Billionaires And Democracies Are Incompatible-- It's Us Or Them

I think we can all agree that billionaires shouldn’t exist. I’m not necessarily advocating executions— just taxation... say the 1944 marginal rate, which was 94% for all income over $200,000. Because of inflation, if it was up to me, I’d say make it 94% for all income over $1,000,000, 95% for all income over $5,000,000. After that we get into the real punitive rate— 96 or 97% (I’m still working on that and I won’t have it finished for a week) for all income over $10,000,000. And no more tax loopholes written specifically for the rich.

Recently, Patriotic Millionaires released a report, High Flyers 2023: How Ultra-Rich Private Jet Travel Costs the Rest of Us and Burns Up Our Planet, which laid out private jet owners freeload off the taxes paid by commercial air passengers and create massive amounts of carbon emissions. Some of their key findings:

• The private aviation sector suffered setbacks during the pandemic, but operations rebounded in spectacular fashion. Today, there are more private flights in the US than at any point in history-- in 2022 alone, there was a record total of 5.3 million private flights.

• Similarly, demand for private jet ownership slumped during the pandemic, but quickly recovered. In 2022, the industry reaped a record $34.1 billion in transactions. The fleet of private jets is now estimated to be 23,133, marking a 133% increase from the year 2000.

• Private jets are very expensive, so naturally the small minority of people that have the unique privilege of owning one are very wealthy. The median net worth of people who own their own private jet is $190 million, and it’s $140 million for people who co-own a private jet with other individuals. The typical owner is also male, over the age of 50, and involved in banking, finance, or real estate.

• The damage to the environment that private jets cause far outweighs their size. While private jets are responsible for only 4% of carbon emissions from aviation, the people who fly private do disproportionate damage to the environment-- emitting ten times more pollutants per passenger-- compared to those who fly commercial. Also, since the pandemic, there has been a 23% increase in carbon emissions from private jets because of the post-pandemic surge in demand for private air travel.

• Elon Musk is the worst private jet offender. In 2022, he purchased a new $78 million private jet, took no fewer than 171 flights, and produced an astounding 2,112 tons of carbon emissions.

• Private jets make up approximately 1 out of every 6 flights handled by the Federal Aviation Administration (FAA), but contribute just 2% of the taxes that go to the trust fund that predominantly funds the agency. The majority of the FAA’s funding comes from commercial airline passengers, who pay a 7.5% tax on the price of their tickets and a passenger facility charge of up to $4.50. Meanwhile, private flyers only pay fuel surcharge taxes, which are roughly $0.22 per gallon of jet fuel.

• The vast majority of airports (3000) in the US are publicly-funded general airports; when the wealthy take to the skies, however, these are the airports they typically use, for what’s almost a free ride. Because private flyers contribute so little in aviation taxes that fund airports and air traffic control services, this effectively means that the broader public subsidizes the luxury air travel of the ultra-wealthy.

• It’s no accident that private jet owners pay so little in taxes. Since 2008, the National Business Aviation Association (NBAA)-- one of the largest trade associations representing the private jet industry-- has spent an average $2.4 million each year lobbying the federal government, mostly for tax relief. The NBAA spent $4 million lobbying in favor of the 2017 Tax Cuts and Jobs Act, which gave the private jet industry a huge bonus depreciation tax break. Private jet companies also received more than $643 million in federal COVID-relief aid, thanks in large part to their lobbying arm.

The report ends by suggesting several measures that lawmakers can take to disincentivize the use of private jets, curb their devastating impact on the environment, and ensure owners pay their fair share in aviation taxes. Here are some of the key recommendations:

• Implement a 10% and 5% sales tax on all preowned private aircraft and new private aircraft, respectively

• Levy an additional jet fuel tax on private flyers

• Institute a “short hop” surcharge on private flights less than 210 miles

• Resist efforts to increase passenger facility charges until private jet owners pay their fair share

