Tax Analysts Blog

If I Were a Rich Man

Posted on Apr 6, 2016

Recently, 50 really rich folks wrote a letter to New York Gov. Andrew Cuomo (D), asking him to not only raise their taxes but to raise the taxes of all rich people. Well, maybe they don't want to tax all rich people -- just the top 1 percent of earners in the state. It's always fun to see rich people throw other rich people under the bus.

The letter called for implementation of the "1 percent Plan for New York Tax Fairness." The plan would establish new marginal rates, ranging from 7.65 percent on income over $665,000 to 9.9 percent for those earning $100 million or more a year. Yes, you read that right, $100 million a year. I doubt even Art Rosen makes a $100 million a year.

I come from a long line of Brunoris who have neither suffered abject poverty nor enjoyed the thrill of lying in a bathtub full of Ben Franklins. I work for a nonprofit and live in Virginia. So why do I care about millionaires wanting to subject themselves to New York tax? Because I find it amusing when people believe that simply being wealthy gives one the right to dictate policy. Many self-flagellants inherited vast sums of money. Steven Clark Rockefeller is on the list. He's the son of Nelson, great-grandson of John D., a graduate of Deerfield Academy and Princeton University. Abigail Disney (yes, from the Disneys who gave you Mickey and Minnie) is also on the list. Agnes Gund (from the Gunds of Cleveland) is a signatory. Obviously, there are a lot of other rich people on the list.

Perhaps these folks are trying to assuage their guilt. Unlike the rest of us, they have no money problems, since they were lucky enough to have rich relatives. And even those who did not inherit fortunes were lucky to have skill, talent, work ethic, and all of those attributes that can lead to wealth. Personally, I wouldn't feel guilty if my old man left me bushels of money, my number came in, or I got rich from my hard work.

That said, my question is this: Why are they trying to get other rich people to pay for their guilt? Will it make them feel better about living on the Upper East Side? Having a second home in the Hamptons? Eating at Masa? (For the hoi polloi, Masa is the most expensive restaurant in the city.) Indeed, many of the signatories are well-known philanthropists. If I were really rich in New York, I would not want these folks trying to salve my guilt by raising my taxes. Honestly, if I were really rich, I might give my fortune away to the poor and dispossessed, but I would be giving my money away -- not someone else's.

Maybe I am being too cynical. These 50 may genuinely care about providing good public services in New York. I suspect that they, like the rest of us, value schools, public safety, and roads without potholes. Conceivably, they believe we need more money for such services and are merely writing the governor to let him know they are willing to do their part. Fair enough. The problem is that there is never as much money going after the really rich as proponents think. We have seen this many times before. Numerous attempts to impose millionaire taxes end up imposing taxes on those making a lot less than a million dollars. The rich tend to have an army of lawyers and accountants -- you, dear readers -- who have the skill to minimize tax burdens for even the richest people on earth. After all, as Warren Buffett and Mitt Romney have taught us, it's all about effective rates. The $2.2 billion additional revenue the signers say they will raise assumes that the rich will take the rate hike lying down. They won't.

 

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