person on the planet, with over $140 billion.
Elon Musk, the CEO of Tesla TSLA, +6.41%, has seen his wealth nearly triple during the pandemic to $70 billion. He would pay an estimated one-time wealth tax of $27.3 billion and would be 75% richer than he was five months ago. Facebook FB, +8.22% co-founder Mark Zuckerberg, who is worth over $88 billion, would pay an estimated one-time wealth tax of $22.1 billion. His wealth would be 28% higher than on March 18.
COVID-19 has caused an unprecedented health and economic crisis that no one should be excessively profiting from. Yet many billionaires are making huge hauls during a time of suffering and sacrifice.
In the past, our leaders took action to curb such profiteering in times of crisis.
During World War II, Sen. Harry Truman held congressional hearings on war profiteering, exposing the ways some corporations grabbed profits during wartime sacrifice. Under President Dwight Eisenhower, the U.S. levied an excess profits tax on companies profiteering during the Korean War.
Today, the choice is stark: Do we enable 500 or so billionaires to further concentrate wealth and power during a pandemic, or do we tax the gains of these billionaires to improve the health and welfare of our country?
How we face this extraordinary inequality is the ultimate test of what kind of country we are and what we will become.
Chuck Collins directs the Inequality Program at the Institute for Policy Studies. Frank Clemente is the executive director of Americans for Tax Fairness.