Why Wealth Taxes Fail

Eat the rich…then what?

Andrew Heaton | 5.1.2026 10:00 AM

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California progressives are pushing for a tax on billionaires; so are senators like Elizabeth Warren (D–Mass.) and Bernie Sanders (I–Vt.). But as Andrew Heaton explains, such programs don't work. Just ask France.

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TrickyVic (old school) 2 months ago

They need the rich to fund their programs.

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1. CE 2 months ago
  
  But announcing a wealth tax scares the rich away and out of your tax jurisdiction. I knew progressives were dense, I just didn't realize how dense. Apparently they even failed Fairy Tales 101 -- you don't kill the goose that lays the golden eggs.
  
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2. See.More 2 months ago
  
  They need ~~the rich~~ tax cattle to fund their programs.
  
  FIFY
  
  The rich are just the most appealing cattle.
  
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JFree 2 months ago

Wealth taxes fail because the actual wealthy distort the proposed tax (by buying pols) so it falls on 'the poorer' half of the 'truly wealthy'. The poorer half of the truly wealthy are those who depend on income generation to build wealth. The Shohei Ohtanis or A-list celebrities or doctors/lawyers/Indian chiefs don't necessarily already have the assets to generate lifetime income and build more assets. The truly wealthy push those folks off the wealth building ladder by ensuring that a 'wealth tax' is nothing but an income tax targeted at the really high income.

Wealth taxes that work are those that change BEHAVIOR of the truly wealthy. eg that force a Bezos/Musk/etc to use their controlling asset stakes to pay dividends to non-controlling (and controlling) asset holders. Or are a tax base that cannot distort behavior - eg (land tax).

Reason is entirely useful idiot economics and has never produced one word of non-cronyist insight.

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1. Sir Chips Alot 2 months ago
  
  those poor pols being forced to sell themselves to the highest bidder!
  
  Why do you always want to steal from others and use force to do so?
  
  How about you start a company and give all its money to the "poor"? You can't, because you are too stupid and low IQ to start a business, but like all brainwashed low IQ far left Democrat cultists you want to steal from the successful
  
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  1. JFree 2 months ago
    
    If you can't read, you should probably not try to write. If you can't understand - well stupid is certainly a bigger problem.
    
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    1. Sir Chips Alot 2 months ago
      
      project much? Always projection with you low IQ brainwashed far left Democrat cultists
      
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  2. JesseAz (RIP CK) 2 months ago
    
    No lies detected.
    
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2. Mickey Rat 2 months ago
  
  Wealth taxes fail because the value of wealth assets are a constantly shifting target due to market conditions and create perverse incentives. That makes them inherently difficult enforce and prove the actual value as what the government is chasing is unrealized vapor of a guesswork value. It is an economically destructive kind of taxation that destroys the overall value of society. It something only a greedy moron of a politician would suggest.
  
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  1. CE 2 months ago
    
    And suddenly forcing all of the wealthiest people to sell off a sizable portion of their assets at once will tank the market price of those assets, reducing not only the expected tax haul theft, but reducing the value of the meager retirement assets of upper middle class working types who supposedly aren't affected by the wealth tax.
    
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    1. Zeb 2 months ago
      
      That's perhaps the most retarded part. Having valued assets doesn't mean you have that money. If Elon Musk tried to sell all of his Tesla stock so he could fill an Olympic pool with gold coins, it would suddenly be worth a whole lot less. It's like these people actually subscribe to the Scrooge McDuck picture of welath.
      
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    2. JFree 2 months ago
      
      That already happens. Anyone other than Bezos who owns Amazon stock and has to pay some bills has to sell their stock. They don't get dividends. What you're really saying is that a system that requires a non-Bezos to sell their Amazon is ok compared to a system that might require a Bezos to get Amazon to pay dividends to pay his tax bill.
      
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3. Rossami 2 months ago
  
  No, even a "perfectly applied" wealth tax would still fail. As the video clearly explains, all wealth taxes depress economic activity and lower asset values of both the wealthy and poor alike.
  
  Your assumption that paying dividends is the correct "behavior" to encourage assumes many things that are only sometimes true.
  
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  1. JFree 2 months ago
    
    No. A 'perfectly applied' wealth tax still distorts economic activity (as do almost all taxes except a land tax) - but by far less (and in a better direction) than the ALTERNATIVE. You can't create a strawman re wealth taxes (as if the alternative is nothing) - and then tax the shit out of income, consumption and create inflation and FIRE sector subsidies re public debt. The only OECD example of a 'perfectly applied' wealth tax is Switzerland.
    
    That tax is not applied at the federal level but is applied by every canton. Ranging from 0.3% or so in Zug to 1.0% or so in Geneva. In every case that changes behavior. The wealthy do not flee from Switzerland but they do create a dividend culture.
    
