On Nov. 1, Amazon workers received a raise. CEO Jeff Bezos announced in October that all Amazon employees, including employees of its subsidiaries, like Whole Foods, would earn at least $15 per hour, a move that earned Bezos a standing ovation from everyone from labor groups to Bernie Sanders.
To a lot of people, $15 per hour sounds like a lot—and indeed, it presents a significant raise to the seasonal workers who reportedly lived in their cars to work seasonal jobs for the online behemoth. It’s the basic minimum wage that millions have been seeking for years, both in the boardroom and at the ballot. But in Seattle, the town that helped make Bezos the billionaire that he is, it’s not nearly enough.
At that rate, a person needs to work more than 100 hours per week to really afford the average one-bedroom apartment in Seattle and not be considered “rent-burdened” by the government. In Washington state, in general, to rent a two-bedroom apartment, you have to earn close to $30 per hour.
Bezos, by comparison, earns nearly $2,500 per second — and pays, by comparison, a fraction in taxes.
The same men who receive awards and accolades for their community involvement… are also the ones who have piled cash reserves while the state government starved.
And yet, the announcement that wages were jumping to $15 per hour was greeted with fanfare from the nation’s biggest progressive boosters. It was considered heroic. And so was the announcement that Bezos was planning to spend up to $100 million to address homelessness—an amount he earns in about half a day, according to Business Insider.
Because when billionaires do anything for anyone else, it’s cause for celebration.
We see this a lot out here in Washington state, a place that is uncommonly kind to people with ample wealth. This is not hyperbole; a report released in October found that, once again, the Evergreen State has the country’s most regressive tax structure. The richest percentile of residents — those who earn more than half a million dollars annually — pay three percent of their income in annual state and local taxes. Meanwhile, those who earn under $24,000 per year — many of whom live below the poverty line — shell out 17.8 percent.
This makes it difficult for lawmakers to tackle the big problems; for over a decade, Washington has struggled to fund basic education and provide critical mental health care to those in need. Every year, elected officials head into session wondering how they’re going to pay for new roads and transportation upgrades when property taxes are maxed out.
But this structure is not an accident. It is by design, crafted and upheld by the people it benefits. Washington state is home to a tax structure that benefits the wealthy because, and not in spite of, the fact that Washington state is also home to the nation’s wealthiest men.
And yet, those same wealthy men — and everyone who carries water for them — will tell you that they are doing everything they can and that anything we receive from them, collectively, should be praised.
Washington is proud of its billionaire population, and many people work hard to retain them; after Amazon announced that it was seeking a second (or, now, a second and third) location, lawmakers penned op-eds decrying Seattle’s “anti-business” climate as the reason the online vending behemoth might want to explore other options and made substantial political offers to try to get them to keep growing at break-neck pace. After all, these billionaires give money. They’re philanthropists. We would be sunk without them.
And yet, the same men — men like Bezos and the late Microsoft co-founder Paul Allen — who receive awards and accolades for their community involvement, for their substantial role in Washington’s booming economy, are also the ones who have piled cash reserves while the state government starved. Washington needs this philanthropy precisely because the wealthy don’t pay taxes.
The bar for the behavior of billionaires feels precariously low.
If you know just one single thing about Paul Allen, it’s probably that he had a lot of money and that he gave away a lot of money. Throughout his life, he donated about $2 billion to charitable causes and organizations he founded. But he also spent a lot of money, mostly quietly, to keep his money.
According to MIT researchers, more than 46 percent of Americans die with less than $10,000 to their name.
Just a few weeks before his death, Allen made headlines for donating $100,000 to a political action committee designed to retain Republican control of the House. He also, in the last several years, made substantial donations to Republican candidates, the majority of whom have backed the Trump administration’s tax plan. And the year he made headlines for joining the “Giving Pledge” to donate 10 percent of his income, he also donated heartily to defeat an initiative that would have created an income tax in Washington. That initiative—to increase taxes on the rich—was led by another billionaire, the father of his one-time business partner, Bill Gates Sr.
