Finally?

It's been a long time coming. But Lawrence Scanlan writes that we're finally talking about taxing the rich:

There has always been a great divide in human history, says Lars Osberg in an October conversation. The Dalhousie University professor of economics has been probing this divide since he was an undergrad and is now a world authority on the subject of inequality.

Osberg argues that while the gap between the rich and the poor has widened since the 1980s, a shift is coming. “The discourse on inequality,” he says, “has changed dramatically in the past five years.”

He recalls that six years ago, in the 2015 federal election, taxing the wealthy was simply not on the table. Even the NDP campaigned on a balanced budget while proclaiming that income tax rates beyond 50 per cent were out of the question.

The pandemic changed a lot of that: billionaires with toys enriched by the worldwide malady made the headlines, but so did makeshift encampments in city parks and growing lineups at food banks and community kitchens. It seems a tipping point was reached, and the shrugging of shoulders at the rich/poor divide gave way to a simmering anger.

In the 1950s things were a lot different:

“The rich, the middle class and the poor,” [Osberg] writes, “all shared in economic growth.” The incomes of the rich were then taxed at 70 per cent, not 30 per cent as now. To revert to those old levels today could net some $26 billion.

Things changed in the 1980s:

Starting in the early 1980s and especially in the mid-1990s, social programs were cut and never restored, and no one suffered more than those at the bottom while those at the very upper end saw their wages (and stock options) begin to soar. These days the top 100 CEOs in Canada earn, on average, $11 million a year.

That’s a heap of political and economic power in the hands of a very few, Osberg says. Power is so concentrated it imperils democracy. Prime ministers always take their phone calls and, a generation later, those of their sons and daughters.

The ice jam, however, is beginning to break:

But things change, sometimes quickly, and sometimes for the better. A minimum tax on corporate wealth was long seen as a pipe dream. Not now. Some 140 countries have just agreed to a minimum global corporate tax of 15 per cent as an antidote to the use of certain countries as tax havens.

It is a sign of change,” says Osberg. “The devil is always in the details, however, as to what will be counted in taxable income, and therefore how much this minimum is actually enforced. Maybe the tax rate should be higher, but that can come later. Multinationally-agreed, minimum corporate tax rates weren’t coming at all for many years.”

As Washington Post columnist Helaine Olen recently noted, “Billionaires are on a collision course with the rest of us. Survey after survey shows a solid majority of Americans believe that the rich in general and billionaires in particular are not paying their fair share.... We don’t need to look at the data on inequality in this country, child poverty, housing or health issues to know that things have gone too far.”

You can see the shift in public attitudes. Now we need to see the results.

Image: Center For Budget And Policy Priorities