Joe Biden proposes to tax the unrealized gains of billionaire hosueholds. Democrats might not be able to ass his plan through Congress, but it highlights his intention to make the tax code more progressive, and Republican opposition to that goal.
A large swath of commentary about American politics is built on the premise that the Democratic Part y represents the economic elite, while Republicans are the party of the working class. The belief is shared by large segments of the left and right alike, and the theme runs below the surface of the hundreds of “diner journalism” accounts of downtrodden Trump voters, as well as of polemics against “neoliberalism” and “woke capital,” and is the explicit foundation of the red-brown collaboration Compact Magazine. But while the voting bases of the two parties have changed some, and the thematic content of American commentary has changed a lot, the prosaic reality has changed very little. The main battle lines between the two parties are fixed around Democrats proposing more redistribution and Republicans proposing less. That reality has been highlighted once again by President Biden’s new plan to tax the income of billionaires. Democrats have long wanted to find a way to tax wealth, since one of the problems with the tax code is that enormous fortunes can accrue and be passed from generation to generation without any tax at all. Figuring out how to tax that wealth presents both a technical problem and a political one. The political problem is that the legal basis for taxing wealth, as opposed to income, is unclear. The pre–New Deal activist right-wing court struck down income tax as unconstitutional, and so it remained until the 16th Amendment specifically authorized an income tax.
