Los Angeles implemented a new tax on luxurious real estate to finance affordable housing and combat homelessness

Publicerad denFörfattareNoah Duker

Los Angeles implemented a so-called “mansion tax”. At a rate of 4% for real estate purchases between 5 and 10 million dollars and 5.5 percent for properties over ten million dollars. All in all, the tax is expected to bring in about 670 million dollars of revenue. The money is mend to finance affordable housing and thus preventing people from becoming homless.  
The tax, officially known as “Measure ULA” was agreed upon by the state legislator after a referendum in November 2022 as close to 60% of voters cast their ballot in favour of the proposed law. Los Angeles being the city with the highest number of homeless people in the country, it’s little wonder that such a tax comes to fruition. California in general is also known as the second most expensive state when it comes to real estate, only being topped by Hawaii. 
Under the new tax, a millionaire selling a house worth 5 million dollars would have to pay 200 thousand dollars to the government. To put the necessity of action in the city of LA into perspective, the recent crises have made the number of homeless people skyrocket to around 42,000 people in February 2022. In 2016 the number was closer to 28,000 people without a home according to an article published in the New York Times.
Other estimates by the “US department of housing and urban development” put the number of homeless people in the LA at a staggering 65.111 people.
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“Mass Panic”: Real Estate Owners get creative in trying to avoid the new Taxes
Despite the relatively low sum of tax money in comparison to the enormous profits made in the real estate market, millionaires and celebrities sought for evermore creative and desperate ways to avoid contributing to improving societal living standards. According to “The Guardian“, one desperate super rich homeowner of a 16.5-million-dollar mansion was going as far as to gift a supercar to whoever buys his house, just to get out of paying around 900 thousand dollars in tax.
Others are taking different approaches to avoid paying taxes. A legal challenge has been put before court, claiming the tax violates the Californian constitution. The outcome of the challenge is, as of now, still open, and it will very likely take a while until any result comes of it. 
The Tax would only affect 4 Percent of the Real Estate Transactions in LA
According to the luxury real estate platform “redfin” the median selling price for property in California is just short of a million dollars. It is hovering around 900 thousand dollars. The tax therefore would only affect about 4% of real estate transactions in the city.
Interesting claims come from real estate agents working for the super-rich. The tax is set too low, as 5 million dollars for a home does not qualify as a mansion. “Five million dollars is certainly not luxury. It’s a nice house, in a nice area. It’s not what most people would consider a luxury house in a prime area”, says real estate agent Scott Tamkin.
Critics launch massive PR campaign to sway Public Opinion
But he is not the only real estate agent trying to tell the average person that a five-million-dollar home (about 4000 square foot in Beverly Hills according to Josh Altman, real estate agent and reality TV star) is not a luxury. A massive PR campaign seems to have been launched to sway public opinion against the tax with multiple large US news outlets writing pieces against the proposed tax, despite the scientific, political, public support for the law.
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The new Tax will bring in about 627 Million Dollars
It’s estimated that the tax will bring in about 627 million dollars, according to an article published by the Guardian. This still enormous sum is almost 400 million dollars short of the sum initially expected being a billion dollars, but still more than triples the amount of revenue collected from the before active transfer tax, which is raking in about 200 million dollars per year.
Multiple universities and analysts, above all the University of California (UCLA) have recently come forward to counteract the multi-millionaires PR offensive to roll back the tax. They are saying that the money collected and the impact on the housing market will really help improve the homelessness crisis in Los Angeles.  Läs mer…

Nobel Prize Winner Stiglitz wants 70% tax on top incomes

Publicerad denFörfattareKontrast.at

Nobel Prize winner Joseph Stiglitz is concerned about increasing social inequality in the world. The gap between rich and poor is widening. To reverse the trend, he calls for the super-rich to pay a higher income tax and a wealth levy. He says introducing a special global tax rate of 70 percent for top earners “would clearly make sense.”
“People at the top might then work a little less if you tax them more. But on the other hand, our society benefits from a more egalitarian society with greater cohesion,” the former World Bank chief economist explained in Oxfam’s “Equals” podcast, summarized by the British newspaper The Guardian.
Current top tax rates are much lower than what Stiglitz has in mind. A few examples

In the U.S., the top tax rate is 37 percent for incomes above $539,901.
The top tax rate in the U.K. is 45 percent on annual incomes above 150,000 pounds.
In Austria, the rate is 55 percent, but only for annual incomes above one million euros.
In Germany, the top tax rate is paid from an annual income of around 278,000 euros—it is 45 percent.

