We should remember that Congress is a co-equal branch of federal government. They can overrule the Supreme Court and the Executive by clarifying legislation. It's not easy, but it is well within the realm of possibility.
Just like overcoming 29-point deficit. Difficult but possible.
I don't agree with the "Co-equal" branch description. Article 1 of the constitution establishes the legislative branch and provides for the House having control of legislation establishing taxes. Article 2 establishes the Executive Branch, but the root of the word President is "preside". The president is to preside over the work of Congress and ensure the laws established by Congress are enacted and enforced. Article 3 of the constitution establishes the judiciary and doesn't provide a great deal of instruction- other than that Congress is to establish a judicial branch. These are not co-equal branches. These are branches that have their own powers and purviews, yes- but all things flow first from Congress. Congress is the primary branch of government and the branch the Framers envisioned to be the true representatives of the people.
Okay . Made me think and I accepted coequal too quickly. And imagine if the house and senate actually represented the multitudes. And if no electoral college mucking things up. Clarifying legislation indeed! Let’s get on it.
Sorry, but legislation can't alter the Constitution. It requires an amendment, which is politically impossible and you can't change equal representation in the Senate by state (not population) even with a simple amendment. Read the Constitution. It's not that long and you may be surprised at some of the things that are in there
Actually, while legislation cannot amend the Constitution it can initiate it. Moreover, Congress can determine the number of justices—both up and down. Congress can respond to SCOTUS decisions with new laws to redefine the issues so that its say holds. Congress can also change what falls within the judiciary's jurisdiction, especially at the appellate level. That may arise as the Trump Administration tries to change the application of habeas corpus.
It's messy, this back and forth between the branches, but none get to call all the shots. That was the genius of the Founders to tried to keep the federal government from becoming tyrannical.
Yeah I know the basics thanks. We have been accepting that things are impossible because that was what those holding power wanted us to believe so that we would just stop trying to defend and retrieve our own power.
For Congress to counter the inexorable march of the wealth of the uber-wealthy, it is necessary that it has the intent or the will to do so. A Republican majority has never displayed either.
I wouldn't bet on that...so many people have been projected the cratering of Tesla shares for years, and...well, still trading well over value despite total failure in FSD, robotaxis, robots, etc. Musk overpromises, and the fanboys lap it up. And now, many market ETFs will be loading up, so even Musk-doubters and haters will be forced to literally pay homage with their 401K and IRA accounts. Plus all the yuuge govt. subsidies and lucrative contracts he's landed...
Well, on the SpaceX IPO, I noted there was another IPO on the same day, a bit smaller, but the ramifications of which have been entirely missed on this Substack, on the other Substacks, and, indeed, in the entire media.
It was for "Dean Baker's Hydroponically-Grown Organic Peanut Butter".
(I'm not sure, but it may be a different Dean Baker. I'm trying to look into that.)
Totally not radical! Where we are is radical….why would we Not tax all exchanged dollars the same? Or not!
If there is a different way then let us all in on it. If no taxes is de rigeur for you, then we too.
And now how are we going to pay, dear billiomaires, for shared infrastructure and transportation of all kinds, universal health and hospitals et al, education of our people, satisfactory military defense and moderate law abiding efficient community policing, administering governmental prerogatives, agriculture farms and food production, water and energy systems, ….
Taxing wealth is an idea that comes from people who don’t understand real economics. When a person doesn’t understand money or wealth or economics then they say stupid things like tax wealth. Money has zero real value. It is created out of nothing. Anyone who passed high-school calculus and physics understands this. Mathematically money is only a medium of exchange. You can’t eat money: if the supply of food or water goes to zero it doesn’t matter how much money you have, you die. Wealth is a step removed from money: while barter still exists almost all real transactions for real goods or services use money as the medium of exchange and so wealth has to be converted to money to actually obtain a good or service. Lots of people learned this truth after 2008 when they couldn’t pay their mortgages. Even today there are creatures who want to blame the banks for the 2008 downturn but the banks did nothing wrong, it was people who bought houses they couldn’t afford and people who didn’t understand the difference between wealth and income. Technology based wealth has huge fluctuations over time with much of it evaporating. When John D. Rockefeller was worth 1.5% of GDP it was only ca. 1/2 of Standard Oil revenue (and > 8% of US GDP). Elon Musk is now worth 3.4% of GDP which is ca. 100x the revenue of his companies. If you taxed Musk 5% of his current wealth it would be more than 2x the revenue of his companies. Rockefeller could have paid a 5% tax out of revenue, Musk could not.
