The Blueprint: Race-Based Taxes Are the Future if Democrats Win (NYC Model)

The NYC Blueprint: The Most Advanced Version of the Plan

New York City is the model for what the Democratic Party plans to do nationwide if they win. It represents the most fully realized execution of a policy architecture that has been built deliberately, state by state, think tank by think tank, for three years running.

To understand what Democrats do nationally if they win Congress and the White House, you have to study what Mayor Zohran Mamdani is doing right now in the most economically significant city in the world.

Mamdani’s own campaign document, titled “Stop the Squeeze on NYC Homeowners,” explicitly committed to “shift the tax burden from overtaxed homeowners in the outer boroughs to more expensive homes in richer and whiter neighborhoods.” That language naming race as the organizing principle of a tax policy is unprecedented in modern American municipal government. When challenged, Mamdani retreated into narrative framing language immediately: “It’s not driven by race. It’s more of an assessment of what neighborhoods are being undertaxed versus overtaxed.”

But his own housing official Cea Weaver had already said publicly and without apology that she wanted to “impoverish the white middle class” because “homeownership is racist,” that “private property is a weapon of white supremacy,” and that “whites especially will be impacted” by the transition she and her colleagues were designing. Weaver is not a fringe voice shouting from outside. She is a senior policy official inside a sitting administration of America’s largest city, describing the policy she is helping design.

What the actual tax proposal does: Mamdani’s revenue plan proposes slashing New York’s estate tax exemption from $7.1 million, where it currently sits, all the way down to $750,000, while simultaneously raising the top estate tax rate from 16% to 50%. When stacked on top of the federal estate tax rate, the combined rate hits 70%. Think about what that means in practice. A family that owns a home in Staten Island, a brownstone in Brooklyn, or a modest property in Queens, any home worth more than $750,000, which describes an enormous share of ordinary New York real estate would owe 70 cents of every dollar above that threshold to the government when a parent dies and leaves the home to their children.

Most families in that position are not wealthy. They are middle-class homeowners who bought decades ago in a city that has become astronomically expensive through no action of their own. Many would be forced to sell the home simply to pay the tax bill.

The $750,000 amount is not a coincidence. The specific threshold of $750,000 did not emerge from economic modeling. It appears first in the NYC Comptroller’s “Racial Wealth Gap in New York City” report a document written by Brad Lander, who is one of Mamdani’s closest political allies as the median home value for white homeowners in New York City.

That number showed up in a racial wealth gap study first. Then it showed up as Mamdani’s estate tax threshold. The document proposing the tax never explains why $750,000 was chosen. No other rationale has been offered. The tax was reverse-engineered from a racial data point, with the legal text using dollar figures rather than skin color to achieve an outcome calibrated based on race. This is the core strategy of the entire movement: use confusing language to target racially correlated wealth.

This plan also has the full government apparatus behind it. The estate tax proposal does not stand alone either. It sits inside a 375-page “Preliminary Citywide Racial Equity Plan” covering all 45 city agencies, with more than 200 agency-level goals, 800 strategies, and 600 performance indicators.

Every arm of city government: housing, health, education, public safety, infrastructure, hiring are all being reoriented around racial outcome metrics.

The racial equity offices alone received a 42% budget increase to $10.2 million annually, in a city facing a shortfall of $5.4 to $7.1 billion. The DOJ’s civil rights division flagged it publicly as “fishy/illegal.” And in one of the most telling details of all, the city’s own Law Department stripped the words “diversity, equity and inclusion” from earlier drafts out of fear of federal legal challenge . This is tantamount to an admission that the underlying goals cannot survive scrutiny if stated plainly. They’re pursuing race-conscious outcomes through race-neutral legal text, and they know it.

The Think Tank Machine: Three Years of Building This in Plain Sight

The political execution in NYC did not emerge organically from one politician’s worldview. It was built from a policy infrastructure assembled over three years by a coordinated network of progressive think tanks, all of which share funders, share personnel, share a common analytical framework, and issue annual policy recommendations that Democratic state legislators treat as legislative blueprints.

