“In many countries, the wealthy pay lower effective taxes than far poorer people. We need to change course—or face the pitchforks.
“The ecological catastrophe fuelled by climate change and the socio-economic upheaval threatened by grotesque inequalities of wealth and power have the potential to destroy everything we care about.
“Based on a mountain of inter-disciplinary evidence, it’s clear that extreme inequalities of income, wealth and opportunity undermine democratic institutions, destabilize healthy economic activity, fuel social unrest, and prevent us from nimbly responding to ecological threats. Yet our global economy is on inequality autopilot, funnelling wealth upwards at a dizzying pace. A couple [of] thousand billionaires now hold more than half the world’s wealth and with it, much of the power to change things—or to block change, as has been the case for decades. In many countries, the wealthy pay lower effective tax rates than those with modest means. Without this revenue, governments plead austerity or take on nihilistic levels of debt.
“Meanwhile, a wealth-defense industry of tax lawyers and wealth planners spend their waking hours gaming tax laws and hiding trillions in wealth. An estimated 10 to 12% of the world’s wealth is hidden in a maze of offshore secrecy jurisdiction, trusts and shell companies. A recent IMF study estimates that 40% of foreign direct investment—about $15tn—passes through ‘empty corporate shells’ with ‘no real business activities.’
“This hidden wealth isn’t basking on a Caribbean island. Billions are flowing into luxury real estate investments. The cranes rising across our major cities, constructing luxury towers, are an affront to residents facing a crisis in affordable housing.
“In many countries, we are seeing a breakdown in social cohesion and a rise in xenophobic nationalism and political extremism. People understandably believe the system is rigged against them, fuelling a sense of unfairness and diminished social trust. This process of pulling apart, both within countries and between nations, will all but guarantee that the global community will further polarize and fail to adequately respond to the looming climate catastrophe. This will be disastrous for everyone, including the planet’s billionaires and millionaires.
“The choice is stark: do we want pitchforks or a working tax system?”
Chuck Collins said all that, and more. And who is Chuck Collins? Chuck Collins is a member of the American organisation Patriotic Millionaires, which is composed of millionaires and billionaires from around the world who advocate higher taxes on the wealthy.
He goes on: “I agree with [the] Dutch historian Rutger Bregman, who said last year, ‘Stop talking about philanthropy and start talking about taxes. The bloom has come off the charitable rose. Perhaps the public has started to realize that billionaire philanthropy has become a taxpayer-subsidized extension of private power, another elaborate tax dodge.’”
The Patriotic Millionaires consists of an initial group of 123 millionaires and billionaires from eight countries who believe that taxes are the “best and only appropriate way” to ensure adequate investment in the things societies need.
While it is hard to disagree with him on much of what he says, it is on this very point that we must part company. Whatever about cause and effect, we reject his vision of the solutions.
He manages to be both completely wrong and completely right. He is completely wrong in that he envisages a nice capitalism, where the rich stay rich but “rejoin humanity” and root themselves in communities of “people and relationships of reciprocity,” where capital is shifted out of the “speculative financial sector and deploy[ed] in the service of humanity.”
He is certainly right when he says that “philanthropy is not a substitute for adequately funded governments at the local, state and federal level.”
But he hits the nail on the head when he recognises that unless unrestrained capitalism is brought to heel, the rich, including himself and his “progressive” millionaires and billionaires, will face the pitchforks. He wants to have his cake and eat it. He is trying to take out an insurance policy against both “excessive” capitalism and the pitchforks.
He may want to bring about a “nicer” capitalism; but when push comes to shove we will still need our pitchforks.