Washington State’s unofficial state motto has long been “Al-ki” which means either “bye and bye” or “by and by” in Chinook. The former meaning now seems official as Gov. Jay Inslee pushes for a “wealth tax.” Wealthy citizens are already saying bye to the state in anticipation of what one Democratic billionaire recently called a “boneheaded” move. The problem is that rich people can move. Unlike fixed assets like a mansion, they can take their wealth and taxes to other states without such laws.
The post from Senate Democrats supporting Senate Bill 5486 said, “The first $250 million of assessed value is exempted, meaning only the wealthiest people in Washington would pay the tax, including some of the wealthiest individuals in the world.”
I have previously written against wealth taxes from both constitutional and practical perspectives in the federal system. Sen. Elizabeth Warren (D., Mass.) has long been a proponent of wealth taxes and the Biden Administration supported the effort.
The Wharton Budget Model at the University of Pennsylvania found that Warren’s legislation would raise $2.7 trillion in revenue, but it would also reduce capital by 3.1%, depress average hourly wages by 1.2%, and reduce gross domestic product (GDP) by 1.2% in 2050.
It is part of an “eat the rich” pitch from liberal politicians and pundits.
When struggling in the 2020 Democratic presidential primaries, Sen. Elizabeth Warren (D-Mass.) pledged a wealth tax, declaring that she was coming after “the diamonds, the yachts, and the Rembrandts too.” Then-New York City Mayor Bill DeBlasio, another Democratic contender at the time, was barely registering in the polls when he promised that “we will tax the hell out of the wealthy.”
The federal constitutional problems are not barriers to the states. However, the effort to hammer the wealthy has never worked for states or countries. France previously saw a massive exodus after it attempted to clip the most wealthy and had to reverse its policies.
Putting aside expected legal challenges, Democratic donor Nick Hanauer criticized state Democrats for the push and said he had already spoken to the wealthiest citizens about fleeing the state.
“Even if it clears the legal, implementation & other challenges, it’s unlikely to raise much [money] given every wealthy person I’ve spoken to in the last few days has said they will leave the state. I believe them. Thoughtful taxes don’t actually drive people away, boneheaded taxes do.”
That is the problem with eating the rich . . . they have to stay put to be eaten. These wealthy individuals are already willing to pay some of the highest taxes in blue states for income. However, a wealth tax would expose their property to what is likely to become an irresistible target for politicians unwilling to make tough budget choices.
Of course, Washington could follow California in seeking a retroactive tax. Rather than try to keep the most wealthy citizens, it could seek to make them pay to leave the state like a giant Venus Flytrap.
We previously discussed the push in California to impose a retroactive tax on the many citizens and companies fleeing that state due to its high taxes and other problems. Warren wants to do the same nationally. So, if businesses are fleeing the country due to these policies, they would have to essentially pay for the freedom in a type of captivity tax. It is incredibly short-sighted. They need these businesses and they will not be able to coerce them into staying by trying to make it more expensive to leave.
The wealth tax campaigns combine fiscal negligence with political opportunism. Rather than imposing budgetary restraints and reducing budgets, Democrats promise to fleece the superrich. This short-term appeal is likely to cost the state dearly as the wealthy leave for less predatorial states.
You can stay in Washington state and get hit with a wealth tax or you can “bye and bye” and move out of the way. It appears that millionaires are already training with a financial expert in Washington to move out of the way of the wealth tax:
Jonathan Turley is the Shapiro Professor of Public Interest Law at George Washington University. He is the author of “The Indispensable Right: Free Speech in an Age of Rage.”
Professor Turley writes, “That is the problem with eating the rich . . . they have to stay put to be eaten.”
That is also the problem for the rest of us. Rich Democrats bring the mind virus and its rotten money with them. Look what California money has already done to Colorado. Ask anybody living in Aurora (other than its colossal fool of a RINO mayor; he needs to be primaried).
If California can have a retro tax, Texas can have a head tax on Democrat immigrants. Everybody is sick and tired of these know-it-all fatheads spreading like locusts, and limousine liberals need to pay for the catastrophes boutique communism creates. If any blue state can make a hash of the Constitution by passing wealth and retro taxes, red states can have a head tax on their fleeing Democrat donors.
This is what I would say to any immigrant coming from anywhere: if you contributed to the problems where you came from, you need to stay the hell there and fix it. No communists. No jihadists. No cartels. Don’t bring that #$% here. GOT IT?!?!?!
Diogenes, there’s another dimension to the equation you proposed. If all the non-communists flee a despotic country, who remains to transform it into something better? Take, for instance, the Cubans who migrated to America in the mid-20th century. They settled in places like Tampa and Miami, worked diligently, built better lives for their families, and contributed significantly to America’s economic and military strength.