Who these organizations are and who pays for them:

The Institite on Taxation and Economic Policy (ITEP) is the central engine. ITEP is heavily funded by left-of-center foundation grantmakers, including the Carnegie Corporation of New York, the Wyss Foundation, the Joyce Foundation, the W.K. Kellogg Foundation, and the Annie E. Casey Foundation. These are not small donors. The Carnegie Corporation holds over $4 billion in assets. The W.K. Kellogg Foundation holds over $9 billion. The Wyss Foundation, funded by Swiss billionaire Hansjörg Wyss (who is actually not even a United States citizen) has poured hundreds of millions into progressive political infrastructure. These foundations, run by wealthy, predominantly white boards of trustees are financing the intellectual architecture for a tax system explicitly designed, in their own publications, to target wealth that is “predominantly white.”

The Roosevelt Institute, which publishes heavily on racial equity and tax restructuring, is funded by the Ford Foundation, the Hewlett Foundation, the MacArthur Foundation, and the Rockefeller Brothers Fund. The MacArthur Foundation gave the Roosevelt Institute $1,000,000 in 2024 and another $500,000 in 2025. The Roosevelt Institute was also added to the Democracy Alliance’s list of recommended funding targets, the Democracy Alliance being the premier coordination vehicle for left-wing mega-donors including George Soros.

The Center on Budget and Policy Priorities raised more than $44 million in contributions in a single year. The Center for American Progress and its advocacy arm raised $77 million in just 2020.

The pattern is consistent: enormously wealthy foundations and individuals sitting on massive investment portfolios, capital gains income, and inherited fortunes are funding the think tanks writing the papers that tell Democratic politicians to raise taxes on exactly the kind of wealth these donors hold. Why? Because the people it will really impact are the middle class.

What these think tanks have been publishing and recommending, year by year:

In 2021, ITEP published “State Income Taxes and Racial Equity,” a 10-point roadmap for state lawmakers to restructure income tax systems around racial outcomes. The explicit premise: white families account for roughly 80% of very high-income families, meaning those falling among the top 1% of earners and this demographic reality means tax policies designed to benefit high-income households primarily benefit an affluent group that is overwhelmingly white.

The recommended remedies: higher top rates, taxing capital gains as ordinary income, eliminating retirement tax preferences, and restructuring property taxes.

In 2023, ITEP published “Hidden in Plain Sight: Race and Tax Policy in State Legislative Sessions,” explicitly evaluating every state tax action that year through a racial outcome lens and issuing prescriptions. Their specific advice: raise taxes on capital gains and corporate income because, in their own words, stocks have grown to be the largest source of wealth for white families, and taxing corporate profits more robustly is an effective way to narrow racial wealth gaps. They also celebrated Washington State’s capital gains tax as a racial equity win.

In 2024, ITEP published the finding that became the centerpiece of every subsequent state tax proposal: white households received 92% of the benefits from preferential tax rates on capital gains and dividends, despite making up just 67% of taxpayers. That single statistic, your retirement account, your stock portfolio, your investment income, has been used in legislative testimony, campaign speeches, and think-tank white papers in every blue state since.

It is the justification for making capital gains the primary target.

In 2025, ITEP issued its annual state directive: implement a Wealth Proceeds Tax, a 4% annual levy on investment income, because it has the potential to reduce racial and economic wealth gaps by taxing wealth holdings. They also told states to decouple from every relief provision in the One Big Beautiful Bill, including the expanded standard deduction, the tip exemption, and the overtime exemption and specifically because these provisions benefit workers regardless of race and therefore don’t advance the racial redistribution agenda.

The Americans for Tax Fairness published a white paper explicitly titled “More Effectively Tax Wealth, Which Is Largely Held By White People,” calling for reforms to address the historic benefits that the current tax system has bestowed on white taxpayers.

The Center on Budget and Policy Priorities told state lawmakers that fiscal policies need not be explicitly race-based to worsen or extend longstanding racial inequities — policies can have those effects if they ignore the history of governmental and private actions that enforced racial segregation. In plain terms: you don’t have to write “white” in the legislation if you calibrate it correctly.

Three years. Dozens of papers. One consistent message: tax what white people disproportionately own capital gains, corporate equity, investment income, real estate using race-neutral legal language as cover, with the racial data driving the threshold selection behind closed doors.

Part III: Who Actually Pays for These Proposals

This is the question the think tanks studiously avoid. When they talk about taxing “the wealthy,” “billionaires,” and “high earners,” the rhetoric implies a small, insulated class of hedge fund managers and tech CEOs. The reality is far broader.

