Friday, July 15, 2011

Taxing Billionaires

Come now, you rich people, weep and wail for the miseries that are coming to you. Your riches have rotted, and your clothes are moth-eaten. Your gold and silver have rusted, and their rust will be evidence against you, and it will eat your flesh like fire. You have laid up treasure for the last days. Listen! The wages of the laborers who mowed your fields, which you kept back by fraud, cry out, and the cries of the harvesters have reached the ears of the Lord of hosts. You have lived on the earth in luxury and in pleasure; you have fattened your hearts in a day of slaughter. You have condemned and murdered the righteous one, who does not resist you.James 5:1-6
The Bible is hard on rich people.

The Letter of James is especially hard, but the theme is consistent. When Mary announces the coming of the Messiah, she sings about the poor being filled with good things and the rich sent away empty. Jesus says that it is harder for a camel to pass through the eye of a needle than for a rich person to enter the Kingdom of God.

In Luke’s Gospel, Jesus tells the story of “The Rich Man and Lazarus.” The rich man does not directly refuse to help poor Lazarus, he simply ignores him. And for that he is consigned to eternal darkness.

The problem is not wealth, but the juxtaposition of wealth and poverty, and the disparity between rich and poor.

There are warnings about focusing too much on possessions and not enough on justice, and it’s clear that we don’t really own things; we are only stewards of what ultimately belongs to God. But the biblical ideal is for everyone to have enough, “every man under his vine and fig tree.” No one should have “too much,” but the definition of “too much” is flexible and the emphasis is really on “enough.”

All Christians live with a certain amount of tension on this. We are not called to renounce everything and live in poverty, although some embrace that calling. We are called to live life fully and abundantly, to accept and rejoice in the good gifts of life. But if we are sensitive to issues of global poverty and inequality, then our thanksgiving for our own comfort includes a concern for those who have less. And we need to be good stewards, setting aside a portion of what we have to do God’s work in the world.

Within the United States, the gap between rich and poor has increased dramatically over the past three decades. Almost all of the gains in economic growth over that time have been funneled to the wealthiest among us. The middle class is stagnant. The poor have less. And the rich have more. We have been redistributing income from the bottom to the top.

The richest 1% of Americans have as much wealth as the total combined wealth of the lower 90%. At the same time, the tax rates for the wealthiest Americans are lower than they have been in decades.

Increasing the tax rates for the wealthiest Americans would be a good idea even if we did not have concerns about debt and deficits. A tax increase would slow the rate of increase in the gap between wealth and poverty, and reduce the upward redistribution of income.

Opponents of increasing the taxes of billionaires point out that the richest one percent of Americans now pay approximately 40% of all income taxes. That sounds like a lot until you realize that the richest one percent also have 40% of the wealth. In other words, the amount they pay in taxes is about average. They pay more dollars but they don’t pay at a higher rate. The tax rate for billionaires is about the same as for average Americans.

Raising the marginal tax rate for the richest Americans would make a significant contribution to reducing the deficit. It would be fairer. But it would also be good. And it would be good for the rich as well as for the poor. In the words of the prophet Isaiah:

If you offer your food to the hungry,
and satisfy the needs of the afflicted,
then your light shall rise in the darkness
and your gloom be like the noonday.
The Lord will guide you continually,
and satisfy your needs in parched places,
and make your bones strong;
and you shall be like a watered garden,
like a spring of water, whose waters never fail.
Isaiah 58:10-11

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