The tax code has encouraged the shift from income to wealth and we have built both high-value job remuneration and our retirement system on this foundation. Many people in high-value/high-paid jobs get a substantial part of pay in the form of stock and retired people mostly live off savings invested in stocks. These combine to increase the current nominal value of stocks. Mathematically the need to convert housing wealth to income in a single year upon sale is the basis of the supposed housing shortage: we have far more bedrooms/bathrooms/square footage per person today than 50 years ago so there is no real housing shortage. But where I live, and across the country, there are huge numbers of large houses with one or two people living in them. As an example if I had to move to assisted living my kids and I would come out ahead on taxes if my house sat empty for 30 years (at current tax and maintenance costs).
A perfect tax system would only tax consumption and would tax it progressively. Income is the closest measure we have to taxing consumption but irregular income (like living on commissions or selling your house) is a problem. A simple tax system that would work far better is to treat capital gains as income but allowing for time averaging, and eliminating the stepped up basis on death. Simple is always better in economics. Wealth taxes are both complex and stupid.
We’ve been taxing real property since forever. Car owners get taxed every year, but they call that a “registration fee.” I’m sure there’s a way to tax other forms of wealth that would work. And before you say anything, I’m an economist, and I KNOW it’s possible and not stupid to tax wealth. Furthermore, Jared is a much more esteemed and respected economist than I, and he’s saying the same thing.
I’m not sure “unlocking” all that living space in McMansions is going to do anything about our housing shortage. That housing stock doesn’t match the current needs of small families and couples and singles.
The states have broad taxing power. Under the Constitution, the federal government can't impose a “direct tax” on property unless the tax is apportioned among the states in proportion to population.
They’ll have to redefine income to include some elements of wealth, like margin loans against massive portfolios that many billionaires use to fund their lifestyles. Also, you present your interpretation as a fact, though it’s not. But I do agree this SCOTUS would likely concur with your interpretation.
You would have to get a majority of the Supreme Court to agree, or adopt a Constitutional amendment, to overrule Supreme Court precedent, which, whether I agree with it or not, is the law of the land. If Congress enacts a wealth tax, the wealthy will sue and eventually the Supreme Court will decide whether it's an income tax. If 5 justices say "no", all the money will have to be refunded, with interest, and we'll have to start over with a new new tax that the Court will uphold. So, change the Court (FDR tried that and failed) or change the Constitution. Sadly, there is no easy fix. If there were, probably some Democratic Congress and president would have already done it
Do they tax wealth in Germany? I assume that’s where you are. You’re probably not familiar with the myriad ways those of us in the U.S. have been discussing this for the last 40 or 50 years. There are many ideas, some of which have been around forever, like inheritance taxes.
The existing federal estate and gift taxes would be a great way to address the concentration of wealth and are clearly constitutional excise taxes on transfers of property, not direct taxes on the property itself. But GW Bush successfully demonized the transfer taxes as "death taxes" and now the laws are riddled with loopholes and raise very little revenue. I'm not familiar with the German tax system, but most European countries have value added taxes, which are basically consumption taxes. That's another approach that could work, but you need a strong social welfare system to go along with it because I think they tend to be regressive (hitting low income folks more than the wealthy)
BTW, it's Article I, Section 9[4] of the Constitution: "No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken."
Let’s get back to reality, the best political outcome in November, Dems take back the House and maybe, although unlikely, the Senate. Trump can veto and overriding a veto, 2/3 probably not.
What should be the first Dem bill?
Removing the cap on Social Security, just uncap. A veto might be overridden.
What next?
Nibble away, selecting bills with wide public support.