    The median dividend payout ratio in CH is 50% v 23% in the US. That does two things. It lowers non-controlling shareholder churn (which is generally non-productive activity created by an overly subsidized FIRE sector living on a pyramid of debt) which improves corporate governance. And it allows for people without wealth to begin to build actual wealth that will itself produce income. That difference is HUGE in building a safety net at the bottom of the income pyramid - where the lowest20% income in CH have non-housing net assets of $15,000 or so v lowest20% in the US with essentially zero. When people HAVE a safety net - and know how one can be created (beyond reading some Horatio Alger shit from Reason) - then they have much less need for the government to build a safety net for them. That is one reason CH govts (all levels) spend 31.5% of GDP v US at 37.5% of GDP - and in CH 2/3 of that is local where accountability can happen. Which is what can also keep tax rates lower.
    
    Wealth tax also requires that a country understand debt. In the case of CH, that is a big reason their bankers have a HUGE comparative advantage in dealing with and doing the banking for the wealthy of everywhere else. And because that skillset is used inside CH to eliminate the crony free-lunch games that most countries play - it is also why CH has a public debt/GDP of 39% v US of 122%. IOW - their taxes actually pay for their spending.
    
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    1. Stupid Government Tricks 2 months ago
      
      It's been a while since I've seen so much word salad in support of so much nonsense. Are you running test speeches for Kamala?
      
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    2. TrickyVic (old school) 2 months ago
      
      Use taxes to force behavior is a fascist move.
      
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4. Stupid Government Tricks 2 months ago
  
  Moron.
  
  Wealth taxes that work ...
  
  Wealth taxes never "work", unless you mean destroy wealth and induce poverty. By definition, wealth is unsold and has no definitive market value. The only way to determine its market value is to sell it, but the only people who could afford to buy it at its normal unforced market value are also trying to sell their own wealth.
  
  Moron.
  
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5. mtrueman 2 months ago
  
  "The poorer half of the truly wealthy are those who depend on income generation to build wealth. "
  
  It sounds like you're dividing the wealthy into the working wealthy, the pop stars, doctors, athletes etc - those who actually work for a living, and the rentier wealthy - those who need not work or produce, but by virtue of ownership, let their wealth work for them. Assuming I have a correct interpretation, how would a tax directed at the rentier wealthy change their behavior?
  
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  1. JFree 2 months ago
    
    True rentier taxes are basically land taxes (in an economic sense) and they don't change behavior. Here in the US, those are a potential problem at the federal level because of the 'direct tax' stuff.
    
    The wealth taxes that 'change behavior' are those which currently provide a huge value that is currently untaxed and very exclusively zero-sum. eg Bezos' ability to control dividend policy of Amazon even though he only owns maybe 10% of the company now. Amazon generates $140 billion EBITDA - but none of the other shareholders have an effective say in what is done with that. For them, it's all just a game of roulette - correctly predict the future hype of multiples/growth/etc - and SELL when you need actual income.
    
    IOW - everyone EXCEPT Bezos has to sell that asset to generate income but libertarians will cry a river if a wealth tax effectively requires Bezos to pay dividends instead of selling assets.
    
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    1. CE 2 months ago
      
      Land taxes definitely change behavior. Wealthy people can just move somewhere else that doesn't steal as much from them just because they own property.
      
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      1. mtrueman 2 months ago
        
        Don't they have to leave their land behind when they move elsewhere?
        
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        Bruce Hayden 2 months ago
        
        Well, yes. But not their Amazon, or hopefully their SpaceX, stock. Or their fine art, cash, etc. Which is to suggest that it will eventually devolve into a property tax on CA land owned by the current batch of CA wealthy. Those with a lot of non-CA real property wealth will flee, leaving those with their wealth tied up in CA real property there holding the bag.
        
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      2. JFree 2 months ago
        
        If you don't want to pay a sales tax, then don't buy anything. If you don't want to pay income tax, then don't earn anything (that's taxed). Those taxes distort incentives because when you act, that doesn't mean that 'the next person' continues to buy stuff or earn income.
        
        The difference between that and a land tax is that the next owner WILL pay the land tax because whoever has title to the land (granted by and protected by government) WILL pay the tax. The difference between a land tax and a property tax (the only thing that anyone in the US understands) was imo best explained by the noted commie William F Buckley.
        
        With a land tax, a parking lot owner and a skyscraper owner on adjacent lots will pay roughly the same tax. The land has roughly the same value - and things that govt does like building roads, parks, schools, fire/police, utilities, etc change the value of that land over time. That land tax (without a property tax) encourages development while discouraging speculation. Someone can buy the parking lot - build a multistory property on it - generate more income than a mere parking lot and yet the land tax remains the same (until next year). With a property tax, development is discouraged and speculation (free-riding rentiership) is incentivized.
        
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      3. minus the clever name 2 months ago
        
        Idle land , maybe.
        
        Henry George championed a land value tax to eliminate speculation, famously arguing that taxing land heavily would force owners to make "idle land" productive. His philosophy in Progress and Poverty suggested that since land value is created by community growth, not the owner, this value should be taxed for public benefit.
        