It worked. The campaign was defeated, and, to this day, Washington state has no income tax, no capital gains tax, and gaping loopholes for things that rich people buy, like jet planes. The bulk of tax money in Washington comes from sales taxes, property taxes, and a business tax that is woefully regressive, particularly to small businesses.
As such, our billionaires keep getting richer. At his death, Allen was worth an estimated $26 billion — an astronomical amount in a nation where, according to MIT researchers, more than 46 percent of Americans die with less than $10,000 to their name, and most have less than $1,000 in savings. Allen owned two yachts, one of which cost $100 million.
Which is fine — it was his money to spend. But while Allen was yachting, Washington struggled to fund a social safety net that works. Seattle’s rapidly growing homeless population has become top-billed news — and for good reason. More people die from complications of homelessness each year than are murdered in Seattle.
This is due in large part to a mismatch between wages and the cost of housing, inflated by a massive influx of highly paid Amazon employees over the last eight years. It’s also due to the fact that the local revenue is heavily dependent on homeowners and renters, who are already struggling to keep up financially.
And while the city of Seattle looks under the couch cushions for more money to pay to build affordable housing, both Amazon and Vulcan, Allen’s real estate holding company, dropped money and influence to repeal a small tax on large companies that would drum up a little more revenue.
This doesn’t mean that Allen or Bezos are bad people or that their philanthropy is meaningless; Bezos’ spending on homelessness has already begun to benefit local organizations around the county. It doesn’t mean that rich people shouldn’t make donations. But it is worth comparing the money they choose to give and the money they have fought so hard to keep.
There is a critical difference between philanthropists and the rest of us; whereas most people struggle to find ways to cover the annual increase in taxes, people like Allen, who famously struggled to give away his money, can cut big checks without a second thought. The 10 percent sales tax that Bezos pays on goods in Seattle isn’t much more than a small rounding error in his budget; the people who help him earn that money, though, notice.
While philanthropy is great, taxes are essential — and unlike charitable donations, they go to everyone.
Philanthropy is widely believed to be a noble pursuit; we collectively praise those who have more than enough, in part because it’s optional. The ultra-wealthy don’t have to give away their money, but sometimes they do. But it’s worth asking how they got so much money to begin with and whether or not their communities would need it if they had been paying their fair share from the start. Because while philanthropy is great, taxes are essential — and unlike charitable donations, they go to everyone.
A capital gains tax could fund Medicare for all in Washington or an educational system that actually works for students of all income levels and backgrounds. It could help provide essential mental health services to people who have no ability to pay for them. It could help all of those Whole Foods workers find a place to live so they don’t have to commute so far. It would help pay for roads and buses so their commute would be more swift, reliable, and affordable.
Whereas philanthropy picks and chooses what gets a benefit, tax dollars are allocated by the will of the people and the people they elect. Philanthropic money goes to whatever organizations wealthy people think are important, with little transparency. And often, those dollars don’t trickle down or benefit the folks who need it the most—for example, a museum filled with sci-fi memorabilia. Arts organizations that cater mostly to other rich people. Sports teams. Pre-schools that are located in “low-income” (as deemed by the organization) neighborhoods and based on a “customer-focused” approach.
When billionaires choose to increase wages for their workers, it’s a savvy business decision that benefits the workers and the community, but it’s often cloaked as an act of grace. When they give money to charities, it’s generous and kind, to be sure, but it’s often applauded as enough. More than enough.
It doesn’t feel like enough.
At least, not in Washington state, where billionaires have held much of the decision-making hostage and used the promise of their good-hearted acts as bait for sweeter deals. Not in Washington state, where the poorest folks still pay the most in taxes and are expected to thank the billionaires for whatever scraps they decide to toss down. Not in Washington state, where we’ve tried to warn everyone else, and they don’t seem interested in hearing it.