Oh. and let’s not forget the mud wrestling for the Dem prez nomination…
The Knicks post coidal elation will fade all too fast
Perhaps the best we can do is block Trump's predations at every turn. Sue constantly to eliminate executive orders that contradict Congressional legislation. Use the time to write legislation that embodies all the good ideas under discussion and go ahead and let Trump veto them. They are the functioning lab of a renewed Democratic agenda for 2028
Absolutely, spot on! This is THE issue in America, again. ( I like the old-school identity for this, rather than USA) We have been here before. Doubt it will be addressed without some huge destructive explosion but maybe, as you suggest, if the Knicks can , we can. SCOTUS, yes. Election integrity, more yes and those in power now are going after this for this fall’s elections and 2028. They know your point, Jared, and will be all in on owning our future and their wealth.
U.S. inequality is such a glaring problem it is surprising so few acknowledge it, especially politicians. Watching the Knicks or American Idol has caught our imagination. And economic numbers are really boring. We are at least 29 points behind. I guess continuous hammering and education is the only solution.
I visited EPI's Wage Calculator today, a median household income of $84,000 would be $113,002. Almost $50,000 higher. About 60% higher. But how to impress that upon Joe and Maxine Sixpack? I also visited the "average weekly earnings of production and nonsupervisory workers" at BLS. In Jan 1972 the average wage was 336.96, and in March 2026 it is 334.27. The median house sales price in 1972 was $208,000 and in 2026 $403,000 (adjusting for inflation).
I'd like to see a minimum wage mandated on the largest employers. Some 2,137 corporations employ more than 20,000 workers; their average payroll is around 64,000 -- from the U.S. Census Statistics of U.S. Businesses. They should pay a minimum $30/hour, make it law.
And so on down to companies with less than 500 workers.
Anyhow, it's a long road ahead.
In Switzerland in 2012, I think, they held a referendum on a 1 to 12 ratio of income. It sounds so simple. It lost badly. 1 to 100 might win. And keep chipping away. A cartoon I saw shows two guys at the watercooler, one says "I had a conversation with the boss, and now I believe he really does work 380 times harder than you and I."
Could we give tax breaks to companies for having human well paid jobs? And for true sustainability? So we do a billionaire tax….so easy to just add a few more tax brackets using AMT alternative minimum tax, and those who have many employees earning living wage or better and spend on safety and clean businesses get some deductions that make those things compelling.
As long as the current 6-3 majority on the Supreme Court prevails, I think the best practical policy would be to stick with taxes that have been held constitutional by long-standing precedent and hope the Court doesn't overrule those cases. The Constitution authorizes Congress to impose taxes on realized income and there are a number of Court decisions on when income is realized. The current Court is unlikely in the extreme to expand those precedents. So, stick to what has worked before. The Constitution prohibits Congress from imposing any "direct tax", unless it is apportioned among the states. That's why it was necessary to amend the Constitution to enact an income tax, at least on corporate income. I'm not sure what that prohibition means exactly for a wealth tax, but I imagine the existing Court would say it obviously prohibits an ad velorum tax on property.
Correction. The sixteenth amendment was necessitated by the Supreme Court's decision in Pollock v. Farmer's Loan & Trust, which held that income taxes on sales of property were prohibited direct taxes on the property itself and had to be apportioned among the states by population. So the Court held that income taxes on income from labor were perfectly legal, but income taxes on property weren't. And, the 16th amendment effectively overruled Pollock by permitting Congress to enact taxes "on income from whatever source derived". The question raised by a wealth tax is whether unrealized appreciation in property values are "income" for purposes of the amendment
Jared, if as you expect SCOTUS would rule that taxing wealth is not permissible, wouldn't that imply taxing residential property is also not allowed? What impact would that have?
