Wealth-tax opposition is rooted in the era of American slavery, 2 economists say

• Sens. Bernie Sanders and Elizabeth Warren have both put forward wealth tax plans that would hit the nation's richest citizens with steeper taxes in a bid to reduce inequality and pay for their progressive agendas.
• The plans have generated fierce blowback among some economists, Wall Street financiers and leading corporate leaders like Bill Gates, who argue that a wealth tax would stifle economic growth and hurt investment.
• It's an argument that echoes back to the 19th century, when the brutal system of slavery was locked into the engine of the American economy, according to two economists at the University of California in a recent book.
• They argue the initial wellspring of anti-tax rhetoric emanated from the slaveowners of the South determined to defend their massive wealth built on the backs of the enslaved.
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Taxing wealth is an idea now thrust to the center of the Democratic primary. Sens. Bernie Sanders and Elizabeth Warren have both put forward wealth tax plans that would hit the nation's richest citizens with steeper taxes in a bid to reduce inequality and pay for their progressive agendas.

The plans have generated fierce blowback among some economists, Wall Street financiers and leading corporate leaders like Bill Gates, who argue that a wealth tax would stifle economic growth and hurt investment.

It's an argument that echoes back to the 19th century, when the brutal system of slavery was locked into the engine of the American economy, according to two economists at the University of California in a recent book.

Economists Gabriel Zucman and Emmanuel Saez - both of whom consulted with the Warren and Sanders campaigns - traced the history of the wealth tax in "The Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay."

They argue the initial wellspring of anti-tax rhetoric emanated from the slaveowners of the South determined to defend their massive wealth built on the backs of the enslaved.

Citing research from historian Robin Einhorn, Saez and Zucman write:

"A fear haunted the slaveowner of the South: that non-slaveholding majorities would use taxation to undermine - and eventually abolish - the 'peculiar institution.' They particularly feared wealth taxation: at a time when 40% of the population in Southern states was considered property, property taxes were an existential threat for slaveholding planters. They fought such taxes tirelessly, and for two centuries wielded their power to keep taxes and public institutions archaic."

They point out that the slaveowners of the South took steps to preserve their economic power. When property taxes were enacted, they put themselves in charge of assessing their land's value amd lowballed it to pay a lower tax rate.

Saez and Zucman say the lingering influence of their arguments can still be heard today:

"Perhaps more than any other social group, they are the artisans of the anti-government belief system that... suffuses American history. They embraced the supreme primacy of private property - even when that property consisted of human beings. They railed against the evil of 'inquisitorial' income and wealth taxes that allow tax collectors to 'invade' private homes."

While the economists are careful not to overstate the link between slavery and anti-tax rhetoric, they say that they left an unmistakable imprint on the way some Americans argue against taxes today.

"While the sources of anti-government tax revenue is complex, over the last centuries, few have done more to perfect the anti-tax narrative than Southern slaveholders," Saez and Zucman write.

When the Civil War broke out, the hostility of the southern states towards taxes severely hampered its ability to generate the revenue needed to fight the Union, which stretched from 1861 to 1865 and killed over 600,000 Americans.

The Confederacy lay in ruins after the end of the war, but it didn't mark the end of the aristocratic dynasties that once held sway in the South. Research published earlier this year from the National Bureau of Economic Research found that some formerly slave-owning families were successful in reaching the top of the economic pyramid again in the South.

By 1880, the sons of slave owners who hadn't deeply invested in enslaved people were better off than sons of Southern whites who did and started at similar levels of wealth, the Washington Post reported.