{"id":"b1c3b6f6-9ba2-43ae-aa04-3e6955011a9e","title":"Eliminating Income Tax and Taxing Wealth","created_at":"2025-10-23T20:06:48Z","saved":true,"shared":true,"branch_id":"00000000-0000-4000-0000-000000000000","profile":{"id":null,"name":null,"model":"gpt-5","model_name":"GPT 5","model_provider":"openai","model_input_limit":1000000,"recommended":false,"model_info":"\n\n\n\n<div class=\"heading\">\n <div class=\"left\">\n \n \n \n <svg class=\"model-icon icon-xs\" data-model=\"gpt-5\">\n <use href=\"#icon-openai\"/>\n </svg>\n <h3>\n \n <span class=\"model-provider\">OpenAI</span>\n \n <span class=\"model-name\">none</span>\n </h3>\n </div>\n\n \n <a href=\"/settings?p=custom_assistant&id=none\">\n <svg class=\"icon-sm edit-icon\" aria-hidden=\"true\">\n <use href=\"#icon-pencil\" />\n </svg>\n </a>\n \n</div>\n\n\n<hr />\n<ul>\n \n <li>\n <h4>\n Cost\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Moderate\">\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-cost --medium\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Quality\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 4 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Speed\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 4 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Privacy\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 2 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li class=\"divider\" aria-hidden=\"true\"></li>\n <li>\n <h4>Last updated</h4>\n <span class=\"date\">\n \n \n 2025-08-07\n \n \n </span>\n </li>\n \n</ul>\n","model_provider_name":"OpenAI","internet_access":true,"personalizations":false,"shortcut":null,"is_default_profile":false},"tag_ids":[],"read_only":true}

[{"id":"80136c3e-e8bb-4c4a-9191-6928d1565274","thread_id":"b1c3b6f6-9ba2-43ae-aa04-3e6955011a9e","created_at":"2025-10-23T20:06:48Z","state":"done","prompt":"If the US wanted to eliminate income tax for earners under 50K and instead tax wealth at a marginal rate starting at 1 million, would it be possible to run the current budget and what would that marginal rate need to be?","references_html":"<ol data-ref-list>\n \n <li>\n <a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf\" >Final 2023 CS charts.pdf - Bureau of the Fiscal Service</a>\n <span class=\"__domain-name\">www.fiscal.treasury.gov</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 35%, transparent 35%)\">35%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.cbo.gov/system/files/2025-10/60306-MBR.pdf\" >Monthly Budget Review: September 2025</a>\n <span class=\"__domain-name\">www.cbo.gov</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 17%, transparent 17%)\">17%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/\" >Who Pays Federal Income Taxes? Latest Federal Income Tax Data</a>\n <span class=\"__domain-name\">taxfoundation.org</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 16%, transparent 16%)\">16%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www2.census.gov/library/publications/2025/demo/p70br-211.pdf\" >[PDF] Wealth of Households: 2023 - Census.gov</a>\n <span class=\"__domain-name\">www2.census.gov</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 11%, transparent 11%)\">11%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://dqydj.com/net-worth-percentile-calculator/\" >Net Worth Percentile Calculator – United States (and Average)</a>\n <span class=\"__domain-name\">dqydj.com</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 6%, transparent 6%)\">6%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.statista.com/statistics/183635/number-of-households-in-the-us/\" >U.S.: number of households 1960-2023 - Statista</a>\n <span class=\"__domain-name\">www.statista.com</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 6%, transparent 6%)\">6%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://fiscaldata.treasury.gov/americas-finance-guide/\" >America&#39;s Finance Guide | U.S. Treasury Fiscal Data</a>\n <span class=\"__domain-name\">fiscaldata.treasury.gov</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 5%, transparent 5%)\">5%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.cbo.gov/publication/59730\" >Revenues in Fiscal Year 2023: An Infographic</a>\n <span class=\"__domain-name\">www.cbo.gov</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 4%, transparent 4%)\">4%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n</ol>\n","references_md":"[^1]: [Final 2023 CS charts.pdf - Bureau of the Fiscal Service](https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf) (35%)\n[^2]: [Monthly Budget Review: September 2025](https://www.cbo.gov/system/files/2025-10/60306-MBR.pdf) (17%)\n[^3]: [Who Pays Federal Income Taxes? Latest Federal Income Tax Data](https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/) (16%)\n[^4]: [[PDF] Wealth of Households: 2023 - Census.gov](https://www2.census.gov/library/publications/2025/demo/p70br-211.pdf) (11%)\n[^5]: [Net Worth Percentile Calculator – United States (and Average)](https://dqydj.com/net-worth-percentile-calculator/) (6%)\n[^6]: [U.S.: number of households 1960-2023 - Statista](https://www.statista.com/statistics/183635/number-of-households-in-the-us/) (6%)\n[^7]: [America's Finance Guide | U.S. Treasury Fiscal Data](https://fiscaldata.treasury.gov/americas-finance-guide/) (5%)\n[^8]: [Revenues in Fiscal Year 2023: An Infographic](https://www.cbo.gov/publication/59730) (4%)\n","reply":"<details><summary>Searched with Kagi<p></p>\n<ul>\n<li>US federal budget revenue sources</li>\n<li>US income tax brackets 2023</li>\n<li>US wealth distribution by net worth</li>\n<li>US federal spending 2023</li></ul></summary> Sources (20):<br>\n<strong>What are the sources of revenue for the federal government?</strong><br>\n<a href=\"https://taxpolicycenter.org/briefing-book/what-are-sources-revenue-federal-government\" target=\"_blank\">https://taxpolicycenter.org/briefing-book/what-are-sources-revenue-federal-government</a><br>\nOver half of federal revenue comes from individual income taxes, 9 percent from corporate income taxes, and another 30 percent from payroll taxes that fund ...\n\n<p><strong>Government Revenue | U.S. Treasury Fiscal Data</strong><br>\n<a href=\"https://fiscaldata.treasury.gov/americas-finance-guide/government-revenue/\" target=\"_blank\">https://fiscaldata.treasury.gov/americas-finance-guide/government-revenue/</a><br>\nApr 15, 2019 Most of the revenue the U.S. government collects comes from contributions from individual taxpayers, small businesses, and corporations through taxes.</p>\n<p><strong>Spending</strong><br>\n<a href=\"https://fiscaldata.treasury.gov/americas-finance-guide/federal-spending/\" target=\"_blank\">https://fiscaldata.treasury.gov/americas-finance-guide/federal-spending/</a><br>\nApr 15, 2019 The U.S. Constitution gives Congress the ability to create a federal budget – in other words, to determine how much money the government can spend over the course of the upcoming fiscal year. Congress’s budget is then approved by the President. Every year, Congress decides the amount and the type of discretionary spending, as well as provides resources for mandatory spending.</p>\n<p><strong>America's Finance Guide | U.S. Treasury Fiscal Data</strong><br>\n<a href=\"https://fiscaldata.treasury.gov/americas-finance-guide/\" target=\"_blank\">https://fiscaldata.treasury.gov/americas-finance-guide/</a><br>\nApr 15, 2019 The federal government collects revenue from a variety of sources, including individual income taxes, payroll taxes, corporate income taxes, and excise taxes. ...</p>\n<p><strong>Monthly Treasury Statement (Mts)</strong><br>\n<a href=\"https://fiscaldata.treasury.gov/datasets/monthly-treasury-statement/\" target=\"_blank\">https://fiscaldata.treasury.gov/datasets/monthly-treasury-statement/</a><br>\n This dataset contains a monthly summary of the federal government’s receipts and outlays, as well as the resulting surpluses and deficits.</p>\n<p><strong>Federal income tax rates and brackets | Internal Revenue Service</strong><br>\n<a href=\"https://www.irs.gov/filing/federal-income-tax-rates-and-brackets\" target=\"_blank\">https://www.irs.gov/filing/federal-income-tax-rates-and-brackets</a><br>\nJul 08, 2025 See current federal tax brackets and rates based on your income and filing status.</p>\n<p><strong>2023 Instruction 1040 TAX AND EARNED INCOME CREDIT TABLES</strong><br>\n<a href=\"https://www.irs.gov/pub/irs-prior/i1040tt--2023.pdf\" target=\"_blank\">https://www.irs.gov/pub/irs-prior/i1040tt--2023.pdf</a><br>\n EARNED INCOME CREDIT TABLES 1040-S NOTE: THIS BOOKLET DOES NOT CONTAIN ANY TAX FORMS. This booklet only contains Tax and Earned Income Credit Tables from the Instructions for Form 1040 (and 1040-SR). FreeFile is the fast, safe, and free way to prepare and e-file your taxes. See IRS.gov/FreeFile. Pay Online. It’s fast, simple, and secure.</p>\n<p><strong>IRS releases tax inflation adjustments for tax year 2026, including ...</strong><br>\n<a href=\"https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill\" target=\"_blank\">https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill</a><br>\n IR-2025-103, Oct. 9, 2025 — The Internal Revenue Service today announced the tax year 2026 annual inflation adjustments for more than 60 tax provisions, including the tax rate schedules and other tax changes. Revenue Procedure 2025-32 provides details about these annual adjustments.</p>\n<p><strong>2023 Tax Brackets and Federal Income Tax Rates | Tax Foundation</strong><br>\n<a href=\"https://taxfoundation.org/data/all/federal/2023-tax-brackets/\" target=\"_blank\">https://taxfoundation.org/data/all/federal/2023-tax-brackets/</a><br>\nFeb 13, 2020 There are seven federal income tax rates in 2023: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent, and 37 percent.</p>\n<p><strong>Alternative Minimum Tax (Amt)</strong><br>\n<a href=\"https://taxfoundation.org/topics/alternative-minimum-tax-amt/\" target=\"_blank\">https://taxfoundation.org/topics/alternative-minimum-tax-amt/</a><br>\n The State Tax Competitiveness Index enables policymakers, taxpayers, and business leaders to gauge how their states’ tax systems compare. While there are many ways to show how much state governments collect in taxes, the Index evaluates how well states structure their tax systems and provides a road map for improvement.</p>\n<p>**U.S. Net Worth by Age: What the Data Shows <a href=\"https://www.harness.co/articles/wealth-benchmarks-net-worth-america/\" target=\"_blank\">https://www.harness.co/articles/wealth-benchmarks-net-worth-america/</a>s-net-worth-america/)<br>\nApr 15, 2025 How Net Worth Is Changing in America ... From 2016 to 2022, the median U.S. household net worth rose by 61%, increasing from $120,000 to $193,000.</p>\n<p><strong>United States Net Worth Brackets, Percentiles, and Top One Percent - DQYDJ</strong><br>\n<a href=\"https://dqydj.com/net-worth-percentiles/\" target=\"_blank\">https://dqydj.com/net-worth-percentiles/</a><br>\n Graph &amp; table of net worth brackets and percentiles in the United States for recent data. See top one percent, top .5%, and .1%, median, and more.</p>\n<p><strong>Years Calculator</strong><br>\n<a href=\"https://dqydj.com/year-calculator/\" target=\"_blank\">https://dqydj.com/year-calculator/</a><br>\n The year calculator lets you enter two dates to compute the number of years (and days) between them. Enter any dates to see years apart.</p>\n<p><strong>Month Calculator</strong><br>\n<a href=\"https://dqydj.com/month-calculator/\" target=\"_blank\">https://dqydj.com/month-calculator/</a><br>\n The month calculator lets you enter two dates and we will give you the number of months (and days) between the two. Enter any timeframe to see months apart.</p>\n<p><strong>Week Calculator</strong><br>\n<a href=\"https://dqydj.com/week-calculator/\" target=\"_blank\">https://dqydj.com/week-calculator/</a><br>\n This week calculator computes the number of weeks between two dates. Enter a start and end date, and we'll show how many weeks separate them.</p>\n<p><strong>Federal Spending | U.S. Treasury Fiscal Data</strong><br>\n<a href=\"https://fiscaldata.treasury.gov/americas-finance-guide/federal-spending/\" target=\"_blank\">https://fiscaldata.treasury.gov/americas-finance-guide/federal-spending/</a><br>\nApr 15, 2019 Explore federal spending by category or agency and learn how much the United States government spends each year.</p>\n<p><strong>America's Finance Guide | U.S. Treasury Fiscal Data</strong><br>\n<a href=\"https://fiscaldata.treasury.gov/americas-finance-guide/\" target=\"_blank\">https://fiscaldata.treasury.gov/americas-finance-guide/</a><br>\n The total debt for the U.S. through October 17, 2025 is $37.98 trillion. At the end of 2024 the government had $35.46 trillion in federal debt. In 2024, the ...</p>\n<p><strong>The Federal Budget in Fiscal Year 2023: An Infographic</strong><br>\n<a href=\"https://www.cbo.gov/publication/59727\" target=\"_blank\">https://www.cbo.gov/publication/59727</a><br>\nMar 05, 2024 The federal deficit in 2023 was $1.7 trillion, equal to 6.3 percent of gross domestic product.</p>\n<p><strong>An Update to The Budget and Economic Outlook</strong><br>\n<a href=\"https://www.cbo.gov/publication/60419\" target=\"_blank\">https://www.cbo.gov/publication/60419</a><br>\n Executive Summary The Congressional Budget Office regularly publishes reports presenting its baseline projections of what the federal budget and the economy would look like in the current year and over the next 10 years if laws governing taxes and spending generally remained unchanged. This report is the latest in that series.</p>\n<p><strong>Data</strong><br>\n<a href=\"https://www.cbo.gov/data/budget-economic-data\" target=\"_blank\">https://www.cbo.gov/data/budget-economic-data</a><br>\n CBO regularly publishes data to accompany some of its key reports. These data have been published in the Budget and Economic Outlook and Updates and in their associated supplemental material, except for that from the Long-Term Budget Outlook.</p>\n</details>\n<details><summary>Searched with Kagi<p></p>\n<ul>\n<li>US federal revenue 2023</li>\n<li>US individual income tax revenue 2023</li>\n<li>number of US taxpayers under 50k income</li>\n<li>total net worth of US households above 1 million</li></ul></summary> Sources (20):<br>\n<strong>Revenues in Fiscal Year 2023: An Infographic</strong><br>\n<a href=\"https://www.cbo.gov/publication/59730\" target=\"_blank\">https://www.cbo.gov/publication/59730</a><br>\nMar 05, 2024 Revenues received by the federal government in 2023 totaled $4.4 trillion, of which half was receipts from individual income taxes.\n\n<p><strong>The Federal Budget in Fiscal Year 2023: An Infographic</strong><br>\n<a href=\"https://www.cbo.gov/publication/59727\" target=\"_blank\">https://www.cbo.gov/publication/59727</a><br>\n The federal deficit in 2023 was $1.7 trillion, equal to 6.3 percent of gross domestic product.</p>\n<p><strong>Graphics | Congressional Budget Office</strong><br>\n<a href=\"https://www.cbo.gov/publication/most-recent/graphics\" target=\"_blank\">https://www.cbo.gov/publication/most-recent/graphics</a><br>\n Revenues received by the federal government in 2023 totaled $4.4 trillion, of which half was receipts from individual income taxes. Graphic. The Federal Budget ...</p>\n<p><strong>Revenues in Fiscal Year 2023 - Congressional Budget Office</strong><br>\n<a href=\"https://www.cbo.gov/system/files/2024-03/59730-Revenues.pdf\" target=\"_blank\">https://www.cbo.gov/system/files/2024-03/59730-Revenues.pdf</a><br>\n 2023 All data are for federal fiscal years, which run from October 1 to September 30. Numbers may not add up to totals because of rounding. GDP = gross domestic product. Amounts reflect the actual amounts reported in The Accuracy of CBO’s Budget Projections for Fiscal Year 2023 (December 2023).</p>\n<p><strong>Monthly Budget Review: September 2025</strong><br>\n<a href=\"https://www.cbo.gov/system/files/2025-10/60306-MBR.pdf\" target=\"_blank\">https://www.cbo.gov/system/files/2025-10/60306-MBR.pdf</a><br>\n October 8, 2025 The federal budget deficit was $1.8 trillion in fiscal year 2025, the Congressional Budget Office estimates, $8 billion less than the shortfall recorded during fiscal year 2024. Revenues increased by an estimated $308 billion (or 6 percent); increases in collections of individual income taxes and customs duties were partially offset by a decline in corporate tax receipts ...</p>\n<p><strong>Revenues in Fiscal Year 2023: An Infographic</strong><br>\n<a href=\"https://www.cbo.gov/publication/59730\" target=\"_blank\">https://www.cbo.gov/publication/59730</a><br>\nMar 05, 2024 Revenues received by the federal government in 2023 totaled $4.4 trillion, of which half was receipts from individual income taxes.</p>\n<p><strong>Revenues in Fiscal Year 2023 - Congressional Budget Office</strong><br>\n<a href=\"https://www.cbo.gov/system/files/2024-03/59730-Revenues.pdf\" target=\"_blank\">https://www.cbo.gov/system/files/2024-03/59730-Revenues.pdf</a><br>\n Trillion Receipts from individual income taxes, the largest source of revenues, in 2023 16.5% of GDP</p>\n<p><strong>Final 2023 CS charts.pdf - Bureau of the Fiscal Service</strong><br>\n<a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf\" target=\"_blank\">https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf</a><br>\n The table that follows depicts the amount of receipts for fiscal years 2023 and 2022 by source, including the amount and percentage of changes from fiscal year 2022. Individual Income Taxes were $2,176.5 billion in fiscal year 2023, a decrease of 17.3 percent or $455.7 billion below the prior fiscal year.</p>\n<p><strong>Note 19. Collections and Refunds of Federal Revenue</strong><br>\n<a href=\"https://www.fiscal.treasury.gov/files/reports-statements/financial-report/2023/notes-to-the-financial-statements19.pdf\" target=\"_blank\">https://www.fiscal.treasury.gov/files/reports-statements/financial-report/2023/notes-to-the-financial-statements19.pdf</a><br>\n Treasury is the government’s principal revenue-collecting entity. Collections of individual income and tax withholdings include FICA/SECA and individual income taxes. These taxes are characterized as non-exchange revenue. Excise taxes, also characterized as non-exchange revenue, consist of taxes collected for various items, such as airline tickets, gasoline products, distilled spirits and ...</p>\n<p><strong>Financial Statements of the United States Government for the Fiscal ...</strong><br>\n<a href=\"https://fiscal.treasury.gov/files/reports-statements/financial-report/2023/financial-statements-2023.pdf\" target=\"_blank\">https://fiscal.treasury.gov/files/reports-statements/financial-report/2023/financial-statements-2023.pdf</a><br>\n Revenue Inflows of resources to the government that the government demands or that it receives by donations are identified as non-exchange revenue. The inflows that it demands include individual income tax and tax withholdings, corporate income taxes, excise taxes, unemployment taxes, custom duties, and estate and gift taxes.</p>\n<p><strong>Summary of the Latest Federal Income Tax Data, 2025 Update</strong><br>\n<a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2025/\" target=\"_blank\">https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2025/</a><br>\n The bottom half of taxpayers, or taxpayers making under $50,399, faced an average income tax rate of 3.7 percent. As household income increases, average ...</p>\n<p><strong>Who Pays Federal Income Taxes? Latest Federal Income Tax Data</strong><br>\n<a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/\" target=\"_blank\">https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/</a><br>\nMar 13, 2024 The top 50 percent of all taxpayers paid 97 percent of all federal income taxes. Explore the latest federal income tax data.</p>\n<p><strong>How Many Taxpayers Fall Into Each Income Tax Bracket?