A state or local government can impose direct taxes on the value of property unless the state constitution limits or prohibits it. The US Constitution prohibits Congress from enacting any "direct tax" unless it is apportioned among the states. So states and localities generally can impose property taxes, but the federal government is restricted by the constitutional provision
The Supreme Court struck down a nineteenth century income tax that applied to sales of property, saying that it was a prohibited direct tax on the property itself. That's why it took a constitutional amendment (the 16th) to finally enact a tax on income, "from whatever source derived". So, now the issue is what is income? There are a number of cases on that. For example, a dividend consistently entirely of common stock distributed pro rata to all common stockholders is not income. Either v. Macomber. The most recent Supreme Court decision upheld a one-time tax on any corporation that owned at least a certain percentage of stock in a foreign corporation, if the foreign corporation had not distributed its income to its US stockholders. Moore v. United States
If we discover a new store of wealth perhaps we may find ways of allocating its beneficence to others than the existing plutocracy. Make things Not Worse.
That's one of the rationales behind the Washoe Forests Carbon Bank (not-Washoe when the Place Tribe is not-Washoe). We of the settler-logger communities recognize that our ancestors, in their brutal ignorance, failed to recognize and steal the carbon values of the forests, seeing them only as a material to build little boxes on the hillside out of ticky tacky. So now we see these values, and find a way forward in recognizing that we have found lost treasure, and ask that you fancy city folk, specifically including those with banking skills, help us build a carbon economy on the financial foundation of indigenous sovereignty over the forests.
Like in Canada.
In the United States, American Indian Movement ideology instructs that if it feels like Reparations, it is shared with the rest of the population of the victims of white Supremacy.
The Washoe Forests Carbon Bank is for the people of Richmond and El Segundo and the cancer corridor of the Louisiana petrochemical complex. One struggle, one people.
Excellent essay.
We should remember that Congress is a co-equal branch of federal government. They can overrule the Supreme Court and the Executive by clarifying legislation. It's not easy, but it is well within the realm of possibility.
Just like overcoming 29-point deficit. Difficult but possible.
I don't agree with the "Co-equal" branch description. Article 1 of the constitution establishes the legislative branch and provides for the House having control of legislation establishing taxes. Article 2 establishes the Executive Branch, but the root of the word President is "preside". The president is to preside over the work of Congress and ensure the laws established by Congress are enacted and enforced. Article 3 of the constitution establishes the judiciary and doesn't provide a great deal of instruction- other than that Congress is to establish a judicial branch. These are not co-equal branches. These are branches that have their own powers and purviews, yes- but all things flow first from Congress. Congress is the primary branch of government and the branch the Framers envisioned to be the true representatives of the people.
Okay . Made me think and I accepted coequal too quickly. And imagine if the house and senate actually represented the multitudes. And if no electoral college mucking things up. Clarifying legislation indeed! Let’s get on it.
Sorry, but legislation can't alter the Constitution. It requires an amendment, which is politically impossible and you can't change equal representation in the Senate by state (not population) even with a simple amendment. Read the Constitution. It's not that long and you may be surprised at some of the things that are in there
Actually, while legislation cannot amend the Constitution it can initiate it. Moreover, Congress can determine the number of justices—both up and down. Congress can respond to SCOTUS decisions with new laws to redefine the issues so that its say holds. Congress can also change what falls within the judiciary's jurisdiction, especially at the appellate level. That may arise as the Trump Administration tries to change the application of habeas corpus.
It's messy, this back and forth between the branches, but none get to call all the shots. That was the genius of the Founders to tried to keep the federal government from becoming tyrannical.
Yeah I know the basics thanks. We have been accepting that things are impossible because that was what those holding power wanted us to believe so that we would just stop trying to defend and retrieve our own power.
For Congress to counter the inexorable march of the wealth of the uber-wealthy, it is necessary that it has the intent or the will to do so. A Republican majority has never displayed either.
Thanks, Jared! Two good news vs one bad which will not last long! Musk bubble will explode soon enough...
I wouldn't bet on that...so many people have been projected the cratering of Tesla shares for years, and...well, still trading well over value despite total failure in FSD, robotaxis, robots, etc. Musk overpromises, and the fanboys lap it up. And now, many market ETFs will be loading up, so even Musk-doubters and haters will be forced to literally pay homage with their 401K and IRA accounts. Plus all the yuuge govt. subsidies and lucrative contracts he's landed...
