Santelli's 'Tax-The-Wealth, Not-The-Income' Plan

Tyler Durden's picture

With the varied interests of constituents very much in mind, finding a compromise over taxation will be worse than Sisyphean in nature we suspect. CNBC's Rick Santelli offers a strawman, that gets around Norquist's 'pledge' and perhaps provides cover for both parties. The Chicagoan recognizes that what seems like a high-salary to some is very much not to others and suggests instead of focusing on the income, we should focus on the wealth. This is not the first time such a proposition was suggested (as we noted 14 months ago that 'muddle-through' was over and "we are confident, that one way or another, sooner or later, it will be implemented. Namely a one-time wealth tax: in other words, instead of stealth inflation, the government will be forced to proceed with over transfer of wealth") Strawman or not, the fact that Santelli is discussing it (and demurs on whether he has been contacted) means it is on the table...


The Pledge...

The Strawman...

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
SgtShaftoe's picture

This whole mess is following the script written out in "dying of money" O'Parrson to the letter.  Hyperinflation is as much a social phenomena as it is a monetary phenomena.  We're reaching end-stage.  We've probably only got a few more years left (max) in this monetary regime.

RSloane's picture

Of course its all bullshit. If you agree with Flameister then you are agreeing to the establishment of 'panels' or groups of people that will determine if you have been useful to society or not, and if not, punish you. No thanks.

If you have time Doc, take a look at Red Pill's post. Brilliant!

Dr. Engali's picture

Hey Sloane..I did read the red pills post and that's always the way that I've felt. I am opposed to taxes but if we have to have them then a consumption tax is the way we should go. It's nice and clean. I don't for a minute really believe in a wealth tax, but it just rubs me the wrong way when they support this guy knowing we are going to take the brunt of it all and not them. Like you and Fonz I've become very jaded's one of those days.

RSloane's picture

Agree with you 100%. Of course we're going to take the brunt of it. Welfare, both private and corporate are growing, not shrinking. Disability rolls are so high now that the US is the most disabled society out of all Western established economies. We're going to pay for that. We're going to pay for lost skillsets, we're going to pay for part time workers who were once full time with benefits, we're going to pay for producing graduates at very high cost to themselves with nothing to do, we're going to pay for the American consumer who leveraged cheap labor abroad for decades, and we're going to pay for the elderly who cannot save for their future because savers are punished. All of those things come with a high cost. We're going to foot the bill.  

 That's probably not helping with your sense of being jaded, and for that I apologize.

fonzannoon's picture

I wonder about that Sloane. My heart is in the right place (I hope) but I am already tired of this crap, and I am 35. One of my friends whose basement got wiped out (again) was already pissing me off. Two years ago Irene did about $1,500 damage to their basement. FEMA wrote them a check that covered that, and a bathroom remodel. They are hoping FEMA helps them with their upstairs bedroom this time. A few more of these storms and they have themselves a free Mcmansion. While they were discussing this I informed them who is actually footing the bill. Tey shrugged their shoulders. They don't care. Eventually the fault lines between families/friends/everyone will grow so wide I can only hope (I guess) that a fullblown breakdown reset comes, because it may be the only chance we have to start over.

RSloane's picture

I'm sorry to hear that. Our community pulled together and had all of the heavy lifting done before FEMA got here. We're all going to be more aware of our core values, if we don't already know them, and stick close to those who share them. That's all any of us can do. I fully believe we're going to start over, but we have a lot of pain to wade through before that happens. Having people around who share your values and you love is going to be of primary importance. I have hope!

MeBizarro's picture

In fantasy land,  a consumption tax is nice and clean.  In reality it is quite hard to collect income from services provided via a consumption tax and verify reporting because people always underreport (and quite singificantly).  As for as goods, even at a low threshold you get some level of black market activity if I guarantee you that if put a consumption tax on essential items (food, medicine, clothing) that was say 10-15% you would see a huge rise of organized crime associated with it. 

Every tax system has its plus and minuses.  No such thing as a clear winner/loser. 

Bicycle Repairman's picture

"Obama will cut off the mortgage tax deduction for anyone making over a million dollars."

I believe Clinton phased out all deductions for anyone making over a million dollars.

Try again.