</strong><br>\n<a href=\"https://taxfoundation.org/data/all/federal/how-many-taxpayers-fall-each-income-tax-bracket/\" target=\"_blank\">https://taxfoundation.org/data/all/federal/how-many-taxpayers-fall-each-income-tax-bracket/</a><br>\n All in all, the majority of American households (77%) fall into the 15% tax bracket or below. Only 892,420 households fall into the top income tax bracket.</p>\n<p><strong>Who Pays Federal Income Taxes? | IRS Federal Income Tax Data...</strong><br>\n<a href=\"https://taxfoundation.org/data/all/federal/summary-latest-federal-income-tax-data-2023-update/\" target=\"_blank\">https://taxfoundation.org/data/all/federal/summary-latest-federal-income-tax-data-2023-update/</a><br>\nSep 29, 2012 The latest federal income tax data 2023 shows that the individual income tax continues to be progressive, borne primarily by the highest income earners.The unit of analysis here is the tax return. In the figures prior to 2001, some dependent returns are included. Under other units of analysis (like the U.S. Treasury Department’s Family Economic Unit), these returns would likely be paired with parents’ returns. These figures represent the legal incidence of the income tax.</p>\n<p><strong>Sources of Personal Income Tax Returns Data | Tax Foundation</strong><br>\n<a href=\"https://taxfoundation.org/data/all/federal/personal-income-tax-returns-data/\" target=\"_blank\">https://taxfoundation.org/data/all/federal/personal-income-tax-returns-data/</a><br>\nJun 27, 2024 The individual income tax An individual income tax (or personal income tax) is levied on the wages, salaries, investments, or other forms of income an individual or household earns.The Federal Income Tax was established in 1913 with the ratification of the 16th Amendment. Though barely 100 years old, individual income taxes are the largest source is the federal government’s largest source of revenue. Taxpayers filed more than 160 million individual income tax returns for tax year 2021, the fourth year under the changes made by the 2017 Tax Cuts and Jobs Act (TCJA).</p>\n<p><strong>U.S. Net Worth Statistics: The State of Wealth in 2025</strong><br>\n<a href=\"https://financebuzz.com/us-net-worth-statistics\" target=\"_blank\">https://financebuzz.com/us-net-worth-statistics</a><br>\nAug 18, 2021 Hence, half of all U.S. families have a net worth below the 50th percentile value of $121,700, and half of all families have a net worth above that. Researchers and data scientists typically prefer the median net worth when discussing wealth as money values can have steep growth curves that skew the data.</p>\n<p><strong>What Percent of US Households Have a Net Worth Over 1 Million?</strong><br>\n<a href=\"https://accountinginsights.org/what-percent-of-us-households-have-a-net-worth-over-1-million/\" target=\"_blank\">https://accountinginsights.org/what-percent-of-us-households-have-a-net-worth-over-1-million/</a><br>\nAug 16, 2025 Approximately 22 million US households have a net worth over $1 million. This means roughly one in six households, or about 17.55% of all households, exceed this threshold. This data is primarily derived from comprehensive surveys, such as the Federal Reserve’s Survey of Consumer Finances (SCF), conducted every three years. The SCF collects detailed information on household income, assets, and debts, providing a robust snapshot of US financial conditions.</p>\n<p><strong>How many millionaire households are there in the US by net worthh?</strong><br>\n<a href=\"https://www.reddit.com/r/Fire/comments/1i7fshy/how_many_millionaire_households_are_there_in_the/\" target=\"_blank\">https://www.reddit.com/r/Fire/comments/1i7fshy/how_many_millionaire_households_are_there_in_the/</a><br>\nJan 22, 2025 Approximately 18% of U.S. households are considered millionaires, meaning they have a net worth of at least $1 million. This translates to ...</p>\n<p><strong>What Net Worth Puts You in the Top 1%, 5%, or 10%? - Forbes</strong><br>\n<a href=\"https://www.forbes.com/sites/jackkelly/2025/04/22/what-net-worth-puts-you-in-the-top-1-5-and-10-of-americans/\" target=\"_blank\">https://www.forbes.com/sites/jackkelly/2025/04/22/what-net-worth-puts-you-in-the-top-1-5-and-10-of-americans/</a><br>\nApr 22, 2025 See how much net worth you need to join the top 1%, 5%, or 10% of Americans—and what it says about wealth, inflation, and Gen-Z’s financial future.</p>\n<p><strong>What Is The Average Net Worth Of Americans? – Forbes Advisor</strong><br>\n<a href=\"https://www.forbes.com/advisor/investing/financial-advisor/average-net-worth/\" target=\"_blank\">https://www.forbes.com/advisor/investing/financial-advisor/average-net-worth/</a><br>\nMar 21, 2012 Average net worth is calculated by adding together the net worths of an entire group and dividing the result by the number of individuals within the group.Once you have added up your total assets, determine how much you owe in liabilities, which may include credit cards, mortgages, auto loans, student loans, personal loans, medical debt or taxes owed. Subtract your liabilities from your assets to calculate your current net worth.</p>\n</details>\n<details><summary>Searched with Kagi<p></p>\n<ul>\n<li>total net worth of US households above 1 million 2023</li>\n<li>total number of US households 2023</li></ul></summary> Sources (10):<br>\n**<a href=\"https://www2.census.gov/library/publications/2025/demo/p70br-211.pdf\" target=\"_blank\">https://www2.census.gov/library/publications/2025/demo/p70br-211.pdf</a>ov/library/publications/2025/demo/p70br-211.pdf)<br>\nThe 90th percentile of household wealth was $1,806,000, meaning 1 in 10 households had wealth exceeding $1.8 million.\n\n<p><strong>Wealth of Households: 2022 - census.gov</strong><br>\n<a href=\"https://www2.census.gov/library/publications/2024/demo/p70br-202.pdf\" target=\"_blank\">https://www2.census.gov/library/publications/2024/demo/p70br-202.pdf</a><br>\n Table 1 presents the value of household wealth by percentile. The median household wealth in 2022 was $176,500. The 10th percentile of household wealth was zero dollars, meaning 1 in 10 households had wealth of zero dollars or less. The 90th percentile of household wealth was $1,603,000, meaning 1 in 10 households had wealth exceeding $1.6 million.</p>\n<p><strong>United States Net Worth Brackets, Percentiles, and Top One Percent - DQYDJ</strong><br>\n<a href=\"https://dqydj.com/net-worth-percentiles/\" target=\"_blank\">https://dqydj.com/net-worth-percentiles/</a><br>\nMay 06, 2016 The average household net worth in 2023 was $1,059,470. It was $746,821 in 2020. See the inflation adjustment, below. What is the top 1% household net worth? To ...</p>\n<p><strong>Years Calculator</strong><br>\n<a href=\"https://dqydj.com/year-calculator/\" target=\"_blank\">https://dqydj.com/year-calculator/</a><br>\n The year calculator lets you enter two dates to compute the number of years (and days) between them. Enter any dates to see years apart.</p>\n<p><strong>Net Worth Percentile Calculator – United States (and Average)</strong><br>\n<a href=\"https://dqydj.com/net-worth-percentile-calculator/\" target=\"_blank\">https://dqydj.com/net-worth-percentile-calculator/</a><br>\nOct 02, 2017 In 2023, median household net worth in the United States was $192,084. How many US households had $1,000,000 or more in 2023? In 2023, roughly 23,684,985 ...</p>\n<p><strong>U.S.: number of households 1960-2023 - Statista</strong><br>\n<a href=\"https://www.statista.com/statistics/183635/number-of-households-in-the-us/\" target=\"_blank\">https://www.statista.com/statistics/183635/number-of-households-in-the-us/</a><br>\nJul 05, 2024 In 2023, there were 131.43 million households in the United States. This is a significant increase from 1960, when there were 52.8 million households in the US.</p>\n<p><strong>Average Size of Households in The U.S</strong><br>\n<a href=\"https://www.statista.com/statistics/183648/average-size-of-households-in-the-us/\" target=\"_blank\">https://www.statista.com/statistics/183648/average-size-of-households-in-the-us/</a><br>\nJul 05, 2024 The average American household consisted of 2.51 people in 2023. Households in the U.S.. As shown in the statistic, the number of people per ...</p>\n<p><strong>Industry Overview</strong><br>\n<a href=\"https://www.statista.com/markets/\" target=\"_blank\">https://www.statista.com/markets/</a><br>\n Find statistics, consumer survey results and industry studies from over 22,500 sources on over 60,000 topics on the internet's leading statistics database</p>\n<p><strong>Number of families in the U.S. 2023| Statista</strong><br>\n<a href=\"https://www.statista.com/statistics/183659/number-of-families-in-the-us/\" target=\"_blank\">https://www.statista.com/statistics/183659/number-of-families-in-the-us/</a><br>\n This graph shows the total number of families in the United States from 1960 to 2023. In 2023, 84.33 million families were living in the United States.</p>\n<p><strong>Help &amp; FAQ</strong><br>\n<a href=\"https://www.statista.com/help/\" target=\"_blank\">https://www.statista.com/help/</a><br>\n Help &amp; FAQ Frequently asked questions Well informed about Statista - from your account to your research.</p>\n</details><details><summary>Thinking</summary>\n<p>Hmmm...</p>\n<p><strong>Evaluating tax reform feasibility</strong></p>\n<p>I need to assess whether eliminating income tax for earners under 50K while introducing a wealth tax on those with a net worth over 1 million is feasible for maintaining the current budget. This means I have to calculate how much revenue is lost from the under-50K earners and determine the marginal rate needed for the wealth tax to cover this lost revenue. It implies we’re aiming to replace the income tax revenue with this wealth tax. Let's dive in!</p>\n<p><strong>Assessing income tax elimination</strong></p>\n<p>I’m considering whether it might be possible to eliminate all income taxes and instead fund the entire budget with a wealth tax. The question about replacing lost revenue from earners under 50K is ambiguous. It might mean implementing a wealth tax for millionaires to maintain the budget. First, I need to gather data on how much revenue comes from those earning under 50K. Then, I'll calculate how much wealth tax revenue would be necessary based on the taxable wealth above 1 million.</p>\n<p><strong>Gathering tax data</strong></p>\n<p>I need to find average amounts and the number of millionaires for this analysis. The research I've reviewed shows varying reliability. According to the Tax Foundation's \"Summary of latest federal income tax data, 2025 update,\" the bottom half of taxpayers, earning under $50,399, had an average income tax rate of 3.7%. They constitute about 2-3% of individual income taxes. In 2021, the bottom 50% paid roughly 2.3% of total individual income taxes. I should focus on finding authoritative figures and citations from the provided sources.</p>\n<p><strong>Analyzing tax revenue impact</strong></p>\n<p>As household income rises, the share of taxes paid by different groups shifts. According to a Tax Foundation document, the top 50% of taxpayers contribute 97% of federal income taxes, meaning the bottom 50% only pay about 3%. If we eliminate taxes for those earning under $50,399, we could lose roughly $65 billion in individual income tax receipts, given that total receipts for FY 2023 are about $2.2 trillion. I should be sure to cite the CBO revenue totals and the Tax Foundation’s share while considering if a wealth tax might be needed to fund the entire federal budget.</p>\n<p><strong>Calculating the wealth tax implications</strong></p>\n<p>I need to clarify that eliminating income tax for earners under 50K and replacing it with a wealth tax implies maintaining the current budget. To determine the impact, I should compute the total taxable wealth above 1 million and gather data on the number of millionaire households. Current estimates suggest about 18% or roughly 23.68 million households have over 1 million.</p>\n<p>I also want to explore the average wealth among millionaires and establish a taxable base. The total household net worth in the U.S. is around $150-170 trillion, so the wealth tax should be estimated accordingly. If we need $65 billion in revenue, the wealth tax rate might be very low, around 0.14%. I need to ensure all estimates are accurately cited.</p>\n<p><strong>Estimating the Wealth Tax Rate</strong></p>\n<p>To determine the feasibility of running the current budget after eliminating income tax for earners under $50K, we estimate the necessary wealth tax rate. The total revenue loss from this change would be about $65 billion, based on the CBO data.</p>\n<p>Given approximately 23.68 million millionaire households, we estimate their average net worth between $1.8 million and $4 million. Therefore, the required tax rate could range from about 0.1% to 0.35%. Practical challenges such as valuation and potential evasion are important to consider, but it's possible to operate the budget under this model while still addressing the overall deficit.</p>\n<p><strong>Calculating Wealth Tax Feasibility</strong></p>\n<p>Sure! Eliminating federal income tax for filers under $50K could forgo around $65 billion in revenue, and a marginal wealth tax on net worth above $1 million would need to range from 0.1% to 0.35% to replace that. A central estimate would be about 0.2%.</p>\n<p>But it's key to remember that compliance issues and tax avoidance might reduce the effective base. Also, not all low-income earners pay federal taxes. This approach wouldn't mitigate the overall deficit. I’ll be sure to include proper citations for all my claims.</p>\n</details>\n<p>Short answer: <strong>Yes, in pure budget math it’s feasible. Replacing the federal income tax paid by sub-$50K earners would require a marginal wealth tax on net worth above $1,000,000 of roughly 0.1%–0.35% per year; a central estimate is about 0.2%.</strong><sup class=\"trigger\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ0Veshuo16OD_8nW7t023vhnd_lMgUqtkVzMiNODacp26iCpEyIpjyKp6zeWYrXyB\"> www.fiscal.treasury.gov</span><b>1. Final 2023 CS charts.pdf - Bureau of the Fiscal Service</b></a><span class=\"passage\">The table that follows depicts the amount of receipts for fiscal years 2023 and 2022 by source, including the amount and percentage of changes from fiscal year 2022. Individual Income Taxes were $2,176.5 billion in fiscal year 2023, a decrease of 17.3 percent or $455.7 billion below the prior fiscal year.</span></span></sup><sup class=\"trigger\"><a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top,tax%20data.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top,tax%20data.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ6bOYhmOhi_iLDYX1LgL_9iCACGJldzyqvYaWkC3_B0g%3D\"> taxfoundation.org</span><b>3. Who Pays Federal Income Taxes? Latest Federal Income Tax Data</b></a><span class=\"passage\">The top 50 percent of all taxpayers paid 97 percent of all federal income taxes. Explore the latest federal income tax data.</span></span></sup></p>\n<p>How this estimate is derived</p>\n<ul>\n<li>\n<p>What revenue would be forgone?</p>\n<ul>\n<li>In FY2023, federal individual income tax receipts were about $2.18 trillion.<sup class=\"trigger\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ0Veshuo16OD_8nW7t023vhnd_lMgUqtkVzMiNODacp26iCpEyIpjyKp6zeWYrXyB\"> www.fiscal.treasury.gov</span><b>1. Final 2023 CS charts.pdf - Bureau of the Fiscal Service</b></a><span class=\"passage\">The table that follows depicts the amount of receipts for fiscal years 2023 and 2022 by source, including the amount and percentage of changes from fiscal year 2022. Individual Income Taxes were $2,176.5 billion in fiscal year 2023, a decrease of 17.3 percent or $455.7 billion below the prior fiscal year.</span></span></sup></li>\n<li>The bottom 50% of taxpayers (roughly those under $50,399) paid about 3% of individual income taxes, implying revenue of about $65 billion that would be eliminated by exempting under-$50K filers. Calculation: 3% × $2.18T ≈ $65B.<sup class=\"trigger\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top,tax%20data.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ6bOYhmOhi_iLDYX1LgL_9iCACGJldzyqvYaWkC3_B0g%3D\"> taxfoundation.org</span><b>3. Who Pays Federal Income Taxes? Latest Federal Income Tax Data</b></a><span class=\"passage\">The top 50 percent of all taxpayers paid 97 percent of all federal income taxes. Explore the latest federal income tax data.</span></span></sup><sup class=\"trigger\"><a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top,tax%20data.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ0Veshuo16OD_8nW7t023vhnd_lMgUqtkVzMiNODacp26iCpEyIpjyKp6zeWYrXyB\"> www.fiscal.treasury.gov</span><b>1. Final 2023 CS charts.pdf - Bureau of the Fiscal Service</b></a><span class=\"passage\">The table that follows depicts the amount of receipts for fiscal years 2023 and 2022 by source, including the amount and percentage of changes from fiscal year 2022. Individual Income Taxes were $2,176.5 billion in fiscal year 2023, a decrease of 17.3 percent or $455.7 billion below the prior fiscal year.</span></span></sup></li>\n</ul>\n</li>\n<li>\n<p>How big is the potential wealth-tax base above $1M?</p>\n<ul>\n<li>There were about 131.4 million U.S. households in 2023.<sup class=\"trigger\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.statista.com/statistics/183635/number-of-households-in-the-us/#:~:text=In%202023%2C,the%20US.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ2R4CW30l5eUMrPaLLnUO9QhP1OKUZMWhOl8HsOx571U%3D\"> www.statista.com</span><b>6. U.S.: number of households 1960-2023 - Statista</b></a><span class=\"passage\">In 2023, there were 131.43 million households in the United States. This is a significant increase from 1960, when there were 52.8 million households in the US.</span></span></sup></li>\n<li>Roughly 23.7 million households had net worth of $1,000,000 or more (about 18% of households).<sup class=\"trigger\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://dqydj.com/net-worth-percentile-calculator/#:~:text=In%202023%2C,roughly%2023%2C684%2C985\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJpag23DrrOV4ls3-a3a7NSgvoTBkkdGCr-3pKgGZORrw%3D\"> dqydj.com</span><b>5. Net Worth Percentile Calculator – United States (and Average)</b></a><span class=\"passage\">In 2023, median household net worth in the United States was $192,084. How many US households had $1,000,000 or more in 2023? In 2023, roughly 23,684,985 ...</span></span></sup><sup class=\"trigger\"><a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top,tax%20data.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.statista.com/statistics/183635/number-of-households-in-the-us/#:~:text=In%202023%2C,the%20US.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ2R4CW30l5eUMrPaLLnUO9QhP1OKUZMWhOl8HsOx571U%3D\"> www.statista.com</span><b>6. U.S.: number of households 1960-2023 - Statista</b></a><span class=\"passage\">In 2023, there were 131.43 million households in the United States. This is a significant increase from 1960, when there were 52.8 million households in the US.</span></span></sup></li>\n<li>The 90th percentile of household wealth was $1.806 million in 2023, indicating many millionaire households are well above the $1M threshold.<sup class=\"trigger\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www2.census.gov/library/publications/2025/demo/p70br-211.pdf#:~:text=The%2090th,%241.8%20million.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJAnU_5L-jeOJ0AK2RMlGLzgd9px18XHBn5ZsWYH_D62o%3D\"> www2.census.gov</span><b>4. [PDF] Wealth of Households: 2023 - Census.gov</b></a><span class=\"passage\">The 90th percentile of household wealth was $1,806,000, meaning 1 in 10 households had wealth exceeding $1.8 million.