A new study out Wednesday shows that billionaires around the U.S. have added to their wealth in the months since the coronavirus pandemic began in March at levels exceeding budget shortfalls due to the economic crisis triggered by the outbreak in 23 states.
"This analysis shows how out of whack our economy has become with handfuls of billionaires in some states experiencing skyrocketing wealth growth that even exceeds the huge state revenue gaps that have opened up due to the coronavirus," said Frank Clemente, executive director of Americans for Tax Fairness, which announced the findings for Tax Day.
Billionaire wealth is booming during the pandemic while states are drowning in red ink.
Short term: The Senate must pass the HEROES Act to keep healthcare, education, housing, transportation and other public services flowing.
After that: Make billionaires pay their fair share. pic.twitter.com/10vmp7AElC
— For Tax Fairness (@4TaxFairness) July 15, 2020
The analysis details the numbers behind billionaire wealth increases and budget shortfalls:
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California's 154 billionaires saw their collective net worth leap $175 billion between March 18 and June 17, three months later. (March 18 is roughly when the coronavirus shutdown began and the date that Forbes published its annual report on the wealth of billionaires.) That's almost double the Golden State's budget gap over the next two years, estimated to be somewhere between $89 billion and $95 billion. Similarly, New York's billionaire class grew $77 billion wealthier during the "pandemic spring," a bonanza almost six times the size of the projected $13.3 billion gap in the state's budget for the fiscal year that began July 1.
As Common Dreams reported on July 7, every state but Vermont is consitutionally or statutorially banned from running a deficit, necessitating cuts when revenues are below spending projections.
Economic Policy Institute reseracher Josh Bivens told Common Dreams that budget cuts in the context of the pandemic-triggered recession are a recipe for economic disaster.
"We have noted estimates of the state and local shortfalls between now and the end of 2021 hover around $1 trillion," said Bivens, "and if we do nothing to close that gap, we'll end 2021 with roughly 5 million fewer jobs in the U.S. economy than we otherwise would have had."
Bivens added that federal aid and taxing the rich are solutions that would work to ease the financial strain on state budgets, a point that Americans for Tax Fairness' Clemente agreed with.
"A few very wealthy people in states are doing really well, while millions suffer," said Clemente. "If there ever was a wake-up call to make the rich start paying their fair share of taxes this is it."