The middle class pays. Mamdani’s $750,000 estate tax threshold in NYC is not a luxury property threshold. The median home sale price in New York City has been running between $764,000 and $800,000 in recent years. That means the estate tax hits the median homeowner not the rich. A family that bought a three-bedroom house in Queens in 1995 for $200,000, which is now worth $850,000 because the whole city got expensive, would owe 70 cents of every dollar above $750,000 — roughly $70,000 to the government when the parents die.

That family did nothing to create that wealth. They just held the home. And they almost certainly don’t have $70,000 in liquid cash sitting around to pay the bill.

Small business owners pay. Most private business wealth is illiquid. A plumber who built a business worth $3 million over 40 years doesn’t have $3 million in cash. He has equipment, a customer list, and a reputation. A wealth tax or estate tax forces him to either sell the business or take on debt to pay the bill. This is why Germany, Austria, and Finland all abolished wealth taxes, the taxes were, in Germany’s own assessment, “devastating to family businesses” that had to liquidate assets to pay an annual levy on paper wealth that generated no cash.

Retirees pay. ITEP’s 2025 paper called for “meaningful limits on the use of tax-subsidized retirement accounts” and restructuring their tax treatment. The 401(k), the IRA, the defined-contribution pension, these are the primary wealth-building tools of the American middle class. White middle-class households are statistically more likely to have them, which is why ITEP frames reforming them as a racial equity measure. But in practice, limiting the tax advantage of a 401(k) is a tax increase on every schoolteacher, nurse, and factory worker who has been dutifully saving for retirement for thirty years.

Investors and entrepreneurs pay and leave. The wealth tax proposals at the federal level such as Warren’s 2% above $50 million, or Sanders’ 5% on billionaires would require the wealthy to pay an annual percentage of their total net worth regardless of whether they sold anything or earned any income. A founder sitting on $200 million in stock in a company he hasn’t cashed out would owe $4 million annually. Not on income. On the value of what he built, whether or not he received a penny.

The Penn Wharton Budget Model found Warren’s wealth tax alone would reduce GDP by 1.2% by 2050 and reduce private capital formation which means less investment, fewer new businesses, lower wages for everyone. The Tax Foundation found Warren’s plan would permanently reduce total wealth in the United States by 7.19% which is equivalent to $8.1 trillion and Sanders’ by 10.21%, or $11.5 trillion. That is not money extracted from rich people and redistributed to the poor. That is wealth that stops existing.

Part IV: What They Will Do If They Win

The bills are written. The moment Democrats retake Congress and the presidency, state-level experiments become federal law. The following is a preview:

Federal Wealth Tax. Warren’s Ultra-Millionaire Tax Act reintroduced in March 2026: 2% annually on net worth above $50 million, 3% above $1 billion. Sanders and Khanna’s bill: 5% annually on America’s 950 billionaires, proceeds redistributed as $3,000 checks to households earning under $150,000. This is explicit: tax a group the think tanks’ own data identifies as overwhelmingly white, redistribute to a population the same data identifies as disproportionately non-white.

Unrealized Gains Tax. Khanna introduced this in March 2026. It taxes the increase in value of stocks and real estate before they are sold. A family business valued at $10 million last year and $11 million this year owes tax on the $1 million gain and that is money that does not exist as cash, that may never be realized, and that could vanish next year if the business declines. No country that has tried this has kept it. Britain considered it in the 1970s, and concluded it was unworkable, and abandoned it. Former Chancellor Denis Healey later wrote it was “impossible to draft one which would yield enough revenue to be worth the administrative cost and political hassle.”

Estate Tax Demolition. The federal exemption currently sits at $13.6 million per person. Democrats want it at $3.5 million or lower. Combined with state-level proposals like Mamdani’s 50% rate at $750,000, the cumulative effect is the systematic destruction of multigenerational family wealth. The destruction of farms, small businesses, homes. The explicit goal, stated in the think-tank literature, is to prevent intergenerational wealth transfer, because white families transfer three times the wealth to heirs that Black families do, and therefore eliminating inheritance is a racial equity intervention.

Capital Gains at Ordinary Income Rates. The preferential rate on long-term capital gains is currently capped at 20% and would be eliminated, bringing gains into the 37% top bracket. Combined with state capital gains taxes in high-tax states, some investors would face combined rates above 50% on the sale of assets they may have held for decades. This does not affect Wall Street traders primarily. It affects the small business owner who sells his company at retirement. It affects the family selling a rental property. It affects everyone who invested in the stock market through taxable accounts rather than tax-sheltered retirement funds.