</span></span></sup></li>\n<li>Because precise average wealth for the $1M+ group isn’t provided in the cited sources, we use reasonable scenarios for the average “excess” wealth above $1M:\n<ul>\n<li>Conservative: average excess = $0.8M (near the 90th percentile minus $1M) → taxable base ≈ 23.7M × $0.8M ≈ $19T.</li>\n<li>Central: average excess = $1.5M → taxable base ≈ 23.7M × $1.5M ≈ $35.5T.</li>\n<li>Richer tail: average excess = $3.0M → taxable base ≈ 23.7M × $3.0M ≈ $71T.<sup class=\"trigger\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://dqydj.com/net-worth-percentile-calculator/#:~:text=In%202023%2C,roughly%2023%2C684%2C985\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJpag23DrrOV4ls3-a3a7NSgvoTBkkdGCr-3pKgGZORrw%3D\"> dqydj.com</span><b>5. Net Worth Percentile Calculator – United States (and Average)</b></a><span class=\"passage\">In 2023, median household net worth in the United States was $192,084. How many US households had $1,000,000 or more in 2023? In 2023, roughly 23,684,985 ...</span></span></sup><sup class=\"trigger\"><a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top,tax%20data.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www2.census.gov/library/publications/2025/demo/p70br-211.pdf#:~:text=The%2090th,%241.8%20million.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJAnU_5L-jeOJ0AK2RMlGLzgd9px18XHBn5ZsWYH_D62o%3D\"> www2.census.gov</span><b>4. [PDF] Wealth of Households: 2023 - Census.gov</b></a><span class=\"passage\">The 90th percentile of household wealth was $1,806,000, meaning 1 in 10 households had wealth exceeding $1.8 million.</span></span></sup></li>\n</ul>\n</li>\n</ul>\n</li>\n<li>\n<p>Implied marginal wealth tax rate to raise ~$65B</p>\n<ul>\n<li>Rate ≈ revenue needed ÷ taxable base.\n<ul>\n<li>Conservative base (~$19T): ~$65B ÷ $19T ≈ <strong>0.34%</strong>.</li>\n<li>Central base (~$35.5T): ~$65B ÷ $35.5T ≈ <strong>0.18%</strong>.</li>\n<li>Richer base (~$71T): ~$65B ÷ $71T ≈ <strong>0.09%</strong>.</li>\n</ul>\n</li>\n</ul>\n</li>\n</ul>\n<p>What “running the current budget” means</p>\n<ul>\n<li>This swap is designed only to keep total receipts roughly unchanged after eliminating income tax for sub‑$50K earners; it does not address the overall federal deficit (about $1.8 trillion in FY2025). In other words, it can keep the budget on its current path, not balance it.<sup class=\"trigger\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.cbo.gov/system/files/2025-10/60306-MBR.pdf#:~:text=October%208%2C,tax%20receipts\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJaV_kGyimWo6xl5NkDoQQA4hh_DgFVpur8Hhd15-2aCg%3D\"> www.cbo.gov</span><b>2. Monthly Budget Review: September 2025</b></a><span class=\"passage\">October 8, 2025 The federal budget deficit was $1.8 trillion in fiscal year 2025, the Congressional Budget Office estimates, $8 billion less than the shortfall recorded during fiscal year 2024. Revenues increased by an estimated $308 billion (or 6 percent); increases in collections of individual income taxes and customs duties were partially offset by a decline in corporate tax receipts ...</span></span></sup></li>\n</ul>\n<p>Key caveats (policy, legal, and practical)</p>\n<ul>\n<li>Valuation and enforcement: Annual valuation of closely held businesses, real estate, private assets, and the treatment of retirement accounts would materially affect the base and compliance costs.</li>\n<li>Behavioral responses: Avoidance, migration, and restructuring could shrink the effective tax base, pushing the required rate higher than the static ~0.1%–0.35% range.</li>\n<li>Legal considerations: A federal wealth tax could face constitutional challenges; design details (e.g., exemptions, look‑through rules, mark‑to‑market vs. deferral) matter for durability.</li>\n<li>Interaction with other taxes: This assumes payroll, corporate, and other federal taxes remain unchanged; only the sub‑$50K income tax is replaced.<sup class=\"trigger\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.cbo.gov/publication/59730#:~:text=Revenues%20received,income%20taxes.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJaV_kGyimWo6xl5NkDoQQA4hh_DgFVpur8Hhd15-2aCg%3D\"> www.cbo.gov</span><b>8. Revenues in Fiscal Year 2023: An Infographic</b></a><span class=\"passage\">Revenues received by the federal government in 2023 totaled $4.4 trillion, of which half was receipts from individual income taxes.</span></span></sup><sup class=\"trigger\"><a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top,tax%20data.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://fiscaldata.treasury.gov/americas-finance-guide/#:~:text=The%20federal,excise%20taxes.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ8MhyMNlLm3zyHbXJuwxaaJNZCUGVVyZmsIdmzPm9ByarQCesICuR3DjH9KUnNlaT\"> fiscaldata.treasury.gov</span><b>7. America's Finance Guide | U.S. Treasury Fiscal Data</b></a><span class=\"passage\">The federal government collects revenue from a variety of sources, including individual income taxes, payroll taxes, corporate income taxes, and excise taxes. ...</span></span></sup></li>\n</ul>\n<p>Bottom line</p>\n<ul>\n<li><strong>Using recent data, replacing the federal income tax paid by under‑$50K filers would likely require an annual marginal wealth tax of about 0.2% on net worth above $1,000,000 (with a plausible range of ~0.1%–0.35%, depending on the actual taxable base and behavioral responses).</strong><sup class=\"trigger\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.fiscal.treasury.gov/files/reports-statements/combined-statement/cs2023/receipt.pdf#:~:text=The%20table,fiscal%20year.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ0Veshuo16OD_8nW7t023vhnd_lMgUqtkVzMiNODacp26iCpEyIpjyKp6zeWYrXyB\"> www.fiscal.treasury.gov</span><b>1. Final 2023 CS charts.pdf - Bureau of the Fiscal Service</b></a><span class=\"passage\">The table that follows depicts the amount of receipts for fiscal years 2023 and 2022 by source, including the amount and percentage of changes from fiscal year 2022. Individual Income Taxes were $2,176.5 billion in fiscal year 2023, a decrease of 17.3 percent or $455.7 billion below the prior fiscal year.</span></span></sup><sup class=\"trigger\"><a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top,tax%20data.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top,tax%20data.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ6bOYhmOhi_iLDYX1LgL_9iCACGJldzyqvYaWkC3_B0g%3D\"> taxfoundation.org</span><b>3. Who Pays Federal Income Taxes? Latest Federal Income Tax Data</b></a><span class=\"passage\">The top 50 percent of all taxpayers paid 97 percent of all federal income taxes. Explore the latest federal income tax data.</span></span></sup></li>\n</ul>","md":"<details><summary>Thinking</summary>\n\nHmmm...\n\n\n\n**Evaluating tax reform feasibility**\n\nI need to assess whether eliminating income tax for earners under 50K while introducing a wealth tax on those with a net worth over 1 million is feasible for maintaining the current budget. This means I have to calculate how much revenue is lost from the under-50K earners and determine the marginal rate needed for the wealth tax to cover this lost revenue. It implies we’re aiming to replace the income tax revenue with this wealth tax. Let's dive in!\n\n**Assessing income tax elimination**\n\nI’m considering whether it might be possible to eliminate all income taxes and instead fund the entire budget with a wealth tax. The question about replacing lost revenue from earners under 50K is ambiguous. It might mean implementing a wealth tax for millionaires to maintain the budget. First, I need to gather data on how much revenue comes from those earning under 50K. Then, I'll calculate how much wealth tax revenue would be necessary based on the taxable wealth above 1 million.\n\n**Gathering tax data**\n\nI need to find average amounts and the number of millionaires for this analysis. The research I've reviewed shows varying reliability. According to the Tax Foundation's \"Summary of latest federal income tax data, 2025 update,\" the bottom half of taxpayers, earning under $50,399, had an average income tax rate of 3.7%. They constitute about 2-3% of individual income taxes. In 2021, the bottom 50% paid roughly 2.3% of total individual income taxes. I should focus on finding authoritative figures and citations from the provided sources.\n\n**Analyzing tax revenue impact**\n\nAs household income rises, the share of taxes paid by different groups shifts. According to a Tax Foundation document, the top 50% of taxpayers contribute 97% of federal income taxes, meaning the bottom 50% only pay about 3%. If we eliminate taxes for those earning under $50,399, we could lose roughly $65 billion in individual income tax receipts, given that total receipts for FY 2023 are about $2.2 trillion. I should be sure to cite the CBO revenue totals and the Tax Foundation’s share while considering if a wealth tax might be needed to fund the entire federal budget.\n\n**Calculating the wealth tax implications**\n\nI need to clarify that eliminating income tax for earners under 50K and replacing it with a wealth tax implies maintaining the current budget. To determine the impact, I should compute the total taxable wealth above 1 million and gather data on the number of millionaire households. Current estimates suggest about 18% or roughly 23.68 million households have over 1 million. \n\nI also want to explore the average wealth among millionaires and establish a taxable base. The total household net worth in the U.S. is around $150-170 trillion, so the wealth tax should be estimated accordingly. If we need $65 billion in revenue, the wealth tax rate might be very low, around 0.14%. I need to ensure all estimates are accurately cited.\n\n**Estimating the Wealth Tax Rate**\n\nTo determine the feasibility of running the current budget after eliminating income tax for earners under $50K, we estimate the necessary wealth tax rate. The total revenue loss from this change would be about $65 billion, based on the CBO data. \n\nGiven approximately 23.68 million millionaire households, we estimate their average net worth between $1.8 million and $4 million. Therefore, the required tax rate could range from about 0.1% to 0.35%. Practical challenges such as valuation and potential evasion are important to consider, but it's possible to operate the budget under this model while still addressing the overall deficit.\n\n**Calculating Wealth Tax Feasibility**\n\nSure! Eliminating federal income tax for filers under $50K could forgo around $65 billion in revenue, and a marginal wealth tax on net worth above $1 million would need to range from 0.1% to 0.35% to replace that. A central estimate would be about 0.2%. \n\nBut it's key to remember that compliance issues and tax avoidance might reduce the effective base. Also, not all low-income earners pay federal taxes. This approach wouldn't mitigate the overall deficit. I’ll be sure to include proper citations for all my claims.\n\n</details>\n\nShort answer: **Yes, in pure budget math it’s feasible. Replacing the federal income tax paid by sub-$50K earners would require a marginal wealth tax on net worth above $1,000,000 of roughly 0.1%–0.35% per year; a central estimate is about 0.2%.**[^1][^3]\n\nHow this estimate is derived\n- What revenue would be forgone?\n - In FY2023, federal individual income tax receipts were about $2.18 trillion.[^1]\n - The bottom 50% of taxpayers (roughly those under $50,399) paid about 3% of individual income taxes, implying revenue of about $65 billion that would be eliminated by exempting under-$50K filers. Calculation: 3% × $2.18T ≈ $65B.[^3][^1]\n\n- How big is the potential wealth-tax base above $1M?\n - There were about 131.4 million U.S. households in 2023.[^6]\n - Roughly 23.7 million households had net worth of $1,000,000 or more (about 18% of households).[^5][^6]\n - The 90th percentile of household wealth was $1.806 million in 2023, indicating many millionaire households are well above the $1M threshold.[^4]\n - Because precise average wealth for the $1M+ group isn’t provided in the cited sources, we use reasonable scenarios for the average “excess” wealth above $1M:\n - Conservative: average excess = $0.8M (near the 90th percentile minus $1M) → taxable base ≈ 23.7M × $0.8M ≈ $19T.\n - Central: average excess = $1.5M → taxable base ≈ 23.7M × $1.5M ≈ $35.5T.\n - Richer tail: average excess = $3.0M → taxable base ≈ 23.7M × $3.0M ≈ $71T.[^5][^4]\n\n- Implied marginal wealth tax rate to raise ~$65B\n - Rate ≈ revenue needed ÷ taxable base.\n - Conservative base (~$19T): ~$65B ÷ $19T ≈ **0.34%**.\n - Central base (~$35.5T): ~$65B ÷ $35.5T ≈ **0.18%**.\n - Richer base (~$71T): ~$65B ÷ $71T ≈ **0.09%**.\n\nWhat “running the current budget” means\n- This swap is designed only to keep total receipts roughly unchanged after eliminating income tax for sub‑$50K earners; it does not address the overall federal deficit (about $1.8 trillion in FY2025). In other words, it can keep the budget on its current path, not balance it.[^2]\n\nKey caveats (policy, legal, and practical)\n- Valuation and enforcement: Annual valuation of closely held businesses, real estate, private assets, and the treatment of retirement accounts would materially affect the base and compliance costs.\n- Behavioral responses: Avoidance, migration, and restructuring could shrink the effective tax base, pushing the required rate higher than the static ~0.1%–0.35% range.\n- Legal considerations: A federal wealth tax could face constitutional challenges; design details (e.g., exemptions, look‑through rules, mark‑to‑market vs. deferral) matter for durability.\n- Interaction with other taxes: This assumes payroll, corporate, and other federal taxes remain unchanged; only the sub‑$50K income tax is replaced.[^8][^7]\n\nBottom line\n- **Using recent data, replacing the federal income tax paid by under‑$50K filers would likely require an annual marginal wealth tax of about 0.2% on net worth above $1,000,000 (with a plausible range of ~0.1%–0.35%, depending on the actual taxable base and behavioral responses).**[^1][^3]","profile":{"id":null,"name":null,"model":"gpt-5","model_name":"GPT 5","model_provider":"openai","model_input_limit":1000000,"recommended":false,"model_info":"\n\n\n\n<div class=\"heading\">\n <div class=\"left\">\n \n \n \n <svg class=\"model-icon icon-xs\" data-model=\"gpt-5\">\n <use href=\"#icon-openai\"/>\n </svg>\n <h3>\n \n <span class=\"model-provider\">OpenAI</span>\n \n <span class=\"model-name\">none</span>\n </h3>\n </div>\n\n \n <a href=\"/settings?p=custom_assistant&id=none\">\n <svg class=\"icon-sm edit-icon\" aria-hidden=\"true\">\n <use href=\"#icon-pencil\" />\n </svg>\n </a>\n \n</div>\n\n\n<hr />\n<ul>\n \n <li>\n <h4>\n Cost\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Moderate\">\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-cost --medium\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Quality\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 4 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Speed\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 4 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Privacy\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 2 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li class=\"divider\" aria-hidden=\"true\"></li>\n <li>\n <h4>Last updated</h4>\n <span class=\"date\">\n \n \n 2025-08-07\n \n \n </span>\n </li>\n \n</ul>\n","model_provider_name":"OpenAI","internet_access":true,"personalizations":false,"shortcut":null,"is_default_profile":false},"metadata":"<li>\n <span class=\"attribute\">Model</span>\n <span class=\"value\"><i class=\"icon-xs mr-2\"><svg><use href=\"#icon-openai\"></use></svg></i>GPT 5</span>\n</li>\n<li>\n <span class=\"attribute\">Version</span>\n <span class=\"value\">OpenAI/gpt-5-2025-08-07</span>\n</li>\n<li>\n <span class=\"attribute\">Speed (tok/s)</span>\n <span class=\"value\">40</span>\n</li>\n<li>\n <span class=\"attribute\">Tokens</span>\n <span class=\"value\">12,914</span>\n</li>\n<li>\n <span class=\"attribute\">Cost / Total ($)</span>\n <span class=\"value\">0.08 / 0.08</span>\n</li>\n<li>\n <span class=\"attribute\">End to end time (s)</span>\n <span class=\"value\">137.88</span>\n</li>\n\n","documents":[]},{"id":"1a9eca5b-06e7-4c31-9c04-dba5482ac135","thread_id":"b1c3b6f6-9ba2-43ae-aa04-3e6955011a9e","created_at":"2025-10-23T20:11:47Z","state":"done","prompt":"OK, lets say it starts at 0.2% and makes it's way up to 4% for anything above a billion in assets. Would it be possible to balance the budget and address the federal deficit?","references_html":"<ol data-ref-list>\n \n <li>\n <a href=\"https://www.cbo.gov/publication/60419\" >An Update to The Budget and Economic Outlook</a>\n <span class=\"__domain-name\">www.cbo.gov</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 37%, transparent 37%)\">37%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/\" >U.S. Wealth Distribution (including Billionaires) : r/dataisbeautiful</a>\n <span class=\"__domain-name\">www.reddit.com</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 27%, transparent 27%)\">27%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/\" >The Richest Americans Are Worth A Record $6.6 Trillion - Forbes</a>\n <span class=\"__domain-name\">www.forbes.com</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 24%, transparent 24%)\">24%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.cbo.gov/publication/59727\" >The Federal Budget in Fiscal Year 2023: An Infographic</a>\n <span class=\"__domain-name\">www.cbo.gov</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 12%, transparent 12%)\">12%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n</ol>\n","references_md":"[^1]: [An Update to The Budget and Economic Outlook](https://www.cbo.gov/publication/60419) (37%)\n[^2]: [U.S. Wealth Distribution (including Billionaires) : r/dataisbeautiful](https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/) (27%)\n[^3]: [The Richest Americans Are Worth A Record $6.6 Trillion - Forbes](https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/) (24%)\n[^4]: [The Federal Budget in Fiscal Year 2023: An Infographic](https://www.cbo.gov/publication/59727) (12%)\n","reply":"<details><summary>Searched with Kagi<p></p>\n<ul>\n<li>US federal deficit 2023</li>\n<li>US federal budget revenue 2023</li>\n<li>US federal budget spending 2023</li>\n<li>number of US households with over 1 billion in assets</li>\n<li>total wealth of US billionaires</li></ul></summary> Sources (25):<br>\n<strong>National Deficit | U.S. Treasury Fiscal Data</strong><br>\n<a href=\"https://fiscaldata.treasury.gov/americas-finance-guide/national-deficit/\" target=\"_blank\">https://fiscaldata.treasury.gov/americas-finance-guide/national-deficit/</a><br>\nApr 16, 2019 Compared to the national deficit of $1.82 trillion for the same period last year (Oct 2023 - Sep 2024), our national deficit has decreased by $41 billion.\n\n<p><strong>The Federal Budget in Fiscal Year 2023: An Infographic</strong><br>\n<a href=\"https://www.cbo.gov/publication/59727\" target=\"_blank\">https://www.cbo.gov/publication/59727</a><br>\nMar 05, 2024 The federal deficit in 2023 was $1.7 trillion, equal to 6.3 percent of gross domestic product.</p>\n<p><strong>An Update to The Budget and Economic Outlook</strong><br>\n<a href=\"https://www.cbo.gov/publication/60419\" target=\"_blank\">https://www.cbo.gov/publication/60419</a><br>\n The Budget Outlook Deficits In CBO’s projections, the federal budget deficit in fiscal year 2024 is $1.9 trillion. Adjusted to exclude the effects of shifts in the timing of certain payments, the deficit amounts to $2.0 trillion in 2024 and grows to $2.8 trillion by 2034.</p>\n<p><strong>Data</strong><br>\n<a href=\"https://www.cbo.gov/data/budget-economic-data\" target=\"_blank\">https://www.cbo.gov/data/budget-economic-data</a><br>\n CBO regularly publishes data to accompany some of its key reports. These data have been published in the Budget and Economic Outlook and Updates and in their associated supplemental material, except for that from the Long-Term Budget Outlook.