Portside

The gap between public needs and public revenues, between the incomes of the rich and the incomes of everyone else, continues to widen. New York may be home to more than 100 billionaires, but most of the city’s parents struggle to afford child care for their preschoolers. Paris is home to the world’s wealthiest merchants of luxury goods, but the government is threatening to enact budget cuts that would reduce funding to hospitals and schools in order to balance its budget.

In those two cities, democratic socialists are proposing similar solutions that have widespread popular support. In New York, Democratic mayoral nominee Zohran Mamdani, who has a commanding lead in the polling for November’s election, has proposed increasing the income tax on city residents with incomes over $1 million by two percentage points, with the proceeds to go to free universal child care and free bus travel. (The state government would have to approve that increase.) In Paris, the nation’s Socialist Party is demanding a 2 percent tax on wealth in excess of 100 million euros, which would close the nation’s projected budget deficit without cuts to social spending, as a condition for supporting the government of the newly appointed prime minister.

The architect of the French socialists’ proposal, for which hundreds of thousands of demonstrators have clogged the streets of Paris and other cities in recent days, is Gabriel Zucman, an economics professor at the Paris School of Economics and UC Berkeley, and a frequent collaborator with Emmanuel Saez and Thomas Piketty on papers that deal with the actual rates of taxation on the rich and everybody else. In 2021, when I profiled Berkeley’s Economics Department for the Prospect, I noted that the department was at the forefront of a shift in the discipline, from positing theories to reporting on actual data (led by department chair David Card, whose work with Alan Krueger on the effect of minimum-wage hikes on employment, which turned out to be negligible, was to win him the Nobel Prize). Piketty, Saez, and Zucman’s work on the preceding century of income tax payments in the United States was both revelatory and, for economics professors, revolutionary. Zucman carried such research even further by documenting the volume and rate of income tax evasion through the rich shifting their income to nations that are tax havens—for which he was awarded the John Bates Clark Medal for producing the most significant work by an economist under 40.

Today, Zucman has become a household name in France: The Socialists’ proposal is commonly known as the Zucman Tax, and he is all but ubiquitous on French media in defense of the proposal. Not surprisingly, that tax has come under intense attack by France’s billionaires, some of whom have termed it “communist.” Zucman has responded by noting that it would indeed be communist if it took 100 percent of their wealth, but taking 2 percent falls 98 percent short of that. Like their French peers, many of New York’s billionaires have predicted the fall of civilization if their taxes are raised, but it’s similarly hard to see how raising the city’s current rate of 10.9 percent for single filers on that portion of their yearly incomes in excess of $25 million to 12.9 percent would bring the walls of the temple tumbling down.

A 2024 Data for Progress poll found that 80 percent of likely voters, including 71 percent of Republicans, supported an excessive CEO pay tax on corporations.

The current demand for fairer taxes is hardly limited to these two capitals of global capital. On September 15, Vermont Sen. Bernie Sanders, joined by Democratic Sens. Elizabeth Warren (MA), Chris Van Hollen (MD), Peter Welch (VT), Ed Markey (MA), and 23 members of the House of Representatives, introduced a bill that would raise taxes on corporations whose CEOs make obscenely more than their median-paid employee. Noting that in the 1960s and ’70s, CEOs made roughly 20 times what their median employee made, Sanders cited the results of the most recent yearly survey by the Securities and Exchange Commission, which showed that the CEOs of the 350 largest publicly owned firms made on average 290 times what their average worker made in 2024. Their proposal would kick in for corporations whose CEOs made at least 50 times their average employee, with a corporate tax increase of 0.5 percent, rising in steps to 5 percent for corporations whose CEOs made more than 500 times their median employee. The legislation also includes a penalty tax for corporations that shift the status of their workers from “employee” to “independent contractor” to avoid liability.

Lest you think that such stratospheric ratios are a rarity, Sanders’s office reports that there were 57 corporations in 2024 where the ratio was higher than 1,000-to-1. Tesla’s board, for instance, recently awarded Elon Musk a $29 billion pay package, which is on the order of 500,000 times more than the average Tesla production associate is paid, and also offered him another pay package that would sum to about $1 trillion—or about 20 million times more than the production associate—at current stock prices, should he meet certain goals.

In answering questions about this proposal, Sanders’s office notes that Portland, Oregon, became the first jurisdiction to adopt such a tax back in 2018. (Its author cold-called me to say he had first gotten the idea for the tax by reading a 2014 column in which I’d made the case for it, which had run in both the Prospect and The Washington Post). Voters in San Francisco enacted that tax by initiative in 2020, and in the first year it was put in place, 2023, it raised roughly $100 million for city coffers.

Put on more such ballots, this kind of tax would have an excellent chance of passing. A 2024 Data for Progress poll found that 80 percent of likely voters, including 71 percent of Republicans, supported an excessive CEO pay tax on corporations. And if you doubt just how ecumenical the support for such a tax truly is, please note that in the first interview he’s given since becoming pope this spring, Pope Leo raised the topic of Elon Musk’s all-but-unimaginable paychecks, saying that that level of wealth undermines “the value of human life, of the family, of the value of society.” He then went on to generalize his disapproval of “the continuously wider gap between the income levels of the working class and the money that the wealthiest receive. CEOs that 60 years ago might have been making four to six times what the workers are receiving, the last figure I saw, it’s 600 times what average workers are receiving.” (The actual numbers aren’t quite that bad—see the SEC ratios, above—but we can forgive Leo for some heartfelt exaggeration here, even should the Trump administration move to compel the media not to cover him for his efforts to undermine capitalism and disparage fortunes like Trump’s.)

As Democrats hone their economic platforms between now and 2028, this kind of proposal could help them in multiple ways. It provides a readily understood portal into the vast disparities in income and wealth that the public generally underestimates, not to mention aligning the Democrats with a still all-too-inchoate public sentiment that the party of Donald Trump does not and cannot share. Aligns Democrats with Pope Leo, too. What’s not to like?

Harold Meyerson is editor at large of The American Prospect.