On November 26, 2019, Joseph Zeballos-Roig writes on Business Insider:
Bill Gates, Warren Buffett and Jeff Bezos. Reuters
- The share of wealth held by the Forbes 400 more than doubled from $1.27 trillion in 2009 to nearly $3 trillion this year.
- That marks a significant increase encouraged by a combination of sliding tax rates, stock market growth, and the economic recovery, according to Gabriel Zucman, an economist at the University of California, Berkeley.
- Zucman, an economist who has consulted with the Warren and Sanders campaigns, noted the staggering amount of wealth that the richest 400 US citizens — or roughly 0.00025% of the American population — built up over the last decade.
- The amount of taxable income for the wealthiest group of US citizens dropped from 27% in 2009 to around 23% this year, the first time they were effectively taxed lower than the nation’s working class, Business Insider reported last month.
- Some economists have argued that the relatively small tax burdens of the wealthy are the product of decisions made by American lawmakers, whether directly or through congressional gridlock.
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The share of wealth held by the Forbes 400 more than doubled from $1.27 trillion in 2009 to nearly $3 trillion this year. That marks a significant increase encouraged by a combination of sliding tax rates, stock market growth, and the economic recovery, according to Gabriel Zucman, an economist at the University of California, Berkeley.
Zucman, an economist who has consulted with the Warren and Sanders campaigns, noted the staggering amount of wealth that the richest 400 US citizens — or roughly 0.00025% of the American population — has built up over the last decade in a Sunday tweet.
Since everybody’s doing their 10 year challenge…
Wealth owned by the Forbes 400 in 2009: $1.27 trillion (2.7% of total US wealth). Their tax rate: ~27% of income.
Wealth owned by the Forbes 400 in 2019: $2.96 trillion (3.3% of total US wealth). Tax rate: ~23% of income
The amount of taxable income for the wealthiest group of US citizens dropped from 27% in 2009 to around 23% this year, the first time they were effectively taxed lower than the nation’s working class, Business Insider reported last month.
The drop reflected changes in federal income tax as well as state and local levies, but particularly corporate taxes, Zucman said in an email to Business Insider.
A blend of factors which included the rapid growth of the stock market, the nation’s economic recovery after the Great Recession, the unfettered growth of large corporations, and declining tax rates fostered a favorable environment for a surge in the wealth held by the Forbes 400, Zucman said.
Meanwhile, the tax rate that the bottom 50% of American taxpayers pay hasn’t budged much over time.
Zucman and Emmanuel Saez — another economist at the University of California he’s partnered with — have argued that the relatively small tax burdens of the wealthy are the product of decisions made by American lawmakers, whether directly or through congressional gridlock. Tax avoidance has also become more common.
Congress has cut taxes on capital gains and estates over the years. And the top income tax rates were slashed six times since 1980, some with the support of Democrats, The Washington Post reported. In 2010, President Obama delayed ending the George W. Bush tax cuts by two years, and Congress allowed it to expire in 2013.
President Trump’s 2017 Republican tax cuts largely benefited wealthy citizens and corporations, experts say. They axed the corporate tax rate from 35% to 21%, while also reducing the top rates for individuals.
Many economists say that decades of income tax cuts in particular have led to the increasing concentration of wealth atop the economic pyramid and contributed to the accelerating inequality within US society, now at a record high according to the Census Bureau.
