Arkansas Democrat-Gazette

A wealth tax tends to start but never stop.

Or just give them millionair­es—at first

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FOR A time during and just after the American Civil War, the United States government tinkered with an income tax on the people. It was enacted, it was canceled, it was approved, it was repealed, it was adjudicate­d and finally tossed.

After the war, or as it’s known in these latitudes, The War, the federal income tax was put on hold. Until something called the Wilson-Gorman tariff came around during the Gilded Age. The only thing you should know from it: The income tax therein would only be applied to the “rich.” That’s how government sold it to the people. And when the

16th Amendment came around before World War

One, the feds were free (of the courts) to pass income taxes at will.

As Joseph J. Thorndike puts it in his 2013 book Their Fair Share, “Until World War II, only rich people paid the levy. Indeed, that was the point. Lawmakers had traditiona­lly confined it to the upper strata of American society, using it to balance more regressive taxes on consumptio­n. When first enacted in 1913, the individual tax affected fewer than 2 percent of U.S. households. Thanks to a large exemption—that portion of an individual’s income that falls below the threshold for taxation—most people remained well outside the taxman’s grasp. The income tax was a rich man’s burden.”

Emphasis on “was.” Decades later, the income tax has crept into the middle class. And next month, most of us will see what it costs us.

The problem is that government eats money, and the middle class is where the money is. It’s the same theory in bank robbery. You go where’s the money.

But in 1913, the federal government only spent $715 million. In 2020, the estimate is $4.8 trillion.

Nobody likes taxes, least of all Americans, who trashed Boston in a tax dispute to start this country. So smart politician­s will promise government largesse, but have somebody else pay taxes for it.

Which brings the conversati­on to Bernie Sanders.

THE INDEPENDEN­T senator, but Democratic presidenti­al nominee, has had a bad week. Our apologies in advance for piling on.

His never-never campaign has a proposal on its website (berniesand­ers. com) to Tax Extreme Wealth. The very first bullet point would “establish an annual tax on the extreme wealth of the top 0.1 percent of U.S. households.”

Today, Bernie Sanders defines Extreme Wealth as the top 0.1 percent of households. But how will Extreme Wealth be defined tomorrow? As Mr. Thorndike put it, when will this “class tax” become a “mass tax”? As it did with the income tax?

During the 1940s, Mr. Thorndike writes, exemptions to the income tax “fell dramatical­ly and the number of taxpayers increased more than sixfold. Almost overnight, it was later said, the income tax ‘changed its morning coat for overalls.’ ” That is, even real people started paying it.

Several factors were responsibl­e for spreading the income tax around over the decades, including politics. But there was also a thing called necessity. The government needed the money, even after World War II. And if the government is going to evolve, and provide for the common defense and the U.S. Postal Service—not to mention, more recently, salon regulators, college loan guarantees, school lunch inspectors, grants to artists, unused mobile homes after Katrina, research papers about the social habits of monkeys, and unfinished hotels in Kabul—then something has to feed the beast. That $4.8 trillion isn’t going to be found under the couch cushions.

A tax on wealth, or Bernie Sanders’ version of it, is currently planned this way, according to the campaign website:

“It would start with a 1 percent tax on net worth above $32 million for a married couple. That means a married couple with $32.5 million would pay a wealth tax of just $5,000. The tax rate would increase to 2 percent on net worth from $50 to $250 million, 3 percent from $250 to $500 million, 4 percent from $500 million to $1 billion, 5 percent from $1 to $2.5 billion, 6 percent from $2.5 to $5 billion, 7 percent from $5 to $10 billion, and 8 percent on wealth over $10 billion.”

Read those first four words again. It would start with . . . .

That’s the problem. Those of us who oppose a wealth tax know the history of taxes in this country. They go on the books clothed in promises about how little they would affect the masses. But once on the books, they spread. Like a malignancy.

Even if one believed Bernie Sanders and his promises that only the top 0.1 percent of Americans would pay such a tax, can anybody guarantee that the next independen­t senator from Vermont won’t amend the damnable thing to include, say, those making $1 million a year? Or $500,000? Or a salary simply above the minimum wage?

On second thought, spare us the promises. We’ve heard them before. We’ll take our counsel from the history books.

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