Why most millionaires want a wealth tax: "There's a certain alarmism among the wealthy about Trump"

Fortune Global Forum - Day 3 Getty/Marc Piscotty/Nicolas Asfouri/Kimberly White
Fortune Global Forum - Day 3 Getty/Marc Piscotty/Nicolas Asfouri/Kimberly White

Extreme wealth and income inequality will eventually destroy a real democracy. Why? Because that disparity of power and resources allows a relatively small number of people and groups to subvert the popular will, undermine checks and balances, the law, and other democratic institutions, and to manipulate the public through a variety of means into making decisions that are contrary to their interests, and democracy and the Common Good more broadly.

At present, the top one percent of income “earners” owns more than 30 percent of the wealth in the United States — that is more than the wealth of the entire American middle class. By comparison, the bottom 90 percent of earners control only 30 percent of the country's wealth. Historically and to the present, these extreme concentrations of wealth and income are held almost exclusively by a small number of white men. Globally, the richest 1 percent of people control almost 46 percent of the wealth; the world’s ten richest billionaires have more wealth than most countries.

Economists and other experts have compellingly shown that most of the economic gains from globalization have gone to the top wage earners and others who possess the skills, capital, and latitude of action to take advantage of the global market.

In all, late-stage capitalism, the internet, AI, and other disruptive technologies have created a real and growing experience of economic precarity for large segments of the public (which includes the college-educated middle and upper classes and other high skilled workers) both in the United States and around the world. These anxieties, in combination with other great unresolved problems and challenges, helped to create the toxic circumstances that gave rise to the global democracy crisis with its collective (and justified) rage at “the elites” in the form of Trumpism and other forms of fake (right-wing) populism.

Chuck Collins was born into the Oscar Mayer meat and cold cuts family fortune. At age 26, he was compelled by conscience to give away his inheritance in an act of solidarity with the poor and larger society. In keep with his commitment to social democracy and a humane society, Chuck Collins is now the Director of the Program on Inequality and the Common Good at the Institute for Policy Studies, where he co-edits Inequality.org. He is also a board member of the Patriotic Millionaires.

Collins is the author of several books, including "Born on Third Base: A One Percenter Makes the Case for Tackling Inequality, Bringing Wealth Home, and Committing to the Common Good"; "Is Inequality in America Irreversible?"; and "The Wealth Hoarders: How Billionaires Spend Millions to Hide Trillions."

In this wide-ranging conversation, Collins explains that we cannot solve the global democracy crisis without first confronting extreme wealth and income inequality and other forms of resource hoarding by the moneyed classes. He shares his personal experiences of how the wealthy and ultra-rich as a class really do live in a different world and feel no connection to “regular people” or obligations to humanity as a whole. Collins warns that the plutocrats and other financial elites are supporting Donald Trump because they see him as a way of getting control of even more money and power, and view fascism and the end of American democracy as relatively unimportant when measured against their personal self-interest.

Collins also shares new polling which shows that a large percentage of wealthy people in the G20 countries (those with at least one million dollars in assets excluding their homes) understand that extreme wealth and income inequality is undermining global stability and that it is in their long-term interest to give something back to society in the form of paying a fair tax and providing other redistributive supports.

How are you feeling right now with all the chaos around the world, the election here in the U.S. and Trump's tribulations and chaos and all the other challenges?

I am an upbeat person by nature. But I feel like we are in a time of great disruption for the worse, on the brink of some bad transformation in terms of democracy and American and global society more generally from these extreme concentrations of wealth and power. Looking at the environment and the lack of affordable housing and people who are unhoused, reflects deep crises and troubles. The political moment that we're in — this sense of rising authoritarianism, is also connected to growing inequality of wealth and power — further reflects our precarious moment. It is all creeping in on my otherwise sunny disposition.

How do the millionaires and billionaires, the wealthy as a class, see the world with all this trouble?

The wealthy are not monolithic. So, there are people whose main concern in life is how can I make more money. But there is a growing number of wealthy people who understand the instabilities and disruptions that are happening because of these extreme inequalities. They are starting to see how unsustainable these extreme societal inequalities are, and that they actually are undermining the quality of life for everybody, including wealthy people. Yes, there are lots of wealthy people who are confident that they'll be able to ride out whatever hard times are ahead, that they will live in a bubble of sorts, and not be personally harmed by these trends that are going to cause even more extreme harm to the world. But there's a growing segment of wealthy people who say, "Oh, this is this is going to be bad for me too." They are starting to think in terms of their long-term self-interest about, for example, how late-stage capitalism is bad for the bottom 90 percent of the public — but that same system can come back and bite them too.

What about the disaster capitalists? This must be a bonanza for them. 

