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Are You Rich Yet? That’s a Ridiculous Question.

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Are You Rich Yet? That’s a Ridiculous Question.

Bloomberg Opinion November 24, 2021
EconomicsOther

Democrats are tying themselves into knots trying to define who’s wealthy enough to pay for their new spending plan. Not surprisingly, it’s a hard number to pin down.

According to President Joe Biden, earning $400,000 a year makes you wealthy. Or maybe it’s $10 million now, if you go by the promise that the wealthy will pay their fair share in taxes to help fund the Democrats’ new spending bill. To most Americans, either number sounds ridiculously high. Median household income in 2020 was $67,521. If earning in the top 10% makes you rich, then your household would earn about $200,000, far below either cut-off.

Of course, it’s all relative. How far your household income goes depends on the size of your household and where you live. But it’s exactly that relativity that shows the absurdity of the promise that the wealthy will pay their fair share.  Not only does the pledge sound punitive (which is not the purpose of taxation), it’s totally unrealistic. Wealth is impossible to define and subject to political manipulation.  The spending we are contemplating is so large, everyone will eventually pay their share — even those “middle class” households earning a mere $200,000.

Continue reading the entire piece here at Bloomberg Opinion

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Allison Schrager is a senior fellow at the Manhattan Institute and a contributing editor of City Journal.

Photo by Tsokur/iStock

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