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tax the rich
A Challenge for Democrats: Getting the Stockholders to Embrace a Stockholder's Tax
There are many good reasons for stockholders to welcome a modest annual tax on stock holdings, chief among them that this would be an investment in America. But somebody is going to have to make that argument.
Sep 08, 2025
Wealthy Americans seem to think of taxes as a form of socialism. They believe they've earned everything they have, and refuse to subsidize 'welfare' recipients. The Guardian notes that "People in the US are about twice as likely as Europeans to believe that the poor are lazy and that hard work leads to higher quality of life in the long run."
But wealthy Americans enjoy a much more lucrative type of socialism. As Investopedia puts it, "When companies, even those that are publicly traded, are profitable, it's the shareholders who reap the rewards. Therefore, only a certain group of people benefit. But when the losses these companies experience are steep, taxpayers must bear the brunt."
The rich are certainly reaping those rewards now. The wealthiest 10% of Americans own 93 percent of the stock market. (The richest 10% of U.S. adults approximately matches the number of U.S. millionaires.) And fortuitously, for them, most of their windfall has derived passively as the S&P 500 has gained a pre-inflation average of over 10 percent annually over the past half-century.
The Coming Market Correction
In recent years stock market valuation has increased so dramatically, and so rapidly, that a correction similar to the dot-com bubble of the 1990s may be inevitable. The so-called Buffett Indicator, named after billionaire Warren Buffett, reflects the highest-ever disparity between stock market valuation and the GDP. Buffett believes, according to Yahoo! Finance, that "the market economy has become more and more 'specialized' with 'economic rewards flowing to people with specialized talents.' This, he says, has caused the wealth gap with many people barely getting by while others thrive."
Stock market gains reflect our productive past. All of us should reap some reward from that long-term effort.
Large-scale public wealth funds have been proposed to correct the imbalance. Funding would come from a Financial Transaction Tax or some form of levy on market capitalization. The argument for a Financial Transaction Tax has been made for years by economists like Dean Baker and lawmakers, including Sens. Elizabeth Warren and Bernie Sanders. An alternative is a small tax on stock holdings.
Why Stockholders Should Embrace an Investment in America
The total U.S. stock valuation as of early September, 2025 was about $65 trillion. Just a two percent tax on that amount would return $1.3 trillion. Each one of America’s 132 million households would earn approximately $10,000. Alternatively, about $5,000 per adult. Everyone, rich or poor, would share in America's prosperity, a prosperity born of 80 years of contributions by millions of Americans.
There’s a good reason for stockholders to welcome a modest annual tax on stock holdings, and to consider it an Investment in America. As noted by reliable financial sources, consumer spending directly influences stock market performance. With the massive trillion-dollar surge in consumer spending, stock market growth is likely to make up that smallish capital holdings tax, and then some.
Is it feasible? It's been proposed in the past. The Peoples Policy Project noted that At the end of 2017, the market capitalization of listed domestic companies was $32.1 trillion. A one-off 3 percent market capitalization tax would thus bring in around $1 trillion of assets. And it's certainly manageable. Investopedia points out that "Every brokerage has a stock record department that is charged with maintaining accurate records of all of its transactions on behalf of clients." Thus the process would be reduced to accounting transactions.
Objections? In the short run, returns will be reduced for investors. In the long run, funds may be transferred to bonds, foreign stocks, or other alternative investments. The stock market may be less liquid if trading activity slows. And of course, the millionaires who own almost the entirety of the stock market will resist even a small percentage payback to the country that made them rich. Conservative sources will find fear-inducing reasons to oppose the idea, as when the Wall Street Journal lamented that "A tax on securities trades would...create large economic and societal distortions." Of course, the increasing wealth gap has already created large economic and societal distortions.
Objections notwithstanding, it's certainly worth paying a nominal amount to stimulate the economy and boost one's own stock portfolio. And to address the GDP/stock disparity reflected by the Buffett Indicator, thus lessening the chances of a market crash.
In the big picture, American productivity is the result of 80 years of progress in technology and medicine and finance and numerous other industries, and it derives from the sweat and inspiration of all of our parents and grandparents. Stock market gains reflect our productive past. All of us should reap some reward from that long-term effort. All of us, including the super-rich, stand to gain by an investment in our long-productive nation.
A Compact for American Workers to Share This Labor Day
Most of the long-overdue planks on this Domestic Compact for America are supported by both liberal and conservative families who live, work, and raise their children here.
Sep 01, 2025
Running on the following Domestic Compact for America is a winning election strategy for candidates at the local, state, and national levels.
Most of these long-overdue programs are supported by both liberal and conservative families who live, work, and raise their children, facing unaddressed necessities of life and livelihoods.
Labor Day celebrations should be about more than department store sales and clambakes. America’s labor unions, at both the national and local levels, should circulate this agenda widely on Labor Day, because it is also a Compact for American Workers.
