Yes, they’ll have to pay higher taxes. So what? That’s still less than they’d pay to a predatory healthcare, financial, education industry — to capitalism in general.
The conservative strategy, which has seen little pushback from the opposition party, is to sew distrust of the federal government at any opening since ’80 when RayGun said: “Government IS the problem”. Over the decades since they have even portrayed anyone wanting to give the people some benefit as “anti-American” and against “freedom”.
The primary weapon wielded against the left is the falsehood that any expenditure of the government must be balanced with some form of “revenue”, either taxation or debt and that debt must be repaid by taxpayers. This fits very well with the only logic voters are familiar with, their own budget process, or that of any entity that “isn’t” the monopoly issuer of the US dollar. As long as the voters have the illusion of paying for the benefits of others they will act as watchdogs for government spending and resist most of it as wasteful.
With public purpose spending virtually frozen and the people thinking that their employers create prosperity, not the government or social contract, those employers and their rich owners and top managers are elevated in stature to the point where taxing them is considered immoral. With a leadership willing to let this reverse concept of how a government funds itself, and the economy, stand without any pushback it is all but assumed that the outcome would be as we are witnessing.
The reality for any government that creates its own currency at will is that taxation and spending are completely disconnected as long as resources exist for the spending to purchase. Such a currency-issuing government can “afford” anything that is for sale priced in the currency it creates. This is true even without “revenue” from taxation or borrowing, as neither actually represents revenue that can be recycled into spending. Taxation is only useful in controlling inflation, not funding anything, and borrowing no longer has any utility.
Given that one cannot collect or borrow what doesn’t yet exist, it is more accurate to say that the government creating new currency is what funds both, not the other way around. The best way to deal with the power of the wealthy is to make them irrelevant to the ability of the government to spend for the public purpose. Once we stop looking at them as the “source” of money, recognizing that money is a no-cost commodity for Congress to use in shaping the economy/society, much higher taxation of their wealth will follow.
The biggest hurdle to this is making voters aware of how their monetary system works. The debt the politicians use to beat them over the head whenever they demand nice things, like education, healthcare, or modern infrastructure, is just an accounting entity that tracks money in the economy, not a mortgage on future productivity. Keeping the economy anemic of money not balanced with private debt keeps the people dependent upon bank lending and sufficient GDP growth to roll over that debt, as only public money can net retire it.
The holy grail of politicians, a “balanced budget”, leaves nothing in the economy to store value from our commerce and claws back all payments for the resources and labor the government uses. It also diminishes the money supply when trade deficits and wealth accumulation are allowed. There are very few circumstances when deficit spending isn’t “required” to maintain a healthy economy. We, and all economies caught up in neoliberal austerity fever currently, must come to grips with our economic reality or fade away into third-world status, and a return of fascism we see creeping into our society at every turn lately as the people react to their fading prosperity by punching down.