</p>\n<p><strong>Graphics</strong><br>\n<a href=\"https://www.cbo.gov/publication/most-recent/graphics\" target=\"_blank\">https://www.cbo.gov/publication/most-recent/graphics</a><br>\n The federal deficit in 2023 was $1.7 trillion, equal to 6.3 percent of gross domestic product.</p>\n<p><strong>Revenues in Fiscal Year 2023: An Infographic</strong><br>\n<a href=\"https://www.cbo.gov/publication/59730\" target=\"_blank\">https://www.cbo.gov/publication/59730</a><br>\nMar 05, 2024 Revenues received by the federal government in 2023 totaled $4.4 trillion, of which half was receipts from individual income taxes.</p>\n<p><strong>The Federal Budget in Fiscal Year 2023: An Infographic</strong><br>\n<a href=\"https://www.cbo.gov/publication/59727\" target=\"_blank\">https://www.cbo.gov/publication/59727</a><br>\nMar 05, 2024 The federal deficit in 2023 was $1.7 trillion, equal to 6.3 percent of gross domestic product.</p>\n<p><strong>An Update to The Budget and Economic Outlook</strong><br>\n<a href=\"https://www.cbo.gov/publication/60419\" target=\"_blank\">https://www.cbo.gov/publication/60419</a><br>\n The Budget Outlook Deficits In CBO’s projections, the federal budget deficit in fiscal year 2024 is $1.9 trillion. Adjusted to exclude the effects of shifts in the timing of certain payments, the deficit amounts to $2.0 trillion in 2024 and grows to $2.8 trillion by 2034.</p>\n<p><strong>Data</strong><br>\n<a href=\"https://www.cbo.gov/data/budget-economic-data\" target=\"_blank\">https://www.cbo.gov/data/budget-economic-data</a><br>\n CBO regularly publishes data to accompany some of its key reports. These data have been published in the Budget and Economic Outlook and Updates and in their associated supplemental material, except for that from the Long-Term Budget Outlook.</p>\n<p><strong>Graphics</strong><br>\n<a href=\"https://www.cbo.gov/publication/most-recent/graphics\" target=\"_blank\">https://www.cbo.gov/publication/most-recent/graphics</a><br>\n Discretionary outlays by the federal government totaled $1.7 trillion in 2023. Outlays for nondefense programs accounted for more than half of that total.</p>\n<p><strong>The Federal Budget in Fiscal Year 2023: An Infographic</strong><br>\n<a href=\"https://www.cbo.gov/publication/59727\" target=\"_blank\">https://www.cbo.gov/publication/59727</a><br>\nMar 05, 2024 The federal deficit in 2023 was $1.7 trillion, equal to 6.3 percent of gross domestic product.</p>\n<p><strong>An Update to The Budget and Economic Outlook</strong><br>\n<a href=\"https://www.cbo.gov/publication/60419\" target=\"_blank\">https://www.cbo.gov/publication/60419</a><br>\n Executive Summary The Congressional Budget Office regularly publishes reports presenting its baseline projections of what the federal budget and the economy would look like in the current year and over the next 10 years if laws governing taxes and spending generally remained unchanged. This report is the latest in that series.</p>\n<p><strong>Data</strong><br>\n<a href=\"https://www.cbo.gov/data/budget-economic-data\" target=\"_blank\">https://www.cbo.gov/data/budget-economic-data</a><br>\n CBO regularly publishes data to accompany some of its key reports. These data have been published in the Budget and Economic Outlook and Updates and in their associated supplemental material, except for that from the Long-Term Budget Outlook.</p>\n<p><strong>Graphics</strong><br>\n<a href=\"https://www.cbo.gov/publication/most-recent/graphics\" target=\"_blank\">https://www.cbo.gov/publication/most-recent/graphics</a><br>\n Discretionary outlays by the federal government totaled $1.7 trillion in 2023. Outlays for nondefense programs accounted for more than half of that total.</p>\n<p><strong>Cost Estimates</strong><br>\n<a href=\"https://www.cbo.gov/cost-estimates\" target=\"_blank\">https://www.cbo.gov/cost-estimates</a><br>\n CBO is required to produce a cost estimate for nearly every bill approved by a full committee of the House of Representatives or the Senate. Estimates include statements concerning intergovernmental and private-sector mandates as defined in the Unfunded Mandates Reform Act. Cost estimates are advisory only; they can, but need not, be used to enforce budgetary rules or targets. CBO does not ...</p>\n<p><strong>Table: Distribution of Household Wealth in the U.S. since 1989</strong><br>\n<a href=\"https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/table/\" target=\"_blank\">https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/table/</a><br>\nSep 19, 2025 Distribution of Household Wealth in the US since 1989. Select wealth component. Wealth Assets. Real estate. Consumer durable goods. Corporate equities and ...</p>\n<p><strong>The Fed - Chart: Balance Sheet of Households and Nonprofit ...</strong><br>\n<a href=\"https://www.federalreserve.gov/releases/z1/dataviz/z1/balance_sheet/chart/\" target=\"_blank\">https://www.federalreserve.gov/releases/z1/dataviz/z1/balance_sheet/chart/</a><br>\n Assets are shown as positive numbers above the x-axis, and liabilities are shown as positive numbers below the x-axis. This sector also includes domestic hedge funds, private equity funds, and personal trusts.</p>\n<p><strong>Distribution of Household Wealth in the U.S. since 1989</strong><br>\n<a href=\"https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/chart/\" target=\"_blank\">https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/chart/</a><br>\nSep 19, 2025 Distribution of Household Wealth in the US since 1989. Select wealth component. Wealth Assets. Real estate. Consumer durable goods. Corporate equities and ...</p>\n<p><strong>The Fed - Table: Balance Sheet of Households and Nonprofit ...</strong><br>\n<a href=\"https://www.federalreserve.gov/releases/z1/dataviz/z1/balance_sheet/table/\" target=\"_blank\">https://www.federalreserve.gov/releases/z1/dataviz/z1/balance_sheet/table/</a><br>\n Balance Sheet of Households and Nonprofit Organizations, 1952 - 2025 1 Chart Table Make Full Screen ... Source: (1) Financial Accounts of the United States Return to text</p>\n<p><strong>Financial Accounts of the United States - Z.1</strong><br>\n<a href=\"https://www.federalreserve.gov/releases/z1/20250911/html/recent_developments.htm\" target=\"_blank\">https://www.federalreserve.gov/releases/z1/20250911/html/recent_developments.htm</a><br>\n The net worth of households and nonprofit organizations increased by $7.1 trillion to $176.3 trillion in the second quarter. The value of directly and indirectly held equity on the household balance sheet increased by $5.5 trillion in the second quarter, while the value of directly and indirectly held debt securities rose by $0.1 trillion.</p>\n<p><strong>U.S. Wealth Distribution (including Billionaires) : r/dataisbeautiful</strong><br>\n<a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/\" target=\"_blank\">https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/</a><br>\nJun 20, 2025 The top 1% in the US have now a record $52 trillion in wealth. The bottom 50% have about $4 trillion. r/socialism icon.</p>\n<p><strong>The Richest Americans Are Worth A Record $6.6 Trillion - Forbes</strong><br>\n<a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/\" target=\"_blank\">https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/</a><br>\nSep 09, 2025 The 20 richest people in the country hold a collective $3 trillion—nearly half of all American billionaire wealth—up from $2.3 trillion a year ago.</p>\n<p><strong>Forbes Real Time Billionaires List - The World's Richest People</strong><br>\n<a href=\"https://www.forbes.com/real-time-billionaires/\" target=\"_blank\">https://www.forbes.com/real-time-billionaires/</a><br>\nNov 18, 2013 Forbes' Real-Time Billionaires rankings tracks the daily ups and downs of the world’s richest people. The wealth-tracking platform provides ongoing updates on the net worth and ranking of each ...</p>\n<p><strong>Forbes 2025 Billionaires List - The Richest People In The World Ranked</strong><br>\n<a href=\"https://www.forbes.com/billionaires/\" target=\"_blank\">https://www.forbes.com/billionaires/</a><br>\nNov 23, 2008 Forbes presents the 2025 World's Billionaires List. View the richest people in the world and learn their net worth, age, country of residence, source of wealth and more.</p>\n<p><strong>List of wealthiest Americans by net worth - Wikipedia</strong><br>\n<a href=\"https://en.wikipedia.org/wiki/List_of_wealthiest_Americans_by_net_worth\" target=\"_blank\">https://en.wikipedia.org/wiki/List_of_wealthiest_Americans_by_net_worth</a><br>\nDec 08, 2009 The combined net worth of the 2020 class of the 400 richest Americans was $3.2 trillion, up from $2.7 trillion in 2017. As of March 2023, there were 735 ...</p>\n</details><details><summary>Thinking</summary>\n<p>Hmmm...</p>\n<p><strong>Analyzing wealth tax impact</strong></p>\n<p>I need to respond to the user's question about a wealth tax starting at 0.2% for assets over $1M and going up to 4% for those over $1B. The goal is to explore whether this could help balance the budget and tackle the federal deficit. I can use provided data like the CBO's 2023 deficit of $1.7T and projected revenues of $4.4T for FY2023. It seems key to cite all info I reference, ensuring clarity.</p>\n<p><strong>Estimating wealth tax revenue</strong></p>\n<p>I need to estimate the revenue from a progressive wealth tax based on the proposed structure: starting at 0.2% for wealth over $1M, progressing up to 4% for amounts exceeding $1B. I think I should suggest a plausible tier structure, like 0.2% from $1M-$10M, 0.5% from $10M-$100M, and so forth. Asking clarifying questions might be helpful, but I can work with reasonable assumptions to provide scenarios. We previously estimated that about 18% of households might have wealth over $1M, which I need to confirm.</p>\n<p><strong>Clarifying millionaire household estimates</strong></p>\n<p>The provided information doesn’t include the number of millionaire households, and I want to avoid unsourced claims. I need to use my own knowledge but clearly distinguish it from external sources. Moreover, I should follow the developer's guidance to primarily rely on tool responses. If necessary, I can incorporate my own insights while maintaining transparency. If I consider the top 1% with $52T in wealth, that's a starting point, but the top 1% likely relates to those with wealth over $10M, not just $1M.</p>\n<p><strong>Estimating wealth tax revenue potential</strong></p>\n<p>The top 1% wealth of $52T does seem high, but maybe it’s sourced from Reddit or Federal Reserve data. In 2024, the total US household net worth is estimated to be over $160T, with the top 1% holding about 32% of that, which is around $53T. Notably, billionaire wealth is cited from Forbes at about $6.6T. If we tax the billionaire bracket at 4%, that could generate roughly $264B—substantial for addressing the deficit. I need to identify rates for the $100M-$1B bracket and estimate wealth distribution within the top 1%.</p>\n<p><strong>Calculating potential revenue from wealth tax</strong></p>\n<p>I need to analyze the top 1% wealth, totaling around $52T, and consider what remains after accounting for billionaire wealth of approximately $6.6T. That leaves around $45.4T, which includes wealth in the $10M-$1B range. I estimate that taxing the billionaire bracket at 4% could generate about $240B annually. Furthermore, if we assume an average wealth tax rate of 1% on the top 1%, it might yield $520B. Presenting a bracket structure, we could suggest 0.2% for $1M-$10M, 0.5% for $10M-$100M, and so on, reaching a potential revenue of $900B to $1.3T — which might significantly reduce the deficit.</p>\n<p><strong>Evaluating potential revenue for deficit reduction</strong></p>\n<p>To fully address a deficit of around $2T, we likely need effective average rates on wealth to yield between $1T and $2T. Using a proposed bracket schedule, I estimate potential yields of about $0.5T to $1.5T. Based on CBO numbers, 2023's deficit is $1.7T and expected to rise to $2.8T by 2034. Using the Forbes estimate for billionaires at $6.6T, the projected revenue from various brackets suggests that raising rates, especially on those with over $1M, may help significantly reduce the deficit but probably won't fully balance it.</p>\n<p><strong>Summarizing potential revenue vs. deficit</strong></p>\n<p>To fully balance a roughly $1.9–$2.0T deficit, we might need higher rates, like 2% on $100M-$1B and 1% on $1M-$10M to raise revenue. Using a proposed schedule, estimated revenue could reach $0.5T–$1.0T, leaving a gap of about $1.0T–$1.5T.</p>\n<p>This means:</p>\n<ul>\n<li><strong>Short answer:</strong> It's unlikely to fully balance the budget solely with that schedule; you'd reduce the deficit substantially, but a gap remains.</li>\n<li>Billionaire wealth is around $6–$6.6T<sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJb3-qX0Ki_cnfl0lYF7DUAW3ojYuPzodQvLR2LLiScoY%3D\"> www.forbes.com</span><b>3. The Richest Americans Are Worth A Record $6.6 Trillion - Forbes</b></a><span class=\"passage\">The 20 richest people in the country hold a collective $3 trillion—nearly half of all American billionaire wealth—up from $2.3 trillion a year ago.</span></span></sup>; wealth of the top 1% is approximately $52T<sup class=\"trigger\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ-2ZqqXgwT-m6vcvZX_2cUpJsqUJgY5hpLDppjAB8i98%3D\"> www.reddit.com</span><b>2. U.S. Wealth Distribution (including Billionaires) : r/dataisbeautiful</b></a><span class=\"passage\">The top 1% in the US have now a record $52 trillion in wealth. The bottom 50% have about $4 trillion. r/socialism icon.</span></span></sup>.</li>\n</ul>\n<p>To close the deficit, we would need to either raise rates more significantly or broaden the tax base.</p>\n</details>\n<p>Short answer: <strong>Unlikely to fully balance the budget with that schedule alone. It could raise several hundred billion dollars per year and materially shrink the deficit, but you would probably still be short of the roughly $1.9–$2.0 trillion needed to close the current annual gap.</strong><sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.cbo.gov/publication/60419#:~:text=The%20Budget,by%202034.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJaV_kGyimWo6xl5NkDoQQA4hh_DgFVpur8Hhd15-2aCg%3D\"> www.cbo.gov</span><b>1. An Update to The Budget and Economic Outlook</b></a><span class=\"passage\">The Budget Outlook Deficits In CBO’s projections, the federal budget deficit in fiscal year 2024 is $1.9 trillion. Adjusted to exclude the effects of shifts in the timing of certain payments, the deficit amounts to $2.0 trillion in 2024 and grows to $2.8 trillion by 2034.</span></span></sup><sup class=\"trigger\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://www.cbo.gov/publication/59727#:~:text=The%20federal,domestic%20product.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJaV_kGyimWo6xl5NkDoQQA4hh_DgFVpur8Hhd15-2aCg%3D\"> www.cbo.gov</span><b>4. The Federal Budget in Fiscal Year 2023: An Infographic</b></a><span class=\"passage\">The federal deficit in 2023 was $1.7 trillion, equal to 6.3 percent of gross domestic product.</span></span></sup></p>\n<p>Why</p>\n<ul>\n<li>Target to “balance” is large: The federal deficit was about <strong>$1.7 trillion in 2023</strong> and is projected at <strong>$1.9–$2.0 trillion in 2024</strong> (and rising thereafter). That’s the amount of new annual revenue (or spending cuts) needed to hit balance. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.cbo.gov/publication/59727#:~:text=The%20federal,domestic%20product.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJaV_kGyimWo6xl5NkDoQQA4hh_DgFVpur8Hhd15-2aCg%3D\"> www.cbo.gov</span><b>4. The Federal Budget in Fiscal Year 2023: An Infographic</b></a><span class=\"passage\">The federal deficit in 2023 was $1.7 trillion, equal to 6.3 percent of gross domestic product.</span></span></sup><sup class=\"trigger\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://www.cbo.gov/publication/60419#:~:text=The%20Budget,by%202034.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJaV_kGyimWo6xl5NkDoQQA4hh_DgFVpur8Hhd15-2aCg%3D\"> www.cbo.gov</span><b>1. An Update to The Budget and Economic Outlook</b></a><span class=\"passage\">The Budget Outlook Deficits In CBO’s projections, the federal budget deficit in fiscal year 2024 is $1.9 trillion. Adjusted to exclude the effects of shifts in the timing of certain payments, the deficit amounts to $2.0 trillion in 2024 and grows to $2.8 trillion by 2034.</span></span></sup></li>\n<li>Upper-tail base is sizable but not enough at those rates:\n<ul>\n<li>U.S. billionaire wealth is roughly <strong>$6–$6.6 trillion</strong>. A <strong>4%</strong> levy on that slice alone yields about <strong>$240–$264 billion/year</strong>. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJb3-qX0Ki_cnfl0lYF7DUAW3ojYuPzodQvLR2LLiScoY%3D\"> www.forbes.com</span><b>3. The Richest Americans Are Worth A Record $6.6 Trillion - Forbes</b></a><span class=\"passage\">The 20 richest people in the country hold a collective $3 trillion—nearly half of all American billionaire wealth—up from $2.3 trillion a year ago.</span></span></sup></li>\n<li>The <strong>top 1% hold about $52 trillion</strong>. Even if you add revenue from lower brackets (for example, 1% on $100M–$1B, 0.5% on $10M–$100M, 0.2% on $1M–$10M), static revenue is likely in the <strong>$0.5T–$0.9T</strong> range under plausible allocations—substantial, but still below the deficit. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ-2ZqqXgwT-m6vcvZX_2cUpJsqUJgY5hpLDppjAB8i98%3D\"> www.reddit.com</span><b>2. U.S. Wealth Distribution (including Billionaires) : r/dataisbeautiful</b></a><span class=\"passage\">The top 1% in the US have now a record $52 trillion in wealth. The bottom 50% have about $4 trillion. r/socialism icon.</span></span></sup></li>\n</ul>\n</li>\n</ul>\n<p>Back-of-the-envelope scenarios (static, illustrative)</p>\n<ul>\n<li>Using only the top 1% ($52T) as the base above $1M:\n<ul>\n<li>&gt;$1B at 4% on ~$6T → ~$240B. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJb3-qX0Ki_cnfl0lYF7DUAW3ojYuPzodQvLR2LLiScoY%3D\"> www.forbes.com</span><b>3. The Richest Americans Are Worth A Record $6.6 Trillion - Forbes</b></a><span class=\"passage\">The 20 richest people in the country hold a collective $3 trillion—nearly half of all American billionaire wealth—up from $2.3 trillion a year ago.</span></span></sup></li>\n<li>$100M–$1B at ~1% on ~$10–11T → ~$100–110B. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ-2ZqqXgwT-m6vcvZX_2cUpJsqUJgY5hpLDppjAB8i98%3D\"> www.reddit.com</span><b>2. U.S. Wealth Distribution (including Billionaires) : r/dataisbeautiful</b></a><span class=\"passage\">The top 1% in the US have now a record $52 trillion in wealth. The bottom 50% have about $4 trillion. r/socialism icon.</span></span></sup></li>\n<li>$10M–$100M at ~0.5% on ~$18T → ~$90B. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ-2ZqqXgwT-m6vcvZX_2cUpJsqUJgY5hpLDppjAB8i98%3D\"> www.reddit.com</span><b>2. U.S. Wealth Distribution (including Billionaires) : r/dataisbeautiful</b></a><span class=\"passage\">The top 1% in the US have now a record $52 trillion in wealth. The bottom 50% have about $4 trillion. r/socialism icon.</span></span></sup></li>\n<li>$1M–$10M at ~0.2% on ~$17T → ~$34B. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ-2ZqqXgwT-m6vcvZX_2cUpJsqUJgY5hpLDppjAB8i98%3D\"> www.reddit.com</span><b>2. U.S. Wealth Distribution (including Billionaires) : r/dataisbeautiful</b></a><span class=\"passage\">The top 1% in the US have now a record $52 trillion in wealth. The bottom 50% have about $4 trillion. r/socialism icon.</span></span></sup></li>\n<li>Total ≈ <strong>$470–$480B/year</strong>. This still leaves a gap of roughly <strong>$1.4–$1.5T</strong> relative to the current deficit. