Tax forms. Getty Images.
If you’ve ever wondered whether our country has an inequality problem, this election should provide all the proof you need. While billionaires used their financial firepower to support their favorite candidates, left-behind Americans expressed their frustrations at the ballot box.
How do we get started on this next chapter in the fight to reverse extreme inequality?
With Senate Republicans still short of a filibuster-proof supermajority, the expiration of Trump’s tax cuts for the wealthy next year could provide an opportunity. But it’s likely that progress will have to start at the city and state level.
Three progressive tax victories in the recent election are an encouraging sign.
The Washington State Initiative 2109 was the most significant tax-related ballot measure of the year. Hedge fund executive Brian Heywood bankrolled this campaign, hoping to repeal the state’s innovative capital gains tax on high earners. The rollback proposal failed in a landslide.
“This victory shows that advocacy in support of creating a more fair tax code is working,” Melinda Young-Flynn, communications director at the Washington State Budget and Policy Center, told me.
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“Business owners, unions, teachers, racial justice advocates, parents, legislators and many more” groups, she added, “have worked together for more than a decade to help the public connect the dots between progressive taxes and common sense and the very real needs of our communities.”
Washington state’s landmark policy, introduced in 2022, imposes a 7 percent excise tax on capital gains from the sale of stocks, bonds and other assets that exceed $250,000 per year (excluding real estate sales). Who earns so much from their financial investments? Less than 1 percent of the state’s wealthiest residents.
Before this tax, Washington’s wealthy prospered under a state constitution that banned income taxes. The capital gains tax ends that ban — and the state Supreme Court has ruled it constitutional.
In its first two years, the capital gains tax has raised $1.3 billion for investments in child care and early learning, public schools and school construction.
“The people of Washington have sent a clear message,” Young-Flynn said. “The well-being of children takes precedence over tax breaks for the ultra-wealthy. All of us who care about economic justice know that it is long past time to stop giving the ultra-wealthy a special deal in the tax code at the expense of everyone else.”
Washington voters also beat back an effort to allow workers to forego a new payroll tax on long-term care insurance if they gave up the benefit of that state-run program. Had this measure been passed, the insurance program would likely have become financially unviable. Fortunately, voters rejected the proposal by a 55-45 margin.
And by a decisive margin, Illinois voters backed an additional 3 percent tax on income over $1 million, with the proceeds going to property taxes. Although the measure is non-binding, organizers hope this victory will fuel efforts to put a constitutional amendment on the ballot in 2026 to authorize the new tax on the wealthy.
In addition to these fair tax victories, I am encouraged by the passage of pro-worker reforms in several “red” states – often in stark contrast to the positions of their Republican representatives in Congress.
Voters in Nebraska, Missouri and Alaska approved guaranteed paid leave, while Missouri and Alaska also approved state minimum wage increases. Abortion rights measures passed in seven of 10 states, while voters in Nebraska supported medical marijuana.
After the election, a friend wrote to me with the following message: “A tree outside my window is almost bare. Perhaps it is a picture of our national life this morning. We have a choice: concentrate on the bare branches or enjoy the colorful leaves.”
These state victories against inequality are some of the colorful leaves I appreciate today.
This column was originally published on OtherWords.org.
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