‘They’re Going To Go Elsewhere’: Steve Forbes on Why Taxing the Rich Backfires

“Tax the rich!” shout progressives.

Why not?

America’s richest people are ridiculously rich.

“Five bucks to you is like $6 million to billionaire Jeff Bezos!” shrieks Sen. Elizabeth Warren (D–Mass.).

Taking more from billionaires and millionaires just seems fair.

That’s why Washington state passed a new “millionaire’s tax,” California will soon vote on a “billionaire’s tax,” and my mayor in NYC shouts, “increase taxes on the wealthiest New Yorkers!”

Don’t these politicians realize that in America, people can move?

The same day Washington’s House passed its millionaire’s tax, Starbucks billionaire Howard Schultz announced that he’s leaving Washington for Florida.

Billionaires Elon Musk, Larry Ellison, Steven Spielberg, Peter Thiel, and now Google co-founders Larry Page and Sergey Brin have left California.

For 170 years, California brought in more people than any other state. It’s clear why—the weather is awesome. There were growing opportunities and jobs.

But now regulation and taxes have changed that.

“Remarkably, for the first time since California came into the union, they’re having out-migration!” says Forbes magazine’s Steve Forbes in my new video.

Some California activists think that’s OK.

“The benefit from this tax is going to outweigh…a couple people moving out,” said a Healthcare Workers union boss.

But “it’s not just people,” warns Forbes. “It’s capital.”

Tesla, Chevron, Hewlett Packard, Oracle, SpaceX, Charles Schwab, and other companies have left.

“When people are not well treated, they’re going to go elsewhere,” says Forbes.

I push back, citing California’s planned tax on the very rich: “It’s just 5 percent. You’re a rich guy, why not pay 5 percent?”

“You think it’s just taking 5 percent out of your checking account? No,” says Forbes.
America’s wealth doesn’t sit in a vault. It’s invested in things that create products and jobs.

Taxing that gives us less of both.

“This also allows government to become more intrusive,” explains Forbes, “‘What’s that asset you might have in your cellar? We have to send inspectors in to find out where you’re hiding the art or the jewelry.'”

In NYC, my new socialist mayor, Zohran Mamdani, is eager to be intrusive. He says, “I don’t have a hesitation in asking those who make…the most profits in the city to pay a little bit more.”

But it’s not just a “little bit” that he wants, and it’s not just from those with the “most” profits. Mamdani wants to change the estate tax so that if you possess more than $750,000, he gets a cut.

“Own a house? Mamdani’s after you,” says Forbes. “Instead of a 16 percent rate, which is outrageous, he wants to raise it to as high as 50 percent. You create something, he wants to take it.”

What’s most absurd is high taxes on the rich have already been tried. They failed.

Maryland expected to make money but instead lost $257 million.

“Nobody should be surprised,” said former Maryland Gov. Robert Ehrlich. “They’re out of here. These people aren’t stupid.”

Europe tried wealth taxes but gave them up because so many rich people left.

“You’re just a rich guy who wants to protect his stuff,” I say to Forbes.

“I may have done well in life. I got a good start in life. But what I want is a world in which…all people have a chance to improve their lot in life.”

“How does raising your taxes impede this?” I ask.

“Because taxes are a price and burden,” says Forbes. “The tax you pay on your income is the price you pay for working…for being successful. And when you have a high price on that, guess what happens? You get less of it.”

Next week is April 15, the horrible income tax day. Americans are reminded just how big that tax burden is.

Years ago, Forbes ran for president pushing a “flat tax.”

The idea went nowhere. I thought it would appeal to people because the current tax code is so complex.

“The code today has over 10 million words,” says Forbes. “Nobody really knows what’s in it. It’s immoral.…We spend now over $500 billion a year in cash and time with this corrupt, incomprehensible tax code. Imagine if we’d taken those trillions of dollars, tens of billions of hours and used it for something productive, like making new products, new services, medical devices, cures for diseases. [We’d be] much better off. Huge opportunity wasted.”

Politicians destroy opportunity all the time.

America does need some taxes to fund limited government that the Founders had in mind.

Sadly, our politicians today go way beyond that.

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