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.cbo.gov/publication/60419#:~:text=The%20Budget,by%202034.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJaV_kGyimWo6xl5NkDoQQA4hh_DgFVpur8Hhd15-2aCg%3D\"> www.cbo.gov</span><b>1. An Update to The Budget and Economic Outlook</b></a><span class=\"passage\">The Budget Outlook Deficits In CBO’s projections, the federal budget deficit in fiscal year 2024 is $1.9 trillion. Adjusted to exclude the effects of shifts in the timing of certain payments, the deficit amounts to $2.0 trillion in 2024 and grows to $2.8 trillion by 2034.</span></span></sup></li>\n</ul>\n</li>\n<li>If the taxable base above $1M is broader (e.g., approaching ~$100T when including more than just the top 1%), the same rate schedule might reach <strong>~$700B±</strong>. Still below the <strong>$1.9–$2.0T</strong> target. (This broader-base figure is an assumption; exact composition is uncertain.)</li>\n</ul>\n<p>What rate would close the gap?</p>\n<ul>\n<li>Rule of thumb: Required average rate ≈ deficit ÷ taxable base.\n<ul>\n<li>If wealth above $1M is ~$50T (top 1% only), you’d need an average <strong>~4%</strong> across that entire base—meaning much higher rates than 0.2%–0.5% on the $1M–$100M tiers.</li>\n<li>If the base is ~$100T, you’d need an average <strong>~2%</strong>.</li>\n</ul>\n</li>\n<li>Given your proposed schedule starts at <strong>0.2%</strong> and only reaches <strong>4%</strong> for &gt;$1B, the implied average is typically well below 2%, unless the higher brackets contain a much larger share of the total base than current data suggest. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ-2ZqqXgwT-m6vcvZX_2cUpJsqUJgY5hpLDppjAB8i98%3D\"> www.reddit.com</span><b>2. U.S. Wealth Distribution (including Billionaires) : r/dataisbeautiful</b></a><span class=\"passage\">The top 1% in the US have now a record $52 trillion in wealth. The bottom 50% have about $4 trillion. r/socialism icon.</span></span></sup><sup class=\"trigger\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJb3-qX0Ki_cnfl0lYF7DUAW3ojYuPzodQvLR2LLiScoY%3D\"> www.forbes.com</span><b>3. The Richest Americans Are Worth A Record $6.6 Trillion - Forbes</b></a><span class=\"passage\">The 20 richest people in the country hold a collective $3 trillion—nearly half of all American billionaire wealth—up from $2.3 trillion a year ago.</span></span></sup></li>\n</ul>\n<p>Caveats</p>\n<ul>\n<li>These are static calculations; real-world responses (valuation challenges, avoidance, asset migration, debt-financing to reduce measured net worth) would likely reduce yield, meaning higher rates or broader bases would be needed to hit the same revenue.</li>\n<li>Legal design and enforcement details matter for durability and realized revenue.</li>\n<li>Deficits are projected to grow (to about <strong>$2.8 trillion by 2034</strong>), raising the bar for balance over time. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.cbo.gov/publication/60419#:~:text=The%20Budget,by%202034.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJaV_kGyimWo6xl5NkDoQQA4hh_DgFVpur8Hhd15-2aCg%3D\"> www.cbo.gov</span><b>1. An Update to The Budget and Economic Outlook</b></a><span class=\"passage\">The Budget Outlook Deficits In CBO’s projections, the federal budget deficit in fiscal year 2024 is $1.9 trillion. Adjusted to exclude the effects of shifts in the timing of certain payments, the deficit amounts to $2.0 trillion in 2024 and grows to $2.8 trillion by 2034.</span></span></sup></li>\n</ul>\n<p>Bottom line</p>\n<ul>\n<li><strong>With a 0.2%–4% progressive wealth tax (4% above $1B), you can plausibly raise on the order of $0.5T–$0.9T per year, cutting the deficit substantially but not fully balancing the current budget.</strong> To reach balance, you’d likely need higher rates on the $10M–$1B tiers, a broader tax base, complementary revenue measures, and/or spending changes. <sup class=\"trigger\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.cbo.gov/publication/60419#:~:text=The%20Budget,by%202034.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJaV_kGyimWo6xl5NkDoQQA4hh_DgFVpur8Hhd15-2aCg%3D\"> www.cbo.gov</span><b>1. An Update to The Budget and Economic Outlook</b></a><span class=\"passage\">The Budget Outlook Deficits In CBO’s projections, the federal budget deficit in fiscal year 2024 is $1.9 trillion. Adjusted to exclude the effects of shifts in the timing of certain payments, the deficit amounts to $2.0 trillion in 2024 and grows to $2.8 trillion by 2034.</span></span></sup><sup class=\"trigger\"><a href=\"https://www.reddit.com/r/dataisbeautiful/comments/1lgdxk5/us_wealth_distribution_including_billionaires/#:~:text=The%20top,r/socialism%20icon.\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://www.forbes.com/sites/chasewithorn/2025/09/09/the-2025-forbes-400-list-of-wealthiest-americans-facts-and-figures/#:~:text=The%2020,year%20ago.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJb3-qX0Ki_cnfl0lYF7DUAW3ojYuPzodQvLR2LLiScoY%3D\"> www.forbes.com</span><b>3. The Richest Americans Are Worth A Record $6.6 Trillion - Forbes</b></a><span class=\"passage\">The 20 richest people in the country hold a collective $3 trillion—nearly half of all American billionaire wealth—up from $2.3 trillion a year ago.</span></span></sup></li>\n</ul>","md":"<details><summary>Thinking</summary>\n\nHmmm...\n\n\n\n**Analyzing wealth tax impact**\n\nI need to respond to the user's question about a wealth tax starting at 0.2% for assets over $1M and going up to 4% for those over $1B. The goal is to explore whether this could help balance the budget and tackle the federal deficit. I can use provided data like the CBO's 2023 deficit of $1.7T and projected revenues of $4.4T for FY2023. It seems key to cite all info I reference, ensuring clarity.\n\n**Estimating wealth tax revenue**\n\nI need to estimate the revenue from a progressive wealth tax based on the proposed structure: starting at 0.2% for wealth over $1M, progressing up to 4% for amounts exceeding $1B. I think I should suggest a plausible tier structure, like 0.2% from $1M-$10M, 0.5% from $10M-$100M, and so forth. Asking clarifying questions might be helpful, but I can work with reasonable assumptions to provide scenarios. We previously estimated that about 18% of households might have wealth over $1M, which I need to confirm.\n\n**Clarifying millionaire household estimates**\n\nThe provided information doesn’t include the number of millionaire households, and I want to avoid unsourced claims. I need to use my own knowledge but clearly distinguish it from external sources. Moreover, I should follow the developer's guidance to primarily rely on tool responses. If necessary, I can incorporate my own insights while maintaining transparency. If I consider the top 1% with $52T in wealth, that's a starting point, but the top 1% likely relates to those with wealth over $10M, not just $1M.\n\n**Estimating wealth tax revenue potential**\n\nThe top 1% wealth of $52T does seem high, but maybe it’s sourced from Reddit or Federal Reserve data. In 2024, the total US household net worth is estimated to be over $160T, with the top 1% holding about 32% of that, which is around $53T. Notably, billionaire wealth is cited from Forbes at about $6.6T. If we tax the billionaire bracket at 4%, that could generate roughly $264B—substantial for addressing the deficit. I need to identify rates for the $100M-$1B bracket and estimate wealth distribution within the top 1%.\n\n**Calculating potential revenue from wealth tax**\n\nI need to analyze the top 1% wealth, totaling around $52T, and consider what remains after accounting for billionaire wealth of approximately $6.6T. That leaves around $45.4T, which includes wealth in the $10M-$1B range. I estimate that taxing the billionaire bracket at 4% could generate about $240B annually. Furthermore, if we assume an average wealth tax rate of 1% on the top 1%, it might yield $520B. Presenting a bracket structure, we could suggest 0.2% for $1M-$10M, 0.5% for $10M-$100M, and so on, reaching a potential revenue of $900B to $1.3T — which might significantly reduce the deficit.\n\n**Evaluating potential revenue for deficit reduction**\n\nTo fully address a deficit of around $2T, we likely need effective average rates on wealth to yield between $1T and $2T. Using a proposed bracket schedule, I estimate potential yields of about $0.5T to $1.5T. Based on CBO numbers, 2023's deficit is $1.7T and expected to rise to $2.8T by 2034. Using the Forbes estimate for billionaires at $6.6T, the projected revenue from various brackets suggests that raising rates, especially on those with over $1M, may help significantly reduce the deficit but probably won't fully balance it.\n\n**Summarizing potential revenue vs. deficit**\n\nTo fully balance a roughly $1.9–$2.0T deficit, we might need higher rates, like 2% on $100M-$1B and 1% on $1M-$10M to raise revenue. Using a proposed schedule, estimated revenue could reach $0.5T–$1.0T, leaving a gap of about $1.0T–$1.5T. \n\nThis means:\n\n- **Short answer:** It's unlikely to fully balance the budget solely with that schedule; you'd reduce the deficit substantially, but a gap remains.\n- Billionaire wealth is around $6–$6.6T[^3]; wealth of the top 1% is approximately $52T[^2].\n\nTo close the deficit, we would need to either raise rates more significantly or broaden the tax base.\n\n</details>\n\nShort answer: **Unlikely to fully balance the budget with that schedule alone. It could raise several hundred billion dollars per year and materially shrink the deficit, but you would probably still be short of the roughly $1.9–$2.0 trillion needed to close the current annual gap.**[^1][^4]\n\nWhy\n- Target to “balance” is large: The federal deficit was about **$1.7 trillion in 2023** and is projected at **$1.9–$2.0 trillion in 2024** (and rising thereafter). That’s the amount of new annual revenue (or spending cuts) needed to hit balance. [^4][^1]\n- Upper-tail base is sizable but not enough at those rates:\n - U.S. billionaire wealth is roughly **$6–$6.6 trillion**. A **4%** levy on that slice alone yields about **$240–$264 billion/year**. [^3]\n - The **top 1% hold about $52 trillion**. Even if you add revenue from lower brackets (for example, 1% on $100M–$1B, 0.5% on $10M–$100M, 0.2% on $1M–$10M), static revenue is likely in the **$0.5T–$0.9T** range under plausible allocations—substantial, but still below the deficit. [^2]\n\nBack-of-the-envelope scenarios (static, illustrative)\n- Using only the top 1% ($52T) as the base above $1M:\n - >$1B at 4% on ~$6T → ~$240B. [^3]\n - $100M–$1B at ~1% on ~$10–11T → ~$100–110B. [^2]\n - $10M–$100M at ~0.5% on ~$18T → ~$90B. [^2]\n - $1M–$10M at ~0.2% on ~$17T → ~$34B. [^2]\n - Total ≈ **$470–$480B/year**. This still leaves a gap of roughly **$1.4–$1.5T** relative to the current deficit. [^1]\n- If the taxable base above $1M is broader (e.g., approaching ~$100T when including more than just the top 1%), the same rate schedule might reach **~$700B±**. Still below the **$1.9–$2.0T** target. (This broader-base figure is an assumption; exact composition is uncertain.)\n\nWhat rate would close the gap?\n- Rule of thumb: Required average rate ≈ deficit ÷ taxable base.\n - If wealth above $1M is ~$50T (top 1% only), you’d need an average **~4%** across that entire base—meaning much higher rates than 0.2%–0.5% on the $1M–$100M tiers.\n - If the base is ~$100T, you’d need an average **~2%**.\n- Given your proposed schedule starts at **0.2%** and only reaches **4%** for >$1B, the implied average is typically well below 2%, unless the higher brackets contain a much larger share of the total base than current data suggest. [^2][^3]\n\nCaveats\n- These are static calculations; real-world responses (valuation challenges, avoidance, asset migration, debt-financing to reduce measured net worth) would likely reduce yield, meaning higher rates or broader bases would be needed to hit the same revenue.\n- Legal design and enforcement details matter for durability and realized revenue.\n- Deficits are projected to grow (to about **$2.8 trillion by 2034**), raising the bar for balance over time. [^1]\n\nBottom line\n- **With a 0.2%–4% progressive wealth tax (4% above $1B), you can plausibly raise on the order of $0.5T–$0.9T per year, cutting the deficit substantially but not fully balancing the current budget.** To reach balance, you’d likely need higher rates on the $10M–$1B tiers, a broader tax base, complementary revenue measures, and/or spending changes. [^1][^3]","profile":{"id":null,"name":null,"model":"gpt-5","model_name":"GPT 5","model_provider":"openai","model_input_limit":1000000,"recommended":false,"model_info":"\n\n\n\n<div class=\"heading\">\n <div class=\"left\">\n \n \n \n <svg class=\"model-icon icon-xs\" data-model=\"gpt-5\">\n <use href=\"#icon-openai\"/>\n </svg>\n <h3>\n \n <span class=\"model-provider\">OpenAI</span>\n \n <span class=\"model-name\">none</span>\n </h3>\n </div>\n\n \n <a href=\"/settings?p=custom_assistant&id=none\">\n <svg class=\"icon-sm edit-icon\" aria-hidden=\"true\">\n <use href=\"#icon-pencil\" />\n </svg>\n </a>\n \n</div>\n\n\n<hr />\n<ul>\n \n <li>\n <h4>\n Cost\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Moderate\">\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-cost --medium\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Quality\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 4 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Speed\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 4 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Privacy\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 2 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li class=\"divider\" aria-hidden=\"true\"></li>\n <li>\n <h4>Last updated</h4>\n <span class=\"date\">\n \n \n 2025-08-07\n \n \n </span>\n </li>\n \n</ul>\n","model_provider_name":"OpenAI","internet_access":true,"personalizations":false,"shortcut":null,"is_default_profile":false},"metadata":"<li>\n <span class=\"attribute\">Model</span>\n <span class=\"value\"><i class=\"icon-xs mr-2\"><svg><use href=\"#icon-openai\"></use></svg></i>GPT 5</span>\n</li>\n<li>\n <span class=\"attribute\">Version</span>\n <span class=\"value\">Azure/gpt-5</span>\n</li>\n<li>\n <span class=\"attribute\">Speed (tok/s)</span>\n <span class=\"value\">109</span>\n</li>\n<li>\n <span class=\"attribute\">Tokens</span>\n <span class=\"value\">8,142</span>\n</li>\n<li>\n <span class=\"attribute\">Cost / Total ($)</span>\n <span class=\"value\">0.07 / 0.15</span>\n</li>\n<li>\n <span class=\"attribute\">End to end time (s)</span>\n <span class=\"value\">50.1</span>\n</li>\n\n","documents":[]},{"id":"f7f25c0a-9791-410f-8fe6-ae9535e6bf12","thread_id":"b1c3b6f6-9ba2-43ae-aa04-3e6955011a9e","created_at":"2025-10-23T20:17:35Z","state":"done","prompt":"Would there be added benefits of reducing wealth inequality? Would it stimulate the economy, since the lower income brackets would see reduced taxes and higher income?","references_html":"<ol data-ref-list>\n \n <li>\n <a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/\" >Do Wealth Taxes Significantly Curb Wealth Inequality? - ProMarket</a>\n <span class=\"__domain-name\">www.promarket.org</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 29%, transparent 29%)\">29%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.sciencedirect.com/science/article/pii/S0264999325000999\" >Does redistribution hurt growth? An empirical assessment of the ...</a>\n <span class=\"__domain-name\">www.sciencedirect.com</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 27%, transparent 27%)\">27%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.imf.org/en/Publications/fandd/issues/2018/03/bourguignon\" >Redistribution of Income and Reducing Economic Inequality</a>\n <span class=\"__domain-name\">www.imf.org</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 22%, transparent 22%)\">22%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://taxfoundation.org/research/all/federal/impact-piketty-s-wealth-tax-poor-rich-and-middle-class/\" >The Impact of Piketty’s Wealth Tax on the Poor, the Rich, and the ...</a>\n <span class=\"__domain-name\">taxfoundation.org</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 13%, transparent 13%)\">13%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.pgpf.org/article/what-is-a-wealth-tax-and-should-the-united-states-have-one/\" >What Is a Wealth Tax, and Should the United States Have One?</a>\n <span class=\"__domain-name\">www.pgpf.org</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 9%, transparent 9%)\">9%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n</ol>\n","references_md":"[^1]: [Do Wealth Taxes Significantly Curb Wealth Inequality? - ProMarket](https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/) (29%)\n[^2]: [Does redistribution hurt growth? An empirical assessment of the ...](https://www.sciencedirect.com/science/article/pii/S0264999325000999) (27%)\n[^3]: [Redistribution of Income and Reducing Economic Inequality](https://www.imf.org/en/Publications/fandd/issues/2018/03/bourguignon) (22%)\n[^4]: [The Impact of Piketty’s Wealth Tax on the Poor, the Rich, and the ...](https://taxfoundation.org/research/all/federal/impact-piketty-s-wealth-tax-poor-rich-and-middle-class/) (13%)\n[^5]: [What Is a Wealth Tax, and Should the United States Have One?](https://www.pgpf.org/article/what-is-a-wealth-tax-and-should-the-united-states-have-one/) (9%)\n","reply":"<details><summary>Searched with Kagi<p></p>\n<ul>\n<li>wealth tax impact on wealth inequality</li>\n<li>wealth tax economic stimulus lower income tax cuts</li>\n<li>economic effects of wealth redistribution</li></ul></summary> Sources (15):<br>\n<strong>Do Wealth Taxes Significantly Curb Wealth Inequality? - ProMarket</strong><br>\n<a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/\" target=\"_blank\">https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/</a><br>\nOct 03, 2023 In a new study, Samira Marti, Isabel Z. Martínez, and Florian Scheuer show how decreases in wealth taxes led to increases in wealth inequality in Switzerland.\n\n<p><strong>Addressing Socioeconomic Inequality with a Wealth Tax</strong><br>\n<a href=\"https://pitjournal.unc.edu/2023/06/06/addressing-socioeconomic-inequality-with-a-wealth-tax/\" target=\"_blank\">https://pitjournal.unc.edu/2023/06/06/addressing-socioeconomic-inequality-with-a-wealth-tax/</a><br>\nJun 06, 2023 Addressing Socioeconomic Inequality with a Wealth Tax By Aum Kendapadi • , Cycle 11, 2023 Wealth inequality has been rising at unprecedented rates in the United States.</p>\n<p><strong>Pros and cons of a wealth tax | The Week</strong><br>\n<a href=\"https://theweek.com/business/economy/pros-and-cons-of-a-wealth-tax\" target=\"_blank\">https://theweek.com/business/economy/pros-and-cons-of-a-wealth-tax</a><br>\nJul 15, 2025 A Wealth Tax Commission report in 2020 calculated that \"after accounting for non-compliance and administration costs, a one-off wealth tax payable on all individual wealth above £500,000 and charged at 1% a year for five years would raise £260 billion; at a threshold of £2 million it would raise £80 billion.\"Only four countries have actually \"retained a wealth tax”, said ThisisMoney: Norway, Spain, Colombia and Switzerland. Other nations have tried but failed as the wealthy avoid them and the levy raises \"little revenue\", creating \"high admin costs\".</p>\n<p><strong>What Is a Wealth Tax, and Should the United States Have One?</strong><br>\n<a href=\"https://www.pgpf.org/article/what-is-a-wealth-tax-and-should-the-united-states-have-one/\" target=\"_blank\">https://www.pgpf.org/article/what-is-a-wealth-tax-and-should-the-united-states-have-one/</a><br>\nFeb 20, 2025 Proponents of the wealth tax argue that it could help address rising wealth and income inequality while also generating revenues.</p>\n<p><strong>The Impact of Piketty’s Wealth Tax on the Poor, the Rich, and the ...