Urban Redneck's picture

Been seduced by one of the sweet songs of seduction of superbia, avaritia, luxuria, invidia, gula, ira, et acedia, have we?

Of course das überlegen support Obama, as das überlegen's über-wealth resides überlengen the designs of Obama's confiscation.

This is the basis of class warfare, it is das überlegen pitting one class of inferiors against another class inferiors to further their own ends (the acquisition and accumulation of additional wealth and power).

Forward Bitchez!

Steve in Greensboro's picture

Dems are the party of the very rich -- people like Warren Buffet, Bill Gates, George Soros, Kerry, Pelosi, Diane Feinstein, the Kennedys, etc. -- the people who already have theirs and don't want anybody else getting rich.  So there is no way there will be a wealth tax.   (Santelli knows that.  He is just tweaking the Dems.)

Income taxes won't work; you've got to define the income levels considered "rich" very low.  And then people just cut down on working since it doesn't pay.  

We will follow our socialist leaders like France and implement a VAT.  Let's make everything cost 20% more than it does now.  That will please the Dem voter base now won't it?

Quoting the Sage of Baltimore: "nobody ever went broke underestimating the intelligence of the American people" and "Democracy is the theory that the common people know what they want and they deserve to get it good and hard".  Amen.

Toolshed's picture

You are a bitter partisan fool. Why not spew about, I don't know.....the Koch boys maybe? Moron.

Ace Ventura's picture

LOL...kettle, pot, black much? Throwing in the Koch bros reference for extra partisan sauce too. Partisan fool indeed.

Toolshed's picture

I am merely attempting to point out that the partisan nonsense needs to stop jackass. I am registered as independent. Both parties suck furiously, as apparently do you. I voted for Ron Paul in protest. If we can't get past the partisan BS then the USA is surely absolutely done. Finished. Kaput. Is the total dysfunction of our political system that hard for you to discern? I pity you......almost.

RSloane's picture

Looks like you know a lot about being a bitter partisan fool.

Blankenstein's picture

Not a partisan here, I wrote in Ron Paul in the most corrupt state in the union, Illinois.  (No doubt the Diebold machine notified the proper government departments and put my name on some sort of watch list.)

But it sure seems to me team blue never wants to admit the mega rich folks who are also flying the blue team flag.  Hell, Jon Corzine had a fundraiser for Obama attended by Dimon and most likely Blankfein.  And people still think team blue is for the underdog.  Bitter partisan - no.  Don't let my emotions blind me to how both sides cater to the Wallstreet mafia -yes.




Toolshed's picture

At last there is hope! +1

RSloane's picture

+ 100 if I could.

[for Blankenstein]

Everybodys All American's picture

Confiscate wealth.

There is no point in taxing wealth. You didn't build that anyway. It's what all good socialist prefer.

MiltonFriedmansNightmare's picture

This talk is all a smoke screen. The fascists will never relinquish their wealth. They will continue to suck on the teat of the middle class until the milk has gone dry, then slam their fascists boots down on our necks. That is the real plan.

MiguelitoRaton's picture

The wealthy would leave, there would be reduced incentive to accumulate wealth in this country (and I am a serial entrepreneur), it would destroy the country. It is also pure confiscation that puts us on a slippery slope. As an entrepreneur, my next company would be in another country...why reach for the golden ring just to have it taken from you? The hard work, long hours, personal investment, personal sacrifice simply would not be worth it.

MeBizarro's picture

What coutnry are you going to move to that is stable, safe, and secure that has lower tax rates and is relatively easy to obtain a visa and ultimately citizenship?

Urban Redneck's picture

There are many countries which are currently competing to INSOURCE entrepenurialism, whereas the US & France are competing to OUTSOURCE entrepenurialism, since apparently they didn't learn anything from the manufacturing outsourcing boom.

BTW Switzerland worked just fine for me.

janchup's picture

Lets be a little obvious: If I have "wealth" I've already paid taxes on it, every penny I've saved and accumulated has received the government bite. 


blueRidgeBoy's picture

your comment seems to imply that government has a satiable appetite for your wealth.  It doesn't.

MiltonFriedmansNightmare's picture

Yes, Unlce Warren has honestly paid his taxes and deserves every penny of his hard earned...belch...I mean, crony-capitalist assisted empire.

