Senators Introduce “Make Billionaires Pay Act”

Almost no one would argue that American families are struggling to make ends meet during the COVID-19 pandemic. Nevertheless, the White House and its allies have repeatedly pointed to rallying stock prices as evidence of a “V” shaped economic recovery, a rally which has allowed the country’s 643 richest billionaires to increase their wealth by 29% during the first six months of the pandemic, with Jeff Bezos’ wealth increasing 40% to a staggering $113 billion.

This stands in stark contrast to the reality many Americans see around them. Unemployment numbers, bankruptcies, savings, and the number of homeowners and renters behind on their housing payments paint a picture of a deeply distressed economy. The huge increase in wealth on Wall Street coupled with the despair on Main Street shows that we are in fact experiencing a “K” shaped recovery, where the richest have become even richer, and the poorest have been left wondering how to pay for their healthcare, especially if they catch COVID-19.

Meanwhile, stimulus talks between Democrats and Republicans in Congress have stalled, in part due to Senate Republicans’ insistence that we simply cannot afford the bill attached to the House Democrats’ proposal. Notably, while the Democrats’ proposal would cost up to $3.4 trillion, the richest Americans have also saved trillions of dollars under the 2017 Tax Cuts and Jobs Act, leading many to question why we are able to deficit fund tax cuts for the richest Americans (which critics argue have allowed billionaires to pay a lower effective tax rate than teachers and truck drivers, and have funded stock buybacks rather than economic growth for workers), but cannot afford to provide a life-line for American workers.

Against this backdrop, Senators Sanders, Markey, and Gillibrand introduced the “Make Billionaires Pay Act” on August 6, 2020. The Act was also introduced by Rep. Omar in the House on August 11th, 2020. Under this Act, anyone with over $1 billion in wealth would have to pay a tax of 60% of their increase in wealth from March 18th to January 1st, 2021. This act alone, which would still allow for an enormous increase in wealth for the richest Americans during the pandemic, would raise an estimated $421.7 billion, money which could be directed towards further stimulus, including covering the healthcare costs of all Americans for 12 months. The tax would not apply to anyone with a net worth of less than $1 billion.

Currently, there is no indication that this bill is likely to pass either the House or the Senate, or that it would be signed into law by President Trump.