Rayne Renney
Ana Chickanis
Shalaye Brown
F. Wendelken
Erica White
4th Day of February
Another year brings another tax season. As the saying goes, there are only two things certain in life: Death and Taxes – except if you’re a part of the wealthy elite. According to a research group at the Paris School of Economics, billionaires only pay between 0-.5% taxes on their wealth. In comparison, the average American worker making approximately 45,000 pays 19% of their income in taxes (Paul Kiel, 2021). How is this fair? (It’s not.)
There is a misconception that if taxes are increased on the wealthy, it creates barriers to becoming wealthy. Another misconception is that the pursuit of financial equality is robbing those who earned their wealth and giving money for ‘free’ to those who did not earn it. Statistically, globally and in the United States, both sentiments are inaccurate.
According to research, “The richest 1 percent grabbed nearly two-thirds of all new wealth worth $42 trillion created since 2020, almost twice as much money as the bottom 99 percent of the world’s population” (OXFAM International, 2023). Also, according to Oxfam’s research, most wealth generated by the wealthy was from assets, which have a significantly lower tax rate than taxes on income or on products and goods. This means that the percentage of taxes which the average person in the world pays is far more significant than the percentage of taxes the wealthy pay.
To have a wealthy person pay a lower tax rate than a person 1000x poorer than them means that the poor person is being robbed. They benefit less from a society that more of their paycheck is given to. They get access to less ease and safety, while struggling to pay their ‘fair share’ of taxes, and the wealthy get to bask in the best society has to offer while paying almost nothing in taxes.
We have agreed in our country that taxation is ok, so taxing the billionaires would make, not only more money available to the citizens and less of a burden upon them, but also improve their hope of being able to reach the American dream. It would expand funding for public structures and increase the feeling that citizens are part of the community. Reading statistics is hard, because of wanting to be informed, but also it just hurts so much for normal Americans who gets excited if they even have a comma in their bank account. It creates a barrier to rising out of poverty when most of what could help people is hoarded by a few thousand people.
The cycle of poverty is extremely tough to break, especially when much of the population grows up in an environment that doesn’t always encourage thinking of us as individuals who are part of society—a society that often does not tolerate the poor. Financial systems add more layers of bureaucracy when we try to get back on our feet creating barriers for us as potential contributors to a healthier future for inhabitants on this planet.
The profound impact on mental health is evident when a considerable segment of society contends with financial instability, juxtaposed with a privileged elite possessing immense wealth. The psychological consequences of economic inequality materialize through increased levels of stress, anxiety, and despondency amongst individuals striving to fulfill their essential requirements. The stark contrast between financial affluence and destitution intensifies sentiments of hopelessness, impeding the realization of the American dream for numerous citizens.
When looking at the research, we find that “Worldwide, only four cents in every tax dollar comes from taxes on wealth” (OXFAM International, 2023). These kinds of statistics have created a financial vacuum for almost all people on the planet. A few thousand people get a life without ever having to worry about a roof over their head, food in their bellies, clothes on their backs, for them and for their families. Their health and safety are provided for, without any insecurity about that changing. Meanwhile, 99 percent of the earth, more than eight billion people, do have to worry about these things, and more than half of them, struggle to even obtain them.
Over the last few decades, the wealthiest individuals have only gotten richer while the middle class disappears into lower class and those in poverty increase more and more. What do the ultra-wealthy do? Simply put, not enough helping and a whole lot of exploitation.
This is not a new debate and somehow it continually falls to the average person to push for change. It should not be our job to convince the wealthy to help. There is simply not enough time in the day to work to barely afford our needs, plus the added stress of our own lives. This should not be a hard question to address. We must enact higher taxes on the ultra-wealthy and rid the system of significant wealth-hoarding enabling loopholes.
If you could rob a bank would you? No. If you did you would be caught, arrested, and put in jail. Just because you can do things doesn't mean you should. Now if a billionaire can cheat the system, should they? No. But there are no reasonable consequences for their actions, and they will continue to do so until they simply cannot anymore.
OXFAM International. (2023, January 16th). OXFAM International. Retrieved from oxfam.org/en/press-releases: https://www.oxfam.org/en/press-releases/richest-1-bag-nearly-twice-much-wealth-rest-world-put-together-over-past-two-years#:~:text=The%20richest%201%20percent%20grabbed,half%20of%20all%20new%20wealth
Paul Kiel, J. E. (2021). You May Be Paying a Higher Tax Rate Than a Billionaire. ProPublica.
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