'We Need to Tax the Rich So Much More': Musk Spent Quarter of a Billion Backing Trump

"If your income was $274 million per year, you'd make more than 99.9% of Americans," wrote one activist. "Elon Musk spent that buying the 2024 elections for Republicans."


Elon Musk embraces Donald Trump during a campaign rally on October 5, 2024 in Butler, Pennsylvania.
(Photo: Anna Moneymaker/Getty Images)

Jake Johnson
Dec 06, 2024
COMMON DREAMS

Federal filings released Thursday revealed that Elon Musk spent significantly more than previously known to help secure a second White House term for Donald Trump and boost GOP congressional candidates, making the world's richest man the nation's largest political donor and perhaps the most influential figure involved with the incoming administration.

The Federal Election Commission (FEC) filings showed that Musk, the CEO of Tesla and owner of the social media platform X, spent around $270 million this year in support of super PACs backing Trump's reelection bid.

The filings also exposed Musk as the mysterious funding source behind RBG PAC, a Republican organization named after the late Supreme Court Justice Ruth Bader Ginsburg. Musk pumped more than $20.5 million into the super PAC, which aimed to paint Trump as more moderate on abortion than other Republicans and falsely claimed Trump shared Ginsburg's views on reproductive rights.

"In reality, RBG unequivocally supported abortion rights, believing it was a fundamental matter of equality," notedRolling Stone's Andrew Perez. "Trump, on the other hand, pledged to appoint Supreme Court justices who would overturn Roe v. Wade and allow states to ban abortion—and his justices did just that. When Ginsburg died late in Trump's first term, he replaced her with Justice Amy Coney Barrett, creating a 6-3 conservative supermajority on the court that overturned Roe and ended the federal right to an abortion."

Musk's ability to convert his extreme wealth into political influence underscored the need for far higher taxes on the nation's economic elites, progressives said in response to the FEC disclosures. In 2018, Musk paid nothing in federal income taxes even as his wealth soared, largely due to Tesla stock appreciation.

"We need to tax the rich so much more," activist Jonathan Cohn wrote on social media. "Not just so that we can fund programs to benefit everyone, but to prevent them from rigging the political system in their favor."

Melanie D'Arrigo, executive director of the Campaign for New York Health, noted that "if your income was $274 million per year, you'd make more than 99.9% of Americans."

"Elon Musk spent that buying the 2024 elections for Republicans," she wrote. "Tax the oligarchs."





Musk's spending on the 2024 elections outpaced that of Timothy Mellon, the secretive heir to a Gilded Age fortune who pumped $197 million into races in support of Republican candidates, Bloombergreported.

"The clear story from the final federal campaign filings of 2024 is of the damage concentrated money in politics does to our elections," said Public Citizen co-president Lisa Gilbert. "This includes being the sole backer of a super PAC that vandalized Ruth Bader Ginsburg's image to try and change Trump's public abortion position. Rich billionaires and corporate money simply ran the table in the 2024 election. They singlehandedly made the case for the aggressive campaign finance reforms we need to fix our system and get big money out of politics."

Musk, whose wealth jumped substantially following Trump's victory, is one of more than a dozen billionaires set to be either a member or close adviser to the incoming administration. The president-elect has tasked Musk and fellow billionaire Vivek Ramaswamy with leading a commission whose goal is to gut federal regulations and slash spending.

"It's not hyperbole to call this a government of billionaires," Axiosreported Friday. "Trump's projected Cabinet alone is worth at least $10 billion... Trump's gilded Cabinet is the product of an election in which billionaires spent like never before in U.S. history—mostly on behalf of Republicans."

The billionaires in Trump's inner circle are set to play central roles in crafting policy over the next four years, including another tax-cut package that's expected to disproportionately benefit wealthy Americans. The 2017 Trump-GOP tax law that Republicans are looking to extend and expand helped boost the collective wealth of U.S. billionaires by over $2 trillion.

"The looters and polluters who are swarming around Trump bear careful watching," Sen. Sheldon Whitehouse (D-R.I.) said earlier this week. "Looks like no one's too rich to want to steal."

This story has been updated to include a statement from Public Citizen.

Honest Math Shows That the U$ Wealthy Aren’t Paying Their Fair Share

For taxing the rich, we currently rely on an income tax based on adjusted gross income as our primary vehicle. That isn’t working.


A person holds a Tax The Rich sign at a June 27, 2020 protest march in New York City.
(Photo: Erik McGregor/LightRocket via Getty Images

Bob Lord
Dec 03, 2024
COMMON DREAMS


The Washington, D.C.-based Tax Foundation has long functioned as an apologist for America’s deepest pockets. Analysts at the foundation have spent years assuring us that our wealthiest are paying far more than their fair tax share—in the face of a reality that has our richest aggressively growing their share of the wealth all Americans are creating.

This past August, the Biden administration’s Treasury Department commissioned a new study that documented just how little of their wealth America’s richest are actually paying in taxes. Last month, the Tax Foundation responded with a predictable critique. Our super rich, insists this new Tax Foundation analysis, are still today paying “super amounts of taxes.”

But tax data, as the study Treasury officials released last summer shows, tell a far different story.

If Congress does not at some point soon raise what our ultra-rich pay in taxes as a percentage of their wealth, our grandchildren could well be living in a nation where our richest 0.01% hold half our nation’s wealth, quintuple their current share.

