Confiscating US billionaires’ wealth would run the US government about 8 months

Around the time Democrats briefly considered a proposed "billionaires tax," a two-year-old Facebook post resurfaced claiming that even if all the wealth of the nation’s billionaires were seized, it wouldn’t run the federal government for very long.

"The 550 US billionaires together are worth $2.5 trillion," said a viral image with the post. "If we confiscated 100% of their wealth, we'd raise enough to run the federal government for less than 8 months. Perhaps our problem isn’t how much billionaires have but how much politicians spend."

The post was flagged as part of Facebook’s efforts to combat false news and misinformation on its News Feed. (Read more about our partnership with Facebook.)

The figures in the 2019 post are not currently accurate for the number of billionaires and their total wealth. But current estimates and spending figures indicate the billionaires’ total wealth would be enough to cover government spending for about eight months. 

The viral image is a Feb. 1, 2019, tweet by Antony Davies, an economics professor at Duquesne University in Pittsburgh and a fellow with the free-market Foundation for Economic Education. 

At the time, Check Your Fact found that the billionaires’ wealth would have covered about nine months of spending, not less than eight months.

So, what do the latest figures show?

Estimates put the total wealth of America’s billionaires at $5 trillion, while the federal government spent nearly $7 trillion in the fiscal 2021, which ended Sept. 30.

Here are the breakdowns.

With its 2021 list of world billionaires, Forbes estimated there were 724 U.S. billionaires as of March 5, the most in any one nation, worth a total of $4.4 trillion. 

More recently, the Institute for Policy Studies estimated that as of Oct. 15 there were 745 U.S. billionaires, together worth slightly more than $5 trillion. That’s a 70% collective increase in fortune since the start of the COVID-19 outbreak on March 18, 2020, according to the institute.

As for the federal government, it spent $6.82 trillion in fiscal 2021, which ended Sept. 30, according to the Treasury Department.

Featured Fact-check

Instagram posts

stated on November 9, 2024 in an Instagram post

Fox News reported California Gov. Gavin Newsom “will withhold” California’s federal income tax.

That’s the figure the Institute for Policy Studies and the Tax Foundation referred us to when we asked about the claim we’re checking. 

We also reached out to Davies, noting that we’re checking the accuracy of the Facebook post currently being circulated. He pointed us to the Institute for Policy Studies as well and cited the fiscal 2022 budget, which lists $7.25 trillion in outlays for fiscal 2021.

So, in round numbers:

The government spends $7 trillion in a year — or about $19 billion per day.

Tapping the billionaires’ $5 trillion would pay for about 263 days of federal government spending — or more than eight months.

There are some caveats. 

Primarily, no one is suggesting a 100% tax.

But Chuck Collins, director of the Program on Inequality and the Common Good at the Institute for Policy Studies, said billionaires have seen their effective tax rates go down compared to the average taxpayer, "so surely billionaires can pay more." 

Davies, the author of the original post, told PolitiFact that even if there were an effort to confiscate all of the billionaires’ wealth, it would actually net less than eight months’ worth of revenue because very little of the wealth is in cash. Billionaires would have to liquidate their stocks, bonds, land and other assets in order to pay the tax and if they did so, it would drive down stock and bond prices and the prices of buildings and land, and in turn, generate less than $5 trillion, "possibly a lot less."

Alex Muresianu, a federal policy analyst at the Tax Foundation, said the claim is "a useful illustration of the problems with comparing what would be a one-time revenue increase for the government as a way to pay for expenses that recur every year."

A 2019 viral image newly reshared on Facebook claimed: "The 550 U.S. billionaires together are worth $2.5 trillion. If we confiscated 100% of their wealth, we'd raise enough to run the federal government for less than eight months."

The two figures are out of date, but the thrust of the claim is accurate: The estimated $5 trillion in wealth of the nation’s billionaires is enough to cover about eight months’ worth of federal spending.

We rate the claim Mostly True.