However, if the most capable and motivated individuals leave a country, they strip it of the very force needed for liberation. My belief is that if the Cubans who fled since 1958 had stayed, the Castro regime might have been overthrown long ago. By leaving, migrants inadvertently enable despots to maintain their grip on power for longer periods.
I bet you’re right, Alan, but I do want a refuge for people who fought bravely and lost against radicals; however, I don’t want their radical neighbors coming to America’s welfare magnets.
Just the fact that Trump just said that it would be a good idea to retrieve the Panama Canal before china gets its hands on it, I think he could entertain the idea of taxing communist/socialist ideas as they contribute to our national debt, render our population unable/unwilling to defend our borders and allow expensive anthropological experiments (such as the concept of gender transference etc.) to break our bank. I could go on but Trump and his minions surely understand where the biggest threats to our nation are and he should make them pay for the consequences of their damage.
Whimsicalmama, I like it! Many of the lefties I’ve seen love status and money–especially other people’s money. All that claptrap about the proletariat is just ornamental BS to hide the contradictions even from themselves. The minute you hit them in the pocketbook, you hit them where they hurt. It will have an effect.
I wish we could force Democrats to house illegals at their own expense. The moral grandstanding would vanish instantly.
Ah The Dems love YOUR dollars! While the wealthy CAN LEAVE town as they see fit, the long arm of taxation may be right behind them!! Recall, California intends to brand anyone leaving the ENCLAVE as a tax cheat and subject to taxation for at least a minimum period after departure, up to and including, FOREVER! It won’t take long for the socialist governments of the West to mimic and tweak those tentacles to get those Daddy & Momma Warbucks to “PAY THER FAIR SHARE”!!! Good Luck Blue State Lovers – you need it!
The problem with socialists, as is the problem with all fanatical idealists, is that their concept of the ideal always requires them to disregard reality and human nature in order for their ideology to function (which is ALWAYS why the ideology fails – bigly). Our current crop of progressive socialists believe in the “perfectability” of man as the essential requirement to achieve their utopian goal. G-d knew we weren’t perfectable except through grace and that is something quite impossible to the prog/left.
I’m a little surprised that Democrats don’t lobby for a flat tax that no one would be able to write off or deduct. Say 8% ???
Democrats are red, progressive shades of red, a wicked red hue, and Republicans are reclaiming their traditional blue colors.
Well, I’m sure Boeing is happy that they moved some significant production to South Carolina. Maybe they will move the rest there. Jeff Bezos has already left the state. I would think the people in the state government could read the tea leaves. But I’m afraid the main thing Professor Turley said is “Rather than imposing budgetary restraints and reducing budgets, Democrats promise to fleece the superrich”. In other words they want no restraint and will tax anything that is in the state or even in the process of leaving the state. I guess these Politico’s also failed to take note of the Billionaires peeling off from the National Democratic Party and swarming down to Mar A Largo. There has been a noticeable shift even since the November election. It seems the state and national Democratic Party is getting even Wackier.
These tax principles have only served to Make the South Wealthy as money and power shifts there. The major manufacturers that export have moved towards ports like Houston, New Orleans, Tampa, Miami, Jacksonville, Savannah. Those Taxes have been bad enough that even Little Rock, Arkansas is starting to grow and build traffic almost like other growing cities in the South. I have been driving through Little Rock for 40 + years and then for the past 10 the traffic is just growing like leaps and Bounds. Little Rock !!.
Thats why the Interstate Corridors are going north-south with growing traffic and more expressways being built because the corridors are overloaded. They don’t go west much much.
Thomas Sowell has many books about athoritarians confiscating peoples’ wealth!
The authoritarians don’t benefit becauase those people took the knowledge of how to create wealth with them when they left!
Bill Gates will probably move out of state.
Seattle Mayor one time wanted to deal with homelessness and the cost of housing. His plan was to raise property taxes to make housing even ore expensive!
That was a great movie (Dodgeball). Thanks for the clip.
Let’s not forget Dame Thatcher’s astute observation: “The problem with socialism is that you eventually run out of other peoples’ money.”
Fascist Democrats can’t help themselves
It is time to DEFUND Democrats
End federal aid to cities, states, non-profits and schools
also ban public unions
Let them fund their own failures, instead of being reward with Federal Aid!
That’s illegal guy. Please think before you post.
So is canceling student debt, but the big guy did it anyway despite the SCOTUS ruling against it, so there’s that.
I think that correctional legislation could make all of that legal, again, as we never had such burdensome federal confiscation of our personal wealth as we have had since woodrow wilson first contaminated our government with both socialist ideals and communist sympathizers. There is nothing in the constitution that demands that we fund aid to any derelict city, state, union or other entity, this has all been slow government creep into our lives and it needs to be ended – now.
