Tax the Rich? It Will Only Hurt Others, They Believe
In the heart of the capital of conspicuous consumption, Bernard Turner spent Monday morning consuming his own ire.
The government in Washington was lurching toward new taxes on the rich, but ensconced in his usual sun-drenched window seat at a stock brokerage firm in the commercial center of Beverly Hills, the retired businessman was already braced for the impact.
“We’re going to get hit hard, you can count on that,” he said, motioning to packs of exquisitely dressed men and women hurrying down Wilshire Boulevard. “Those people are going to be screaming. You watch. You’ll see people go out and decide not to buy $500 bathrobes anymore. They’re going to buy $100 bathrobes.”
This is the kind of talk that freezes blue blood and causes grown Hollywood executive producers to shed real tears. In Beverly Hills and Los Angeles’ adjoining playgrounds for the rich--in beauty salons and counting houses, trattorias and boardrooms--it is no longer a question of whether the rich will get soaked by a new tax bill, or even how drenched they will get--but rather, who else will get spattered as the rich shake themselves off.
That was the fix that Turner had on events as he made his usual late-morning appearance Monday inside the reception area of Kennedy, Cabot & Co., where he and a group of retirees meet every day to trade stock tips, snipe at each other and watch the progress of the stock market on a green electronic ticker. As they eyed the board, Congress worked to thrash out a compromise on efforts to increase taxes on people earning more than $1 million a year.
“There’s one thing I want to know!” interrupted a man who identified himself as Norman. “Why are all these politicians in Washington holding out for these white-collar types?”
“Norman, you’re making too much noise,” said a man whose face was buried in Fortune magazine.
“So sue me,” said Norman.
Their anteroom on Wilshire Boulevard is a world apart from the vault-like jewelry stores and couturiers clustered nearby on Rodeo Drive. Here, the talk revolves around money and its making, and the uniform is polyester and white socks, not natural fiber and brushed leather jackets.
Turner, 73, who used to own a metal supply warehouse, said that without a cut in the capital gains tax, “I’m going to get killed.” He motioned to the others in the room and added: “Every one of us has a lot in the market. We’ve all got stock portfolios in the six figures.”
“But then,” Turner added, “I’m not rich.”
That is a refrain common among those in upper tax brackets, a way of commenting on their situation without disqualifying themselves. It is how a public relations mogul managed to exit her jade Rolls-Royce on Beverly Boulevard shortly before lunch, and, clutching her new Hermes handbag, sound as if she was describing auto layoffs in Detroit.
“Everyone here will be affected,” said the woman, who declined to give her name for fear of losing clients. “I was at the opening ceremonies for Tiffany’s this morning and there were some lovely jewels there. Well, you know that if this bill comes to pass, people simply won’t be buying as many of those kinds of items.”
Larry Marks’ reluctance to be pegged as wealthy allowed him to browse with familiarity past a jewelry case in Neiman-Marcus with his wife, Rachel, and at the same time sound like a farm belt populist.
“Terrible, just terrible,” said Marks, who described himself as “in retail” as he adjusted a cashmere sweater slung casually over his shoulders. “We’re going to get hit hard and for no reason other than we make a decent living. When we start hurting, the people who depend on us, our employees, will start hurting too.”
Interior designer Barbara Woolf, having her nails buffed, filed and refreshed in Jessica’s Nail Clinic on West Hollywood’s exclusive Sunset Plaza shopping strip, managed to adopt a fervent we-all-must-pitch-in attitude about the rich. “Some of their income is so out of proportion to the rest of us,” she said.
Woolf reclined on a pink banquette inside a pink, scented room where white-uniformed emigres silently performed their miracles on pampered fingertips. While nail technician Anna Berendi applied finishing touches, Woolf wondered whether she would be hurt by the proposed removal of the tax rate “balloon” that has allowed some wealthy taxpayers to pay lower rates while merely affluent taxpayers pay higher rates.
“You know,” she concluded, “I don’t know whether I’m in the balloon or not.”
But, like Turner, she was certain of one thing--that if the rich get hurt, everyone else will too.
“People will not be spending money,” Woolf said, holding out her nails one more time. “This tax business could drive some of them out of business. There has to be a balance for people like us.”