This agenda is being sent to Liz Shuler, president of the AFL-CIO (see the letter sent to her on August 27, 2024), and to the presidents of other major unions, including those representing postal workers, flight attendants, electrical workers, autoworkers, steelworkers, service workers, nurses, textile workers, and agricultural workers.
You might ask yourself: How many of these protections and benefits is US President Donald Trump opposing? These are good yardsticks by which to compare his deceptive rhetoric with his misdeeds.
The basic question is, whose side are you on? The key elements of the Compact are:
- Raising the federal minimum wage from $7.25 per hour to at least $15 per hour, benefiting 25 million workers.
- Raising all the Social Security benefits, frozen for over 45 years, paying for it by increasing the Social Security tax on the wealthy, benefiting over 60 million elderly. This was supported by about 200 House Democrats in 2022 but was blocked by the Democratic Speaker from going to the floor. Rep. John Larson (D-Conn.), the bill’s champion, can provide further explanation.
- Restoring taxes on the very under-taxed super rich and corporations (85% approval).
- Establishing a children’s tax credit, cutting child poverty in half, with over 60 million children benefiting. Very popular with parents regardless of their political party affiliations.
- Instituting Medicare for All, safer, more efficient, and much less stressful than our current approach to healthcare.
- Cracking down on corporate crooks stealing consumer dollars, wages, and worker pensions.
- Adopting social safety nets long available in Western Europe and Canada.
- Passing labor law reforms put forth decades ago. (See my column on Taft Hartley at Nader.org)
- Investing in crumbling public services and infrastructures.
- Paying for the above by restoring taxes on the very under-taxed super rich and large corporations and by ending huge corporate welfare giveaways and debloating the runaway, unaudited military budget.
Why has the Democratic Party declined to lead with such an agenda, which has been proposed for years by various citizen groups? (See winningamerica.net.)
One reason is special interest campaign money. Another is that the Democratic Party contracts out many of its campaigns to corporate-conflicted consulting firms that have long pushed weak messaging that leads voters to keep wondering what the party stands for. These consulting firms know the answer—have the party do what is necessary to outraise the GOP in campaign contributions from corporate PACs, the super wealthy, and Wall Street titans.
When the labor union chiefs just write campaign checks to the Democratic Party without demanding an authentic, publicly visible agenda for workers, the pressure is off the party’s leadership to cease being a corporate party or to recruit younger leaders to provide needed energy from the Democratic National Committee down to the grassroots. Without this energy, there is no serious effort to mobilize informed voters who demand these changes and overdue redirections. (See Roots Action, founded by Jeff Cohen and Norman Solomon.)
Here is to a more vibrant, respectful LABOR DAY.
For more information about what workers can do to advance their interests, see my book Civic Self-Respect—Chapter 2: “I, the Worker.”
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If the Dems Want to Beat Trump, They Should Embrace Medicare for All
If Democrats want to convince voters that they will make their lives better, they need to be identified with policies that will make their lives better.
Aug 24, 2025
At a time when we don’t know if we will have real elections in 2026 and 2028, it may seem a bit absurd to be plotting an agenda for Democrats, but it is essential. While polls show approval for US President Donald Trump and Republicans is plummeting, people are not flocking back to the Democrats.
A major reason is that people don’t know what Democrats stand for, other than not being Donald Trump. While that is an important credential, democracy does still mean something to many people, and that alone is not likely to convince voters to come out and pull the Democratic lever.
Most people do feel they are being screwed by the rich. They have a good case, which has gotten a lot better in the seven months Donald Trump has been in office. His endless tax breaks for the rich and corporations, coupled with all sorts of government giveaways from his crypto scams to giving the right to dump their crap on our lawns (i.e. pollute without constraints), should convince any doubters that we have a government by and for the rich.
But the Democrats need to make the case that they are something different. That will be hard when so many are openly in bed with crypto scammers and other Wall Street high rollers.
Moving to universal Medicare will be difficult both politically and practically, but it can be done.
If they want to convince voters that they will make their lives better, they need to be identified with policies that will make their lives better. Some of these should be obvious.
Raising the minimum wage to $18 an hour is a straightforward one. Minimum wage hikes always poll well, and when referendums have appeared on the ballot, they win even in heavily Republican states like Arkansas. And there is now extensive research showing that modest increases in the minimum wage do not result in job loss.
Workers want to join unions but are stifled by current labor law. Strong protections for worker rights should go a long way here. Suppose we not only had a worker-friendly National Labor Relations Board, but we also had serious sanctions for violations. I suspect fewer bosses would break the law if they were looking at jail time.
That would at least be symmetric. A union official faces jail time if they ignore a court’s back to work order. It seems an employer who continually breaks the law to obstruct workers’ efforts to organize should face similar consequences.
But an item that really should be top of the list is universal Medicare. This had seemed like a big lift to me and many others, which would require a long phase-in period. But Trump and the Republicans’ radical attack on the current hodgepodge system of providing healthcare, coupled with Trump’s extreme uses of executive power, convinced me that we can move quickly in this direction.