</strong><br>\n<a href=\"https://taxfoundation.org/research/all/federal/impact-piketty-s-wealth-tax-poor-rich-and-middle-class/\" target=\"_blank\">https://taxfoundation.org/research/all/federal/impact-piketty-s-wealth-tax-poor-rich-and-middle-class/</a><br>\n In short, Piketty’s wealth tax would reduce income and wealth inequality, but at the cost of making everyone significantly poorer. In addition to the large, negative growth effects, the broad-based wealth tax that Piketty recommends may not be practical because it would place huge compliance costs on many households and be difficult to enforce.</p>\n<p><strong>There will be pain: Continuing low tax rates for the rich and ...</strong><br>\n<a href=\"https://www.epi.org/publication/tcja-extensions-2025/\" target=\"_blank\">https://www.epi.org/publication/tcja-extensions-2025/</a><br>\nFeb 13, 2025 This report highlights that efforts to keep tax rates low for the rich and corporations will likely result in sharper trade-offs now than in past episodes of ...</p>\n<p><strong>By the Numbers: House Republican Tax Agenda Favors the Wealthy and ...</strong><br>\n<a href=\"https://www.cbpp.org/research/federal-tax/by-the-numbers-house-republican-tax-agenda-favors-the-wealthy-and-leaves\" target=\"_blank\">https://www.cbpp.org/research/federal-tax/by-the-numbers-house-republican-tax-agenda-favors-the-wealthy-and-leaves</a><br>\nJun 17, 2025 Under the bill, the average family earning less than $50,000 would get under $300 in tax cuts in 2027, less than $1 a day, while the average tax ...</p>\n<p><strong>Republican Agenda's “Triple Threat” to Low- and Moderate-Income ...</strong><br>\n<a href=\"https://www.cbpp.org/research/federal-tax/republican-agendas-triple-threat-to-low-and-moderate-income-family-well-being\" target=\"_blank\">https://www.cbpp.org/research/federal-tax/republican-agendas-triple-threat-to-low-and-moderate-income-family-well-being</a><br>\nApr 17, 2025 Triple Threat Agenda Will Likely Result in Slower Economic Growth. Tax cuts for the wealthy paid for by cutting programs that help low- and ...</p>\n<p><strong>How Tax Cuts Affect the Economy</strong><br>\n<a href=\"https://www.investopedia.com/articles/07/tax_cuts.asp\" target=\"_blank\">https://www.investopedia.com/articles/07/tax_cuts.asp</a><br>\nOct 01, 2008 Critics claim that tax cuts only benefit the wealthy and reduce necessary government services for the lower-income bracket.</p>\n<p><strong>Trickle-Down Economics: Theory, Policies, and Critique</strong><br>\n<a href=\"https://www.investopedia.com/terms/t/trickledowntheory.asp\" target=\"_blank\">https://www.investopedia.com/terms/t/trickledowntheory.asp</a><br>\nOct 01, 2008 Corporate income tax reduction, tax cuts for the wealthy, and deregulation are the initial steps of a trickle-down policy. As more money remains in the corporate sector, business investment may be triggered with new factories, upgraded technology, equipment, and an increase in employment. Wealthy individuals may spend more, creating more demand for goods in the economy.</p>\n<p><strong>Redistribution of Income and Reducing Economic Inequality</strong><br>\n<a href=\"https://www.imf.org/en/Publications/fandd/issues/2018/03/bourguignon\" target=\"_blank\">https://www.imf.org/en/Publications/fandd/issues/2018/03/bourguignon</a><br>\nMar 01, 2018 The redistribution of income might achieve not only greater equality but also faster growth and, for developing economies, faster poverty reduction.\"</p>\n<p><strong>Unpacking The Economics of Wealth Redistribution: Balancing Inequality ...</strong><br>\n<a href=\"https://socialstudieshelp.com/economics/the-economics-of-wealth-redistribution/\" target=\"_blank\">https://socialstudieshelp.com/economics/the-economics-of-wealth-redistribution/</a><br>\nApr 26, 2025 The economics of wealth redistribution is a complex and multifaceted issue that impacts every corner of society. It intersects with questions of fairness, efficiency, and justice, and balances economic inequality with the desire for personal freedom.</p>\n<p><strong>Does redistribution hurt growth? An empirical assessment of the ...</strong><br>\n<a href=\"https://www.sciencedirect.com/science/article/pii/S0264999325000999\" target=\"_blank\">https://www.sciencedirect.com/science/article/pii/S0264999325000999</a><br>\n Redistribution to high-income earners and pensioners has a negative impact on economic growth. •. The results suggest that well-targeted redistributive ...</p>\n<p><strong>Monetary policy and the persistent aggregate effects of wealth ...</strong><br>\n<a href=\"https://www.sciencedirect.com/science/article/pii/S0304393223001599\" target=\"_blank\">https://www.sciencedirect.com/science/article/pii/S0304393223001599</a><br>\n The wealth redistribution channel also implies that negative supply shocks can be more severe and persistent. A central bank that offsets the short-term negative impact on output at the expense of higher inflation creates additional redistribution from savers to borrowers that lowers the output over the medium term.</p>\n<p><strong>Redistribution of income and wealth - Wikipedia</strong><br>\n<a href=\"https://en.wikipedia.org/wiki/Redistribution_of_income_and_wealth\" target=\"_blank\">https://en.wikipedia.org/wiki/Redistribution_of_income_and_wealth</a><br>\nMar 05, 2015</p>\n</details><details><summary>Thinking</summary>\n<p>Hmmm...</p>\n<p><strong>Formulating a response on wealth inequality</strong></p>\n<p>I need to respond in English and ensure I follow formatting guidelines; this includes bolding key points and citing sources correctly. The user is asking about the benefits of reducing wealth inequality, specifically its potential impact on the economy. I can draw from evidence, like Switzerland's experience with wealth tax changes affecting inequality. Also, research shows that redistributing wealth toward lower-income groups can stimulate demand, as they tend to have a higher marginal propensity to consume.</p>\n<p><strong>Discussing wealth taxation effects</strong></p>\n<p>I should address the potential downsides of wealth taxes, like negative growth effects due to reduced investment or issues with compliance. I can cite a ProMarket study and also reference a PGPF piece highlighting that some argue wealth taxes help reduce inequality while generating revenue. An IMF study suggests that redistribution can support faster growth. I’ll also note that targeted transfers to liquidity-constrained households tend to have higher economic multipliers, which is supported by various studies.</p>\n<p><strong>Structuring the response on inequality benefits</strong></p>\n<p>I think I’ll skip tangential discussions about monetary policy and wealth effects. Instead, I can structure the response with a clear headline stating there are added benefits. I can bold the answers to the two questions: Yes, evidence suggests that reducing inequality is beneficial, and likely there will be a short-run demand boost if tax relief is aimed at lower incomes. However, net macro effects depend on design and investment responses. I should also mention potential impacts on human capital and entrepreneurship through reduced tax burdens for low and moderate incomes.</p>\n<p><strong>Evaluating inequality metrics</strong></p>\n<p>I want to present a cited viewpoint on wealth inequality without claiming to be entirely unbiased.</p>\n<p>First, I can mention that the Gini coefficient for wealth is likely to decline; evidence from Switzerland suggests that decreases in wealth taxes have been linked to increased inequality, implying that raising such taxes could reduce inequality.</p>\n<p>I’m cautious about discussing the effects on racial or age wealth gaps since there's a lack of direct citations—speculation might not be useful here.</p>\n<p>I should briefly touch on implementation issues like valuation, avoidance, and enforcement without needing citations. Although the focus is on inequality and macro stimulus, I still need to include citations for claims from my sources.</p>\n<p><strong>Drafting response on wealth tax and inequality</strong></p>\n<p>I need to emphasize that using imperial units and 12-hour time is necessary. It's important to highlight key answers in bold. The macro effect relates to being deficit-neutral; if we're eliminating taxes under $50K while implementing a new tax of 0.2%-4%, we need to assume this is deficit-neutral. Lower-income households generally show a higher marginal propensity to consume (MPC), which can boost demand in the short run. I should provide citations from relevant sources throughout the response.</p>\n<p>To summarize:</p>\n<p>Yes, a progressive wealth tax and eliminating income tax under $50K likely reduce wealth inequality and stimulate demand. Evidence suggests wealth taxes can curb inequality, while lower-income tax relief raises disposable income, supporting aggregate demand. Design is crucial; however, potential risks and investment effects should also be considered. While expecting a decline in inequality and a demand boost, the long-term growth effects remain ambiguous. Careful structuring is essential, informed by existing research indices.</p>\n</details>\n<p>Short answer:</p>\n<ul>\n<li><strong>Yes, a progressive wealth tax paired with eliminating income tax for under-$50K earners would likely reduce wealth inequality.</strong> Evidence from Switzerland shows that lowering wealth taxes increased wealth inequality, implying the reverse—raising or adding them—curbs it. <sup class=\"trigger\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJmYMn608mfxpelXYE6PGKiFwERrLpbM6s6dItdVk_TI0%3D\"> www.promarket.org</span><b>1. Do Wealth Taxes Significantly Curb Wealth Inequality? - ProMarket</b></a><span class=\"passage\">In a new study, Samira Marti, Isabel Z. Martínez, and Florian Scheuer show how decreases in wealth taxes led to increases in wealth inequality in Switzerland.</span></span></sup></li>\n<li><strong>It would likely provide a near-term demand boost</strong>, because shifting after‑tax income from high-wealth households to lower-income households raises consumption (lower-income households spend a larger share of extra dollars). Well-designed redistribution can be consistent with faster growth, especially when targeted effectively. <sup class=\"trigger\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.imf.org/en/Publications/fandd/issues/2018/03/bourguignon#:~:text=The%20redistribution,poverty%20reduction.%22\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJovQq79tWzopbIx1uU6SaoPrWUaS9jGyvzMyonx5JyqE%3D\"> www.imf.org</span><b>3. Redistribution of Income and Reducing Economic Inequality</b></a><span class=\"passage\">The redistribution of income might achieve not only greater equality but also faster growth and, for developing economies, faster poverty reduction.\"</span></span></sup><sup class=\"trigger\"><a href=\"https://www.imf.org/en/Publications/fandd/issues/2018/03/bourguignon#:~:text=The%20redistribution,poverty%20reduction.%22\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.sciencedirect.com/science/article/pii/S0264999325000999#:~:text=Redistribution%20to,well-targeted%20redistributive\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJR0E11NoSbC-jgtBWgUB9B77NasjfM0nHDFxD27AymhvhsfrAEYbRoB7S-w7U0ZGi\"> www.sciencedirect.com</span><b>2. Does redistribution hurt growth? An empirical assessment of the ...</b></a><span class=\"passage\">Redistribution to high-income earners and pensioners has a negative impact on economic growth. •. The results suggest that well-targeted redistributive ...</span></span></sup></li>\n</ul>\n<p>What benefits you could expect</p>\n<ul>\n<li>\n<p>Reducing wealth concentration:</p>\n<ul>\n<li>Empirical evidence: When Swiss cantons cut wealth taxes, wealth inequality rose—suggesting that wealth taxes can meaningfully restrain concentration at the top. <sup class=\"trigger\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJmYMn608mfxpelXYE6PGKiFwERrLpbM6s6dItdVk_TI0%3D\"> www.promarket.org</span><b>1. Do Wealth Taxes Significantly Curb Wealth Inequality? - ProMarket</b></a><span class=\"passage\">In a new study, Samira Marti, Isabel Z. Martínez, and Florian Scheuer show how decreases in wealth taxes led to increases in wealth inequality in Switzerland.</span></span></sup></li>\n<li>Policy rationale: Proponents argue wealth taxes can counter rising wealth and income inequality while raising revenue that can be used for pro-growth or equity-enhancing purposes. <sup class=\"trigger\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.pgpf.org/article/what-is-a-wealth-tax-and-should-the-united-states-have-one/#:~:text=Proponents%20of,generating%20revenues.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJsxNGYf4uEMW4m1urGa_2YQk1RGV9xAP_O_8vI4177UU%3D\"> www.pgpf.org</span><b>5. What Is a Wealth Tax, and Should the United States Have One?</b></a><span class=\"passage\">Proponents of the wealth tax argue that it could help address rising wealth and income inequality while also generating revenues.</span></span></sup></li>\n</ul>\n</li>\n<li>\n<p>Macro demand and potential growth effects:</p>\n<ul>\n<li>Short-run stimulus: Moving tax burden from lower-income earners (high marginal propensity to consume) to very wealthy households (lower propensity to consume) tends to raise aggregate demand. Redistribution can support growth when it is well targeted. <sup class=\"trigger\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.imf.org/en/Publications/fandd/issues/2018/03/bourguignon#:~:text=The%20redistribution,poverty%20reduction.%22\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJovQq79tWzopbIx1uU6SaoPrWUaS9jGyvzMyonx5JyqE%3D\"> www.imf.org</span><b>3. Redistribution of Income and Reducing Economic Inequality</b></a><span class=\"passage\">The redistribution of income might achieve not only greater equality but also faster growth and, for developing economies, faster poverty reduction.\"</span></span></sup><sup class=\"trigger\"><a href=\"https://www.imf.org/en/Publications/fandd/issues/2018/03/bourguignon#:~:text=The%20redistribution,poverty%20reduction.%22\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.sciencedirect.com/science/article/pii/S0264999325000999#:~:text=Redistribution%20to,well-targeted%20redistributive\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJR0E11NoSbC-jgtBWgUB9B77NasjfM0nHDFxD27AymhvhsfrAEYbRoB7S-w7U0ZGi\"> www.sciencedirect.com</span><b>2. Does redistribution hurt growth? An empirical assessment of the ...</b></a><span class=\"passage\">Redistribution to high-income earners and pensioners has a negative impact on economic growth. •. The results suggest that well-targeted redistributive ...</span></span></sup></li>\n<li>Longer-run ambiguity: If a wealth tax is broad and heavy, it may dampen saving and investment at the top, which some analyses argue could reduce growth—even while inequality falls. Design details (rates, thresholds, exemptions, valuation rules) are crucial. <sup class=\"trigger\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://taxfoundation.org/research/all/federal/impact-piketty-s-wealth-tax-poor-rich-and-middle-class/#:~:text=In%20short%2C,to%20enforce.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ6bOYhmOhi_iLDYX1LgL_9iCACGJldzyqvYaWkC3_B0g%3D\"> taxfoundation.org</span><b>4. The Impact of Piketty’s Wealth Tax on the Poor, the Rich, and the ...</b></a><span class=\"passage\">In short, Piketty’s wealth tax would reduce income and wealth inequality, but at the cost of making everyone significantly poorer. In addition to the large, negative growth effects, the broad-based wealth tax that Piketty recommends may not be practical because it would place huge compliance costs on many households and be difficult to enforce.</span></span></sup></li>\n</ul>\n</li>\n</ul>\n<p>Key caveats and design choices</p>\n<ul>\n<li>Administrative and behavioral responses: Valuation of privately held businesses and real estate, avoidance strategies, and potential capital flight can lower realized revenues and blunt inequality and stimulus effects if not addressed.</li>\n<li>Liquidity and investment: To reduce growth risks, pair higher top-end rates with features like deferral options plus interest, carve-outs for retirement accounts, and transitional rules for illiquid assets.</li>\n<li>Use of funds matters: Channeling revenue to high-multiplier uses (refundable credits, child benefits, targeted work supports) strengthens the pro-growth and inequality-reducing impacts. Evidence suggests well‑targeted redistribution is more growth‑friendly. <sup class=\"trigger\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.sciencedirect.com/science/article/pii/S0264999325000999#:~:text=Redistribution%20to,well-targeted%20redistributive\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJR0E11NoSbC-jgtBWgUB9B77NasjfM0nHDFxD27AymhvhsfrAEYbRoB7S-w7U0ZGi\"> www.sciencedirect.com</span><b>2. Does redistribution hurt growth? An empirical assessment of the ...</b></a><span class=\"passage\">Redistribution to high-income earners and pensioners has a negative impact on economic growth. •. The results suggest that well-targeted redistributive ...</span></span></sup></li>\n</ul>\n<p>Bottom line</p>\n<ul>\n<li><strong>Expect inequality to fall and near-term demand to rise</strong> under your swap (wealth tax with sub‑$50K income-tax relief). The net effect on long-run growth is uncertain and hinges on implementation: careful targeting and enforcement can preserve the inequality gains and short-run stimulus while limiting potential drag on investment. <sup class=\"trigger\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.promarket.org/2023/10/03/do-wealth-taxes-significantly-curb-wealth-inequality/#:~:text=In%20a,in%20Switzerland.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJmYMn608mfxpelXYE6PGKiFwERrLpbM6s6dItdVk_TI0%3D\"> www.promarket.org</span><b>1. Do Wealth Taxes Significantly Curb Wealth Inequality? - ProMarket</b></a><span class=\"passage\">In a new study, Samira Marti, Isabel Z. Martínez, and Florian Scheuer show how decreases in wealth taxes led to increases in wealth inequality in Switzerland.</span></span></sup><sup class=\"trigger\"><a href=\"https://www.imf.org/en/Publications/fandd/issues/2018/03/bourguignon#:~:text=The%20redistribution,poverty%20reduction.%22\" target=\"_blank\">3</a><span class=\"tooltip top center citation\"><a href=\"https://www.imf.org/en/Publications/fandd/issues/2018/03/bourguignon#:~:text=The%20redistribution,poverty%20reduction.%22\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJovQq79tWzopbIx1uU6SaoPrWUaS9jGyvzMyonx5JyqE%3D\"> www.imf.org</span><b>3. Redistribution of Income and Reducing Economic Inequality</b></a><span class=\"passage\">The redistribution of income might achieve not only greater equality but also faster growth and, for developing economies, faster poverty reduction.\"</span></span></sup></li>\n</ul>","md":"<details><summary>Thinking</summary>\n\nHmmm...\n\n\n\n**Formulating a response on wealth inequality**\n\nI need to respond in English and ensure I follow formatting guidelines; this includes bolding key points and citing sources correctly. The user is asking about the benefits of reducing wealth inequality, specifically its potential impact on the economy. I can draw from evidence, like Switzerland's experience with wealth tax changes affecting inequality. Also, research shows that redistributing wealth toward lower-income groups can stimulate demand, as they tend to have a higher marginal propensity to consume.\n\n**Discussing wealth taxation effects**\n\nI should address the potential downsides of wealth taxes, like negative growth effects due to reduced investment or issues with compliance. I can cite a ProMarket study and also reference a PGPF piece highlighting that some argue wealth taxes help reduce inequality while generating revenue. An IMF study suggests that redistribution can support faster growth. I’ll also note that targeted transfers to liquidity-constrained households tend to have higher economic multipliers, which is supported by various studies.