The president and liberal Democrats spy a rare opportunity — but face resistance from Republicans and moderate Democrats.
By Giovanni Russonello
Raising taxes on the wealthiest Americans was already a widely popular idea before ProPublica published a report on Tuesday that threw back the curtain on just how easily the richest Americans have been avoiding taxation.
But popularity isn’t everything: On Capitol Hill, tax protections for wealthy Americans have been among the hardest things to attack, thanks to the ever-growing influence of big money in politics.
Billionaires like Jeff Bezos and Michael Bloomberg have effectively been paying taxes at a rate of about 1 percent of their wealth gains, the ProPublica report found, largely because the tax system treats investments and wealth differently than it does earned income.
President Biden has said he’d like to revamp parts of this system, and the White House has already proposed a number of reforms that would patch some of the loopholes and carve-outs that allow the wealthiest Americans to pay so little in taxes.
“It’s time for corporate America and the wealthiest 1 percent of Americans to just begin to pay their fair share — just their fair share,” Mr. Biden said in April during his first address to a joint session of Congress, outlining his proposals to raise taxes on corporations and high-level investors.
The president and many liberal Democrats spy an opportunity. About three in five Americans have expressed support for higher taxes on corporations and the wealthy to pay for infrastructure projects and climate action, according to a range of recent polls. That includes a solid majority of independents.
Which helps explain why raising taxes on the rich was such a prominent issue on the campaign trail, particularly during the Democratic primary, when progressives like Senators Elizabeth Warren and Bernie Sanders pushed for an extensive tax overhaul. As president, Mr. Biden has embraced many of their goals.
Still, like so many items on his agenda, those proposals are staunchly opposed by most Republican lawmakers. So it doesn’t help Mr. Biden that the most conservative Democratic senator, Joe Manchin III of West Virginia, is dead set on finding bipartisan compromise. Or that Mr. Manchin himself is a fairly reliable ally of big business, and has already expressed opposition to some of Mr. Biden’s tax ideas.
Robert Reich, a professor of public policy at the University of California, Berkeley, and former secretary of labor under President Bill Clinton, noted that Democrats as well as Republicans are heavily funded by corporate interests.
“With great wealth comes political power, and the intricacies of the tax code are the place where that power is wielded most efficiently,” Mr. Reich said in an interview.
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