Socialist-leaning Democrats are promoting a new wave of wealth redistribution tax schemes that are setting the stage to tear the Democrat Party apart. The drive to loot and demonize wealth creators runs the risk of alienating pro-capitalism Democrats and forcing them to abandon the party.
The decision by former Starbucks CEO Howard Schultz to contemplate running for president in 2020 as an independent is a canary in a coal mine for Democrats. Schultz is a progressive, but he believes in capitalism because it helped him live the American dream, going from a housing project in Brooklyn to billionaire.
The Democrats’ move to the socialist Left, ignited by Sen. Bernie Sanders, I-Vt., during the 2016 presidential campaign, is gaining steam in 2019. Sen. Elizabeth Warren, D-Mass., who recently established a 2020 presidential exploratory committee, is proposing a wealth tax. Warren wants a two percent annual tax on assets that exceed $50 million and a three percent tax for households with more than $1 billion in assets. Representative Alexandria Ocasio-Cortez D-N.Y., has another idea. She feels high-income earners who make more than $10 million should be taxed at a 70 percent rate.
Limiting higher taxes to very high-income earners or the very wealthy makes for a clever political scheme. It’s far easier to sway the masses to support the tax measures by narrowing the focus on a small and unsympathetic base of the very wealthy. According to the Washington Post, “16,000 Americans earned more than $10 million each,” and that represents “fewer than 0.05 percent of all U.S. households.”
Similarly, the wealth tax, or, as Sen. Warren calls it, the “Ultra-Millionaire Tax,” targets 75,000 families, meaning less than 0.1 percent of U.S. households, based on an analysis of Warren’s advisers, economists Emmanuel Saez and Gabriel Zucman of the University of California, Berkeley.
Based on public opinion surveys, a significant percent of the public are willing to take from the ultra-rich. A Morning Consults/Politico poll reported 61 percent of registered voters backed the Warren type of wealth tax, while only 45 percent favored the Ocasio-Cortez tax idea. Warren’s tax plan cuts across party lines, with 50 percent of Republicans and 56 percent of independents supporting her “Ultra-Millionaire Tax.” Almost three quarters of Democrats supported the tax.
A Fox News poll of registered voters on Ocasio-Cortez’s idea centered on very high-income earners also found broad-based political support. Seventy percent of those polled supported the tax, and the breakdown along political parties also showed significant support, with a whopping 85 percent of Democrats and a majority of Republicans at 54 percent. Taken together, the polls show that taxing the very wealthy is getting bipartisan backing, but the support among Democrats is overwhelming.
In political terms, the soak-the-rich mentality is so keen in the socialistic wing that they are pushing out the very wealthy from the Democrat Party.
A possible run for president by Schultz is a case in point. Schultz made it very clear that the tax-the-very-wealthy agenda was the motivating force behind his decision to consider runnning as an independent. During an interview on CNBC, Schultz said he respects the Democrat Party but that taxing at the 70 percent level, Ocasio-Cortez’s rate idea, is unacceptable.
Ocasio-Cortez hit back at Schultz on Twitter, essentially saying that billionaires should not jump to the top of the political ladder and run for president but need to start at the bottom rung.
Schultz was also criticized by Warren after he called her tax plan “ridiculous.” Warren responded on Twitter, “What’s ‘ridiculous’ is billionaires who think they can buy the presidency to keep the system rigged for themselves while opportunity slips away for everyone else.”
Schultz also fears that Warren’s idea is the first step toward socialism.
The left-wing media also joined in the bash-the-billionaire game. Mika Brzezinski, co-host of MSNBC’s “Morning Joe,” embarrassed Schultz because he didn’t know the cost of a box of Cheerios — a clear cheap-shot question aimed at making him look out of touch with Americans.
These high-tax ideas are also sending a powerful message to other Democrat CEOs in corporate America and liberals on Wall Street. It’s only a matter of time before the socialist Democrats initiate an attack on billionaire and former New York City Mayor Michael Bloomberg, who is also considering a 2020 run for president.
The Democrat Party the very rich helped create is about to eat its own.
Dr. Tom Borelli is a contributor to Conservative Review. Follow him on Twitter @tomborelli.