\n\n**Structuring the response on inequality benefits**\n\nI think I’ll skip tangential discussions about monetary policy and wealth effects. Instead, I can structure the response with a clear headline stating there are added benefits. I can bold the answers to the two questions: Yes, evidence suggests that reducing inequality is beneficial, and likely there will be a short-run demand boost if tax relief is aimed at lower incomes. However, net macro effects depend on design and investment responses. I should also mention potential impacts on human capital and entrepreneurship through reduced tax burdens for low and moderate incomes.\n\n**Evaluating inequality metrics**\n\nI want to present a cited viewpoint on wealth inequality without claiming to be entirely unbiased. \n\nFirst, I can mention that the Gini coefficient for wealth is likely to decline; evidence from Switzerland suggests that decreases in wealth taxes have been linked to increased inequality, implying that raising such taxes could reduce inequality.\n\nI’m cautious about discussing the effects on racial or age wealth gaps since there's a lack of direct citations—speculation might not be useful here.\n\nI should briefly touch on implementation issues like valuation, avoidance, and enforcement without needing citations. Although the focus is on inequality and macro stimulus, I still need to include citations for claims from my sources.\n\n**Drafting response on wealth tax and inequality**\n\nI need to emphasize that using imperial units and 12-hour time is necessary. It's important to highlight key answers in bold. The macro effect relates to being deficit-neutral; if we're eliminating taxes under $50K while implementing a new tax of 0.2%-4%, we need to assume this is deficit-neutral. Lower-income households generally show a higher marginal propensity to consume (MPC), which can boost demand in the short run. I should provide citations from relevant sources throughout the response. \n\nTo summarize:\n\nYes, a progressive wealth tax and eliminating income tax under $50K likely reduce wealth inequality and stimulate demand. Evidence suggests wealth taxes can curb inequality, while lower-income tax relief raises disposable income, supporting aggregate demand. Design is crucial; however, potential risks and investment effects should also be considered. While expecting a decline in inequality and a demand boost, the long-term growth effects remain ambiguous. Careful structuring is essential, informed by existing research indices.\n\n</details>\n\nShort answer:\n- **Yes, a progressive wealth tax paired with eliminating income tax for under-$50K earners would likely reduce wealth inequality.** Evidence from Switzerland shows that lowering wealth taxes increased wealth inequality, implying the reverse—raising or adding them—curbs it. [^1]\n- **It would likely provide a near-term demand boost**, because shifting after‑tax income from high-wealth households to lower-income households raises consumption (lower-income households spend a larger share of extra dollars). Well-designed redistribution can be consistent with faster growth, especially when targeted effectively. [^3][^2]\n\nWhat benefits you could expect\n- Reducing wealth concentration:\n - Empirical evidence: When Swiss cantons cut wealth taxes, wealth inequality rose—suggesting that wealth taxes can meaningfully restrain concentration at the top. [^1]\n - Policy rationale: Proponents argue wealth taxes can counter rising wealth and income inequality while raising revenue that can be used for pro-growth or equity-enhancing purposes. [^5]\n\n- Macro demand and potential growth effects:\n - Short-run stimulus: Moving tax burden from lower-income earners (high marginal propensity to consume) to very wealthy households (lower propensity to consume) tends to raise aggregate demand. Redistribution can support growth when it is well targeted. [^3][^2]\n - Longer-run ambiguity: If a wealth tax is broad and heavy, it may dampen saving and investment at the top, which some analyses argue could reduce growth—even while inequality falls. Design details (rates, thresholds, exemptions, valuation rules) are crucial. [^4]\n\nKey caveats and design choices\n- Administrative and behavioral responses: Valuation of privately held businesses and real estate, avoidance strategies, and potential capital flight can lower realized revenues and blunt inequality and stimulus effects if not addressed.\n- Liquidity and investment: To reduce growth risks, pair higher top-end rates with features like deferral options plus interest, carve-outs for retirement accounts, and transitional rules for illiquid assets.\n- Use of funds matters: Channeling revenue to high-multiplier uses (refundable credits, child benefits, targeted work supports) strengthens the pro-growth and inequality-reducing impacts. Evidence suggests well‑targeted redistribution is more growth‑friendly. [^2]\n\nBottom line\n- **Expect inequality to fall and near-term demand to rise** under your swap (wealth tax with sub‑$50K income-tax relief). The net effect on long-run growth is uncertain and hinges on implementation: careful targeting and enforcement can preserve the inequality gains and short-run stimulus while limiting potential drag on investment. [^1][^3]","profile":{"id":null,"name":null,"model":"gpt-5","model_name":"GPT 5","model_provider":"openai","model_input_limit":1000000,"recommended":false,"model_info":"\n\n\n\n<div class=\"heading\">\n <div class=\"left\">\n \n \n \n <svg class=\"model-icon icon-xs\" data-model=\"gpt-5\">\n <use href=\"#icon-openai\"/>\n </svg>\n <h3>\n \n <span class=\"model-provider\">OpenAI</span>\n \n <span class=\"model-name\">none</span>\n </h3>\n </div>\n\n \n <a href=\"/settings?p=custom_assistant&id=none\">\n <svg class=\"icon-sm edit-icon\" aria-hidden=\"true\">\n <use href=\"#icon-pencil\" />\n </svg>\n </a>\n \n</div>\n\n\n<hr />\n<ul>\n \n <li>\n <h4>\n Cost\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Moderate\">\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-cost --medium\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Quality\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 4 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Speed\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 4 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Privacy\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 2 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li class=\"divider\" aria-hidden=\"true\"></li>\n <li>\n <h4>Last updated</h4>\n <span class=\"date\">\n \n \n 2025-08-07\n \n \n </span>\n </li>\n \n</ul>\n","model_provider_name":"OpenAI","internet_access":true,"personalizations":false,"shortcut":null,"is_default_profile":false},"metadata":"<li>\n <span class=\"attribute\">Model</span>\n <span class=\"value\"><i class=\"icon-xs mr-2\"><svg><use href=\"#icon-openai\"></use></svg></i>GPT 5</span>\n</li>\n<li>\n <span class=\"attribute\">Version</span>\n <span class=\"value\">Azure/gpt-5</span>\n</li>\n<li>\n <span class=\"attribute\">Speed (tok/s)</span>\n <span class=\"value\">47</span>\n</li>\n<li>\n <span class=\"attribute\">Tokens</span>\n <span class=\"value\">7,785</span>\n</li>\n<li>\n <span class=\"attribute\">Cost / Total ($)</span>\n <span class=\"value\">0.04 / 0.19</span>\n</li>\n<li>\n <span class=\"attribute\">End to end time (s)</span>\n <span class=\"value\">51.93</span>\n</li>\n\n","documents":[]},{"id":"5e184893-c13e-4d1b-92b3-3ed3f342ae90","thread_id":"b1c3b6f6-9ba2-43ae-aa04-3e6955011a9e","created_at":"2025-10-23T20:19:59Z","state":"done","prompt":"Would it have negative effects, such as increasing inflation? Also does the budget deficit increase inflation?","references_html":"<ol data-ref-list>\n \n <li>\n <a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt\" >The Inflationary Risks of Rising Federal Deficits and Debt</a>\n <span class=\"__domain-name\">budgetlab.yale.edu</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 47%, transparent 47%)\">47%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation\" >Do Budget Deficits Cause Inflation?</a>\n <span class=\"__domain-name\">www.philadelphiafed.org</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 42%, transparent 42%)\">42%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n <li>\n <a href=\"https://www.investopedia.com/ask/answers/021015/what-effect-fiscal-deficit-economy.asp\" >The Effects of Fiscal Deficits on an Economy</a>\n <span class=\"__domain-name\">www.investopedia.com</span>\n <div class=\"trigger\" tabindex=\"0\">\n <span class=\"contribution\" style=\"background: linear-gradient(to right, var(--primary-70) 11%, transparent 11%)\">11%</span>\n <div class=\"tooltip top end tooltip_base tw-auto\">\n This percentage indicates how much a source has contributed to the answer.\n </div>\n </div>\n </li>\n \n</ol>\n","references_md":"[^1]: [The Inflationary Risks of Rising Federal Deficits and Debt](https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt) (47%)\n[^2]: [Do Budget Deficits Cause Inflation?](https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation) (42%)\n[^3]: [The Effects of Fiscal Deficits on an Economy](https://www.investopedia.com/ask/answers/021015/what-effect-fiscal-deficit-economy.asp) (11%)\n","reply":"<details><summary>Searched with Kagi<p></p>\n<ul>\n<li>wealth tax inflation effects</li>\n<li>budget deficit inflation effects</li></ul></summary> Sources (10):<br>\n<strong>How Inflation Benefits The Wealthy And Harms The Working Class</strong><br>\n<a href=\"https://www.forbes.com/sites/jackkelly/2024/04/08/how-inflation-benefits-the-wealthy-and-harms-the-working-class/\" target=\"_blank\">https://www.forbes.com/sites/jackkelly/2024/04/08/how-inflation-benefits-the-wealthy-and-harms-the-working-class/</a><br>\nApr 08, 2024 The Federal Reserve Bank’s monetary policies, such as cutting interest rates and quantitative easing, contribute to the wealth effect that drives inflation and benefits the wealthy.\n\n<p><strong>The Real Cost Of Inflation: How Investors Are Quietly Losing Wealth</strong><br>\n<a href=\"https://www.forbes.com/sites/jimosman/2024/09/03/the-real-cost-of-inflation-how-investors-are-quietly-losing-wealth/\" target=\"_blank\">https://www.forbes.com/sites/jimosman/2024/09/03/the-real-cost-of-inflation-how-investors-are-quietly-losing-wealth/</a><br>\nSep 03, 2024 Richer investors who own inflation-hedged assets, such as real estate and stocks, can more effectively protect and increase their wealth. As inflation gradually devalues more cautious, \"safe ...</p>\n<p><strong>The Inflation Tax</strong><br>\n<a href=\"https://www.forbes.com/sites/johngoodman/2024/06/02/the-inflation-tax/\" target=\"_blank\">https://www.forbes.com/sites/johngoodman/2024/06/02/the-inflation-tax/</a><br>\nJun 02, 2024 A 10 percent inflation rate imposes a tax of almost 7 percent on the real wealth of the average family. It transfers that amount to the government.To simulate the effects of inflation, the authors assume that we begin with zero inflation and increase the rate to 5 or 10 percent. The higher inflation rate affects all wages and prices evenly and persists indefinitely for all future years. How Inflation Shifts More Money to the Government.</p>\n<p><strong>What Is Inflation And How It Impacts Your Retirement: October 2025...</strong><br>\n<a href=\"https://www.forbes.com/sites/investor-hub/article/what-is-inflation-and-how-it-impacts-your-retirement/\" target=\"_blank\">https://www.forbes.com/sites/investor-hub/article/what-is-inflation-and-how-it-impacts-your-retirement/</a><br>\nMay 13, 2024 “Inflation is a tax on one’s purchasing power.” Ware added that when the Federal Reserve raises interest rates to stamp out inflation, it is “harmful to the general economy as consumer budgets don’t go as far, confidence falls and the cost of borrowing rises.” In addition, he said, high inflation can be “typically unkind to equities for a period of time, principally because of the third element, rising interest rates.”</p>\n<p><strong>IRS Inflation Adjustments For 2026: Higher Thresholds, New ... - Forbes</strong><br>\n<a href=\"https://www.forbes.com/advisor/d/irs-2026-tax-updates-online-filing-tools/\" target=\"_blank\">https://www.forbes.com/advisor/d/irs-2026-tax-updates-online-filing-tools/</a><br>\n The IRS has unveiled its annual inflation adjustments for the 2026 tax year, rolling out a long list of changes to deductions, tax brackets and credits. The updates also include new provisions ...</p>\n<p><strong>Do Budget Deficits Cause Inflation?</strong><br>\n<a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation\" target=\"_blank\">https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation</a><br>\n Developed countries, however, show little evidence of a tie between deficit spending and inflation. In “Do Budget Deficits Cause Inflation?,” Keith Sill states ...</p>\n<p><strong>The Inflationary Risks of Rising Federal Deficits and Debt</strong><br>\n<a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt\" target=\"_blank\">https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt</a><br>\n Higher debt adds to the risk of inflationary pressure in both the short- and the long-run, through aggregate demand, inflation expectations, crowding-out of private investment, and worries about fiscal dominance.</p>\n<p><strong>Understanding Budget Deficits: Causes, Impact, and Solutions</strong><br>\n<a href=\"https://www.investopedia.com/terms/b/budget-deficit.asp\" target=\"_blank\">https://www.investopedia.com/terms/b/budget-deficit.asp</a><br>\nMay 28, 2010 Learn how budget deficits arise, their economic impact, and discover strategies to reduce them. Gain insights into managing government spending and national debt.</p>\n<p><strong>The Effects of Fiscal Deficits on an Economy</strong><br>\n<a href=\"https://www.investopedia.com/ask/answers/021015/what-effect-fiscal-deficit-economy.asp\" target=\"_blank\">https://www.investopedia.com/ask/answers/021015/what-effect-fiscal-deficit-economy.asp</a><br>\nFeb 11, 2015 Learn about the real impact of budget deficits on the economy and see why government financing reduces private financing.</p>\n<p><strong>How Does Fiscal Policy Impact the Budget Deficit?</strong><br>\n<a href=\"https://www.investopedia.com/ask/answers/032615/how-does-fiscal-policy-impact-budget-deficit.asp\" target=\"_blank\">https://www.investopedia.com/ask/answers/032615/how-does-fiscal-policy-impact-budget-deficit.asp</a><br>\nApr 01, 2015 Fiscal policy refers to the use of the government budget to affect government spending and levied taxes.Not all economists agree on the net effect of expansionary fiscal policy on the budget in the long run. Either surpluses will shrink or deficits will grow in the short run, The government can step in and increase its spending when businesses are cutting back on investments and consumers are spending less during an economic downturn.</p>\n</details><details><summary>Thinking</summary>\n<p>Hmmm...</p>\n<p><strong>Considering inflation effects</strong></p>\n<p>I need to think about whether increasing budget deficits could have negative effects like rising inflation. The tool results suggest that I should focus on the provided citations while also incorporating my own knowledge carefully.</p>\n<p>I see that the Philadelphia Fed indicates there's little evidence linking deficits to inflation, which is essential to note. The Yale Budget Lab mentions inflationary risks tied to rising federal deficits. I'll use these citations clearly and concisely to support my claims.</p>\n<p><strong>Examining inflation risks</strong></p>\n<p>Higher debt can increase inflation risks through demand and expectations, among other factors. It's crucial to present this viewpoint alongside the counterarguments. I want to reference entries from Investopedia for general explanations, but I need to be cautious about relying too heavily on them.</p>\n<p>When considering the proposed tax shift, if revenue is neutral, moving from high-wealth to low-income can increase consumption and aggregate demand in the short run. However, if it doesn't balance the budget, the change may remain neutral overall. Results could be modestly inflationary if there’s a revenue shortfall. Supply-side effects from a wealth tax might deter investment and increase long-term inflationary pressure, though evidence remains unclear.</p>\n<p><strong>Exploring the deficit-inflation relationship</strong></p>\n<p>For the second question about whether budget deficits increase inflation, the literature presents mixed findings. In developed countries, there's little evidence of this link unless there's fiscal dominance or when output is at capacity, in which large deficits may boost demand. I'll use insights from the Philadelphia Fed and the Yale piece to present this nuance, ensuring to include inline citations as I go.</p>\n<p>While I can incorporate my own knowledge, I need to clarify what comes from those provided sources and avoid bringing back earlier citations about the Swiss wealth tax. Instead, I’ll concentrate solely on inflation and deficits.</p>\n<p><strong>Analyzing the wealth tax impact</strong></p>\n<p>I want to clarify that a wealth tax alone isn't inherently inflationary; its effect really depends on the overall fiscal stance. Since it's a swap, it seems likely neutral. However, lower-income individuals typically have higher marginal propensities to consume (MPC), so there might be a near-term increase in demand, though modest compared to monetary policy influences.</p>\n<p>I'll note key points:</p>\n<ul>\n<li>The wealth tax swap isn’t inherently inflationary; if revenue-neutral or deficit-reducing, inflation risk is lower.</li>\n<li>Budget deficits can raise inflation risks, particularly when they're large and persistent, but in advanced economies, there's little systematic link during normal times.</li>\n</ul>\n<p><strong>Analyzing the inflation effects of fiscal policy</strong></p>\n<p>I want to start by noting that if the Federal Reserve maintains its inflation target, it can counter fiscal stimulus by tightening rate policy, so inflation outcomes really depend on the policy mix.</p>\n<p>For your proposal’s inflation effects:</p>\n<ul>\n<li>\n<p>If revenue-neutral, inflation impact is likely minimal; reducing the deficit could be disinflationary, while increasing it could be inflationary, especially when the economy is at capacity. I’ll cite the Yale piece on deficits and the Philadelphia Fed for evidence of weak ties to inflation in developed countries.</p>\n</li>\n<li>\n<p>Regarding budget deficits and inflation: there's mixed evidence, but sustained large deficits can heighten inflation risk through demand and expectations. I’ll reference the same citations and maybe include a general explanation from Investopedia about deficits affecting aggregate demand and crowding out.</p>\n</li>\n</ul>\n<p>I can outline quick scenarios too: If the swap raises demand by shifting income to lower-income households, some inflation could happen in the short term, but the Fed might offset that. Over the long term, any investment drag could affect potential output, but that’s ambiguous.</p>\n<p>Based on standard macro logic, a revenue-neutral tax swap shouldn’t increase inflation pressure and could decrease it if it lowers the deficit. Shifting after-tax income toward lower-income groups could raise spending propensity, leading to potential inflation if not fully financed, but again, the central bank can counter this effect.</p>\n</details>\n<p>Short answer:</p>\n<ul>\n<li><strong>Your wealth-tax-for-low-income-tax swap is not inherently inflationary.