Abstract

A Modest Proposal to Net the Rich

Every time U.S. President Bill Clinton puts forward a new program the Republicans accuse him of increasing the deficit; and every time he suggests a new source of revenue, they call him tax-happy. Herewith, a modest proposal for a tax that could begin to balance the budget and eliminate the federal deficit and at the same time pay for social programs. This is a net worth tax, a significant one-time tax not on income but on an individual's total net worth. Recently, the Internal Revenue Service issued its latest report on the personal wealth of the richest Americans--people with a net worth over $600,000. Extrapolating from estate tax returns filed over a three-year span, the IRS concluded that in 1989 the top wealthholders in the country--some 3,417,000 individuals--had a net worth of $4.8 trillion, or about 30 percent of the total personal wealth in the United States.