Occasionally, you didn't build that actually rings true.

blunderdog's picture

     If I have "wealth" I've already paid taxes on it, every penny I've saved and accumulated has received the government bite.

Just because YOU'RE a sucker who pays your share of taxes doesn't mean that RICH GUY is also.

dwdollar's picture

This is the problem when you run such a corrupt system for so long. There's no longer a distinction between wealth from honest means and wealth from corrupt means.

We're already past the point of no return. Taxing wealth is just the logical next time. Later comes total confiscation. Have a nice day.

ekm's picture

Republicans are in disbelief, but it's gona pass.


Obama/Far Left PROMISED good life for everybody, not different from Pierre Trudeau here in Canada. He ruled for a decade by promising and promising free stuff, until Canada was ruined.

It came to a point that there was a proposal to evict Canada from G7 but USA insisted for it to remain in order not to feel lonely from North America.

Later Brian Mulroney and Jean Chretien were forced to undo all that Trudeau ruined. Trudeau was always inspired by Fidel Castro.

There are still millions of people in welfare who still dream of Trudeau.


Obama is like Trudeau. He has promised good life with little work. Canada is 30 mil and has crude oil but USA is 300 mil, ten times bigger. Misery will come faster than you think, way faster.

Then, people will talk to each in disbelief and say to themselves: What did we do? Were we so stupid?


lolmao500's picture

Start raiding the bank accounts of Bill Maher, Bill Gates, Soros, Pelosi, the banksters... then we can talk.

MiltonFriedmansNightmare's picture

Wealth bashing is contagious, I kinda dig it

blunderdog's picture

Yeah, it's so nice to see how much the Reds and Blues have in common when it really comes down to it. 

It's not really that a guy like lolmao500 wants small government or low taxes, he just doesn't want it done to HIS GUYS.

Winston Smith had his breaking point, too. 

"Do it to Julia!  Do it to HER!"

blueRidgeBoy's picture

the problem with "one-time" taxes is that they never are.

Benjamin Glutton's picture

So, if Grover Norquist owns The Great Santelli it is safe to assume that Jerk Welch owns both men.


I cannot believe Santelli would suggest such a thing. Amazing.


just plain wrong.

FiatFapper's picture

Bullish on $500 p/h accountants.

Arkaenun's picture

Glad he said it, because wealth tax will be floated again, soon. It is a little less painful coming from Rick and laced with sarcasm.

earnyermoney's picture

Wealth tax for those who voted fro Romney. Barry's supporters not so much.

buzzsaw99's picture

Tax Hank Paulson 99% of his net worth. Tax Corzine 100%. Tax Pandit... Until then let it all die.

John_Coltrane's picture

Hey, we already have a tax on wealth (i.e. accumulated savings from past production). Its called inflation.  Its made possible by a debt backed money, fractional reserve lending, and the FEDs inflation "targets".  I'm surprised Santelli doesn't understand how that ponzi works (the first to get access to the new $ benefit, everyone else is screwed)-I assume he's just having fun playing devil's advocate. 

I'm sure he understand that the problem with socialism is always that you run out of other people's money.  So, instead of addressing this and getting rid of entitlements and the mentality they encourage lets punish the productive savers, reward the profligate debtors and you'll get less saving and more debt.  That should work quite well for destroying wealth-no new taxes needed.  People with talent and ability will leave the country in droves-its already happening in California to the benefit of states like Texas and its happening in France too.  I've got news for the parasites who elected Obama-we don't need you or the government.

Quinvarius's picture

It is not enough that they just create money out of thin air.  We all have to have less of it to maintain the illusion of scarcity as well. 

Quinvarius's picture

This is stupid.  Stop feeding the banks free money as a business model, and stop them from trading, make them act as bankers who give loans.  There is no amount of tax or theft that is going to fix anything.

Also, when the Fed buys our debt, we don't pay interest on it.  So that is just straight up printing.  We don't need higher taxes to pay that back because we will never have to pay it back or pay interest on it.  What we need is a functional banking system if we want a functioning economy.

Rearranging Deckchairs's picture

There already is a wealth tax. Its called transfer taxes: the estate tax, the gift tax, and the generation skipping transfer tax. And frankly Capital gains are a form of wealth tax. Then Propoperty taxes are very much a wealth tax already at least on real property.

