The economic elites gathered in Davos this week may not yet be shaking in their snow boots, but the more prescient among them see a political storm coming their way — a revolt against the rich across Western democracies.
Just look around at what is happening down the mountain. In France, Emmanuel Macron, stuck with the moniker “president of the rich,” is besieged by a popular revolt over inequality. In Italy last week, the government approved the “citizen’s income” scheme that will give the poorest up to 780 euros (nearly $900) a month. And in the United States, polls show that 59 percent of voters agree with the just-elected 29-year-old Rep. Alexandria Ocasio-Cortez (D-N.Y.)’s proposal for a 70 percent marginal tax rate on the richest.
In Davos, the chief investment officer of Guggenheim Partners said he thinks “the likelihood that a 70 percent tax rate, or something like that, becomes policy is actually very real.” Ray Dalio, one of the wealthiest investors in the world, also sees such ideas gaining serious traction.