The reason “soaking the rich” as you say is correct is … because they’re the ones with the money.
You can’t get money from poor and middle class people because they don’t have any (extra-beyond-expenses) money. It’s very simple; of course that is not going to stop conservatives/republicans/corporate democrats/right-wing democrats from doing that.
The motto of the 4 groups I named above is “let anyone with less than 10 million dollars live under a bridge in a tent. What a glorious life for them in USA USA USA!”
It’s never really been about the tax revenue (though it’s bigger than you are representing; the $50B is just unpaid taxes). It’s about disincentivizing people from the accumulation of vast wealth in the first place. Keep that money in the economy (by putting it in the hands of the 90%) rather than rotting in derivative investments.
It’s not even about someone owning 10 megayachts. At least that money was spent. We need to push more of the GDP, both private and corporate earnings, into the middle class, and bring more people out of poverty and into the middle class. That keeps the money flowing into and through the economy.
With income inequality at current levels, a large proportion of economic productivity is being extracted into stagnant wealth held by the 1%, where it stops participating in the economy.
Isn’t that money at least being shuffled around by banks and investors and such forth in order to earn interest? Or is it really just stuffed under a proverbial mattress?
Yes, it’s being shuffled around, and the interest money has to come from somewhere, but it’s usually extremely inefficient gains, or net negative for the economy. Two examples: financial derivatives from the mortgage loan market, which were garbage, and packaged as premium. The interest that some people made, if they got out before the big crash, was essentially paid for by liquidation of the banks that actually failed before the bailout, people losing their homes and banks selling off the foreclosure, and by the bailout itself.
If you think that was crazy, it gets better. There are now derivatives of cryptocurrency valuations, some of which have a nominal value several multiples higher than the cryptocurrency market they are based on.
I’ve even heard the case made that extremely high marginal taxes on personal income actually encourage corporations to re-invest in expansion that benefits lower income workers and consumers. The argument goes that, when upper management realize that every dollar of their personal compensation over x amount is going to be heavily taxed, they are more likely to elect to invest in actual expansion of their operations than to hand it over to the tax collector. If this is even half-way plausible, higher taxes on the wealthy could conceivably create more jobs and economic growth than tax cuts were promised to do.
