Millionaires say they favor tax hike to fix wealth gap
Survey of wealthy Americans finds that politics determine the solution for inequality. But they were united on other key wealth issues facing the country.
Robert Frank, CNBC
In the heated debate over inequality, the wealthy are usually portrayed as the cause rather than the solution.
But CNBC's first-ever Millionaire Survey reveals that 51 percent of American millionaires believe inequality is a "major problem" for the U.S., and nearly two-thirds support higher taxes on the wealthy and a higher minimum wage as ways to narrow the wealth gap.
The findings show that — far from being a purely self-interested voting bloc — American millionaires have complicated views when it comes to the wealth gap and opportunity in America. They are unashamed of their own wealth and attribute their success to hard work, smart investing and savings. They also believe that anyone in America can get wealthy if they work hard.
Yet millionaires also believe that cultural and family issues prevent many Americans from climbing the wealth ladder. They advocate improved education, higher taxes on the wealthy and better savings incentives for the poor and middle class as important changes that would reduce inequality.
The CNBC Millionaire Survey polled 514 people with investable assets of $1 million or more, which represents the top 8 percent of American households. The respondents came from around the country and were split between Democrats, Republicans and Independents.
The online survey was conducted in March by Spectrem Group on behalf of CNBC. The overall margin of error was 4.3 percentage points.
When asked about the No. 1 factor in obtaining their wealth, the millionaires ranked hard work first (23 percent), followed by smart investing (21 percent) and savings (18 percent). Education ranked fourth, at 10 percent, followed by frugality and then inheritance. Only 1 percent cited luck as the top reason for their wealth.
Multimillionaires, or people worth $5 million or more, were more likely to cite "running my own business" as their top wealth factor. Women were three times more likely to cite inheritance as their top wealth factor (15 percent vs. 5 percent for men), while men were more likely to cite savings (20 percent vs. 14 percent for women).
Most millionaires still believe in the American dream. Fully 94 percent said the American dream is achievable. When asked to define that dream, the largest number (45 percent) said the American dream is "prosperity and upward mobility through hard work." Only 18 percent defined it as "spiritual and temporal happiness more than material goods." Multimillionaires, however, were far more likely to define the dream as material rather than spiritual (63 percent vs. 4 percent).
Despite being winners in the new economy, U.S. millionaires view inequality as a problem. More than half of millionaires and multimillionaires agreed that "inequality of wealth in our nation is a major problem."
Yet they don't see themselves as a cause. Fully 81 percent said they don't feel embarrassed by their wealth, "because I earned it," and only 5 percent said they feel a sense of guilt about the wealth they possess. More than half said anyone in the U.S. can become wealthy if they work hard.
When asked about the reasons for inequality, most (78 percent) said the wealthy have greater access to education. Two-thirds cited that the "lack of financial literacy" prevents poor households from making better financial decisions.
More than half said cultural issues and broken families also prevent people from attaining wealth. Only 6 percent said that people worth less do not work as hard as those with wealth.
The best way to reduce inequality, millionaires say, is through improved education. Fully 83 percent supported an increase in educational opportunities for the less wealthy. An equal number (64 percent) supported better savings incentives for the less wealthy and higher taxes for the wealthy.
Perhaps surprisingly, a majority (63 percent) also support a minimum wage. Only 13 percent supported reducing unemployment benefits to encourage more work as a solution to inequality.
A millionaire's view on inequality and taxes, however, seems to depend more on their politics than their wealth. Eighty-six percent of Democratic millionaires said inequality is a problem, compared with only 20 percent of Republicans. Two-thirds of Republicans vs. a quarter of Democrats say anyone can become wealthy in America if they work hard.
Democratic millionaires are far more supportive of taxing the rich and raising the minimum wage. Among Democratic millionaires, 78 percent support higher taxes on the wealthy, and 77 percent back a higher minimum wage. That compares with 31 percent and 38 percent, respectively, for Republicans.