It is true that there is a segment of capitalists who prey on disruption. For example, the affordable housing crisis where there are many people who cannot afford an apartment or to own a home and then end up in the extreme situation of being homeless. There are mercenary capitalists who take advantage of that crisis. We see this with how private equity firms are moving into the rental housing market. If people won't be able to own a home, these bad actors reason that they will put a squeeze on vulnerable people and make even more money from doing it. Student loans are another example where these predators can profit by exploiting vulnerable people. There are disaster capitalists who are of course trying to make money off the global climate disaster. Basically, their plan is to party until the music stops.

I am a proud member of the Black working class. My father was basically a janitor, albeit the supervisor, and my mother was a home healthcare worker. I am thinking specifically of the war in Ukraine and Gaza. I know enough about military and defense issues to have invested pretty early on before this all turned "hot" and to have made a good sum of money. But my conscience won't allow me to do such a thing even if I had the money — I would like to believe. If I grew up as one of the wealthy, would I still feel the same way? Or would my ethics and values be fundamentally different?

I believe that there are plenty of people with money who would also choose not to profit from war and other disasters. That you wouldn't do such a thing reflects your upbringing and values. There are other people who feel the same way, even among the wealthy. There are stages of wealth accumulation. You make your first millions and you are focused on starting a company. It takes off and now you are experiencing a hyper-acceleration of your financial assets. Then there is the next generation: those are the wealth defenders. They are going to hire professionals to hide their money, protect it, and not pay taxes. Then there are what I would call "the hyper extractors." These are the people who are predators, they are the ones trying to take advantage of a bad situation. "Somebody's going to do it, might as well be me." "I am smarter than everyone else. I am taking advantage of my vision and insight." That is their logic. Wealth is a type of disconnection drug. You operate in a bubble; You don't see the impact on real people. U.S. defense contractors are cashing in from the wars in Ukraine and Gaza. How do you live with yourself when you are making money from death and misery? How do you live with yourself? You create a belief system that justifies whatever you do. The harm to people doesn't matter.  Ultimately, there are always people who will figure out how to make money out of other people's adversity.

These disaster capitalists and other blood merchants and such disreputables. How do they sleep at night? I know the answer, but the question must still be asked.

They have a powerful justification story. They live with a mythology of justification, whatever it is.

So, they sleep very, very well then. When these types of predatory wealthy people get together, what do they talk about? Are they laughing about all this misery? Mocking it? Or is it considered inappropriate and gauche to even talk about money? 

I don't know. I assume that there are people who meet up at Davos for example whose hearts bleed for the suffering in the world. I think about the fossil fuel barons, the carbon barons, who are sitting there saying, "well, let's build more coal and gas infrastructure because nobody's going to stop us so let's grab as much as we can. They worship at the altar of greed and money. "I'm smarter than the rest of you because I figured out how to make money on this." So there's probably a cozy club of wealthy people who cheer each other on to just keep grabbing all that they can. And there's probably some wealthy people who have a line that they won't cross in terms of profiting from suffering.

How are the wealthy as a class positioning themselves relative to Trump and his plans to be the country's first dictator?

There's a certain alarmism among the wealthy about Trump. On the one hand, they're thrilled that he's going to protect their tax cuts, and maybe expand corporate tax cuts and maintain a type of even more deregulated business environment. But they are also worried about instability, chaos in the marketplace and around the world. They are also worried about authoritarianism. Capital likes predictability. But in the end, the wealthy are probably going to support Trump because they are going to get even richer if he takes back the White House.

The elites can organize to stop Trump and the neofascist movement if they want to. As occurred in Nazi Germany and the rise of Hitler, elites can also facilitate such a disaster too. Are there (enough) wealthy people working behind the scenes to stop Trump?  

Some of that is happening. There is money going into the never-Trump organizations. In terms of history, if you look at the rise of the billionaires and big industrialists under Nazism it wasn't clear to them, until quite late, that Hitler was going to be as dangerous as he turned out to be. But once Hitler and the Nazi regime took power it was too late. In the United States right now with Trump we are at the stage where some of the big money types are saying we have to stop him now. But there are others who are saying we can live with Trump and the MAGA movement for now until their 2025 tax cuts are made permanent. Trump can deliver the goods to them for a few more years so it is a good deal. Their money is more important to them than democracy or other societal concerns. They don't really care.

Chase CEO Jamie Dimon recently said that we should sympathize and try to understand Trump's MAGA people. Your thoughts?

I can understand if he was saying, "we need to better understand what is fueling people's sense of alienation and disaffection so much that they would vote for someone like a Donald Trump, who they see as a shock to the system." But these elites need to get much clearer on their messaging around the harms to society of rising authoritarianism. Even from a self-interested point of view, they need to understand that these authoritarians like Trump will be coming after the rich and wealthy people too at some point.