He's not going to lose, bottom line.
ponzi scheme will fail eventually
Well, on the SpaceX IPO, I noted there was another IPO on the same day, a bit smaller, but the ramifications of which have been entirely missed on this Substack, on the other Substacks, and, indeed, in the entire media.
It was for "Dean Baker's Hydroponically-Grown Organic Peanut Butter".
(I'm not sure, but it may be a different Dean Baker. I'm trying to look into that.)
--
Ha, ha! Nothing like a Sunday morning joke! 😊
Gene, this is a very specific sense of humor! You made me groan if not laugh.
FDR: "Take a method and try it. If it fails, admit it frankly, and try another. But by all means, try something."
Three suggestions: 1) eliminate step up in basis, 2) eliminate perpetual trusts, and 3) tax carried interest as ordinary income.
I'd add ending build/borrow/die. Alternatively, just reverse the Trump-Ryan tax cut and the BBB and go from there.
Totally not radical! Where we are is radical….why would we Not tax all exchanged dollars the same? Or not!
If there is a different way then let us all in on it. If no taxes is de rigeur for you, then we too.
And now how are we going to pay, dear billiomaires, for shared infrastructure and transportation of all kinds, universal health and hospitals et al, education of our people, satisfactory military defense and moderate law abiding efficient community policing, administering governmental prerogatives, agriculture farms and food production, water and energy systems, ….
Taxing wealth is an idea that comes from people who don’t understand real economics. When a person doesn’t understand money or wealth or economics then they say stupid things like tax wealth. Money has zero real value. It is created out of nothing. Anyone who passed high-school calculus and physics understands this. Mathematically money is only a medium of exchange. You can’t eat money: if the supply of food or water goes to zero it doesn’t matter how much money you have, you die. Wealth is a step removed from money: while barter still exists almost all real transactions for real goods or services use money as the medium of exchange and so wealth has to be converted to money to actually obtain a good or service. Lots of people learned this truth after 2008 when they couldn’t pay their mortgages. Even today there are creatures who want to blame the banks for the 2008 downturn but the banks did nothing wrong, it was people who bought houses they couldn’t afford and people who didn’t understand the difference between wealth and income. Technology based wealth has huge fluctuations over time with much of it evaporating. When John D. Rockefeller was worth 1.5% of GDP it was only ca. 1/2 of Standard Oil revenue (and > 8% of US GDP). Elon Musk is now worth 3.4% of GDP which is ca. 100x the revenue of his companies. If you taxed Musk 5% of his current wealth it would be more than 2x the revenue of his companies. Rockefeller could have paid a 5% tax out of revenue, Musk could not.
The tax code has encouraged the shift from income to wealth and we have built both high-value job remuneration and our retirement system on this foundation. Many people in high-value/high-paid jobs get a substantial part of pay in the form of stock and retired people mostly live off savings invested in stocks. These combine to increase the current nominal value of stocks. Mathematically the need to convert housing wealth to income in a single year upon sale is the basis of the supposed housing shortage: we have far more bedrooms/bathrooms/square footage per person today than 50 years ago so there is no real housing shortage. But where I live, and across the country, there are huge numbers of large houses with one or two people living in them. As an example if I had to move to assisted living my kids and I would come out ahead on taxes if my house sat empty for 30 years (at current tax and maintenance costs).
A perfect tax system would only tax consumption and would tax it progressively. Income is the closest measure we have to taxing consumption but irregular income (like living on commissions or selling your house) is a problem. A simple tax system that would work far better is to treat capital gains as income but allowing for time averaging, and eliminating the stepped up basis on death. Simple is always better in economics. Wealth taxes are both complex and stupid.
We’ve been taxing real property since forever. Car owners get taxed every year, but they call that a “registration fee.” I’m sure there’s a way to tax other forms of wealth that would work. And before you say anything, I’m an economist, and I KNOW it’s possible and not stupid to tax wealth. Furthermore, Jared is a much more esteemed and respected economist than I, and he’s saying the same thing.
I’m not sure “unlocking” all that living space in McMansions is going to do anything about our housing shortage. That housing stock doesn’t match the current needs of small families and couples and singles.
