Elizabeth Warren floundered in her own party’s presidential primary last year and was disqualified for a cabinet position because taking one would have cost the Democrats control of the Senate. But that doesn’t mean that she’s faded from the scene entirely. As the Democrats struggle to keep their caucus together and push through some of their legislative priorities, Warren is back with the support of the progressive wing and pitching a big, new idea. Okay… it’s not actually a new idea at all. She’s been pushing it for a while. But now she thinks it might be possible. Yes, the Massachusetts Senator wants to try to pass her “wealth tax.” (CNN)
Now that Democrats control the White House and Congress, President Joe Biden and other party leaders are pushing to spend big to revive the economy and address income inequality.
Massachusetts Sen. Elizabeth Warren, Washington Rep. Pramila Jayapal and Pennsylvania Rep. Brendan Boyle want the ultra-wealthy to pay for it.
The three Democrats unveiled the Ultra-Millionaire Tax Act on Monday morning. It would levy a 2% annual tax on the net worth of households and trusts between $50 million and $1 billion as well as a 1% annual surtax on assets above $1 billion, for a 3% tax overall on billionaires.
I find it interesting that the coverage of this announcement discusses plans by Warren and Bernie Sanders to “revive the economy and address income inequality” and this so-called wealth tax is how they would do it. I can’t be the only one sitting here and wondering, wait a minute… when did we start worrying about how to pay for stuff again?
As I recall, this was also how these people were going to pay for Medicare for All and the Green New Deal. Joe Biden has technically rejected both of those ideas, but he’s still implementing bits and pieces of them via executive orders and supporting other pieces if they show up on his desk for a signature. And yes, all of that adds up to a ton of cash, but we’re currently burning through trillions every four to six months with nobody mentioning anything about cost offsets.
CNN’s article was nice enough to mention one of the major sticking points in this plan, though you have to scroll all the way down to the final two paragraphs to find it. Where in our system of constitutional law does the federal government find the power to tax “wealth” as opposed to “income?” Keep in mind that those are two very different things. The money or goods you have legally acquired have already been taxed once when you received the money. This isn’t something that’s ever been done, and there’s probably a reason for that.
Let’s give Warren the benefit of the doubt here for a moment and assume that this robbery scheme could actually pass constitutional muster. Who will be in charge of assessing every successful person’s total wealth? She’s not just talking about the total value of the cash in their savings accounts and stock portfolios. That’s easy enough to determine, though the stock values change on a daily basis. The majority of the total wealth of many successful people isn’t found in their checking accounts. It’s in the things they acquire. Real estate, vehicles, expensive artwork and even private planes are all on the table. But many of those things are “used” so they’re not worth as much as what the owner originally paid for them.
This is going to get complicated quickly. Complicating matters further is that many of them might not even be around to tax by the time the law takes effect. Someone will probably make a movie titled, “The Flight of the Billionaires” about the fallout from such a scheme. There are plenty of countries that would no doubt love to have an army of the rich and famous showing up at their door. And not for nothing, but do you think a single one of those wealthy people will ever again donate so much as a plug nickel to the campaigns of anyone who supports this idea or a president who signs it into law? It is to laugh.
This has been a pipe dream of Warren and Sanders for a long time. But that’s all it should really remain… a pipe dream. If not, then this country is in a lot more trouble than I already thought it was.