Bernie Sanders proposed a new bill named “Make Billionaires Pay Act” last week on Thursday (6th August). According to this new law, the billionaires in the US, who mostly belong to tech giants, will be subjected to a one-off 60% tax on the earnings they have accumulated during the COVID-19 pandemic.
While this proposal has faced massive criticism, it heated things between the Vermont senator and a very famous Billionaire of US, Elon Musk. The CEO of Tesla showed his concern in a reply to an article posted by a twitter handle named TESLARATI which was delivering the news about Bernie’s new law.
Elon Musk on Make Billionaires Pay
Incensed by the outrageous proposition by Sanders, the billionaire expressed his anguish in the form of one of the most viral memes of the senator.
This meme is normally used to bash the brand of socialism by Bernie Sanders. The leftist politician is a big supporter of free programs by the government which don’t even exist in fairy tales.
Bernie Sanders defended his ideology by citing a 2015 article which stated that Musk had received government subsidies of 4.9 billion USD for his three projects, Tesla, SpaceX and Solar City.
Sanders exclaimed that Musk would be nothing today without that support. He accused Musk for being hypocrite due to poking fun at socialism but prefers corporate socialism for himself while heavily contributing in capitalism.
Musk replied quickly by saying that this accusation from Bernie reflects the animosity of oil and gas industry. Musk considers him a puppet of major oil companies, who allegedly hate Musk for slashing their business by revolutionizing the automobile industry.
The billionaire reminded everyone about how his electric car manufacturing company, Tesla is contributing in promoting sustainable energy. The upcoming Cyber Truck by Tesla would also be a smoke-free alternative to a lot of commercial vehicles polluting the air on daily basis.
Musk also said that Sanders made that statement to distract people from speaking out against trillions of dollars of subsidies that the oil and gas industry enjoys.
How Much Money Can Be Collected As Tax?
After this tweet, Sanders did not reply. According to the reports, the Make Billionaires Pay Act will charge tax from 467 American billionaires for the period of 18th March 2020 to 1st January 2021. There is still a polarizing response on this new bill but it is clear that rich people have become obscenely richer during the pandemic while major issues like Medicare suffered crises.
Sanders explained that this one-time tax of 60% could raise over 420 billion USD which is enough to provide Medicare to every American for the whole year. Below is the tax amount which three of the major US billionaires allegedly owe to the US treasury. If this law is passed then Elon Musk would owe 27.5 billion USD.
More than 5 million Americans have lost health insurance in these trying times. Bernie probably thought it was about time billionaires gave back to the community which they exploit but according to many reports his numbers aren’t quite right.
Why Sander’s Law Is Problematic?
Reportedly, the large part of net worth of billionaires who would pay tax under this Act is based on their holdings in Stock Market. It stumbled well before March, which would be the starting month of investigating billionaires’ growth. If this law is applied like this then the final taxed amount would be unfair for the tax payers.
When coronavirus began to wreak havoc on the US in February, the stock market crashed hard and a lot of entities lost money. Unfortunately the period which tracks the income growth does not include the impact of crash that could have produced different results than Sanders is expecting.
Most of the initial growth suggests that billionaires were recovering from the losses they incurred during the February crash. To measure the exact impact of coronavirus on billionaires’ wealth, the growth must be tracked from the month of February. It is possible that most of the involved number of billionaires might show far fewer gains than Sanders and his supporters are leading on.