The states have broad taxing power. Under the Constitution, the federal government can't impose a “direct tax” on property unless the tax is apportioned among the states in proportion to population.
They’ll have to redefine income to include some elements of wealth, like margin loans against massive portfolios that many billionaires use to fund their lifestyles. Also, you present your interpretation as a fact, though it’s not. But I do agree this SCOTUS would likely concur with your interpretation.
You would have to get a majority of the Supreme Court to agree, or adopt a Constitutional amendment, to overrule Supreme Court precedent, which, whether I agree with it or not, is the law of the land. If Congress enacts a wealth tax, the wealthy will sue and eventually the Supreme Court will decide whether it's an income tax. If 5 justices say "no", all the money will have to be refunded, with interest, and we'll have to start over with a new new tax that the Court will uphold. So, change the Court (FDR tried that and failed) or change the Constitution. Sadly, there is no easy fix. If there were, probably some Democratic Congress and president would have already done it
Do they tax wealth in Germany? I assume that’s where you are. You’re probably not familiar with the myriad ways those of us in the U.S. have been discussing this for the last 40 or 50 years. There are many ideas, some of which have been around forever, like inheritance taxes.
The existing federal estate and gift taxes would be a great way to address the concentration of wealth and are clearly constitutional excise taxes on transfers of property, not direct taxes on the property itself. But GW Bush successfully demonized the transfer taxes as "death taxes" and now the laws are riddled with loopholes and raise very little revenue. I'm not familiar with the German tax system, but most European countries have value added taxes, which are basically consumption taxes. That's another approach that could work, but you need a strong social welfare system to go along with it because I think they tend to be regressive (hitting low income folks more than the wealthy)
BTW, it's Article I, Section 9[4] of the Constitution: "No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken."
Let’s get back to reality, the best political outcome in November, Dems take back the House and maybe, although unlikely, the Senate. Trump can veto and overriding a veto, 2/3 probably not.
What should be the first Dem bill?
Removing the cap on Social Security, just uncap. A veto might be overridden.
What next?
Nibble away, selecting bills with wide public support.
Oh. and let’s not forget the mud wrestling for the Dem prez nomination…
The Knicks post coidal elation will fade all too fast
Perhaps the best we can do is block Trump's predations at every turn. Sue constantly to eliminate executive orders that contradict Congressional legislation. Use the time to write legislation that embodies all the good ideas under discussion and go ahead and let Trump veto them. They are the functioning lab of a renewed Democratic agenda for 2028
Absolutely, spot on! This is THE issue in America, again. ( I like the old-school identity for this, rather than USA) We have been here before. Doubt it will be addressed without some huge destructive explosion but maybe, as you suggest, if the Knicks can , we can. SCOTUS, yes. Election integrity, more yes and those in power now are going after this for this fall’s elections and 2028. They know your point, Jared, and will be all in on owning our future and their wealth.
Keep talking like this and I'll write you in the ballot
U.S. inequality is such a glaring problem it is surprising so few acknowledge it, especially politicians. Watching the Knicks or American Idol has caught our imagination. And economic numbers are really boring. We are at least 29 points behind. I guess continuous hammering and education is the only solution.
I visited EPI's Wage Calculator today, a median household income of $84,000 would be $113,002. Almost $50,000 higher. About 60% higher. But how to impress that upon Joe and Maxine Sixpack? I also visited the "average weekly earnings of production and nonsupervisory workers" at BLS. In Jan 1972 the average wage was 336.96, and in March 2026 it is 334.27. The median house sales price in 1972 was $208,000 and in 2026 $403,000 (adjusting for inflation).
I'd like to see a minimum wage mandated on the largest employers. Some 2,137 corporations employ more than 20,000 workers; their average payroll is around 64,000 -- from the U.S. Census Statistics of U.S. Businesses. They should pay a minimum $30/hour, make it law.
And so on down to companies with less than 500 workers.
Anyhow, it's a long road ahead.