The Budget and the Resources for Universal Medicare
In moving toward universal Medicare, it is important to recognize the distinction between the budgetary implications and the real demands on resources. There is no doubt that a universal Medicare program will require a large amount of additional spending, although the increase can be exaggerated.
We will save at least $400 billion a year (5% of the federal budget) on what we pay the insurance industry to shuffle papers and deny people care. Prescription drugs and other pharmaceutical products would also be cheap if the government didn’t give out patent monopolies for these items. We will spend over $700 billion this year for drugs that would likely cost around $150 billion in a free market. The difference of $550 billion comes to $4,400 per household annually.
Contrary to what is often asserted, government makes drugs expensive. We need less government to make them cheap, not more. The same is true for medical equipment, like scanning machines.
We do need to provide incentives to develop new drugs and equipment, but there are alternatives to granting patent monopolies. We can pay people. The National Institutes of Health and other government agencies used to spend over $50 billion a year on biomedical research.
Insofar as it is necessary to raise revenue, Trump has shown us how easy it can be.
We can triple this sum and make all findings fully open source so that new drugs can be produced as generics the day they are approved. This would both make drugs cheap and eliminate most of the motivation for corruption in the pharmaceutical industry.
It’s also worth pointing out that a major reason insurers are so determined to limit care is the high prices of drugs and medical equipment. If a year’s treatment with a drug costs $100,000, as is the case with some new cancer drugs, an insurer will try to avoid paying it. If the cost were around $1,000, which would likely be the case in the absence of patent monopolies, there would be little concern about using the drug, if a doctor determined it to be the best treatment.
But even moving quickly to bring costs down in the healthcare sector, we will still need considerably more money to pay for a universal healthcare system than what the government pays for our current system. This is a place where Trump’s erratic policies have done us a great service.
First, we need to remember that the actual constraint to the government’s spending is not revenue, it is the availability of real resources. In the case of universal Medicare that means the doctors, physicians’ assistants, nurses, medical technicians, home healthcare aides, and other people who directly provide healthcare to patients.
We currently have over 18 million employed in these jobs. We would need considerably more to adequately meet the country’s healthcare needs. We already have shortages in many occupations, and there is a huge problem of access in rural areas and some inner-city neighborhoods.
We can’t immediately fill this shortfall since many of these fields require years of training. If the country moved to universal Medicare, radically ramping up training programs in healthcare fields should be a top priority. We need to go the Immigration and Customs Enforcement route here and offer huge recruitment bonuses. People can be paid tens of thousands of dollars for entering and then completing programs in physical therapy, nursing, and other health-related fields.
We also should be turning to foreign countries for assistance. There already are large numbers of immigrants working in healthcare in the United States. The Trump administration is hard at work deporting many of them. That will make it more difficult to attract foreign healthcare workers in the future, but hopefully a progressive Democratic administration can convince the world that the United States has returned to sanity.
There is an issue that by bringing large numbers of healthcare workers to the United States, especially doctors, we will be depriving poorer countries of desperately needed healthcare providers. There is a simple answer to this. We pay these countries to train two or three healthcare workers for every one that comes here.
This is a classic story of the winners from trade compensating the losers that economists always talk about when pushing trade deals through Congress, but never actually happens after they take effect. The logic is actually solid; the problem is the political will. Anyhow, we can give this compensation and create a win-win situation, if there is political support for it.
Getting back to the budget situation, the problem from large deficits is that they can push the economy beyond its capacity and lead to inflation. That doesn’t seem to be the problem at present, where the economy is showing considerable weakness. It’s hard to say what the world will look like if and when a progressive Democratic administration comes into power.
Insofar as it is necessary to raise revenue, Trump has shown us how easy it can be. He set the country on a course to raise close to $400 billion a year in taxes (more than $4 trillion over a decade), without even getting approval from Congress.
His method of ad hoc tariffs is probably about the worst way to raise revenue, but it does show that it is possible to raise large amounts of revenue. The better routes would be raising income taxes on high-end earners and a corporate income tax that we actually collect. (Either mandate companies give the government non-voting shares of corporate stock, or make returns to shareholders the basis for the income tax; proposals that are too simple for great policy minds to understand.)
We also should apply a modest sales tax to stock trades of say 0.1%. This will hugely reduce the bloat in the financial sector and cost the vast majority of households nothing. The politicians whining that a middle-class family with $400,000 in a 401(k) could end up paying another $100 a year in taxes should be told to eat shit and die. They are shilling for Wall Street: full stop.
Anyhow, the dire budget calculations showing that if we never do anything about deficits, in 2040 or 2050 we will have an incredibly high interest burden might be a good way to employ budget wonks, but they should not be treated as serious basis for policy. We can and do change budgets all the time, and if we do face problems where deficits are pushing the economy beyond its capacity, we know how to raise taxes and, if need be, cut less useful spending.
Moving to universal Medicare will be difficult both politically and practically, but it can be done. Democrats really should have it at the center of their political agenda.
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