Dan Riffle, the policy adviser who wrote Rep. Alexandria Ocasio-Cortez‘s “every billionaire is a policy failure” slogan, said in an interview with Vox‘s Dylan Matthews that the phrase had much clunkier origins: It started out as “tax income over $5 million at 99 percent.”
Riffle told Vox that he nixed that version because it didn’t “roll off the tongue” but said he believed the underlying policy was the right way to address growing wealth inequality in the US. Riffle said he wasn’t sure that $5 million is the right threshold for the 99% tax but that it could be decided in a nationwide referendum.
“There’s nothing in this world that anybody wants or needs to do that you can’t do with, let’s say, $10-15 million,” Riffle told Vox. “And so at some point there has to be a line. To me, $1 billion is way, way, way, way past the line.”
The revenue raised by a wealth tax could be used to tackle issues being worked on by billionaire philanthropists, Riffle told Vox. “Increasing taxes, and democratic control over the distribution of society’s resources, is a hell of a lot more important to fairness and equality and progress than any philanthropy pledge,” Riffle said.
Riffle is among a growing group of Democrats calling for new taxes to address wealth inequality. Sen. Elizabeth Warren’s proposal for a wealth tax earned the support of some ultrawealthy Americans.
In June, a group of 19 multimillionaires and billionaires wrote an open letter to all 2020 presidential candidates asking them to consider a “moderate” wealth tax, citing Warren’s “Ultra-Millionaire’s Tax.” Under Warren’s proposal, wealthy Americans would pay an annual tax on high-value assets they already own, such as fine arts and superyachts, not their income. Riffle’s proposal, in contrast, would tax billionaires’ paychecks.
Riffle’s plan may have unintended consequences, the former Department of Justice tax attorney James Mann, who is now a tax partner at law firm Greenspoon Marder, told Business Insider. The tax might cause high-net-worth people like CEOs to embrace leisure activities full time after they initially make their fortunes, Mann said.
“If an additional dollar of income is taxed at a 99% rate, who would go to the effort of making the additional dollar?” Mann said.
“The notion that people will not change their behavior in response to changes in the tax code is naive,” Mann added.
Business Insider previously reported that a wealth tax like the one Warren is proposing could also help reduce wealth inequality but would likely not generate as much revenue as its proponents hope because it would be difficult for the IRS to enforce.