Tax the Rich and Slash the Military Budget

The Left is often asked how it proposes to pay for programs like universal childcare, Medicare or All, and a green jobs program. Here’s how: tax wealth and capital the same way we already tax wages, and slash our bloated and destructive military budget.

Here’s a question progressives get asked constantly: Fine, you want universal childcare, Medicare for All, and a green economy — but how are you going to pay for it? As part of the Game Changers project, economists Gerald Epstein and Aaron Medlin just answered it with a full accounting. They price out the thirty policies in the Game Changers initiative and show, line by line, how to fund them without adding a dime to the deficit — by taxing wealth and capital the same way the United States already taxes wages and by shrinking a military and immigration-enforcement budget that is both bloated and destructive. The burden of the increased taxes they propose would fall most heavily on those in the upper reaches of the top 1 percent.

Protesters stand on Whitehall in London to protest for equality in our economy. A placard reads 'Tax the Rich'.

Let’s start with the scale of inequality that these thirty policy proposals are responding to. The top 1 percent of American households hold about a third of the nation’s wealth and roughly half of the stock market. In income terms, that same 1 percent takes home twice as much as the entire bottom half of the country combined. The effects ripple outward: stagnant demand drags down growth, upward mobility stalls, and a small elite ends up with political influence wildly out of proportion to its numbers. Meanwhile, ordinary families get squeezed from both sides — wages haven’t kept pace with productivity, and housing, health care, and childcare keep getting more expensive. At the same time, advances in AI threaten to make even stable jobs feel precarious.

Epstein and Medlin’s sharper point is that this isn’t just about how wealth is distributed — it’s about how the government pays its bills. The way Washington currently finances itself is a driver of inequality. Labor income gets taxed heavily and reliably; wealth and capital income get taxed lightly and unevenly. Whatever isn’t collected gets borrowed instead — mostly from the same wealthy households who weren’t taxed for it, who then collect interest on the loan, year after year. It’s a system that manufactures inequality twice: once by under-taxing fortunes, and then again by paying those fortunes interest on the resulting debt.

The numbers back this up. Between 2018 and 2020, the four hundred richest Americans paid an average tax rate of about 24 percent on their pretax income — lower than what the bottom 50 percent of income earners pay on average, and far below the 45 percent top labor-income earners pay. Since two-thirds of federal bonds, which the government issues to borrow money, are held by private investors, interest payments flow disproportionately to people who are already wealthy. The result: the four hundred richest Americans held about $300 billion (in today’s dollars) in 1982; by 2025 that amount had grown more than twentyfold, to $6.6 trillion. Republican administrations from Ronald Reagan’s through both Donald Trump terms accelerated federal government borrowing with tax cuts skewed to the top. Most recently, the 2025 One Big Beautiful Bill Act, which the Congressional Budget Office projects will cut federal revenue by trillions and widen the deficit by roughly $3–4 trillion through 2034, will hand the richest 1 percent over $50,000 a year in tax cuts. Meanwhile, revenue from the corporate income tax, which taxes corporate profits, has collapsed from 7 percent of gross domestic product (GDP) in 1944 to about 1 percent in 2019. As Warren Buffett famously put it, an economy where his receptionist pays a higher tax rate than he does “does not strike me as a just economy.”

The authors are careful to note that deficits aren’t inherently bad — borrowing to fund productive investment (such as education, infrastructure, and most of the Game Changers agenda) pays for itself over time because the social return exceeds the cost. The danger is borrowing to fund waste: excess military spending, fossil fuel subsidies, and corporate giveaways. That kind of borrowing doesn’t just fail to pay off — it deepens inequality and, if debt costs ever outrun economic growth, can become self-reinforcing.

So, what’s the fix? The Game Changers policies are split into three funding categories. Many need no new government money at all — things like stronger labor protections, national rent control, fairer trade rules, or a four-day workweek, which change laws and norms rather than spend cash. A second group has dedicated funding mechanisms tied to the programs themselves: polluters fund climate resilience and a fossil fuel phasedown; scaled premiums fund paid family leave, disaster insurance, and long-term care. Medicare for All, the single biggest item, mostly falls into this category too — it eliminates private insurance premiums, leaving most Americans paying less overall and only the wealthiest paying more.

A third group of policies — universal childcare, a child allowance, social housing, plus a small residual slice of Medicare for All — requires general tax revenue. That’s the piece this brief is really about, and the plan pays for it two ways.

First, spending gets reallocated by cutting military spending deemed unnecessary for genuine defense and shrinking Immigration and Customs Enforcement’s budget in favor of a more humane immigrant-integration system. Together, these reallocations free up between $208 billion and $413 billion a year.