Only four European Countries have a wealth tax: Spain, Norway, Switzerland, and Belgium.
Joseph Stiglitz: Getting rich is a question of chance—not performance
Stiglitz explained in the podcast that such a new, higher top tax would lead to more redistribution—but at the same time one must also tax wealth fairly. Because that way, the richest people in the world would make a fair contribution, whose wealth has been accumulated over generations. According to Stiglitz, a global wealth tax would have an even greater impact in combating social inequality.
“We should tax wealth more heavily, because a lot of the wealth is now inherited. For example, the young Walmart’s inherited their wealth“, Stiglitz cited as an example.
“One of my friends describes it as winning the sperm lottery. You got the ‘right’ parents. I think we have to realize that most billionaires got a lot of their wealth just by luck.“
The Nobel Prize winner considers U.S. Senator Elizabeth Warren’s proposals for a 2 percent tax on wealth of more than $50 million and a 3 percent tax on wealth of more than $1 billion “very reasonable.” He believes that would “really do a lot to raise revenue that could be used to alleviate some problems our country faces.“
The crisis has made rich even richer
According to Stiglitz, the Corona pandemic has exacerbated social inequality around the world to an “astonishing” degree and “both exposed and exacerbated global inequalities.“
“At a time when so many people’s lives have been so difficult, when they have lost their jobs, when food prices have risen and oil prices have risen, it is shocking how many people and rich companies have made off like bandits,” Stiglitz criticized.
Oxfam study: For the first time in 25 years, extreme wealth and extreme poverty are growing simultaneously
A recent Oxfam study showed that nearly two-thirds of the wealth accumulated since the pandemic began has gone to the richest 1 percent. The charity found that the best-off will have amassed $26 billion in new assets by the end of 2021. That’s 63 percent of all new wealth, with the rest going to the remaining 99 percent of people.
As a result, for the first time in 25 years, the rise in extreme wealth has been accompanied by an increase in extreme poverty. 
The charity said that a tax of up to 5 percent on multimillionaires and billionaires could raise $1.7 trillion a year for the world. That, in turn, would be enough to lift 2 billion people out of poverty and end world hunger.
“While millions of people don’t know how to pay for food and energy, the crises of our time are bringing gigantic increases in wealth for billionaires and billionaires’ wives,” said Oxfam spokesman Manuel Schmitt.
200 super-rich call for global wealth taxes
More than 200 members of the super-rich elite have written to governments around the world in the run-up to the World Economic Forum in Davos calling on them to “tax us, the super-rich, now” to tackle the crisis of inequality. “Patriotic Millionaires”, “Tax me Now” and “Millionaires for Humanity” were behind the campaign.
Among the signatories are Disney heirs Abigail and Tim Disney and “Hulk” actor Mark Ruffalo. Marlene Engelhorn from Austria also participated in the protest—she delivered the letter on site.

Members Phil White and Marlene Engelhorn protest the World Economic Forum in Davos.
It’s time to #TaxTheRich. pic.twitter.com/QwV7aWMPEP
— Patriotic Millionaires (@PatrioticMills) January 17, 2023

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Black Friday: Amazon employees protest for better working conditions

Publicerad denFörfattareFabian Zickler

On Black Friday, in over 40 countries, Amazon employees protested to draw attention to the poor working conditions in the distribution centers. With the “Make Amazon Pay” initiative, the workforce is demanding higher wages and better working conditions. Although the company is making record profits, many of its employees can barely live on their salaries. 
For many, “Black Friday” is simply a day on which to look for a bargain or two. For the Amazon workforce, it is a day of worldwide strikes and protests to draw attention to the miserable working conditions in the distribution centers. In the past, the poor working conditions in the Amazon distribution centers have repeatedly made headlines: employees are poorly paid, monitored and put under pressure.
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 Over 80 organizations have joined together to stage protests from Mexico to India in countries around the world. This is the third year that people around the world have united against the exploitative methods of the major corporation. 
The “Make Amazon Pay” initiative, for example, is trying to use the day for strikes and rallies to support the fight for fair working conditions. They accuse the company of squeezing “every last drop out of workers, communities, and the planet” and seek to end this injustice. 

Today, on #BlackFriday, we start our @organizeAWAS campaign against the surveillance of workers in all parts of @AmazonDE. We fight back against constant tracking of every move, be it in fulfillment centers, parcel delivery, data centers or office work. #MakeAmazonPay 1/4
— Amazon Workers Against Surveillance (@organizeAWAS) November 26, 2021

Despite 470 billion in sales: Amazon employees still poorly paid
In 2021, the online retailer Amazon generated sales of around 470 billion US dollars—which is roughly equivalent to the entire economic power of Austria. However, the employees of the major corporation feel relatively little of the record profits. In some cases, the low wages are barely enough to survive reasonably well. 
Amazon exploits not only its own workers, but also the public. In 2021, the online retailer did not pay a single cent in income tax in Europe, instead pocketing tax refunds.
System error: Amazon fires employees in case of illness
In the USA, Amazon employees have been paid less or even fired when they are sick, according to a report in the New York Times. The reason for this was a system error, according to the company. The sick days were interpreted as days of absence. The company is trying to find and compensate those affected. 
Amazon mobilizes against unionization in Alabama
In early 2021, Amazon workers* in Alabama began to band together to form a union and  fight grievances. The company financed a mobilization campaign instead of supplying better working conditions itself. In conferences, the management openly spoke out against the formation of a union. Flyers on toilets or a dedicated homepage were supposed to convince employees that wages were already sufficiently high.
Employees in Staten Island formed Amazons first ever Union. (Photo: Amazon Labour Union_Twitter)
First Amazon union ever, founded in Staten Island
But this is slowly changing: Not much later, a union was successfully founded for the first time at Amazon in a distribution center in Staten Island—despite immense resistance from the company’s management.  Läs mer…