Tax The Poor To Fund The War? Absolutely! Tax The Rich To Help The Poor? Perish The Thought!

Greenpeace used this slogan last year - it fell on deaf ears...

Throughout history, particularly in times of war, governments have imposed steep taxes on the wealthy, often to fund military spending. This policy, despite its inherent contradictions, has demonstrated the willingness of elites to support significant wealth redistribution when the stakes are high, specifically when national security is at risk.

But this redistribution, sometimes decades in the making, seems to evaporate once the war has ended and the threat has subsided, leaving many pressing societal needs, like housing and healthcare, unmet and at the mercy of the market.

In better times, the redistribution of wealth is framed as "impossible" or "unaffordable," with the phrase "No magic money tree" often used to justify inaction - particularly when it is aimed at lifting people out of poverty or providing basic housing. This irony exposes a system built on greed, where priorities shift based on the interests of the few, rather than the needs of the many.

After World War II, the United States imposed a staggering 91% income tax rate on the wealthiest Americans, applicable to income over $200,000 (the equivalent of millions today when adjusted for inflation). This was seen as 'a necessary sacrifice' to help the country recover from the devastating costs of the war and to pay for the rebuilding of Europe through initiatives like the Marshall Plan.

But once there isn't a war to fund, the wealthy, it would seem, do not see paying more tax to help lift their fellow man out of poverty as 'a necessary sacrifice'...

The tax burden was heavy, but during wartime, such measures were accepted, even by the wealthy, as an unavoidable part of the national effort. This policy was not unique to the United States. In the UK, for example, the 1940s saw a top income tax rate of 98% on income over £20,000, which, when adjusted for inflation, would be around £1.1 million today.

This was also justified as a necessary means to fund the war effort. Both the US and the UK understood that such taxes were part of the cost of survival in a global conflict. In these cases, the redistribution of wealth, although it may seem extreme to some, was deemed acceptable, even beneficial, as it directly supported the war machine.

In the UK, the immediate post-war period also saw significant social reforms, particularly under the leadership of Clement Attlee and the Labour government. Attlee's Labour Party, which came to power in 1945, made bold moves towards social welfare and redistribution that benefitted working-class Britons.

The Labour government implemented the creation of the National Health Service (NHS), nationalised key industries such as coal, railways, and steel, and introduced welfare state programmes that aimed to provide security for the population. In this period, there was a marked effort to reduce inequality and ensure that public wealth would be used for the common good, rather than just for military or corporate interests.

But while this momentary progress was significant, it didn’t last. By the 1980s, under the influence of the Conservative Party and figures like Margaret Thatcher, the welfare state began to unravel.

Privatisation became the dominant political mantra, and key industries were sold off to private investors. Tax rates on the wealthy were slashed, and the social programmes that had been built up post-war were gradually dismantled. The balance shifted back in favour of capital, with the interests of elites, corporations, and the military-industrial complex taking priority once again.

Fast forward to the present day, and the contrast is stark. While the willingness to tax the wealthy for the military effort during war seems unquestioned, applying similar redistributive measures for social welfare is often deemed unaffordable. The housing crises continue to escalate in many countries, including the US and the UK, with rising rents, property speculation, and homelessness at historically high levels. Yet, when it comes to addressing these issues, the idea of redistributing wealth to ensure housing and healthcare for all is often framed as "unrealistic" or "too expensive."

In the US, for example, the debate around healthcare reform often runs into resistance from wealthy elites and their political supporters. Despite the clear need for a system that would ensure everyone has access to healthcare, proposals like Medicare for All are dismissed as unaffordable, despite the vast amounts of money that are regularly funneled into military spending. The US military budget for 2024 was estimatedto be more than $800 billion, more than the next ten countries combined.

Yet, funding basic public services for citizens, like universal healthcare or affordable housing, is met with opposition and financial constraints.

Here in the UK, the government has faced growing calls to raise taxes on the wealthiest individuals and corporations to address societal needs like housing, education, and healthcare. However, these calls are often met with political resistance, despite the fact that the UK has consistently increased its military spending, including a £16.5 billion increase in 2020, primarily aimed at maintaining military capabilities and modernising nuclear defences.

If a world war were to break out today, it is not difficult to imagine that governments, once again, would push for higher taxes on the wealthy to fund the war effort. In such a scenario, military spending would become the priority, and wealth would be redistributed, not for the welfare of citizens, but for the preservation of national security. In this sense, one could argue that we would see a form of "socialism for the military"—a situation where the state uses its power to reallocate resources for the sole benefit of armed forces, defence contractors, and national security interests.

This would likely be done in the name of patriotism and national unity, but it would remain a redistribution that serves the interests of the elite, specifically those who profit from war, such as arms manufacturers, defence contractors, and military-industrial complex players.

Once the war ends, however, and the elite no longer feel the existential pressure, the social contract over time begins to collapse. Instead of funding public goods like housing, healthcare, and education, taxes are slashed, and the narrative shifts back to "market solutions" and "individual responsibility." The welfare state that was once rebuilt after World War II, with significant social programmes like the NHS, begins to fall apart under the weight of neoliberal economic policies and corporate interests.

The key takeaway here is the way in which society’s economic priorities shift depending on who benefits. In times of war, redistribution of wealth is seen as necessary for national survival, and even the wealthiest elites are willing to accept it. But in peacetime, the idea of using similar tax measures to benefit society is met with resistance. The military-industrial complex continues to receive unprecedented funding, while the needs of ordinary citizens go unmet. This system is rooted in a form of greed and self-interest, where wealth and power are concentrated in the hands of a few, and the general public is left to shoulder the burdens.

Whether it's military spending or corporate tax breaks, the redistribution of wealth only seems possible when it serves the interests of the elites. If there were a world war tomorrow, we would undoubtedly see a shift toward "socialism for the military", a temporary period where the collective wealth is reallocated to fund war, but once the war is over, and the elites no longer feel the pressure, the redistribution declines, and the status quo resumes.