The news media presents almost everything though a crisis frame and narrative. America's political leaders are also in a perpetual crisis mode. But these so-called crises are actually the result and part of decades-long (and in some cases much older) trends and patterns. How do the wealthy think about time and their relationship to it? What is their framework for decision-making? 

The ultra-wealthy are one of the few groups who do think in the long term. They are focused on future trends and long-term investments and what is going to happen to the world's natural resources. There's a fair amount of positioning based on advanced forecasting. People with dynastic wealth think in terms of generations, and how to keep their wealth and power long into the future. They create foundations that will exist long after they are dead. The ultra-wealthy are also in a quest for immortality. They want to live forever. What they are doing is creating trusts that will allow them to keep their money if they are reanimated in the far future. Ideally, for them that money will keep growing for hundreds of years into the future and they will have even more money when they are revived. It really is science fiction made real. This of course includes leaving the planet Earth, which will be ruined by then.

It is a very surreal thing to see Davos on the front page of newspapers and other mainstream news media. What is actually happening there?

The World Economic Forum is a place where elites gather. There is an attraction to these peer-to-peer gatherings. It's an attempt to build elite consensus, but there is no follow through program. The Trilateral Commission by comparison did have a political program and agenda and its members tried to work within their nation-state to enact those changes. Davos is a place of ideas and elite consensus. Who attends? Leaders of global corporations, heads of state, politicians, and other thought leaders and powerful people. Davos also invites some dissenters or academics or civil society spokespeople just to keep it interesting. The best way to think of Davos is that it is a giant conference, with a fairly exclusive membership, where they talk about ideas, and certain themes emerge and get amplified and echoed.

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I find it very hard to believe that these very rich and very powerful people are getting together, having these meetings and conversations, and then not influencing public policy to serve their own interests and agenda. That is unbelievable. 

Sure, people probably meet at Davos and form alliances that go on to influence policy and laws. It's not done in the name of Davos, or the World Economic Forum. So yes, I think they're definitely hatching plans. They're just not necessarily executed, in the name of the World Economic Forum. You should be skeptical.  

The Patriotic Millionaires were actually able to get access to wealthy people and to conduct some polling. The wealthy, especially the ultra-rich, are notoriously private. What did you learn?

We commissioned a firm that has access to high net worth individuals, these are people with more than a million dollars in financial assets. We were pleasantly surprised that three-fourths of millionaires in these G20 countries support higher taxes on the wealthy. These millionaires also believe that extreme wealth inequality poses perils to democracy and stability. The rise of Trump and these other fake right-wing populists is an example of when you degrade and have wage stagnation for four decades, and more than half the society doesn't share in the money created by the productivity gains of the last couple of decades. This creates resentments, and grievances that unscrupulous politicians can tap into. As shown by our new poll, a lot of wealthy people understood that these extreme inequalities are bad for democracy which is why they support a very modest 2% wealth tax on the ultra-rich. In the United States, there are perhaps 25% of the wealthy that don't want to see their taxes go up, and they have captured at least one political party, and they terrified the other political party when it comes to taxing the wealthy. Members of Congress are afraid to talk about taxing the wealthy — until they start to see the polling. A huge percentage of Americans believe the rich are not paying their fair share. But that popular will is up against the ultra-rich people who have figured out how to stall the system and capture it. The reason why they love Republicans is because they are the party of gridlock. So even if there's huge support and pressure for taxing the rich, or even enforcing existing tax laws around the rich, they can stop the reforms.

What are you most hopeful for right now? What are you most afraid of?

There are a couple of good signs. One is that there's a younger generation, who may have inherited wealth, but they are pro-redistribution. They believe that they should pay taxes; they believe that too much money in too few hands is bad for society and by extension bad for them too. There are billionaires who are increasingly willing to share their wealth for the public good. There are also some cracks in the wealth defense industry, where the people who have spent their adult lives helping the rich get rich are now starting to question whether that is a good thing or not. Some of them are even helping to dismantle that system of wealth protection they created.

As I said several times in our conversation, I am deeply concerned about authoritarianism.

In terms of the environment, we don't have decades, we have seven to 10 years to shift the trajectory of how we live on Earth and reduce our consumption of fossil fuels and transition to something very different. The wealthy, particularly within the fossil fuel sector, are using their considerable power to block alternatives, and to make money from the disaster. They’ve locked the human race into this horrible trajectory. Most people are asleep at the wheel. The wealthy are the ones that are really driving humanity to the brink of destruction. We need to turn the corner environmentally.