In 2019, Bill Gates will take back the title of world’s richest man from Jeff Bezos. He has come under unprecedented scrutiny for the wave of strong opposition to the billionaire class and its affiliated economies. In a year-end review, Gates, who ended 2019 with a net worth of $110 billion, seems to have taken public criticism of the billionaire class to heart. And his conclusion is that we should definitely impose higher taxes on the rich.
This is not a new idea for him (he has expressed support for tax increases in the past), but it is a cause for concern as the subject of the year-end summary. Also worth noting, a few months ago, Gates made a joke on Twitter that he didn’t want to pay a huge wealth tax, which became the subject of ridicule. The joke was taken out of context, leading to growing comments about Gates on social media.
“The gap between rich and poor is widening,” Gates wrote. America’s income gap is much larger than it was 50 years ago. A few people end up reaping a lot, for example, for the work I’ve done paid off disproportionately. Many others work as hard as I do, but they can barely survive. ”
He has proposed a wide range of ways to raise taxes on the rich, and he has many ideas: raising the capital gains tax, raising the estate tax, removing the cap on Medicare tax revenues, closing the fringe loopholes, making savvy investors pay less tax and taxing huge amounts of wealth.
These are not unique ideas, many of which have been put forward by tax policy experts. Some of them are strikingly similar to the proposals put forward in the Democratic presidential primaries.
But in any case, Gates has a lot of influence in our conversationabouts about the super-rich and what they do. So it’s important to make him one of the prominent billionaires who pushed for tax increases, and to dismiss many of the ideas that they are unfair to the rich or hinder innovation. Gates points out that when he started Microsoft, taxes were much higher, but that didn’t affect his motivation to start a company.
“The dynastic system of passing on vast amounts of wealth to their children is not good for anyone,” Gates wrote. If they do, the next generation will not have the same incentive to work hard and contribute to the economy. “His words are defending higher inheritance taxes. The difference between capital gains tax and income tax is expressed in the “preference for wealth over work” and there is no good reason to support the former.
What thoughts did Gates leave for the billionaire’s philanthropy, another much-criticized target in recent years?
Gates is one of the largest and most effective global health and development donors. But Mr Gates found that the US government operates much larger than the Gates Foundation, and that even the richest people in the world cannot solve America’s social problems on their own. “Even if Melinda and I donated all of our foundation’s donations to California, it would not be enough to support the state’s one-year public school funding,” he wrote. ”
So he concluded that problems like this must be solved through tax policy, not just on individual donations.
Still, Gates believes individual donors like him should play a role in our society.
Gates is an unusual billionaire in philanthropy, not only because of how much he has donated, but also because of the efficiency with which he spends his money. The vast majority of billionaires spend less money than household names like Gates and Buffett. It’s worth noting that the billionaires who give the most are always the ones who are most pro-reform, and tax reform will only make them more tax-burdened – and in a world that’s less friendly to billionaires, it makes sense to see how they see the role of philanthropy.
Even those who were the fiercest critics of philanthropy last year believe that private donations have a place. In particular, philanthropy can meet the demands that governments refuse to undertake, for example, by running experimental projects that do not justify taxpayer spending.
This means that Mr Gates’s position is not really very different from that of some of the fiercest critics of foundations, wealth and charity.
Now, if only other billionaires had joined him.