“It is time to DEFUND Democrats
End federal aid to cities, states, non-profits and schools
also ban public unions”
********************************
I think I’d just declare the Democratic Party a domestic terrorist organization (what they so obviously are) and sieze its assets. I’d then raid its offices for the inevitable teasure trove of incriminating documents detailing all manner of mayem they’re wrought along with their globalist friends. The Grand Jury investigations would start the next day. Then I’d appoint a receiver like Steve Bannon to restore the party to the American people. He may also have to do a location exorcism but that’s for another day.
This policy is a headscratcher. Wash is targeting the uber-wealthy at $250mil+ but these are people that are choosing to live in Wash more as a convenience than anything else. Their wealth is so immense that they can live anywhere in the world. Only about 1% of NYC residents pay over half of the city’s taxes. With the absolute top of that 1% paying the lion’s share. NJ’s state income and high property taxes, drives away retiree’s in droves. Its very hard to retire in a state on a fixed income and pay $25k per year in property taxes. I’m not entirely sure these places really care. While there are people from both parties escaping the high taxes for for more tax-friendly locations, its pretty clear that the exodus taking place is mostly republicans. FL for example has been the recipient of many of these tax refugees and their republican majority has swelled. NJ and NY probably feel that pushing these folks out will make their states a deeper blue.
Dumb Democrats fleeing MA move to NH and turn that state blue. Dumb Democrats flee NY and move to NJ to continue keeping NJ blue. Dumb Californian Democrats move to AZ, ID and TX and shade them more blue than they were.
Smart and proactive Republicans flee MA, NY, NY, IL and MI and move to Fl turning it from purple to DEEP RED. They move to NC and keep it red. They move to GA and keep it red and they move to TX and at least keep it from going blue.
Liberals are too dumb to know that fleeing your blue state and then voting the same way will not help their situation. Conservatives flee blue fascist states to enjoy the freedom of FL and a few other red areas.
I fu\ind nothing wrong with allowing those wealthy socialists (who made their wealth via capitalism – lest we forget) to foot the entire bill for their progressive nonsense. If gates wants to stay and fork over his wealth to a bottomless pit of social programs who is going to stop him.
have you ever seen a Democrat policy that didn’t expand and grow like a cancer until the body is devoured?
Everything the Democrats touch turns to crap…
The Democrats love their Double Standard…
Democrats Believe that ALL Americans are stupid…
Not simply a Democrat problem, a government problem. We all know that the promise of ‘it won’t affect you because (fill in the blank)….and then the tax oozes out to entrap everyone.
I think their motto should be: “We’re not happy ’till you’re not happy…”
How can a State law that violates the equal protection clause of the 14th Amendment not be illegal under the Constitution? Sadly, this is just another example of tax policy that discriminates against a certain segment of the population (rich people); the 16th Amendment was written in such a way that it only applied to something like 4000 US citizens. While it may be politically acceptable to most people, I don’t see how it is close to what our Founding Fathers envisioned. I wish that Professor Turley would write a column explaining how this is Constitutional.
I think an equal protection challenge under the 14th amendment to a wealth tax would survive the rational basis test review by the courts. See this wiki piece that explains the test/review.
Oops here is the link: https://en.wikipedia.org/wiki/Rational_basis_review
Not dismissing the rational basis test review by courts. But… seriously? Wikipedia?
I think the Wiki article explains it well — feel free to link to a better article or source.
“That is the problem with eating the rich . . . they have to stay put to be eaten.” (JT)
The deeper problem is the Left’s cannibalistic notion of eating the rich.
They should immediately impose this tax on their wealthy supporters, such as the Clooney’s, the Hollywood big mouth’s, that political brain trust Swift can easily handle the tax. There’s an abundance of their wealthy supporters they should tax first. As far as these people moving to more hospitable locations, PLEASE stay where you are!
And they think the wealthy will continue to dump money into libs campaigns?
What about a tiny Rembrandt etching?
Asking for a friend?
J
If Liz Warren finds out who you are, that etching will be hanging in her office by the end of the month.
One day they will learn. One day
No, I regret to say, they will never learn. Envy will inevitably defeat reason. One day, they will succeed. They will make it impossible to leave, like the Venus Fly Trap, and devour the wealthy (i.e., successful). And then, of course, the definition of “wealthy” will slowly, then quickly, expand to cover those like Governor Inslee and Senator Warren, and the process will grind down to where society is once again made up of nomadic hunter-gatherers.
No they won’t. We have seen this type of stupidity across the world. and accross the US. This nonsense NEVER works.
Frankly I think the Wharton estimate is completely Bogus.
A Wealth tax in the US will cause the value of fixed assets subject to the tax to tank. It will hit GDP much harder than predicted, And it will likely cause Tax Revenues to decline.