By Chuck Collins / Inequality.org
The collective wealth of all U.S. billionaires has increased over $1.1 trillion since mid-March 2020, a nearly 40% leap during the past 10 months of national emergency. This wealth windfall could pay for all the relief for working families contained in the $1.9 trillion coronavirus relief package proposed by President Biden, while leaving the nation’s richest households no worse off than they were before COVID-19 hit.
The combined fortune of the nation’s 660 billionaires as of Monday, January 18, 2021 was $4.1 trillion, up 38.6% from their collective net worth of just under $3 trillion on March 18, 2020, the rough start of the pandemic, based on Forbes data compiled in this report by the Americans for Tax Fairness (ATF) and the Institute for Policy Studies (IPS). There have been 46 newly minted billionaires since the beginning of the pandemic, when there were 614.
March 18 is used as the unofficial beginning of the pandemic because by then most federal and state economic restrictions responding to the virus were in place. Moreover, March 18 was also the publication date of Forbes’ annual billionaires report in 2020. It provided a detailed baseline that ATF and IPS have been comparing periodically with real-time data from the Forbes website. This methodology has been favorably reviewed by PolitiFact.
The $1.1 trillion wealth gain by 660 U.S. billionaires since March 2020 could pay for:
- All of the relief for working families contained in President Biden’s proposed $1.9 trillion pandemic rescue package, which includes $1,400 in direct payments to individuals, $400-a-week supplements to unemployment benefits, and an expanded child tax credit. (See table below)
- A stimulus check of more than $3,400 for every one of the roughly 331 million people in the United States. A family of four would receive over $13,000. Republicans in Congress resisted sending families stimulus checks most of last year, claiming we couldn’t afford them.
Ordinary Americans have not fared as well as billionaires during the pandemic:
- Over 25 million have fallen ill with the virus and more than 420,000 have died from it. [Johns Hopkins Coronavirus Resource Center]
- Collective work income of rank-and-file private-sector employees—all hours worked times the hourly wages of the entire bottom 82% of the workforce—declined by 1% in real terms from mid-March to mid-December, according to Bureau of Labor Statistics data.
- Over 73 million lost work between Mar. 21 and Dec. 26, 2020. [S. Department of Labor]
- 16 million were collecting unemployment on Jan. 2, 2021. [S. Department of Labor]
- Nearly 100,000 businesses have permanently closed. [Yelp/CNBC]
- 12 million workers have likely lost employer-sponsored health insurance during the pandemic as of August 26, 2020. [Economic Policy Institute]
- Some 29 million adults reported between Dec. 9-21 that their household had not had enough food in the past week. From Nov. 25-Dec. 7, between 8 and 12 million children lived in a household where kids did not eat enough because the household could not afford to fully feed them. [Center on Budget & Policy Priorities (CBPP)]
- 14 million adults—1 in 5 renters—reported in December being behind in their rent. [CBPP]
Because of long-standing racial and gender disparities, low-wage workers, people of color and women have suffered disproportionately in the combined medical and economic crises of 2020. Latinos are more likely to become infected with Covid-19 and Blacks to die from the disease than are white people. Billionaires are overwhelmingly white men.
The stock market surge and lock-down economy have been a boon to tech monopolies and helped create multiple U.S. “centi-billionaires.” Jeff Bezos, Elon Musk, and Bill Gates were each worth more than $100 billion on Jan. 18. Prior to this year, Bezos had been the only U.S. centi-billionaire, reaching that peak in 2018. Bezos and other billionaires have seen particularly astonishing increases in wealth over the past 10 months:
- Elon Musk’s wealth grew by over $154 billion, from $24.6 billion on March 18 to $179.2 billion on Jan. 18, a nearly eight-fold increase, boosted by his Tesla The boost in wealth of the SpaceX founder over the past 10 months is more than twice that of any other billionaire. That $154 billion growth in wealth is also about seven times NASA’s $22.6 billion budget in FY2020, the federal agency Musk has credited with saving his company with a big federal contract when the firm’s rockets were failing and it faced bankruptcy.
- Jeff Bezos’s wealth grew from $113 billion on March 18 to $182 billion, an increase of 61%. Adding in his ex-wife MacKenzie Scott’s wealth of $55 billion on Jan. 18, the two had a combined wealth of almost a quarter of a trillion dollars thanks to their Amazon If Bezos’s $68.6 billion growth in wealth was distributed to all his 810,000 U.S. employees, each would get a windfall bonus of almost $85,000 and Bezos would not be any “poorer” than he was 10 months ago.