</strong> If it’s roughly revenue‑neutral, it shouldn’t add net demand; if it reduces the deficit, it would generally lower inflation risk. If it increases the deficit, it can raise inflation risk, especially when the economy is running hot. <sup class=\"trigger\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJOkhp2mNmrlzebWvUh8Bt_9rnwNpOiocWE6D8njdSv3o%3D\"> budgetlab.yale.edu</span><b>1. The Inflationary Risks of Rising Federal Deficits and Debt</b></a><span class=\"passage\">Higher debt adds to the risk of inflationary pressure in both the short- and the long-run, through aggregate demand, inflation expectations, crowding-out of private investment, and worries about fiscal dominance.</span></span></sup><sup class=\"trigger\"><a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation#:~:text=Developed%20countries%2C,Sill%20states\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation#:~:text=Developed%20countries%2C,Sill%20states\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJBMjiI0STvTZ4HMzC2fGmrUsZvyKfAlqDnsv9UJZx3jaJheSwZHKp20wGlh8KboLk\"> www.philadelphiafed.org</span><b>2. Do Budget Deficits Cause Inflation?</b></a><span class=\"passage\">Developed countries, however, show little evidence of a tie between deficit spending and inflation. In “Do Budget Deficits Cause Inflation?,” Keith Sill states ...</span></span></sup></li>\n<li><strong>Budget deficits don’t mechanically cause inflation, but large and persistent deficits raise inflation risks.</strong> In advanced economies the historical link is weak overall, yet higher deficits and debt can pressure inflation through aggregate demand, expectations, and concerns about fiscal dominance. <sup class=\"trigger\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation#:~:text=Developed%20countries%2C,Sill%20states\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJBMjiI0STvTZ4HMzC2fGmrUsZvyKfAlqDnsv9UJZx3jaJheSwZHKp20wGlh8KboLk\"> www.philadelphiafed.org</span><b>2. Do Budget Deficits Cause Inflation?</b></a><span class=\"passage\">Developed countries, however, show little evidence of a tie between deficit spending and inflation. In “Do Budget Deficits Cause Inflation?,” Keith Sill states ...</span></span></sup><sup class=\"trigger\"><a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation#:~:text=Developed%20countries%2C,Sill%20states\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJOkhp2mNmrlzebWvUh8Bt_9rnwNpOiocWE6D8njdSv3o%3D\"> budgetlab.yale.edu</span><b>1. The Inflationary Risks of Rising Federal Deficits and Debt</b></a><span class=\"passage\">Higher debt adds to the risk of inflationary pressure in both the short- and the long-run, through aggregate demand, inflation expectations, crowding-out of private investment, and worries about fiscal dominance.</span></span></sup></li>\n</ul>\n<p>Why</p>\n<ul>\n<li>\n<p>Inflation effects of your proposal:</p>\n<ul>\n<li>If the swap is revenue‑neutral: Net demand doesn’t rise, so inflation pressure should be limited. If the swap reduces the deficit, it’s typically disinflationary. <sup class=\"trigger\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJOkhp2mNmrlzebWvUh8Bt_9rnwNpOiocWE6D8njdSv3o%3D\"> budgetlab.yale.edu</span><b>1. The Inflationary Risks of Rising Federal Deficits and Debt</b></a><span class=\"passage\">Higher debt adds to the risk of inflationary pressure in both the short- and the long-run, through aggregate demand, inflation expectations, crowding-out of private investment, and worries about fiscal dominance.</span></span></sup></li>\n<li>If the swap increases the deficit: That adds demand and can lift inflation risk, depending on slack in the economy and how monetary policy responds. <sup class=\"trigger\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJOkhp2mNmrlzebWvUh8Bt_9rnwNpOiocWE6D8njdSv3o%3D\"> budgetlab.yale.edu</span><b>1. The Inflationary Risks of Rising Federal Deficits and Debt</b></a><span class=\"passage\">Higher debt adds to the risk of inflationary pressure in both the short- and the long-run, through aggregate demand, inflation expectations, crowding-out of private investment, and worries about fiscal dominance.</span></span></sup><sup class=\"trigger\"><a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation#:~:text=Developed%20countries%2C,Sill%20states\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://www.investopedia.com/ask/answers/021015/what-effect-fiscal-deficit-economy.asp#:~:text=Learn%20about,private%20financing.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ6SzNx2-IfidKv8eER9jbMwODFmOjmebNFZtJorK4OBQM57BKRauCt7g9kcNcFUfE\"> www.investopedia.com</span><b>3. The Effects of Fiscal Deficits on an Economy</b></a><span class=\"passage\">Learn about the real impact of budget deficits on the economy and see why government financing reduces private financing.</span></span></sup></li>\n<li>Composition matters: Shifting after‑tax income toward lower‑income households tends to raise near‑term consumption. Any inflation effect from that channel is usually modest and can be offset by monetary policy; the net effect depends on whether the overall fiscal stance is expansionary or contractionary. (General macro logic)</li>\n</ul>\n</li>\n<li>\n<p>Do deficits increase inflation?</p>\n<ul>\n<li>Evidence in developed economies shows little systematic, one‑to‑one link between deficits and inflation across normal times. <sup class=\"trigger\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation#:~:text=Developed%20countries%2C,Sill%20states\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJBMjiI0STvTZ4HMzC2fGmrUsZvyKfAlqDnsv9UJZx3jaJheSwZHKp20wGlh8KboLk\"> www.philadelphiafed.org</span><b>2. Do Budget Deficits Cause Inflation?</b></a><span class=\"passage\">Developed countries, however, show little evidence of a tie between deficit spending and inflation. In “Do Budget Deficits Cause Inflation?,” Keith Sill states ...</span></span></sup></li>\n<li>Still, larger and persistent deficits and debts are associated with higher inflation risk via:\n<ul>\n<li>Stronger aggregate demand (especially near capacity). <sup class=\"trigger\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJOkhp2mNmrlzebWvUh8Bt_9rnwNpOiocWE6D8njdSv3o%3D\"> budgetlab.yale.edu</span><b>1. The Inflationary Risks of Rising Federal Deficits and Debt</b></a><span class=\"passage\">Higher debt adds to the risk of inflationary pressure in both the short- and the long-run, through aggregate demand, inflation expectations, crowding-out of private investment, and worries about fiscal dominance.</span></span></sup><sup class=\"trigger\"><a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation#:~:text=Developed%20countries%2C,Sill%20states\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://www.investopedia.com/ask/answers/021015/what-effect-fiscal-deficit-economy.asp#:~:text=Learn%20about,private%20financing.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ6SzNx2-IfidKv8eER9jbMwODFmOjmebNFZtJorK4OBQM57BKRauCt7g9kcNcFUfE\"> www.investopedia.com</span><b>3. The Effects of Fiscal Deficits on an Economy</b></a><span class=\"passage\">Learn about the real impact of budget deficits on the economy and see why government financing reduces private financing.</span></span></sup></li>\n<li>Higher inflation expectations and risk of fiscal dominance if investors doubt debt sustainability. <sup class=\"trigger\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJOkhp2mNmrlzebWvUh8Bt_9rnwNpOiocWE6D8njdSv3o%3D\"> budgetlab.yale.edu</span><b>1. The Inflationary Risks of Rising Federal Deficits and Debt</b></a><span class=\"passage\">Higher debt adds to the risk of inflationary pressure in both the short- and the long-run, through aggregate demand, inflation expectations, crowding-out of private investment, and worries about fiscal dominance.</span></span></sup></li>\n<li>Potential crowding out of private investment, which can constrain supply over time. <sup class=\"trigger\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJOkhp2mNmrlzebWvUh8Bt_9rnwNpOiocWE6D8njdSv3o%3D\"> budgetlab.yale.edu</span><b>1. The Inflationary Risks of Rising Federal Deficits and Debt</b></a><span class=\"passage\">Higher debt adds to the risk of inflationary pressure in both the short- and the long-run, through aggregate demand, inflation expectations, crowding-out of private investment, and worries about fiscal dominance.</span></span></sup><sup class=\"trigger\"><a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation#:~:text=Developed%20countries%2C,Sill%20states\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://www.investopedia.com/ask/answers/021015/what-effect-fiscal-deficit-economy.asp#:~:text=Learn%20about,private%20financing.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJ6SzNx2-IfidKv8eER9jbMwODFmOjmebNFZtJorK4OBQM57BKRauCt7g9kcNcFUfE\"> www.investopedia.com</span><b>3. The Effects of Fiscal Deficits on an Economy</b></a><span class=\"passage\">Learn about the real impact of budget deficits on the economy and see why government financing reduces private financing.</span></span></sup></li>\n</ul>\n</li>\n</ul>\n</li>\n</ul>\n<p>Practical takeaway</p>\n<ul>\n<li>If your reform is designed to be at least revenue‑neutral (ideally deficit‑reducing), the inflation risk is low and could even decline. If it’s deficit‑increasing, expect some elevation in inflation risk—how much depends on the size of the shortfall and the macro environment. <sup class=\"trigger\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\" target=\"_blank\">1</a><span class=\"tooltip top center citation\"><a href=\"https://budgetlab.yale.edu/research/inflationary-risks-rising-federal-deficits-and-debt#:~:text=Higher%20debt,fiscal%20dominance.\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJOkhp2mNmrlzebWvUh8Bt_9rnwNpOiocWE6D8njdSv3o%3D\"> budgetlab.yale.edu</span><b>1. The Inflationary Risks of Rising Federal Deficits and Debt</b></a><span class=\"passage\">Higher debt adds to the risk of inflationary pressure in both the short- and the long-run, through aggregate demand, inflation expectations, crowding-out of private investment, and worries about fiscal dominance.</span></span></sup><sup class=\"trigger\"><a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation#:~:text=Developed%20countries%2C,Sill%20states\" target=\"_blank\">2</a><span class=\"tooltip top center citation\"><a href=\"https://www.philadelphiafed.org/the-economy/macroeconomics/do-budget-deficits-cause-inflation#:~:text=Developed%20countries%2C,Sill%20states\"><span class=\"source\"><img alt=\"\" src=\"/proxy/favicons?c=lQ30-cxV_E2Vdyqb6hrbuYgId7qu7hecjO7o1T7aqQDFc7XpcLttL1Ryala-GNHJBMjiI0STvTZ4HMzC2fGmrUsZvyKfAlqDnsv9UJZx3jaJheSwZHKp20wGlh8KboLk\"> www.philadelphiafed.org</span><b>2. Do Budget Deficits Cause Inflation?</b></a><span class=\"passage\">Developed countries, however, show little evidence of a tie between deficit spending and inflation. In “Do Budget Deficits Cause Inflation?,” Keith Sill states ...</span></span></sup></li>\n</ul>","md":"<details><summary>Thinking</summary>\n\nHmmm...\n\n\n\n**Considering inflation effects**\n\nI need to think about whether increasing budget deficits could have negative effects like rising inflation. The tool results suggest that I should focus on the provided citations while also incorporating my own knowledge carefully. \n\nI see that the Philadelphia Fed indicates there's little evidence linking deficits to inflation, which is essential to note. The Yale Budget Lab mentions inflationary risks tied to rising federal deficits. I'll use these citations clearly and concisely to support my claims.\n\n**Examining inflation risks**\n\nHigher debt can increase inflation risks through demand and expectations, among other factors. It's crucial to present this viewpoint alongside the counterarguments. I want to reference entries from Investopedia for general explanations, but I need to be cautious about relying too heavily on them. \n\nWhen considering the proposed tax shift, if revenue is neutral, moving from high-wealth to low-income can increase consumption and aggregate demand in the short run. However, if it doesn't balance the budget, the change may remain neutral overall. Results could be modestly inflationary if there’s a revenue shortfall. Supply-side effects from a wealth tax might deter investment and increase long-term inflationary pressure, though evidence remains unclear.\n\n**Exploring the deficit-inflation relationship**\n\nFor the second question about whether budget deficits increase inflation, the literature presents mixed findings. In developed countries, there's little evidence of this link unless there's fiscal dominance or when output is at capacity, in which large deficits may boost demand. I'll use insights from the Philadelphia Fed and the Yale piece to present this nuance, ensuring to include inline citations as I go.\n\nWhile I can incorporate my own knowledge, I need to clarify what comes from those provided sources and avoid bringing back earlier citations about the Swiss wealth tax. Instead, I’ll concentrate solely on inflation and deficits.\n\n**Analyzing the wealth tax impact**\n\nI want to clarify that a wealth tax alone isn't inherently inflationary; its effect really depends on the overall fiscal stance. Since it's a swap, it seems likely neutral. However, lower-income individuals typically have higher marginal propensities to consume (MPC), so there might be a near-term increase in demand, though modest compared to monetary policy influences.\n\nI'll note key points: \n- The wealth tax swap isn’t inherently inflationary; if revenue-neutral or deficit-reducing, inflation risk is lower. \n- Budget deficits can raise inflation risks, particularly when they're large and persistent, but in advanced economies, there's little systematic link during normal times.\n\n**Analyzing the inflation effects of fiscal policy**\n\nI want to start by noting that if the Federal Reserve maintains its inflation target, it can counter fiscal stimulus by tightening rate policy, so inflation outcomes really depend on the policy mix.\n\nFor your proposal’s inflation effects: \n- If revenue-neutral, inflation impact is likely minimal; reducing the deficit could be disinflationary, while increasing it could be inflationary, especially when the economy is at capacity. I’ll cite the Yale piece on deficits and the Philadelphia Fed for evidence of weak ties to inflation in developed countries. \n\n- Regarding budget deficits and inflation: there's mixed evidence, but sustained large deficits can heighten inflation risk through demand and expectations. I’ll reference the same citations and maybe include a general explanation from Investopedia about deficits affecting aggregate demand and crowding out.\n\nI can outline quick scenarios too: If the swap raises demand by shifting income to lower-income households, some inflation could happen in the short term, but the Fed might offset that. Over the long term, any investment drag could affect potential output, but that’s ambiguous. \n\nBased on standard macro logic, a revenue-neutral tax swap shouldn’t increase inflation pressure and could decrease it if it lowers the deficit. Shifting after-tax income toward lower-income groups could raise spending propensity, leading to potential inflation if not fully financed, but again, the central bank can counter this effect.\n\n</details>\n\nShort answer:\n- **Your wealth-tax-for-low-income-tax swap is not inherently inflationary.** If it’s roughly revenue‑neutral, it shouldn’t add net demand; if it reduces the deficit, it would generally lower inflation risk. If it increases the deficit, it can raise inflation risk, especially when the economy is running hot. [^1][^2]\n- **Budget deficits don’t mechanically cause inflation, but large and persistent deficits raise inflation risks.** In advanced economies the historical link is weak overall, yet higher deficits and debt can pressure inflation through aggregate demand, expectations, and concerns about fiscal dominance. [^2][^1]\n\nWhy\n- Inflation effects of your proposal:\n - If the swap is revenue‑neutral: Net demand doesn’t rise, so inflation pressure should be limited. If the swap reduces the deficit, it’s typically disinflationary. [^1]\n - If the swap increases the deficit: That adds demand and can lift inflation risk, depending on slack in the economy and how monetary policy responds. [^1][^3]\n - Composition matters: Shifting after‑tax income toward lower‑income households tends to raise near‑term consumption. Any inflation effect from that channel is usually modest and can be offset by monetary policy; the net effect depends on whether the overall fiscal stance is expansionary or contractionary. (General macro logic)\n\n- Do deficits increase inflation?\n - Evidence in developed economies shows little systematic, one‑to‑one link between deficits and inflation across normal times. [^2]\n - Still, larger and persistent deficits and debts are associated with higher inflation risk via:\n - Stronger aggregate demand (especially near capacity). [^1][^3]\n - Higher inflation expectations and risk of fiscal dominance if investors doubt debt sustainability. [^1]\n - Potential crowding out of private investment, which can constrain supply over time. [^1][^3]\n\nPractical takeaway\n- If your reform is designed to be at least revenue‑neutral (ideally deficit‑reducing), the inflation risk is low and could even decline. If it’s deficit‑increasing, expect some elevation in inflation risk—how much depends on the size of the shortfall and the macro environment. [^1][^2]","profile":{"id":null,"name":null,"model":"gpt-5","model_name":"GPT 5","model_provider":"openai","model_input_limit":1000000,"recommended":false,"model_info":"\n\n\n\n<div class=\"heading\">\n <div class=\"left\">\n \n \n \n <svg class=\"model-icon icon-xs\" data-model=\"gpt-5\">\n <use href=\"#icon-openai\"/>\n </svg>\n <h3>\n \n <span class=\"model-provider\">OpenAI</span>\n \n <span class=\"model-name\">none</span>\n </h3>\n </div>\n\n \n <a href=\"/settings?p=custom_assistant&id=none\">\n <svg class=\"icon-sm edit-icon\" aria-hidden=\"true\">\n <use href=\"#icon-pencil\" />\n </svg>\n </a>\n \n</div>\n\n\n<hr />\n<ul>\n \n <li>\n <h4>\n Cost\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Moderate\">\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-cost --medium\"></div>\n \n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-cost --medium\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Quality\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 4 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Speed\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 4 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li>\n <h4>\n Privacy\n </h4>\n <span>\n \n \n \n\n \n \n \n\n <div class=\"score\" aria-label=\"Rated 2 out of 5\">\n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"filled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n \n \n <div aria-hidden=\"true\" class=\"unfilled-bubble\"></div>\n \n \n </div>\n</span>\n </li>\n <li class=\"divider\" aria-hidden=\"true\"></li>\n <li>\n <h4>Last updated</h4>\n <span class=\"date\">\n \n \n 2025-08-07\n \n \n </span>\n </li>\n \n</ul>\n","model_provider_name":"OpenAI","internet_access":true,"personalizations":false,"shortcut":null,"is_default_profile":false},"metadata":"<li>\n <span class=\"attribute\">Model</span>\n <span class=\"value\"><i class=\"icon-xs mr-2\"><svg><use href=\"#icon-openai\"></use></svg></i>GPT 5</span>\n</li>\n<li>\n <span class=\"attribute\">Version</span>\n <span class=\"value\">OpenAI/gpt-5-2025-08-07</span>\n</li>\n<li>\n <span class=\"attribute\">Speed (tok/s)</span>\n <span class=\"value\">44</span>\n</li>\n<li>\n <span class=\"attribute\">Tokens</span>\n <span class=\"value\">6,614</span>\n</li>\n<li>\n <span class=\"attribute\">Cost / Total ($)</span>\n <span class=\"value\">0.04 / 0.22</span>\n</li>\n<li>\n <span class=\"attribute\">End to end time (s)</span>\n <span class=\"value\">54.96</span>\n</li>\n\n","documents":[]}]