• Create a sustainable transportation equity trust fund

But even if some of us don’t want billionaires to exist, billionaires have their own ideas about what shouldn’t exist. On Wednesday, Adam Lowenstein wrote an essay, The Billionaires Who Are Threatening Democracy, about Quinn Slobodian’s new book, Crack-Up Capitalism: Market Radicals And The Dream Of A World Without Democracy. “For a small but powerful collection of executives,” wrote Lowenstein, “along with certain investors and libertarian ideologues, Singapore’s ‘benevolent dictatorship’ offers a model for how well a market-driven system can work when concerns about democracy don’t get in the way… Slobodian, a historian of ideas at Wellesley College, seeks to understand how these market radicals undermine democracy. His analysis zeroes in on a particular worldview that he claims is shared by an eclectic cast of characters, including former British Prime Minister Margaret Thatcher and the Silicon Valley billionaires Peter Thiel and Marc Andreessen. How this radicalism is expressed varies greatly: There are executives and investors who scour the globe for places to shelter and multiply their wealth, and who may not actively oppose democracy but do see civil and political freedom as secondary to economic permissiveness and societal stability. Some echo that most laissez-faire of economists, Milton Friedman, who once lamented that ‘political democracy has elements which tend to destroy economic freedom.’ On the most extreme end, they include libertarian ideologues like Friedman’s grandson Patri, who advocates for ‘seasteading’— the creation of secessionist (and tax-free) communities that are built on floating platforms in international waters and, in turn, not beholden to meddlesome laws and regulations that don’t suit their founders. As Crack-Up Capitalism shows, what unites market radicals is the conviction that societies should be designed to prioritize capital, not people. The book illustrates the profound fatalism about democracy— and sometimes outright contempt for it— that sits at the core of many market radicals’ beliefs. As Slobodian writes, they believe that democracy— self-government characterized by citizen participation, civil and political freedoms and protections, and representatives responsive and even beholden to the people’s demands— does not provide an adequate environment for maximal profit-making… ‘Their goal,’ Slobodian writes, is ‘not to take a wrecking ball to the state but to hijack, disassemble, and rebuild it under their own private ownership.’ Crack-Up Capitalism argues that market radicals aspire, above all, to use the authority of government to serve their interests: to eliminate taxes, unions, workers’ and citizens’ rights, political uncertainty, and barriers to capital flows, and to put the resources of the state— whether labor, land, or the legal system— at their disposal. They believe that this approach will, in turn, result in a more prosperous society with benefits eventually accruing to all.”

Among Dubai’s vocal fans is the influential software engineer and blogger Curtis Yarvin, sometimes known by his pen name Mencius Moldbug, who has cited Dubai as evidence that “politics is not necessary to a free, stable, and productive modern society.”

While Yarvin may not be a household name for most Americans, he has grabbed the attention of some of the most powerful figures on the right, including Steve Bannon, Tucker Carlson and Peter Thiel, one of the biggest Republican campaign donors in recent election cycles. In 2022, Thiel, who is friends with Yarvin and has written that he doesn’t “believe that freedom and democracy are compatible,” invested tens of millions of dollars in the Senate campaigns of J. D. Vance and Blake Masters, both of whom, as Vox reported, have also praised and cited Yarvin’s work. Yarvin has even advocated on his blog for bringing some of the characteristics he admires about Dubai— namely, an authoritarian form of leadership— to the United States, which would ideally be run by a CEO “without any interference from the Congress or courts.” This worldview doesn’t exist on just the fringes of the internet. Slobodian suggests that it is beginning to infiltrate one of America’s main political parties.

Many of the market radicals Slobodian writes about say they are fighting to liberate humanity and unleash markets from the tyranny of government and bureaucracy. Thinkers and investors emanating from Silicon Valley, in particular, claim to be hacking the state to make it more efficient and effective. But Slobodian argues that many of these self-proclaimed advocates for disruption actually just want to disrupt the norms— such as civil and political freedom— that might threaten their interests. Democracy is already facing numerous threats from factions on the right who question the legitimacy of election results that don’t go their way. Crack-Up Capitalism is a reminder that this political challenge is only one of a number of fronts in the sustained attack on American democracy.

You can imagine what these billionaire-fascists think of progressives like Bernie and Pramila. Yesterday I got this e-mail (in part) from Pramila: “Health care is a human right and it must be guaranteed for all— not just the wealthy few. And passing the Medicare for All Act of 2023 is the strongest step forward in building the future we deserve.

…It's time to put people over profits and care over corporations. And our country's lack of universal health care has proven to be an issue of gender justice, racial justice, and economic justice.

By passing the Medicare for All Act of 2023, we will ensure that:

• Everyone will have health care, including dental, vision, hearing, and long term care.

• Expensive premiums, deductibles, co-pays, and other out of pocket costs will be eliminated completely.

• Roughly 95% of all U.S. households would save money on health care costs.

• The U.S. would save over $450 billion on health expenses annually.

As a progressive movement dedicated to building a democracy rooted in love, compassion, and equality, we have a moral and ethical obligation to show up and root for solutions that meet the urgency of our needs.”

The kind of people described by Lowenstein and Slobodian see this kind of thing and whine louder than Ron DeSantis about their freedom being impinged. The push for Medicare-for-All being advocated again by Bernie and Pramila would include putting almost $200 billion into the healthcare system, $200 billion that would come largely from the billionaires Slobodian is talking about in his book.

Bernie’s top priorities right now— priorities he’s pushing on the Senate HELP committee he chairs— are lowering the cost of prescription drugs, raising the minimum wage and this $200 billion new infusion of health care money into community health centers and funding the growth of the healthcare workforce (including $15 billion for graduate medical education programs). In an e-mail this morning, he wrote "The function of a rational and humane health care system is to provide quality care for all as a human right. Yet in America today, our health care system is designed to make tens of billions of dollars every year for the insurance companies and the drug companies while people go bankrupt trying to afford their medical bills. It is a system that desperately needs to change, which is why I'm introducing Medicare for All legislation this week to grant health care as a right for all of our people. At a time when every other major country on earth guarantees health care for all, it is time for the U.S. to do the same."