Finding more government revenue isn't even close to impossible

I know I should not spend much time scrolling through Facebook despite being far past the time in life when a poor self-image of my physique can inflict much damage. The shape my body in could never be described as anything short of alarming.

But I bumped into a post from Elizabeth Warren last weekend about an "ultra-millionaire" wealth tax and how it could generate nearly all the $3.5 trillion over the next decade that the Build Back Better legislation demands. Senator Warren proposed this wealth tax in 2019.

Here's a quick summary of the plan: "The Ultra-Millionaire Tax taxes the wealth of the richest Americans. It applies only to households with a net worth of $50 million or more -- roughly the wealthiest 75,000 households, or the top 0.1%. Households would pay an annual 2% tax on every dollar of net worth above $50 million and a 6% tax on every dollar of net worth above $1 billion. Because wealth is so concentrated, this small tax on roughly 75,000 households will bring in $3.75 trillion in revenue over a ten-year period."

I did the quickest fact checking and there is disagreement on how to enforce this tax, not to mention that $3.5 trillion seems like the "top end" of potential revenue. Still, the plan has the virtue of tapping the very, very wealthy to help pay for a much better life for millions of Americans.

Even if Warren's plan generated only half of her projection, that ain't nothin'. 

One source of math confusion is that we sometimes mix up individuals with households, though normally we should think of taxpayers as households (hence we don't need all 333 million Americans to file a tax return). 

There must be additional confusion since polls show only about 60 percent of Americans favor such a wealth tax. That seems underwhelming, since that leaves another nearly 40 percent perhaps dreaming that they may someday reach that group of the top 75,000 households. Such a dream is peculiarly American and incredibly unlikely to happen.

It seems clear that 99.9 percent of American households would pay no additional tax at all with this wealth tax.

More generally, what I was thinking is that when we begin with a very large pool of people to contribute to our tax base, even small percentage increases can add up fast. 

For instance, and I know this is just a thought experiment, imagine asking EVERY American to contribute an additional dollar to the federal government. That would bring in $333 million. Make it ten dollars from each and every American (including infants) and you get to $333 billion. That is just about what the Build Back Better plan shoots for in additional expenditures/investments each year. 

Considered that way, how many Americans simply could not contribute that $10 per person? 

I believe in a progressive income tax and I am well aware that a simple "toll" of $10 per person is the opposite of progressive. But for those who think finding large numbers of additional dollars is impossible, my little thought experiment indicates that it's not that crazy.