Opinion: Who are today's millionaires?

I do not ordinarily write about partisan politics. I leave that to the commentators on Fox News, MSNBC, and countless others. Instead, I prefer to focus on public policy and how it affects everyday Americans, especially seniors. However, there is a growing political movement whose ideas deserve scrutiny by aging Americans: the Democratic Socialists of America (DSA). Some of the policies being discussed by the DSA concern me, but one proposal in particular could have significant consequences for current and future retirees. A few weeks ago, DSA Vice Chair Megan Romer appeared on Fox News Sunday with Shannon Bream. During a series of rapid-fire questions about the organization's platform, Romer answered directly and without the usual political evasiveness. Admittedly, it was refreshing to hear straightforward responses, even though I disagreed with many of them. Her answers provided viewers with a clear picture of what the DSA stands for. At one point, Bream asked about the organization's position on taxing wealthy Americans. Romer responded, "Yes. Tax the hell out of millionaires." That answer concerns me because the term "millionaire" is rarely defined in today's political debate. "Tax the millionaires" is an effective political slogan, but who exactly are today's millionaires? The phrase sounds simple enough. After all, most Americans envision millionaires as people living in mansions, flying on private jets, or enjoying lavish lifestyles. Increasingly, however, that image bears little resemblance to reality. According to Federal Reserve data, roughly one-third of households headed by Americans between the ages of 55 and 80 have accumulated assets exceeding $1 million. Yet many of these households would never consider themselves wealthy. In fact, many would describe themselves as solidly middle class. Consider a retired couple who purchased a modest home decades ago. Thanks to rising property values, that home may now be worth $500,000 or more. Add retirement savings accumulated over a lifetime of work through IRAs, 401(k)s, and other retirement accounts, and their net worth can easily exceed $1 million. On paper, they are millionaires. In practice, they may still drive older vehicles, budget carefully, spend frugally, rely on Social Security, and think twice before making major purchases. Many are the children of Depression-era parents who taught them the virtues of saving, avoiding debt, and living below their means. Their wealth is not the product of extraordinary income. It is the result of decades of disciplined saving, investing, and the appreciation of assets over time. This distinction is important because public discussions about taxing millionaires often fail to recognize how dramatically the meaning of the word "millionaire" has changed. A million dollars today is not what it was a generation ago. There is also a second concern. New taxes rarely come with automatic inflation adjustments. History shows that tax thresholds established for one generation can gradually capture many more people over time as incomes rise and asset values increase. What begins as a tax aimed at the wealthy can eventually affect households that most Americans would still consider middle class. For future retirees, that possibility should not be dismissed. A couple that spends forty years building retirement savings, paying off a mortgage, and accumulating home equity could find itself meeting the definition of a millionaire without ever feeling affluent. Whether one agrees or disagrees with the DSA's broader agenda, Americans should carefully consider what is meant by the term "millionaire." Policymakers should recognize the difference between extraordinary wealth and the accumulated assets of working families who spent a lifetime preparing for retirement. The real issue is not whether wealthy Americans should pay taxes. The real issue is how we define wealth in a society where decades of home appreciation and retirement saving can transform an ordinary middle-class family into a household with a seven-figure net worth. Before politicians promise to "tax millionaires," they should first explain exactly who they mean. Millions of retirees who spent a lifetime working, saving, and investing deserve at least that much clarity. Joseph Stango of Southbury is an advocate for senior citizens.