It’s happening. California looks likely to put a “one-time” tax of 5% on wealth above $1 billion on the ballot in November, and polls suggest it could pass — despite opposition from some economists (not so surprising) and Democratic politicians (more so). Meanwhile, calls to tax the rich are resounding across the country, from New York’s proposed “pieds-a-tierre tax” to Washington State’s first-ever income tax, imposed only on millionaires.

Allison Schrager

As someone who has been arguing for more than a decade that these taxes are bad economics, I find all this disheartening. I missed the point. I thought the argument was about the optimal allocation of resources, but it is really about the redistribution of power. I concede that the concentration of power among the wealthy can be harmful. But using the tax code to fix it will create worse problems.

Allison Schrager is a Bloomberg Opinion columnist covering economics. A senior fellow at the Manhattan Institute, she is author of “An Economist Walks Into a Brothel: And Other Unexpected Places to Understand Risk.”

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