Does this mean they'll decrease the exemption amounts and leave ordinary income taxes alone


BTW if we ever got out of this ZIRP environment the economy would be doing better as more would trickle down. Met with a client this week who is liquid to a few million and also a couple million in real estate and yet at 65 while taking advantage of Medi-care and Social Security and a paltry income from her investments and savings who feels very poor and fears spending it all down before she dies. She was literally contemplating investing $240,000 with some shaddy ATM sale and leaseback investment scheme which "promised" her a 20% return each year.



Peter Pan's picture

If they want to tax wealth they should tax wealth that is stashed away in tax havens which according to one report is close to $30 trillion dollars.

MsCreant's picture

If someone has to mark assets to market (and they would want the truth for this fiasco) the whole thing goes up in flames.


kevinearick's picture


Middle Class Escapism

The US middle class pays itself in tomorrow's money to produce escapism, virtual expansion in a rapidly contracting Newtonian box, within which there are many boxes within boxes, a failed extrapolation of the failed Japanese economy of minaturization, which is why its participants cannot love. They cannot see beyond the box they have chosen, let alone make the leap of faith required to place the future needs of others ahead of their own addictions today. Their idea of parenting is denial at best, and government directive at worst.

And now that their children and grandchildren have zero real work skills to support further expansionary escapism, and they see the future as a part-time WalMart security guard, pleading to the next generation of teenage female gatekeepers for welfare extensions, in lieu of social security, medicare, and civil service pensions, they point their fingers in all directions, except their own. Nothing prevents them from taking over the government; they are the government. And they just re-elected the same regime, ensuring more of the same.

The eye is a lamp, for good and is in the eye of the beholder.

Just yesterday, the church put malcontents on the rack, and much worse, for teaching that the earth was not flat, and the Irish hid books in caves. If you tell present administrators that we have moved well beyond Newton, they'll take your children and declare you a non-person, in a world controlled by digital credit, to its own end. Nevetheless, Germany and the defense contractors are collapsing of their own dead weight, again. Who'd a thunk?

How many times have we seen gold trotted out for the occassion of excessive asset and associated currency inflation, in our lifetimes alone? Every empire is the latest and greatest suit of bells, whistles and sparklies, and every empire gets replaced, while every middle class feigns shock and horror when its tyranny of the manufactured majority is disrobed for all to see. Jesus didn't die on the cross to save the middle class; the middle class voted to crucify him, just as the current middle class seeks to crucify another, to save its own hide.

This time around, the final bait and switch, normally capital to labor, is going to turn out a wee bit different. The trick, as always, is to let them "think" they have crucified you, and leave the rest to nature. How could anyone possibly survive beyond the authority of the all-powerful OZ?

The US middle class is a sunk cost, pulling the entire empire down with it. That's critters. They can no longer hide behind Jesus and the cave is running out of oxygen, because hypocrits cannot think for themselves. Step out of the way and the empire implodes. Basically, you add dead weight to your backpack as you climb the first half of the mountain, and drop it as you go up the second half. Start training your children right out of the gate.

Why would anyone accept the empire's definition of labor, trading a non-recurring carrot for a recurring sledge hammer to the head, like sex for syphillus? Live by the sword, die by the sword.

"Nearly every man who develops an idea works at it up to the point where it looks impossible and then gets discouraged. That's not the place to become discouraged."  TAE

Watch what happens when the next 20% of the middle class gets gutted by the remaining 40%.

Spastica Rex's picture

Hasn't pretty much everything since WWII (and maybe since Edward Bernays) simply been wealth confiscation from the future? Built-in obsolescence was never going to pay for itself.

edit: Looks like the future is now.

israhole's picture

Since nobody has a job these days, they will have to steal from someplace else.  Makes sense to me.

Bobportlandor's picture

John Boehner House Leader, only choise is to raise the debt limit, let the fiscal cliff happen and raise the taxes on rich and along with healthcare it all collapses.

Come out and stress this is a terrible mistake, but you want it you got it.

Any other compromise will let the dems once again claim the rep are to blame.

Neither party is willing to go out on a limb so I predict dems won't vote for his plan either.

Compromise = your fault it didn't work