Aotearoa has a poverty problem: far too many people with not enough. And we have a fairness problem, with research from IRD showing that the rich aren't paying half the tax rate of normal people. The solution to these two problems is obvious and complementary, but unthinkable under the NeoLiberal orthodoxy inflicted on us by Roger Douglas and Ruth Richardson and enthusiastically continued by the political duopoly. But yesterday, the Greens came out and said it: we should tax the rich more so we can end poverty.
Their actual proposal to do so seems well-constructed: a wealth tax which kicks in after $2 million of (net) assets for individuals, or $4 million for couples. That's high enough that its not just "person who owns their own home", even in Auckland - its basicly people with large property portfolios, or enough money that they don't need to work for the rest of their lives. Normal people with jobs who rent or pay a mortgage simply won't be affected. Neither will normally successful people, who own their own homes and have a bit stashed away for their retirement. Even if you think about the kiwi dream - house, bach, boat, BMW, and enough to comfortably not work if you don't want to - its just flirting with the couples threshold. At which stage most normal kiwis would say "fair enough" to paying a bit extra.
In short, the vast majority of us will never, ever, have to worry about this, even people who have done well for themselves. We're not talking about normal levels of wealth here. We're talking excessive wealth, people who have gone beyond what is needed for comfort, into hoarding. In numbers, we're talking about 0.7% of the population, about 35,000 people. The fact that John Key hates the idea shows it is perfectly targeted: he's one of the rich pricks who isn't paying their fair share.
Meanwhile, the flip-side of taxing the rich is to adjust thresholds and tax rates to lower taxes on the rest of us. Those on high salaries will face higher marginal rates - 45% from $180,000, which hits MPs and Ministers nicely - but normal people, even well-paid normal people, will pay less. And again, that seems fair enough. A progressive tax system means those who can afford to pay more, and those who can't pay less, but NeoLiberalism means we've lost sight of this principle, in favour of just giving the rich a free ride in the hope that we will get something from their tailings. That doesn't work, it never worked, but the rich laughed all the way to the bank while they robbed us.
And of course, there's ending poverty - because it turns out that taxing the rich properly frees up a hell of a lot of money which the government can put to use. The Greens want to increase benefits, fix working for families, restore the universal student allowance, and expand ACC to cover all sickness and disability - basicly, restore the social safety net that Douglas and Richardson stole from us. I think this is worthwhile, because fixing poverty fixes so many other things - but if YMMV on applications, it certainly gives an idea of what we can achieve just by making the rich pay their way. And it should end forever the NeoLiberal lie that we "can't afford" better things. As with everything government does, that's a matter of choice - and Labour has chosen to favour the rich over its own voters.
Poverty is a political choice. The Greens have shown we can choose differently. All we need to do is vote for it.