Politics even plays a role in how millionaires view wealth creation. Among Republican millionaires, 63 percent say hard work is the No. 1 reason the wealthy are wealthy. Democrats were most likely (45 percent) to cite a person's family or place of birth as the top reason for their wealth.
The bottom line: American millionaires, in general, agree that inequality is a problem. But when it comes to solutions, millionaires are just as split along political lines as the rest of the country.
More from CNBC
VIDEO ON MSN MONEY
"The CNBC Millionaire Survey polled 514 people with investable assets of $1 million or more, which represents the top 8 percent of American households."
Out of 10 million households with a million investable dollars, they asked only 514 of them and squeeked by 51% to 49% to come up with the ultraliberal MSN headline "Millionaires say they favor tax hike to fix wealth gap" - yeah -that's quality journalism folks!
Why don't people understand that the government will spend you money much more wisely than you will. We should take all of our income, give it to the government and let them decide what we do and don't need.
BTW, I would love to hear the poll questions given here to come up with these results. IF these people were so interested in giving their money away, wouldn't they already be doing it?
Taxes on wages (in any form – flat or progressive) are the greatest evil of our American Republic. When government is free to steal from you, there are no limits to waste and abuse in government. If a person chooses to work extra hours or two jobs in order to better provide for themselves or their family, they should not be penalized, but that is what happens. The more you make by working harder and longer, the more money is stolen from you, and given to those who spend their lives living off the hard work of others.
The revenue the government needs to provide legitimate constitutional services should be obtained primarily from a national sales tax instead of a tax on wages. All would pay based on consumption, the more you spend the more you pay. The more luxury you surround yourself with, the more you pay. Your choice. A national sales tax system would capture money spent by criminals and by illegal aliens who currently pay near zero in taxes. There would need to be some exemptions: Cars (already have a federal excise tax) Primary Residence/Rental Properties (vacation homes would be subject to tax/rental profit would be taxed) Fresh Food (Preprocessed foods and prepared meals would be taxed – only fresh/fresh frozen/canned goods would be exempt) Insurance Premiums, Health Care & Certified Education.
Adding another layer of tax to a business would not be fair. Businesses would need to be compensated by keeping a portion of the tax to cover the expense of collection and reporting. A percentage of .20 to .05 would be fair.
Sure people like Warren Buffet have advocated paying higher taxes. Problem : Warren Buffet owes the IRS over $1 BILLION in back taxes either personally and / or Berkshire Hathaway.
He gets away with it because he backs Obama and has money to hire lawyers to fight it.
This is a bunch of crap. I do not want the federal government.to have any of my money to pay bonuses to IRS employees who also owe back taxes.
WAKE UP AMERICA.
Maybe the govt need to give classes to those on welfare. "How to work hard" "How to save" "How education makes a difference in propserity"
Of course a Dem White House would never put those classes out. Most likely more classes teaching how to apply for govt aid.
Let the wealthy contribute to these free classes.
But I fear our country is headed for its demise.
Apparently it's racist to ask one for an ID to vote, yet you need an ID to receive obamacare and govt aid.
Just one reason we cannot move forward.
We have given to the poor, and given to the poor a lot. It's now generational. Now they expect more and more. So the govt (Taxpayers) give more at the point of a gun. We are screwed, we are all just riding it out til it hits.
I'm not in the 1%, but maybe the 3%. Taxing me more to give to the parasitic class will not fix the problem. He have more people on the dole than working. I guess when you give something away for free they will line up for it.
What we need to do is TAX that poor heavily so we have less of them. That works with cigarettes, booze and other things right? When we tax business at the highest rates in the world that is because we don't want business here. We want them to move overseas, right?
Sorry, but you cannot TAX your way to prosperity no matter what that imbecile Obama says...
Bull Chit. I do NOT support paying more taxes OR a higher 'hurt the poor wage'.
NONE of my friends do either.
So where did they allegedly find these 'millionaires' who want to finish destroying the economy?
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.