Senator Elizabeth Warren (D-Massachusetts), a 2020 presidential candidate, has proposed a 2% annual tax on assets of households with a net worth of $50 million or more. The tax would increase to 3% for billionaires.

Warren's policy team estimates the wealth tax would raise an astonishing $2.75 trillion over the next decade. She suggests the tax would be a good way to start paying for proposals such as "Medicare for All."

Some of the wealthiest people in the world support the idea. A public letter signed by George Soros, Facebook co-founder Chris Hughes, and the daughter of billionaire Charlie Munger calls for a wealth tax to "help address the climate crisis, improve the economy, improve health outcomes, fairly create opportunity, and strengthen our democratic freedoms."

The mechanics of a wealth tax couldn't be simpler. You prepare a balance sheet of your worldwide assets. Then, you subtract an exempted amount, say $50 million. You then multiply the difference by 2% or 3%.