CREDO Action

Tell Congress: No more tax handouts for wealthy investors

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Petition to Congress:

"Put an end to 'opportunity zones' and similar programs that make wealthy investors richer and incentivize gentrification."

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    Tell Congress: No more tax handouts for wealthy investors

    Michael Milken is a corrupt former Wall Street trader who served two years in prison for insider training and was the inspiration for the notoriously greedy character Gordon Gekko in the movie "Wall Street." He's also pals with Treasury Secretary Steve Mnuchin, Commerce Secretary Wilbur Ross, Ivanka Trump and Jared Kushner.1

    Not surprisingly, Mnuchin appears to have personally intervened to help Milken personally benefit from an "opportunity zone" tax break designed to help wealthy investors exploit poor areas.2

    Mnuchin's apparent corruption is business-as-usual for the Trump administration. But it wouldn't even be possible if it weren't for opportunity zones, a bad idea that isn't working and needs to go away. We need to seize on the new attention Mnuchin's corruption is bringing to the opportunity zone tax scams to finally end this handout to wealthy investors.

    Tell Congress: No more tax handouts for wealthy investors.

    Opportunity zones incentivize destructive gentrification, pure and simple. The current opportunity zone program was part of the Trump Tax Scam, but the idea existed in various forms for years. In theory, a tax break on investment in low-income areas will spur development and create jobs. In reality, because there are no rules saying opportunity zone investments must benefit the community, they turn out to be just another bonus for the already wealthy.3

    Some wealthy investors already owned property in areas now designated as opportunity zones, giving them a tax break on projects they already intended to build. In other cases, old data meant the area had long since gentrified and only wealthy landowners benefited. Most of the time, the zones fueled massive gentrification – giving investors an incentive to build unaffordable housing in low-income neighborhoods and push out the people who lived there first.4

    Mnuchin's gift to his pal Milken is just one glaring example. Milken spent years rehabilitating his image through his Milken Institute, which advocated for opportunity zones. After a series of meetings at Milken Institute events, Mnuchin personally intervened to deem a property Milken owned in a Reno, Nevada investment area an opportunity zone, giving Milken a massive tax benefit.5

    The Wall Street investor class in America convinced members of both parties that tax incentives like opportunity zones were a great idea. But Mnuchin's corrupt dealings show how they help the super-rich at the expense of the rest of us. We need to make sure Congress strikes at the root of the problem by ending these tax breaks for gentrification for good.

    Tell Congress: No more tax handouts for wealthy investors.

    Thank you for speaking out.

    References:

    1. Eric Lipton and Jesse Drucker, "Symbol of ’80s Greed Stands to Profit From Trump Tax Break for Poor Areas," The New York Times, Oct. 26, 2019.
    2. Ibid.
    3. Angela Peoples, "Opportunity zones are just an opportunity for the rich to gentrify poor neighborhoods," MarketWatch, Oct. 29, 2019.
    4. Ibid.
    5. Lipton and Drucker, "Symbol of ’80s Greed Stands to Profit From Trump Tax Break for Poor Areas."