Each of the major candidates for Mayor, Nikkita Oliver, Mike McGinn, Cary Moon, and incumbent Mayor Ed Murray are all advocating an illegal tax on income for the city of Seattle (Moon says she doesn’t support the passage of the tax because it’s illegal, but my guess is that if it was legal, she would). What motivates this is politics pure and simple. I’ll go a step further (without any hard data to support this) and suggest that the demand by people in Seattle to “tax the rich!” is a mix of simple envy, thoughtless adherence to ideology, and resistance to growth. There are serious problems with the idea of taxing the rich aside from it being illegal under state law. These kinds of proposals have very little data to support them, don’t have any clear redistributive plan for plundered wealth, and have unintended negative consequences.

First, all we ever here from people angry about income distribution is stuff about how X percent of the population has Y percent of the wealth. A recent article was posted to the City Builders Facebook group headlined, NYC’s Top 0.1 Percent Makes Four Times The Income Of The Bottom Half Of Earners. These stories are part of what today would be called fake news. Their purpose is to stoke outrage. One can almost feel the head shaking and eye rolling and expressions of exasperation all over the town. “Damn those rich people! Pass the butter, please.” Here’s what I wrote in response,

Remember the common sense side of this. The rich are called rich for a reason : they have more by definition. So in a room full of people wealth, like height and weight of other characteristics are not distributed equally. These stories are as relevant as saying “the people in the room with the biggest bodies weigh four times the smallest people in the room.” So what?

The implication is that the ratio is wrong. The weight or wealth in this case should be distributed more evenly. But what should the ratio be? Three times? Twice the income? Or should everyone earn the same?

There isn’t a normative quantitative standard for what the ratio should be and a good rationale for that standard. This is data abuse. We’d be better off without these pointless stories that do nothing but rile people up against high earners.

Sure, it’s frustrating that one person works two jobs and earns as much as a rounding error in someone else’s income. What do we do? Yeah. I know. Taxes. But why not encourage and improve the earning power of the poor person.

Dang Xiaoping once said “I have two choices. I can distribute poverty or I can distribute wealth.” You can’t create wealth if it’s creation is punished and discouraged.

Every time I hear people demand that we tax the wealthy because they have too much and others have too little, I never hear what the ratio should be. Never. I also never hear what method and means would be used to redistribute the cash.

That’s problem two. We’ve already seen the horribly wasteful mess that is non-profit housing development. I might warm up to the “tax the rich schemes” if I had a sense of the normative ratio of wealth and what would be done with the money from a wealth tax other than simply pouring it into existing programs that have clearly not been effective; if they were, why do we have such a disparity of wealth. In other words, why would we give a raise to a system that so clearly hasn’t ameliorated the problems of wealth maldistribution and are inefficient. It takes money to spend money. Even if the budget for social service programs was doubled or tripled it takes lot of resources to collect then spend that money, even if it was just poured out of money bags off the top of the Columbia Center.

Finally, what message are we sending to entrepreneurs and businesses that are looking to locate in prosperous, growing Seattle? The message is clear: go away! We don’t want you here, you make too much money. Imagine a tax that was a tax on unicorns. Tax the unicorn ranchers! Why would a unicorn rancher move her heard to Seattle. Wealth isn’t unicorns? Right. But is it a bad thing? That’s the message implicit in schemes aimed at taxing some group of people. Their wealth is somehow ill gotten, bad, and harmful to the community. This mindset is closely aligned with the people in Seattle who marched for science this last weekend, but still believe that building more housing makes it more expensive. Whatever, Galileo.

Taken together, a mayoral candidate or anyone who proposes a “tax on the rich” needs to explain the quantitive basis of the problem of wealth distribution (i.e. when is someone too wealthy and thus deserving of a tax and why), what the collection and distribution of the new revenue will accomplish and how and why will it reduce income inequality, and lastly, how will it not discourage entrepreneurs and innovation when the reward for success in Seattle is punishment. Support for these schemes, in my view, is disqualifying for office unless there are really, really, good answers to these questions. Don’t hold your breath waiting for them. The candidates measure their success in applause and votes, not actual success in addressing poverty.