The World’s Richest Families 2020 is an article on Bloomberg.com that is well worth reading. It relates the history of the worlds richest families, some going back well over 100 years. Years of starting small, taking risks, failure and success, expanding and careful planning. For example, Sam Walton gave 20% of his assets to each of his four children before he opened his first store.
In the process these families created millions of jobs, and the products and services we all enjoy an rely on.
Their wealth is largely the shares of stock in the family companies plus hard assets such as real estate.
Nevertheless, many people resent the success and wealth and believe society through government is entitled to more of that wealth. There is a big difference between income and wealth, a rise in wealth has nothing to do with income in most cases.
Take the example of Warren Buffet, his earned income subject to payroll taxes is $100,000 per year. His wealth, mostly in shares of stock, is tens of billions. Eventually his wealth will go to charity or be subject to the estate tax. Which will benefit society more?
However, I will say, there are some super wealthy families that could do more in charitable giving, but given their wealth is in shares of stock, they keep an eye on losing control of the business or family members created.
Because of this, some Americans and politicians want a new wealth tax. Simply take a percentage of ones wealth each year in addition to taxes on income.
You can come to different conclusions as to whether the wealthy pay their fair share of taxes based on total share of taxes paid or the tax rate paid on income. In fact, the top 10% of Americans based on income pay 69.47% of all federal taxes while the top 5% pay 58.23%. Consider that to be in the top ten percent, taxable income need only be $139,713, a figure easily reached by a household with two teachers or other public employees or many union job working families.
We need to be careful when using the word wealthy. It means something quite different to different people and it is accumulated differently, sometimes over many decades.
I don’t resent the super wealthy, I believe paying a fair share is appropriate (when fairly defined). However, I do fear the collection of more and more taxes to fund political promises for more government programs that once in place are typically poorly managed, their true cost and liabilities hidden or ignored and their ongoing value rarely challenged… but always requiring more funding.
Anyone, especially a politician, who dares challenge such a program in the future or attempts to manage its costs is immediately and roundly vilified. That’s the real danger in higher taxes…on anyone.