- Mark Zuckerberg’s wealth grew from $54.7 billion on March 18 to $92 billion, an increase of over two-thirds fueled by his Facebook
Tax reform that ensures the wealthy pay their fair share—the principle the Biden tax plan is built on—would transform a good chunk of those huge billionaire gains into public revenue to help heal a hurting nation. But getting at that big boost in billionaire fortunes is not as simple as raising tax rates: tax rules let the rich delay, diminish and even ultimately avoid any tax on the growth in their wealth. What’s needed is structural change to how wealth is taxed.
The most direct approach is an annual wealth tax on the biggest fortunes, proposed by Senators Elizabeth Warren and Bernie Sanders, among others. Another option is the annual taxation of investment gains on stocks and other tradable assets, an idea advanced by the new Senate Finance Committee chair, Ron Wyden. Even under the current discounted tax rates for investment income, if Wyden’s plan had been in effect in 2020, America’s billionaires would be paying hundreds of billions of dollars in extra taxes this spring thanks to their gargantuan pandemic profits last year.
December 9, 2020 Update
According to a new report by the Institute for Policy Studies (IPS) and Americans for Tax Fairness (ATF), the collective wealth of America’s 651 billionaires has jumped by over $1 trillion since roughly the beginning of the COVID-19 pandemic to a total of $4 trillion at market close on Monday, December 7, 2020. Combined, just the top 10 billionaires are now worth more than $1 trillion.
Their wealth growth since March is more than the $908 billion in pandemic relief proposed by a bipartisan group of members of Congress, which is likely to be the package that moves forward for a vote in the next week, but has been stalled over Republican concerns that it is too costly.
The total net worth of the nation’s 651 billionaires rose from $2.95 trillion on March 18—the rough start of the pandemic shutdowns—to $4.01 trillion on Dec. 7, a leap of 36%, based on an analysis of Forbes magazines research on billionaires. By around March 18 most federal and state economic restrictions in response to the virus were in place.
Forbes’ annual global billionaires report was published March 18, and ATF and IPS collected the real-time data on Dec. 7 from the Forbes website. The methodology of this analysis has been favorably reviewed by PolitiFact. The ATF-IPS analysis also looks at wealth growth since February 2019—the date of Forbes’ immediately previous annual billionaires report published well before the start of the pandemic and resulting market gyrations.
The $1 trillion wealth gain by 651 U.S. billionaires since mid-March is:
- More than it would cost to send a stimulus check of $3,000 to every one of the roughly 330 million people in America. A family of four would receive over $12,000. Republicans have blocked new stimulus checks from being included in the pandemic relief package.
- Double the two-year estimated budget gap of all state and local governments, which is forecast to be at least $500 billion. By June, state and local governments had already laid off 1.5 million workers and public services—especially education—faced steep budget cuts.
- Only slightly less than total federal spending on Medicare ($644 billion in 2019) and Medicaid ($389 billion in FY2019), which together serve 120 million Americans (69 million in Medicaid, 63 million in Medicare, less 12 million enrolled in both).
- Nearly four times the $267 billion total in stimulus payments made to 159 million people earlier this year.
“Never before has America seen such an accumulation of wealth in so few hands,” said Frank Clemente, executive director of Americans for Tax Fairness. “As tens of millions of Americans suffer from the health and economic ravages of this pandemic, a few hundred billionaires add to their massive fortunes. Their pandemic profits are so immense that America’s billionaires could pay for a major COVID relief bill and still not lose a dime of their pre-virus riches. Their wealth growth is so great that they alone could provide a $3,000 stimulus payment to every man, woman and child in the country, and still be richer than they were 9 months ago. Joe Biden won a tax-fairness mandate in November. We look forward to working with him and Congress to deliver on that mandate by taxing the massive wealth of these billionaires.”
About ATF: Americans for Tax Fairness is a diverse campaign of more than 420 national, state and local endorsing organizations united in support of a fair tax system that works for all Americans. It has come together based on the belief that the country needs comprehensive, progressive tax reform that results in greater revenue to meet our growing needs.
About IPS: The Institute for Policy Studies is a multi-issue research center that has conducted ground-breaking research on inequality for more than 20 years. The IPS Program on Inequality and the Common Good, and the Inequality.org website, provide research, advocacy and policy development on issues related to economic inequality.
To see all updates back to April 30, 2020, with many more statistics, graphs and other juicy evidence, see the full blog at Inquality.org here.