In Switzerland in 2012, I think, they held a referendum on a 1 to 12 ratio of income. It sounds so simple. It lost badly. 1 to 100 might win. And keep chipping away. A cartoon I saw shows two guys at the watercooler, one says "I had a conversation with the boss, and now I believe he really does work 380 times harder than you and I."
Could we give tax breaks to companies for having human well paid jobs? And for true sustainability? So we do a billionaire tax….so easy to just add a few more tax brackets using AMT alternative minimum tax, and those who have many employees earning living wage or better and spend on safety and clean businesses get some deductions that make those things compelling.
As long as the current 6-3 majority on the Supreme Court prevails, I think the best practical policy would be to stick with taxes that have been held constitutional by long-standing precedent and hope the Court doesn't overrule those cases. The Constitution authorizes Congress to impose taxes on realized income and there are a number of Court decisions on when income is realized. The current Court is unlikely in the extreme to expand those precedents. So, stick to what has worked before. The Constitution prohibits Congress from imposing any "direct tax", unless it is apportioned among the states. That's why it was necessary to amend the Constitution to enact an income tax, at least on corporate income. I'm not sure what that prohibition means exactly for a wealth tax, but I imagine the existing Court would say it obviously prohibits an ad velorum tax on property.
Correction. The sixteenth amendment was necessitated by the Supreme Court's decision in Pollock v. Farmer's Loan & Trust, which held that income taxes on sales of property were prohibited direct taxes on the property itself and had to be apportioned among the states by population. So the Court held that income taxes on income from labor were perfectly legal, but income taxes on property weren't. And, the 16th amendment effectively overruled Pollock by permitting Congress to enact taxes "on income from whatever source derived". The question raised by a wealth tax is whether unrealized appreciation in property values are "income" for purposes of the amendment
Jared, if as you expect SCOTUS would rule that taxing wealth is not permissible, wouldn't that imply taxing residential property is also not allowed? What impact would that have?
A state or local government can impose direct taxes on the value of property unless the state constitution limits or prohibits it. The US Constitution prohibits Congress from enacting any "direct tax" unless it is apportioned among the states. So states and localities generally can impose property taxes, but the federal government is restricted by the constitutional provision
How flexible is the idea of a direct tax? Maybe some creative Constitutional scholars could help with that.
The Supreme Court struck down a nineteenth century income tax that applied to sales of property, saying that it was a prohibited direct tax on the property itself. That's why it took a constitutional amendment (the 16th) to finally enact a tax on income, "from whatever source derived". So, now the issue is what is income? There are a number of cases on that. For example, a dividend consistently entirely of common stock distributed pro rata to all common stockholders is not income. Either v. Macomber. The most recent Supreme Court decision upheld a one-time tax on any corporation that owned at least a certain percentage of stock in a foreign corporation, if the foreign corporation had not distributed its income to its US stockholders. Moore v. United States
Spell check mangled my reply. It's a dividend "consisting" entirely of common stock. Also it's Eisner v. Macomber
More direct. Tell the #not-supremes to sod off
If we discover a new store of wealth perhaps we may find ways of allocating its beneficence to others than the existing plutocracy. Make things Not Worse.
That's one of the rationales behind the Washoe Forests Carbon Bank (not-Washoe when the Place Tribe is not-Washoe). We of the settler-logger communities recognize that our ancestors, in their brutal ignorance, failed to recognize and steal the carbon values of the forests, seeing them only as a material to build little boxes on the hillside out of ticky tacky. So now we see these values, and find a way forward in recognizing that we have found lost treasure, and ask that you fancy city folk, specifically including those with banking skills, help us build a carbon economy on the financial foundation of indigenous sovereignty over the forests.
Like in Canada.
In the United States, American Indian Movement ideology instructs that if it feels like Reparations, it is shared with the rest of the population of the victims of white Supremacy.
The Washoe Forests Carbon Bank is for the people of Richmond and El Segundo and the cancer corridor of the Louisiana petrochemical complex. One struggle, one people.
Viva la Raza, insists Blondie here.
Necessito un pueblo, to translate Hilary.
No es que un pueblo.
El pueblo unido jamas sera vencido.
Si.se puede.
I'm a lumberjack and I'm ok.