Part V: The Economic Destruction

The evidence against these policies is not theoretical. It comes from 14 countries that tried them.

Over the past six decades, 14 European countries imposed a broad tax on personal wealth. Most repealed them, with officials citing capital flight, disappointing revenue, high administrative costs, and revenue losses from other existing taxes. The countries that abolished wealth taxes include Austria, Denmark, Finland, France, Germany, Iceland, Ireland, Italy, Luxembourg, the Netherlands, and Sweden. The reasons given were identical in almost every case.

France had its wealth tax from 1988 to 2017. By 2015, approximately 10,000 millionaires were leaving France annually and 7,000 from Paris alone, roughly 6% of the city’s millionaires in a single year. GDP growth was reduced by 0.2% per year, and the tax burden from wealthy departing taxpayers was moved onto other taxpayers. President Macron abolished it in 2017, calling France a “tax hell.” His Finance Minister stated plainly: “If you want to make the rich pay, the right solution is not to make them leave.”

Sweden had its wealth tax for nearly 100 years. It abolished it in 2007. By the time of abolition, the tax caused massive capital flight estimated at up to SKr1,500 billion which is roughly $200 billion and its abolition had “virtually no effect” on government finances because it had stopped collecting meaningful revenue. The founder of IKEA moved to Switzerland to escape it.

Norway is the live experiment. A small increase in the wealth tax rate in 2022 triggered more ultra-wealthy households departing in 2022 than in the prior 13 years combined. Norwegian-owned companies were drained of capital year after year to pay the tax, while foreign-owned companies avoided it entirely because the tax applied only to Norwegian private owners, not foreign investors. The effect was to transfer ownership of Norwegian businesses from Norwegians to foreigners, exactly the opposite of what a nationalist economic policy should produce.

Germany considered reintroducing its abolished wealth tax and commissioned an economic study. The findings: it would reduce growth by 0.33%, reduce investment by 10%, reduce employment by 2%, and reduce total tax revenue by €31 billion. The tax would cost the government more than it collected.

The American data is equally clear. The Penn Wharton Budget Model the supposed gold standard for independent fiscal analysis found that Warren’s wealth tax alone would raise between $2.3 and $2.7 trillion over ten years while reducing GDP in 2050 by 1 to 2 percent and reducing average hourly wages by 0.8 to 2.3 percent of the wages paid to workers at all income levels, not just the wealthy.

The Tax Foundation found the combined Warren-Sanders proposals would cause the average trade deficit over the next ten years to more than double from 3.1% of GDP to nearly 7% as foreign investors replaced domestic ones as owners of American capital. American businesses would increasingly be owned by people who don’t live, vote, or pay taxes in America.

Wealth taxes force asset liquidation to pay taxes on paper values. Business owners sell equity to foreigners. Entrepreneurs move to Florida, Texas, or Switzerland. Investment capital migrates to lower-tax jurisdictions. The tax base erodes. The government collects less than projected. It then raises rates on whoever remains, accelerating the exodus.

This cycle has played out in every country that tried it. And in the United States, the mobility problem is even more acute because leaving Norway requires crossing an ocean; leaving California or New York requires a moving truck and a two-hour flight.

The final irony is the one the think tanks cannot acknowledge. The communities these policies claim to help which is the Black and Latino Americans building wealth through homeownership, retirement savings, and small business ownership are also harmed by the economic contraction these taxes produce.

Lower GDP means fewer jobs. Lower wages affect workers at every income level. A weaker investment climate hurts every entrepreneur regardless of race. And when the wealthy leave and the tax base collapses, the public services these same think tanks promise to fund such as education, healthcare, childcare will face the cuts they were supposedly designed to prevent.

The people who fund ITEP and the Roosevelt Institute (the Carnegie Corporations and the MacArthur Foundations sitting on billions in endowment assets) will survive whatever tax regime they help install. They have lawyers, accountants, foundations, and trusts specifically designed to navigate it.

The people who won’t survive it are the ones these proposals claim to champion: the middle-class family with a $900,000 home and no cash, the small business owner with a company worth $4 million and a payroll to meet, the retiree with a 401(k) and a fixed income. They’re the ones who will pay. They always are.​​​​​​​​​​​​​​​​

People need to really think about that as midterms approach because this will happen if Democrats get back into power, they have spent three years already researching this they’re already bills that have been drafted and they will pass this. Just look at New York City.