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6. Get To Da Chippah 2 months ago
  
  Wealth taxes do change the behavior of the truly wealthy. Such taxes make wealthy people move out of those jurisdictions. It was even mentioned in the video.
  
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Idaho-Bob 2 months ago

The truly wealthy push those folks off the wealth building ladder by ensuring that a 'wealth tax' is nothing but an income tax targeted at the really high income.

Stupid DNC take.

FYI - All taxes are wealth taxes.

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1. JFree 2 months ago
  
  Taxes are for the little people.
  
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  1. Spiritus Mundi 2 months ago
    
    Taking pride in your ignorance is always a bad look.
    
    'The Rich Don't Pay Their Fair Share' and 4 Other Tax Myths That Won't Die
    
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2. Zeb 2 months ago
  
  I suppose that's true if you ignore what people are actually talking about when they use the term. Is it not worth making a distinction between taxes on transactions/income and taxes on long term assets?
  
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  1. Idaho-Bob 2 months ago
    
    Is it not worth making a distinction between taxes on transactions/income and taxes on long term assets?
    
    No. All taxes are income taxes, it's just a matter of when.
    
    Property taxes based on imaginary appraisals and taxes on unrealized gains is a criminal act and should met with deadly force.
    
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    1. Zeb 2 months ago
      
      You seem to be making a similar distinction there yourself.
      
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    2. JFree 2 months ago
      
      Insurance is based on those same 'imaginary appraisals'. If something gets stolen, you can bet they are going to go to court and claim that that insurance amount is exactly what they will demand as recompense.
      
      I don't really have a problem, absent a wealth tax, of saying that no court will adjudicate property theft or put someone in prison for allegedly taking something of 'imaginary appraised value' with no legal record of ownership either. After all - if you REALLY want a world of natural rights/law, then everything belongs to the meanest alpha-sob who can take it.
      
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TJJ2000 2 months ago

Hating the productive is a conscience requirement to STEAL their produce.

Think about it. It's not that anyone 'Hates' what these rich/productive people are doing for them (Amazon, Dig Movies, Health, etc, etc). The only reason 'Hate' is there is to fake self-justify their desire to STEAL from them. It's literally an emotional response to avoid addressing who they REALLY are (i.e. Criminals).

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Mickey Rat 2 months ago

Wrong article to post

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Agammamon 2 months ago

>"Eat the rich and then what?"

That is future Mamdani's problem. Current Mamdani doesn't give a shit about that guy.

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But SkyNet is a Private Company 2 months ago

You subsidize something, you get more of it. You tax something, you get less of it.

Which is why we have more social pathology and less work and liquidity in assets that appreciate.

Tax consumption. Tax (GASP) buying foreign made goods.

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1. TrickyVic (old school) 2 months ago
  
  ""You subsidize something, you get more of it.""
  
  Too bad it's become a political strategy. Subsidize voters and they will vote for you. That's exactly how Mamdami won. I still don't see free busses.
  
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TrickyVic (old school) 2 months ago

Did any supporter stop to think about how this will affect the market when multi-billionaires have to sell off large volumes of stocks to pay the tax bill?

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MWAocdoc 2 months ago

No, it's not that they hate the rich and want to get rid of them. It's not even that they want to raise more revenue and are just clueless that it will cost them more than they can raise that way. It's that they could not care less whether they can raise enough money to pay for their failed social welfare programs. They don't even care whether their social welfare programs fail or not. If their promises fail they know they can simply blame the other party or throw each other under the bus. What they care about is destroying freedom. They hate freedom. They hate the messy social landscape filled with people doing pretty much whatever they want to do. They despise people and think everyone else is in need of permanent daycare with them as the nannies. They want us all to sit at our desks in nice neat rows informing on each other while they stab each other in the backs as they claw their way up through the Politburo, Secretariat and Orgburo into the Central Committee.

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minus the clever name 2 months ago

No, I don't see any reality in this analysis

1) Wealth taxes fail because of the Pelosi Factor. One is determined to spend X Billion on say Freedom T-Shirts for Tren de Aragua members so you have to then go find some money.

2) Most of those lawmakers are loaded so they don't know frugality or hardship or normal life: As of March 2026, an analysis indicated that at least 73 out of 100 U.S. Senators have a median net worth surpassing $1 million...Over half of the members of the U.S. House of Representatives are millionaires, with median net worths significantly higher than the average American. As of 2024, approximately 199 House members (about 45%) had a net worth exceeding $1 million, with at least 20 members worth over $25 million

3) BIden and Obama KILLED the labor market and rejoiced to have done so
the number of people moving from the living room couch into jobs was exceeded by the number who dropped out of the workforce, or, as was the case with millions of 20-somethings, never got a job. From January 2009 to December 2016, almost 10 million jobs were added, but amazingly, 1.6 million working-age people dropped out of the workforce.
==================
Ideology in this article has killed facts in some dark alley.

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