This Treasury study—led by an academic team that included the widely respected economists Emmanuel Saez and Gabriel Zucman—spotlighted a wide variety of stats on the incomes America’s 183.7 million taxpayer units reported and the taxes they paid in 2019.

The report devoted special attention to how much in taxes the nation’s most affluent that year paid, breaking these taxpayers down into wealth categories ranging from our richest 10% to our richest 0.001%. To drill down even deeper, the report tapped annual Forbes 400 data to calculate comparable stats for those households that sit at our nation’s even higher wealth summit.

And what did the Treasury report show? At that summit, the nation’s richest 0.0002%—a group that roughly corresponds in size to the Forbes 400—paid in 2019 federal and state taxes the equivalent of less than 1% of their wealth. The richest of America’s rich, the top 0.00005% of taxpayers, paid in federal and state taxes an amount that equaled just 0.75%.

All these rich did, to be sure, pay some foreign taxes as well. But the richest of America’s rich, even after taking these foreign taxes into account, still paid in taxes less than 1% of their wealth, as this charting of the Treasury Department stats shows.




The Tax Foundation’s just-published response to the Treasury data doesn’t dispute the accuracy of any of these figures. The Tax Foundation claims instead that the Treasury report confirms that America’s rich “pay more than one-third of their annual income in federal taxes and more than 45% when state and local taxes are included.”

Indeed, the Tax Foundation adds, the total tax burden on the nation’s super wealthy can, with foreign taxes paid taken into account, run “upwards of 60% of their annual income.”

The key word here: income. The Treasury study, the Tax Foundation charges, “classifies taxpayers according to an estimate of their wealth rather than their income, with the intention of showing that the rich pay very little in taxes.” The rich, the foundation concludes, “are not undertaxed relative to their annual income.”

This Tax Foundation’s claim begs some obvious questions: What yardstick should we use to consider whether our wealthiest are paying an appropriate amount of tax? If our wealthiest, after paying their taxes, are still watching their personal wealth grow at a higher growth rate than the nation’s total wealth, are these wealthy paying their “fair tax share”?

The annual Forbes 400 may be the best place to start our answer to that question. Between 2014 and 2024, the wealth of the Forbes 400 increased from $2.29 trillion to $5.4 trillion. That translates to an annual growth rate of 8.96%, net of taxes and living expenses. Over the same period, America’s total household wealth grew 6.8% annually, increasing from $79.94 trillion to $154.39 trillion.

At those 2014-2024 rates of growth, the share of the nation’s wealth the Forbes 400 holds would double every 35 years. Over the past 42 years, the Forbes 400 share of the nation’s wealth has actually grown at an even faster rate, nearly quadrupling over that four-decade-plus span.

The wealth of our wealthiest has no natural limit. If Congress does not at some point soon raise what our ultra-rich pay in taxes as a percentage of their wealth, our grandchildren could well be living in a nation where our richest 0.01% hold half our nation’s wealth, quintuple their current share.

What level of taxation would be required to stop America’s wealth from concentrating so furiously? To close the gap between the growth rate for the wealth of the richest Americans and our nation’s overall growth in total wealth, current combined federal and state taxes on those at the top would have to rise substantially, at least tripling.

None of these figures should come as a surprise. We’ve known for decades now about the under-taxation of America’s billionaires, a reality that rests on what may be the single most glaring flaw in America’s tax system: “adjusted gross income.” The Internal Revenue Code uses this “AGI” as the starting point for calculating federal income tax due. But “adjusted gross income”—for America’s richest taxpayers—has become and continues to be an entirely meaningless figure.

Consider 2019, the year the Treasury study this past August most closely highlighted. The S&P 500 stock index that year rose 30% between the opening of trading in January and the last trading day in December. For Americans at our nation’s economic summit, that made for a wonderful year. These wealthy derive nearly all their income from their investments.

As we move up the economic scale, the wealth growth of the ultra-rich follows a clear pattern: The economic income—that is, the rate of wealth growth—of the topmost group increases as the size of the group shrinks.

Between 2014 and 2024, for example, the wealth of the 92 richest Americans increased from $1.4 trillion to $3.4 trillion, a jump that translates to an annual growth rate just over 9%. Over that same period, the wealth of remaining 308 in the Forbes 400 grew at a rate of 8.82%. By contrast, in 2019, the average adjusted gross incomes of the top 92 taxpayers and the next 275 taxpayers stood at 1.66% and 3.11% of their average wealth.

In other words, the higher up we go on the wealth ladder, the higher the rate of wealth growth, as we would expect. But adjusted gross income, expressed as a percentage of wealth, decreases. For America’s wealthiest, adjusted gross income bears no relationship to actual economic income. Any estimate of income that places, as the AGI does, the income of the 92 richest Americans at only 1.66% of their wealth rates as essentially useless.

To sharpen this picture even more, consider the increase in tax on America’s wealthiest 367 that would be needed to freeze the increase in their share of our nation’s wealth. Avoiding a further increase in the concentration of the nation’s wealth would require an overall increase in the rate of taxes our top 367 pay to more than 150% of their adjusted gross income. If we limited their overall tax rate to a mere 100% of their adjusted gross income, their share of the country’s wealth would continue to increase.

Where does that leave us? For taxing the rich, we currently rely on an income tax based on adjusted gross income as our primary vehicle. That isn’t working. If we’re going to achieve fair share taxation of the rich, we need to scrap AGI and develop a measure of income that accurately reflects their true economic income. Otherwise, we need to tax wealth directly.