New York Times congressional reporter Jonathan Weisman offered some strong “soak the rich” energy in his optimistic analysis of the Democratic Party’s latest money-raising proposal, “How Democrats Would Tax Billionaires to Pay for Their Agenda — The plan stakes out new territory by putting levies on unrealized gains in the value of billionaires’ liquid assets, such as stocks, bonds and cash.”
If “stakes out new territory” was a euphemism for “unconstitutional levy,” then it certainly does. The lead sets the tone, ranting in non-journalistic fashion about “the richest of the rich” with their “mountains of wealth,” like real-life Scrooge McDucks swimming in their vaults of gold coins:
Senate Democrats plan to tax the richest of the rich, hoping to extract hundreds of billions of dollars from the mountains of wealth that billionaires sit on to help pay for their social safety net and climate change policies.
The dubious constitutionality of the federal government taxing unrealized gains was euphemistically dismissed in paragraph two as the subject of possible “court challenges”:
The billionaires tax would almost certainly face court challenges, but given the blockade on more conventional tax rate increases imposed by Senator Kyrsten Sinema of Arizona, Democrats have few other options for financing their domestic agenda.
It would for the first time tax billionaires on the unrealized gains in the value of their liquid assets, such as stocks, bonds and cash, which can grow for years as vast capital stores that can be borrowed off to live virtually income tax free.
The tax would apply to all those with over $1 billion in assets or $100 million in income for three consecutive years:
For men like the Facebook founder Mark Zuckerberg, the Amazon founder Jeff Bezos and the Tesla founder Elon Musk, that hit would be enormous, since the initial value of their horde of stocks was zero. They would have five years to pay that sum.
Democrats say the billionaires tax could be one of the most politically popular elements of their social safety net and climate change bill, which is expected to cost at least $1.5 trillion and could be completed as soon as Wednesday.
“I think there is an absolute understanding that at a time of massive income and wealth inequality, when you have people like Jeff Bezos, in a given year, not paying a nickel in federal income taxes, that these guys are going to have to start paying their fair share,” said Senator Bernie Sanders, the Vermont independent.
“Vermont independent” was one way to describe the proud socialist Sanders.
Only in the next-to-last paragraph did Weisman come clean with concerns about the constitutionality of the fundraising scheme:
The plan faces resistance from some Democrats who worry that it may not be feasible and could be vulnerable to legal and constitutional challenges. The Constitution gives Congress broad powers to impose taxes, but says “direct taxes” — a term without clear definition — should be apportioned among the states so that each state’s residents pay a share equal to the share of the state’s population.
The 16th Amendment clarified that income taxes do not have to be apportioned, and proponents of the billionaires tax have been careful to portray it as a tax on income, not wealth.
Weisman approved of spending as well as tax hikes. He was lead author on a September front-page story cheerleading the big-spending plans of President Biden and the liberal Democrats in Congress.
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